|
TAX TIP OF THE DAY... seniors should deduct SALES TAX
Retired seniors will pay very little in PA and Local income taxes. So the alternate deduction of SALES TAX PAID should be pursued. The IRS has a standard sales tax table which eliminates the need to keep sales tax receipts. However those seniors that do keep track of their receipts are welcome to use their own calculations... especially if their calculations exceed the standard IRS table amounts. Ask your tax preparer about additional amounts that can be added to the IRS tables for home improvements and automobile/motorcycle/RV purchases. SHARE WITH A FRIEND. If you need tax help... www.baboiancpa.com TAX TIP OF THE DAY... Obamacare 2015 penalties for not having health insurance.
The greater of: 1) $325 per adult and $162.50 per child under age 18 2) 2% of household income over a certain dollar threshhold that varies based upon # of household members and filing status. Penalties are prorated based upon the number months of being uninsured. WHAT YOU NEED TO KNOW: There are various ways out of this penalty based upon "hardships". SHARE WITH A FRIEND. If you need tax help... www.baboiancpa.com TAX TIP OF THE DAY... deduct Student Loan interest.
Deduct up to $2,500 of student loan interest as reported to you on form 1098-E. The tricky part is that you can only deduct interest on a loan in your name. And you can only deduct the interest if you are the one making the payments. Another trap is that dependent students can not deduct student loan interest. Best tax strategy... decide who will be paying the loan back. Structure the student loan in that person's name. If the student will be making the payments, try to delay payments until the tax year that the parent no longer claims the student as a dependent. This strategy may not be valid if you expect student loans to be forgiven in the future. SHARE WITH A FRIEND. If you need tax help... www.baboiancpa.com TAX TIP OF THE DAY... deduct moving expenses
Moving expenses associated with a job related move of at least 50 miles are deductible. Surprisingly, the deduction is allowed for 1) a move to a first job after college, 2) a move to return to full-time work after a substantial period of part-time or unemplyment 3) a move to the USA from a foreign country in order to retire here. Moving expenses include movers, tips, truck rentals, packing supplies, hotel, temporary storage, auto mileage and tolls. SHARE WITH A FRIEND. If you need tax help... www.baboiancpa.com TAX TIP OF THE DAY... Sale of your main home.
If you sold your main home that you lived in for 2 of the past 5 years... GREAT NEWS. Use IRS code section 121 to pay zero tax on the gain. You don't need to reinvest in another home anymore. The only catch is that you can only do this once every 2 years. SHARE WITH A FRIEND. If you need tax help... www.baboiancpa.com TAX TIP OF THE DAY... What to do with new 1095-B and 1095-C tax forms?
Have you noticed that you received new 1095 Health Inurance tax forms in the mail? Or maybe not since many companies filed for extensions which gives them until March to get you the 1095 forms. The good news: you do absolutely nothing with them. Don't attach to tax returns. Don't report any of the account numbers on your tax return. Just file away in case the IRS accuses you of not having health insurance. SHARE WITH A FRIEND. If you need tax help... www.baboiancpa.com TAX TIP OF THE DAY... new 2015 rules for rental property owners!
In the past large repairs, improvements, appliances and furniture needed to be depreciated over time... you could not deduct the entire purchase price in the year of purchase. Ask your tax preparer about a brand new election that can be made retroactive back to 01/01/2015 which ALLOWS THE EXPENSING of any item costing less than $2,500. This is huge... the best rental property tax break in 20 years!!! SHARE WITH A FRIEND. If you need tax help... www.baboiancpa.com TAX TIP OF THE DAY... deduct a VACATION to paradise
We've all seen the continuing education brochures for our jobs... Caribbean cruises, Mexico resorts, Arizona spas, Disney, Myrtle Beach. The boss is definitely NOT paying for this one. So is there some way to get a tax deduction? YES, with planning and proper documentation. The general rules: 1) The same identical seminar can not be available in the states... if it is, your deduction is limited to the price of the stateside seminar. 2) The trip must be primarily for business which is a greater than 50% test. This test can be passed based upon a) # of days with substantial business, b) # of business hours or c) the overall importance of the business portion of the trip. 3) Other family members traveling with you will not detrimentally affect the 50% test. The test only pertains to you. 4) Other family members' expenses are generally not deductible unless they are seminar participants. 5) This deduction requires the advance help of a tax pro to guide you through documentation and strategy requirements to maximize the deduction. SHARE WITH A FRIEND. If you need tax help... www.baboiancpa.com TAX TIP OF THE DAY... IRS says it's 5 o clock somewhere
MYTH: IRS code bans alcohol as a deduction. NOT TRUE. Deduct, deduct, deduct. The deduction category is "meals & entertainment" and requires a business discussion before, during or after the drink. So toast to your work and enjoy a drink on the IRS... and don't forget to deduct the tip as well. SHARE WITH A FRIEND. If you need tax help... www.baboiancpa.com |
AuthorDavid S. Baboian, CPA Archives
February 2018
Categories |
RSS Feed