December 13, 2020 Don’t waste the annual gift tax exclusion. You can give up to $15,000 to each child, grandchild, or any other person in 2020 without having to pay gift tax or tap your lifetime estate and gift tax exemption. Your spouse can also give $15,000 to the same donee, making the tax-free gift …
The one-year suspension of required minimum distributions can be a blessing to some retirees who don’t otherwise need the funds. The money can continue to grow tax-free in the IRA, 401(k) or other defined-contribution plan for another year. But it also puts a glitch in a popular income tax withholding strategy. Tax withheld at any …
Want to convert a traditional IRA to a Roth? Now might be a good time to consider it. You’ll have to pay income tax on the converted funds for the year of the switch, but once the money is in the Roth IRA, future earnings, and distributions that you take from the account are tax-free. …
Have income from rental properties you own? You may be eligible to take a juicy tax break: The 20% qualified business income deduction., Subject to a litany of rules, self-employed individuals and owners of S corporations, partnerships and LLCs can write off 20% of their qualified business income. QBI is your allocable share of income …
A small business owner often wears many different hats. They might have to wear their boss hat one day, and the employee hat the next. When tax season comes around, it might be their tax hat. They may think of doing their taxes as just another item to quickly cross off their to-do list. However, …
Four common tax errors that can be costly for small businesses Read More »
Taking higher-than-average deductions. IRS may pull a return for audit if the deductions shown are disproportionately large, compared with reported income. Writing off alimony. The rules on deducting alimony are complicated, and IRS knows that some filers who claim this write-off don’t meet the requirements, so it pulls suspicious returns for audit. Look for the …
Very few people are put in jail for not filing a tax return, but it does happen occasionally. A willful failure to file tax returns is a misdemeanor if you owe taxes. You can be sentenced for up to a year in jail and a $25,000 fine for each year of non-filing (Internal Revenue Code …
The income levels to qualify for the health premium credit in 2019 go up. The credit is available for people with household incomes ranging from 100% to 400% of the federal poverty level…$12,140 to $48,560 for singles and $25,100 to $100,400 for a family of four…who buy health insurance through one of the exchanges. Individuals …
Tax Update – June, 2019 -Here are some general updates to the tax code for 2019! Read More »
The IRS can seize your assets as long as you owe any part of a tax debt and the 10 year statute on collections has not expired. Generally, levies are one-shot affairs. The government must prepare and send a new levy notice every time it wants to seize an asset. EXAMPLE: If the IRS levies …
If you can’t informally convince the IRS to forgo recording a tax lien, here are some options to consider once the tax lien has been filed. Appeal the lien filing. The IRS has 5 business days after the filing of the lien to provide written notice to the taxpayer. The must include notice of …
What should you do when the IRS files a tax lien? Read More »
