Our federal income tax law did not have special treatment for capital gains until a much lower rate (12.5% rather than a top rate of 73%) was added by the Revenue Act of 1921 (P.L. 67-87; 11/23/1921).
So, November 23 marks 100 years of complexity, lots of discussion on why and how there should be any preference for capital gains, and fairly constant changes to these rules.
The Revenue Act of 1921 defined capital asset as “property acquired and held by the taxpayer for profit or investment for more than two years (whether or not connected with his trade or business), but does not include property held for the personal use or consumption of the taxpayer or his family, or stock in trade of the taxpayer or other property of a kind which would properly be included in the inventory of the taxpayer if on hand at the close of the taxable year.”
The 1921 Act also
Your home is exempt from Capital Gains Tax (CGT) when you sell it, In contrast, buy to let properties sold at a profit are liable to CGT. However, in certain circumstances, some or all of the gain on a let property is also tax free. This works best when you let a property which used to be your home, for example you trade up but keep your old house, or a couple move in together and keep both houses, one of which they decide to let. However it can also apply if you acquire a property, let it for a few years and then decide to move into it. Read More
The Minister for Finance, Public Expenditure and Reform Paschal Donohoe T.D delivered his first Budget on 10th October 2017 which concentrated more on expenditure than on tax changes. The Minister announced a number of positive measures to assist small and medium sized enterprises prepare for “Brexit” as well as confirming Ireland’s commitment to the 12½% corporation tax rate. We are pleased to bring you our summary of the tax measures set out in Budget 2018.
How do you plan to give back next year?
The more money we tend to have, the harder it tends to be to share our resources with others. This is true up to the point we start to appreciate the significance of giving back. For many this tipping point comes far too late in life if at all. If you charitably donate or are considering being charitable, how much are you donating? How are you making those donations? Money? In kind? Time? How do you decide what is appropriate?
During February 2016, the beleaguered South African Minister of Finance, Pravin Gordhan made a serious attempt to balance government’s books. Being an election year, the increase in wealth taxes went down well with the grassroots support base of the ruling ANC.
The provisions of Section 179 – 186 Taxes Consolidation Act (TCA) 1997 examine the following scenarios:
- The departure of a disgruntled shareholder.
- The retirement of a controlling shareholder who wishes to stand aside and make way for new management/the next generation.
- Situations where one shareholder wants to continue carrying on the trade while the other shareholder would prefer to exit the business and the company has the necessary funds to buy back its own shares.
- Access to company surplus funds as part of succession planning
- An outside shareholder who initially provided equity finance but who now wants the return of that finance.
- A marriage break-up, etc.
When faced with a large tax bill and the administrative burden of having to file Tax Returns in two jurisdictions, people always regret not getting professional taxation advice BEFORE they completed the transaction.
Over the past number of years I’ve been contacted by several Irish citizens returning home from the UK where they’ve lived and worked for a number of years.
In the majority of cases, these individuals have had difficulty selling their UK homes and, as a result, may have rented them out for a number of years until a suitable buyer was found.
Their main question they asked was “Do I have an Irish and a UK Capital Gains Tax Read More
With careful planning, and provided the rules are followed, the tax code allows the home sale gain exclusion every two years.
Let’s assume you own a home, perhaps a second (vacation) home, or maybe are even thinking about buying a fixer-upper and flipping it. With careful planning, it is possible to apply the full home sale exclusion to all three of the properties.
Here is how it works. The tax code allows you to exclude up to $250,000 ($500,000 for married couples) of gain from the sale of your primary residence if you have lived in it and owned it for two of the five years immediately preceding Read More
• Inherited Basis
• Certified Appraisals
• Loss On Sale
• Potential Law Change
People who inherit property are often concerned about the taxes they will owe on any gain from that property’s sale. After all, the property may have been purchased years ago at a low cost by a deceased relative but may now have vastly appreciated in value. The usual question is: “Won’t the taxes at sale be horrendous?” Read More
As the economy shows signs of improvement, with the stock market rebounding and unemployment falling steadily, it is only reasonable to believe, all thing being equal, that the housing market will also rebound, and will once again become a very viable investment vehicle. There are a number of distinct tax advantages to be derived from investing in real estate, and this article will look at some of these advantages. For both middle and high-income individuals alike, the tax advantages of investing in real estate can be substantial. Some of the advantages are as follows:
The IRS allows investors to depreciate (deduct from rental income) the cost of a residential rental building over a period of 27.5 years, and 39 years for nonresidential Read More
Here is a brief Summary of some of the Taxation Measures for introduction in Ireland in 2015.
There will be an increase in the standard rate band of income tax by €1,000 from €32,800 to €33,800 for single individuals and from €41,800 to €42,800 for married one earner couples.
There will also be a reduction in the higher rate of income tax from 41% to 40%.
The threshold for the artists’ exemption will be increased by €10,000 to €50,000. Read More
If you’ve already made or about to make a disposal of a capital asset (e.g. certain shares, an investment property, a business, etc.) anytime between 1st January and 30th November 2014 you will be obliged to pay your Capital Gains Tax by 15th December 2014.
If you decide to wait and dispose of your asset between 1st December and 31st December 2014 then your payment will be due by 31st January 2015.
What happens if you miss these deadlines?
Interest of 0.0219% per day will be applied to all late payments of Capital Gains Tax.
What happens if you make a gain in the first part of the year and a loss in the second part?