The US Tax Court case of David A. Gates, et ux. v. Commissioner 135 serves as best I can tell as precedent. Under §121, if married taxpayers own and use property as their principal residence for at least two of the five years ending on the date of sale, they can...
Reporting back pay is not as straight forward as one imagines. If you issued back pay you should report it on IRS Form W-2 (in boxes 1, 3, and 5) for the year payment is made. If any punitive damages are involved in a settlement they should be reported...
Under IRC 761 the term partnership essentially includes a syndicate, group, pool, joint venture, or other unincorporated organization through or by means of which any business, financial operation, or venture is carried on, and which is not, a corporation or a trust or estate. It goes on to essentially state...
Generally co-ownership in rental property does not require the formation of a partnership when the following conditions are met. 1. Each co-owner must hold title to the property as a tenant in common (TIC) under local law. This usually doesn't apply community property. Although the title to the property...
Generally you are eligible to exclude the gain from income if you have owned and used your home as your main home for two years out of the five years prior to the date of its sale. If you have a gain from the...
The VOW to Hire Heroes Act of 2011, provides an expanded Work Opportunity Tax Credit (WOTC) to businesses that hire eligible unemployed veterans and for the first time also makes the credit available to certain tax-exempt organizations. IRS Notice 2012-13, posted today on IRS.gov, and the instructions ...
IRS Form 1040 Schedule C: Profit or Loss from Business can be a tough form to work through. Tread lightly and seek guidance. The sole proprietorship or single member Limited Liability Corporation (LLC) is in my opinion the easiest type of business entity to set up...
IRS Failure to File Penalty Abatement for Partnerships - Rev Proc 84-35 IF your partnership failed to timely file its IRS Form 1065 and you get penalized by the IRS you should consider seeking relief from or abatement of this penalty under IRS Revenue Procedure 84-35. ...
Check out Mitt Romney's 2010 tax return and learn how he does it. The most important lesson I learned in perusing his return (besides the significance of sheltering your $$ outside of the USA) is the immediate impact of targeted charitable contributions. In my professional opinion the...
Medical expenses include amounts paid for the diagnosis, cure, mitigation, treatment, or prevention of disease under IRC 213, as well as amounts paid for qualified long-term care services under IRC 7702B. You may deduct certain medical expenses that are paid during the year and that are not compensated for...