My Odeo Channel (Code: 11a1db75c4117aa5)

TaxMama's Year-End Tips

2016-12-20 by Eva Rosenberg

Today TaxMama® wants to remind you about last-minute steps to take before 2016 ends.

http://taxmama.com/wp-content/uploads/2015/04/tmreplies.gif

Dear Friends and Family,

 

The Electoral College has confirmed our new president-elect. So we can expect some changes next year. You can view an outline of what to expect next year, here.

 

For now, we still need to take care of some of the routine things. Here are some quick steps:

 

  • Make your charitable contributions before year end. Note: Remember to look up the charity to see what they do with your donations. The Foundation Center is a good source of information. For instance, the president of the Salvation Army receives no compensation (see page 7). While the president of Goodwill Industries is receives over $700,000 in compensation (see page 73).
    • Clean out your closets and make a list of all the things you are taking to your favorite thrift shop.
    • Make your final cash contributions.


  • If you are age 70 ½ or older, remember to draw your Requirement Minimum Distribution (RMD) from your retirement accounts. There are substantial penalties if you don’t draw the money in time.
    • You are entitled to draw up to $100,000 from your retirement account and transfer it directly to your charity.
    • This would make it possible to take your RMD without paying taxes on the amount. But you won’t get a deduction for the contribution.


  • Folks with too much money in their IRAs or retirement plans should consider transferring the funds to their Roth IRAs, or cashing some of the money out. Do some computations to see how much you can transfer at your lowest possible tax rate.
  • Balance out your brokerage accounts. Are there any gains or losses you can harvest?
    • And are you in a low enough tax bracket that your capital gains will be taxed at 0% or 15%?


  • Prepay certain routine bills.
    • Pay your January mortgage payment late in December – so your payment covers most of the month’s accrued interest expense.
    • Pay your full property taxes, not just half.
    • If you owe state taxes, make your 4th quarter payment in December.


  • Folks who are in business or use employee business deductions:
    • Delay your invoicing until January, so you can move income into next year. (No constructive receipt)
    • Make your major equipment purchases before the end of the year.
    • Prepay January’s expenses, dues, etc. before the end of December.


  • SSNs and ITINs – make sure that you have ID numbers for all eligible people in your household BEFORE filing your 2016 tax returns. Without them, you stand to lose tax credits and tax benefits.
  • Health insurance, get insurance in place for all household members for 2016. Penalties are high without coverage. Don’t count on Obamacare to disappear for 2017.


 

For much more detail, tax professionals can sign up for the CPE Link Tax Update workshops – discount still good until December 30. Everyone else, drop by my column at MarketWatch.com and the TaxWatch columns.

 

To make comments and toss in your own ideas, please drop into the TaxQuips Forum.

 

And remember, you can find answers to all kinds of questions about changes in the tax laws and other tax and business issues, free. Where? Where else? At www.TaxMama.com.

[Note: If you were subscribed to the e-mailed version of TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the join TaxMama.com link – it’s free!]

Please post all Comments and Replies in the TaxQuips Forum .

Download the Media (0:00min, 4MB) or listen now...

Ask TaxMama
Where Taxes are Fun
TaxQuips
The best Free Tax Podcast Online
TaxQuips Forum
Where you can you ask your tax questions
TaxQuips Forum
Where you can you can add your comments


TaxMama’s TaxQuips Highlights of Trump Tax Plan

2016-11-09 by Eva Rosenberg

Today TaxMama® wants to give you an advance peek on what you can expect from a Donald Trump tax plan, coming to a Congress near you!

To read the details, please drop by here:
TaxMama.com

Download the Media (0:00min, 5MB) or listen now...

Ask TaxMama
Where Taxes are Fun
TaxQuips
The best Free Tax Podcast Online
TaxQuips Forum
Where you can you ask your tax questions
TaxQuips Forum
Where you can you can add your comments


He Who Hesitates is Lost - or - Expired Refunds

2016-08-09 by Eva Rosenberg

busy Today TaxMama® hears from several people in the TaxQuips Forum with questions about expired refunds. Let me summarize. “I faced a hardship and didn’t file tax returns for several years. Now, I learn that I cannot get my refunds for all those years. Can you help?”

http://taxmama.com/wp-content/uploads/2015/04/tmreplies.gif

Dear Friends and Family,

My answers to Dustin and to DParker don’t bring much hope.

They do have heartbreaking stories. And I truly wish I had a solution.

But here’s the problem. Even the IRS doesn’t have discretionary control over this matter. These r[s3audio s3url=”http://taxmama.audioacrobat.com/download/taxmama-Expired_Refunds.mp3” /]efunds that have expired, due to the statute of limitations, are controlled by laws passed by Congress – they folks you vote for. You need to get in touch with your legislators to get them to make the law more sympathetic.

The tax code doesn’t provide a way to get those refunds from closed years. When we talk about a ” statute of limitations,” the word “statute” means LAW – in this case IRC 6511.

