Net Capital Losses

After the netting of long-term and short-term capital gains and losses for any tax year, any remaining net capital loss in excess of $3,000 ($1,500 for married taxpayers filing separately) must be carried forward into the next tax year. That carryforward retains its character as long-term or short-term for netting purposes in that year. One…

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At Risk Losses

Code Sec. 465 generally limits a taxpayer’s deductible loss applicable to a trade or business or production of income to the amount that the taxpayer has at risk with respect to an activity. The rules apply to individuals and certain closely held corporations. They generally apply separately to each activity, rather than on an aggregated…

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Passive Activity Losses

Code Section 469 provides that individuals, trusts, estates, personal service corporations and closely held C corps may only deduct passive-activity losses from passive-activity income. The rules do not apply to S corps and partnerships, but do apply to their respective shareholders and partners. Passive activity is trade or business activity in which the taxpayer does…

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Order your IRS Transcripts – form 4506T-EZ

The Internal Revenue Service has issued a new form that will make it easier to order tax transcripts and help process mortgage modification applications. The new forms are being issued in conjunction with the Obama administration’s push to help more homeowners cope with their mortgage problems. The form will aid in the processing of mortgage…

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Biomass fuel is an energy-efficient building property

The American Recovery and Reinvestment Act of 2009 provides that certain expenditures made by the taxpayer for energy-efficient building property are eligible for the nonbusiness energy property credit. The term “energy-efficient building property” includes a biomass fuel stove that burns biomass fuel to heat a dwelling unit that the taxpayer uses as a residence, or…

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IRS Publication 4128 – Tax Impact of Job Loss

IRS Publication 4128 Tax Impact of Job Loss was released in August of 2009. The publication explains the job loss tax issues connected to severance pay, unemployment compensation, pension plans, IRAs, expenses for a job search, and possible moving costs. It also discusses self-employment issues for the newly unemployed. The IRS provides the following information to assist…

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Discharge income tax debt through bankruptcy

If the income tax debt meets all five of these rules, then the tax debt is dischargeable in Chapter 7 and Chapter 13 bankruptcy petitions. The due date for filing a tax return is at least 3 years ago. The tax return was filed at least two years ago. The tax assessment is at least…

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Currently Not Collectible IRS transaction code 530

Currently Not Collectible means that a taxpayer has no ability to pay his or her tax debts. The IRS can declare a taxpayer “currently not collectible,” after the IRS receives evidence that a taxpayer has no ability to pay. Such evidence is usually obtained from the taxpayer on IRS Form 433-F, Collection Information Statement. A…

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An International Tax Guide for Professors Taking Non-U.S. Sabbaticals

Michelle Dhanda (J.D. 2010, Suffolk) has published, International Taxation: A Guide for Academics Abroad, 32 Suffolk Transnat’l L. Rev. 701 (2009). Here is part of the Introduction: Academics are one group who consistently travel to other nations, and their tax burden is relatively heavy. Once preparation for an academic career is complete, however, academics abroad…

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Online Tool Helps Exempt Organizations Complete Form 990

The IRS has created an online tool on its website for exempt organizations that uses a hypothetical case study to illustrate how Form 990 should be filled out. The website also has a video series that walks you through key reporting issues common to most organizations required to file Form 990. This information is available…

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