501(c)3 Tax Exempt Entity creation

Just as with all other types of business organizations, a certificate of incorporation must be drafted and filed with the secretary of state. In this document the organizers must come to a mutual agreement as to the purpose(s) of forming a tax exempt organization. This includes: The activities it will conduct; Who are the intended…

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Disqualified Employment Tax Levy

Ack NAEA Generally, the IRS must advise taxpayers of its intent to levy or seize property before doing so. Taxpayers, in turn, have the right to appeal IRS’ intent to levy through a request for a collection due process hearing. Both of these subjects are treated in Internal Revenue Code (IRC) Sections 6320 and 6330.…

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Farm Income and Deductions

If you are in the business of farming, there are a number of tax issues that you should consider before filing your federal tax return. Crop Insurance Proceeds You must include in income any crop insurance proceeds you receive as the result of crop damage. You generally include them in the year you receive them.…

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Health Coverage Tax Credit

The Health Coverage Tax Credit pays 80 percent of health insurance premiums for eligible taxpayers and their qualified family members. However, many people who could be receiving this valuable credit don’t know about it, and are missing out on big savings that can help them and their families keep their health insurance. Here are the…

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Mark to market securities transactions IRS Revenue Proceedure 99-17

This revenue procedure provides the exclusive procedure for dealers in commodities and traders in securities or commodities to make an election to use the mark-to-market method of accounting under § 475(e) or (f) of the Internal Revenue Code. BACKGROUND Section 475(e) allows a dealer in commodities to elect mark-to-market accounting for commodities. Mark-to-market accounting under…

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Traders in Securities – IRS Topic 429

This tax topic explains whether an individual who buys and sells securities qualifies as a “trader in securities,” for tax purposes and how traders must report the income and expenses resulting from the trading business. In order to better understand the special rules that apply to traders in securities, it is helpful to first review…

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Standard or Itemized Deductions

Most taxpayers have a choice of either taking a standard deduction or itemizing their deductions. If you have a choice, you can use the method that gives you the lowest tax. Whether to itemize deductions on your tax return depends on how much you spent on certain expenses last year. Money paid for medical care,…

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