If Your Child’s Investment Income is Greater Than $1,900 in 2010 It May Be Taxable at Your Tax Rate

Children with investment income may have part or all of this income taxed at their parents’ tax rate rather than at the child’s rate. Investment income includes interest, dividends, capital gains and other unearned income. Your child’s tax must be figured

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Posted in Child Tax, Children

Residential Rental Income + Expenses – IRS Publication 527

Rental income is any payment you receive for the use of or occupation of property. Expenses of renting property can be deducted from your gross rental income. You generally deduct your rental expenses in the year you pay them. Publication 527,

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Posted in Rental Real Estate

Punitive Vs. Compensatory Determines if Payment is a Deductible Expense

Stephens V. Commissioner, 93 TC 108 showed that any payment labeled 'restitution' or 'punitive' is non-deductible as an expense.  If the payments are labeled 'compensatory' then in order for the payment to be a deductible expense the question of whether

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Posted in Deductible Expense

Home Office Deduction Pitfall – IRS Form 8829

The home office deduction is something that you can choose not to take and sometimes that is the best choice.  If you are legitimately using dedicated space in your house for your on-going business with a profit motive or you

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Posted in Home Office

Inherited IRA’s Are NOT a Protected Asset Class in FEDERAL Bankruptcy Proceedings

Traditional retirement accounts are generally speaking considered a protected asset should you be required to endure FEDERAL bankruptcy protection. However an Inherited IRA is not generally considered a protected asset in 2 distinguishable regards: The distributions of funds from an

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Posted in IRA

Self Employed Health Insurance Tax Facts

When signing up for a health insurance plan registered under your business, the business may be able to deduct premiums paid for medical and dental insurance and qualified long-term care insurance for you, your spouse, and your dependents if you are

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Posted in Health Insurance, Self Employ

Foreign Earned Income – IRS Form 2555

IRS Form 2555, Foreign Earned Income Exclusion says basically that United States Citizens and resident aliens who live and work abroad may be able to exclude all or part of their foreign salary or wages from their income when filing their

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Posted in Foreign Income

Expenses Disallowed by IRS become Constructive Dividends

One of the areas that the IRS more frequently becomes involved in deals with expenses that are deducted by a closely-held corporation. Many expenses are personal to the stockholder/employee. When the IRS reviews such expenses and disallows the expenses for

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Posted in Disallowed Expenses

How Can Someone Legitimately Deduct the Cost of a Ski Trip

So in that I'm a self professed ski bum I often get asked on the chair lift by total strangers how someone can legitimately deduct the cost of s ski trip on their taxes.  Today for some strange reason I

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Posted in Deductible Expense

Alternative Minimum Tax (AMT) IRS From 6251

It is blowing my mind how many people this year have become unwittingly liable for the Alternative Minimum Tax.  Good people who thought they had been withholding enough taxes now find themselves owing big. The people hit the hardest seem

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Posted in Alternative Minimum Tax (AMT)
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