For future reference, please don’t put off filing your tax returns – no matter how sick or depressed you are. Family and friends, please keep an eye on those you love and help file their tax returns. They don’t need to be totally accurate. If some information is frustratingly elusive – make good estimates and attached a statement to the tax return that this has been done. After all, you have three years to correct the tax return. In the meantime, you save the refund for that year – which would otherwise be lost forever.

What can you do if it IS lost? There IS one thing I would try. You have nothing to lose.
Contact the Taxpayer Advocate Service and see if there is any way they can help you. Sometimes, in extreme situations, they can pull a rabbit out of a hat. And their service is free. I truly wish you-all luck!

To see the rest of this discussion, please drop into the TaxQuips Forum.

And remember, you can find answers to all kinds of questions about unfiled tax returns and other tax and business issues, free. Where? Where else? At www.TaxMama.com.

[Note: If you were subscribed to the e-mailed version of TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the join TaxMama.com link – it’s free!]

Please post all Comments and Replies in the new TaxQuips Forum

Download the MP3 (0:00min, 3MB) or listen now...

Ask TaxMama
Where Taxes are Fun
TaxQuips
The best Free Tax Podcast Online
TaxQuips Forum
Where you can you ask your tax questions
TaxQuips Forum
Where you can you can add your comments


Wages for S Corp Officers

2016-06-13 by Eva Rosenberg

IRS_1461001834-1170x250 Today TaxMama® hears from ASquare in the TaxQuips Forum with this question. “I work as a full time employee for a company on W2. I own S-CORP that i get income for the services provided in my free time. Do I need to run the payroll for that money earned on S-CORP or can I claim it as distribution at the end of the year?”

 

tmreplies

 

 

Dear ASquare,

This is a very common issue that people really should think about before forming S corps or LLCs – but often don’t consider.

Hmmm…is your S Corporation showing a profit?

If so, you need to be on payroll if you want to avoid an audit.
These days, the IRS is not wasting time on unprofitable audits.

They are focusing their energy on audits they know will generate revenue.

And when it comes to profitable S corporations, the IRS knows that the probability of generating additional taxes is 100%.

So, in short, yes, if you want an S Corp – run it properly.

If you don’t want to bother with the inconvenient technicalities, dissolve the S Corp and run a sole proprietorship. Get business liability insurance if you’re concerned about lawsuits.

And remember, you can find answers to all kinds of questions about S Corporations and other tax and business issues, free. Where? Where else? At www.TaxMama.com.
[Note: If you were subscribed to the e-mailed version of TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the join TaxMama.com link - it’s free!]

Please post all Comments and Replies in the new TaxQuips Forum

Download the MP3 (0:00min, 2MB) or listen now...

Ask TaxMama
Where Taxes are Fun
TaxQuips
The #1 Free Tax Podcast Online
TaxQuips Forum
Where you can you ask your tax questions
TaxMama's TaxQuips
Where you can you can add your comments


Divorce Home Sale

2016-05-24 by Eva Rosenberg

Alexas_Fotos / Pixabay[/caption]

Today TaxMama® hears from Greg in the TaxQuips Forum with a very common divorce issue. Let me paraphrase. “We got divorced. My wife and child stayed in our home. I made the payments. Now, when we want to sell it 7 years later, is there any way at all that I can get the personal residence exclusion?”

tmreplies


Hi Greg

Well, I have good news for you.

1) Yes, you are entitled to claim the $250,000 personal residence exclusion
on your share of the profit when the house is sold.

There’s only one glitch here – the exclusion works if there is a divorce or separation agreement allowing this arrangement. Your agreement limited the arrangement to 5 years – not “5 years or until our son leaves home.” If you are audited, that could cause you a problem.

2) Personally, I would not have claimed those additional payments as alimony expenses. I would have used them to deduct the mortgage interest and property tax. But you survived audit…and you have proof of two successful audits, so the IRS may not audit this same issue again – IF you had a “no change” determination.

I hope you two can work this out amicably and reasonably.

CPE LinkFor more great tips on how to save taxes during a divorce, please view our special resource – Tax Checklist for Knotty Divorces . This two hour course can help couples resolve issues fairly – and save thousands of dollars – in taxes and legal fees.

 

And remember, you can find answers to all kinds of questions about divorce and other tax and business issues, free. Where? Where else? At www.TaxMama.com.

[Note: If you were subscribed to the e-mailed version of TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the join TaxMama.com link – it’s free!]

Please post all Comments and Replies in the new TaxQuips Forum .

Download the MP3 (0:00min, 3MB) or listen now...

Ask TaxMama
Where Taxes are Fun
TaxQuips
The #1 Free Tax Podcast Online
TaxQuips Forum
Where you can you ask your tax questions
TaxMama's TaxQuips
Where you can you can add your comments



<< previous page :: next page >>

Google Custom Search



create & buy custom tax nerd products at Zazzle