Archive for the 'Income Taxes' Category
Does Married Filing Separately supply An AMT Escape Hatch?
Q: whether my wife and I file as married filing separately, will that compose us less likely to get hit by the AMT? We each build about $150,000 per year in salary and have $55,000 in joint deductions. Uncle Sam A: Those that haven’t do so yet should first read my posts on the AMT and the married fi…
Dividing Pension May Have Tax Consequences
I previously posted on one installment of a series of articles on Basic Tax Questions for Divorcing Parties Answered.
A later installment in the series focuses on division of pension plans, IRAs and the like.
As the exposition explains, pension plans are often divided via special court orders …
Commuting Expenses Are Never Deductible
Q: I am an independent contractor with one client. Can I deduct my travel costs to and from work? Mike A: Commuting expenses (defined as your first daily trip from your residence to your place of business) is personal and never tax-deductible. As a contractor, though, you have an easy way to get…
Finding Old Municipal Bonds
Q: How do I find copies of old municipal bonds purchased by a relative? They don’t run out until 2011. A: These old records (especially when you’re dealing with a deceased or infirm family member) are often the trickiest things to find. In that case, the best thing to do is to contact the state …
S-Corporations and 529 Plans
Q: Can I set up a 529 college savings plan for my child using my S-corporation? Rob, MN A: These two tax items have nothing to do with one another. Setting up a 529 plan is something an individual sets up. There is no “earned income” requirement like IRAs have, so you can feel free to use S-corp pro…
IRS Streamlines Per Diem Substantiation
We’ve spoken before about per diems. These allow taxpayers to history for lodging, meals, and incidental expenses using a location-specific safe harbor, rather than having to tabulate actual expenses paid. These per diems are available to the self-employed and for employees. An fundamental considera…
Answering the Backlog of Comments
My apologies to those of you who have been sending comments in by the final few months. Yahoo has been putting the Typepad emails in my junk folder, so I didn’t even notice they were there. by the next couple of months, I will be plowing through them (one per weekday). Keep sending them in, and I wi…
Rangel Introduces moment domestic Tax
Congress is swooping in to save the day on sub-prime mortgages. In so doing, they’re only creating an artificial subsidy for reckless behavior, but that is Congress, after all. Unfortunately, that Congress feels the need to pay for any new tax cuts, and the revenue raisers will affect anyone with re…
Employer ID Numbers Now Automatic
A quick note from the IRS front: many commerce owners are familiar with the EIN application process. In prior years, an SS-4 profile would be filled out, and the IRS would send you your EIN. that improved in the past few years, as a preliminary EIN could be obtained online, and the IRS would send yo…
Combining a Workplace 401(k) and a Solo 401(k)
Q: I have a full-time job with a 401(k) benefit. Additionally, I get side trade income (unincorporated). Can I combine my workplace 401(k) with a self-employed 401(k) plan?John A: Yes, you can. However, you have to be careful to juggle the separate limits that apply. These include the limit on elect…
Combining a Workplace Retirement Plan and a Solo 401(k)
Q: I have a full-time job with a 401(k) benefit. Additionally, I get side trade income (unincorporated). Can I combine my workplace 401(k) with a self-employed 401(k) plan?John A: Yes, you can. However, you have to be careful to juggle the separate limits that apply. These include the limit on elect…
2008 Tax Brackets and Inflation Adjustments
The official stats on that will come out in October, but CCH has come out with their list of probable adjustments here.Original post by Ryan Ellis
How to Deal with IRAs from the Beneficiary End
Q: As many of us have parents getting older, could you please inform us about how to best handle an IRA which you get as a beneficiary upon their passing? I am certain the rules are tricky and one mistake could lead to unitended taxable income.Richard, North Providence RIA: The rules on that are pre…
New IRS Website on domestic Foreclosures
With all the news in recent weeks about the potential taxability of “cancellation of debt” income (see my post on that here), the IRS has come out with a one-stop webpage on house foreclosures. go here to see it.Original post by Ryan Ellis
