Tag Archive for tax return

Filed Joint Return But Spouse Did Not Sign?

Tax Court Did Not Consider To Be A Valid Return

In Reifler, TC Memo 2015-199TC Memo 2015-199, the Tax Court recently held that a joint return not signed by the wife was not a valid return and, as a result, imposed the failure-to-file penalty. In so doing, it rejected the taxpayer’s arguments that the return was valid either because it substantially complied with the valid return rules or because the wife intended to file a joint return and tacitly consented to the filing of a joint return.

Signatures on a tax return not only verify that a return has indeed been filed by the person indicated on the front page of a Form 1040 but also certify that all the statements in the tax return are made under penalty of perjury and are true, correct, and complete to the best of Read More

Written by | Posted in Income Tax

Facing A Huge Gain From A Realty Sale?

If you are contemplating selling real-estate property, there are a number of issues that could impact the taxes that you might owe, and there are steps you can take to minimize the gain, defer the gain, or spread it over a number of years.

The first and possibly most important issue is adjusted basis. When computing the gain or loss from the sale of property, your gain or loss is measured from your adjusted basis in the property. Thus, your gain or loss would be the sales price minus the sales expenses and adjusted basis.

So what is adjusted basis? Determining adjusted basis can sometimes be complicated, but in a simplified overview, it is a dollar amount that starts with your acquisition value and Read More

Written by | Posted in Real Estate

Claiming The Child Tax Credit

The child tax credit is a credit given for each dependent child on your tax return, who is under the age of 17 at the end of the tax year. The child tax credit is a nonrefundable credit, and is intended to provide an extra measure of tax relief for taxpayers with qualifying children.
To qualify for this credit, you must have a qualifying child on your tax return. The rules for determining if your child is a qualifying child for the purpose of this credit are as follows:

• The child must be your son, daughter, adopted child, stepchild, eligible foster child, brother, sister, stepbrother, stepsister, or a descendant of any of them. (This includes your niece, nephew, grandchild, great-grandchild, etc.)
• The child must not provide for over half of his or her own support for the year. Read More

Written by | Posted in Tax Credit

10 Tips For Deducting Losses From A Disaster

National Hurricane Season is officially in progress. If you suffer damage to your home or personal property, you may be able to deduct the losses you incur on your federal income tax return. Here are ten tips you should know about deducting casualty losses:

1. Casualty loss. You may be able to deduct losses based on the damage done to your property during a disaster. A casualty is a sudden, unexpected or unusual event. This may include natural disasters like hurricanes, tornadoes, floods and earthquakes. It can also include losses from fires, accidents, thefts or vandalism.

2. Normal wear and tear. A casualty loss does not include losses from normal wear and tear. It does not include progressive deterioration from age or termite damage. Read More

Written by | Posted in Corporate • Expatriate • Federal • Income Tax • Individual • International • Tax Deductions • Tax Planning • Tax Tips

Claiming A Qualifying Relative On Your Tax Return

For you to claim a person as your Qualifying Relative, that person must either be:

(a) Related to you (generally by blood, adoption, or through marriage), or

(b) Be a member of your household for the entire year.

There are five tests to determine if you can claim a person as your Qualifying Relative. These tests are as follows:

1) The Not a Qualifying Child Test

If a child meets all the tests to be your qualifying child, that child cannot also be your Qualifying Relative. Also, if that child qualifies to be the Qualifying Child of another person, Read More

Written by | Posted in Individual • Tax Deductions • Tax Planning

Forgot Something On Your Tax Return? It’s Not Too Late To Amend The Return

If you discover that you forgot something on your tax return, you can amend that return after it has been filed. The need to amend can be because of:

• Receiving an unexpected or amended K-1 from a trust, estate, partnership, or S-corporation.
• Overlooking an item of income or receiving a corrected 1099.
• Failing to claim the correct advanced premium credit because of an incorrect 1095-A.
• Forgetting about a deducible expense.
• Forgetting about an expense that would qualify for a tax credit.

These are among the many reasons individuals need to amend their returns, whether it is Read More

Written by | Posted in IRS • Tax Planning

Start Planning Now For Next Year’s Taxes

You may be tempted to forget about your taxes once you’ve filed your tax return, but did you know that if you start your tax planning now, you may be able to avoid a tax surprise when you file next year?

That’s right. Now is a good time to set up a system so you can keep your tax records safe and easy to find. Here are six tips to give you a leg up on next year’s taxes:

1. Take action when life changes occur. Some life events such as a change in marital status or the birth of a child can change the amount of tax you pay. When they happen, you may need to change the amount of tax withheld from your pay. To do that, file a new Form W-4, Employee’s Withholding Allowance Certificate, with your employer. Read More

Written by | Posted in Tax Planning

Choosing The Correct Filing Status

An individual’s tax refund or tax liability depends primarily upon two variables: the individual’s filing status and the taxable income.

Choosing the correct filing status, therefore, is very important, and is really the first step that you take in ensuring that you will end up with an accurately prepared tax return. You need to appreciate this, because your filing status determines a number of very important things, such as; filing requirements, tax deductions, tax credits, tax rate, and ultimately, your correct tax refund or tax liability. In general, filing status depends on whether a taxpayer is considered unmarried or married, and this is determined based on your marital on the last day of the tax year. For federal tax purposes, a marriage means only a legal union between a man and a woman as husband and wife. The word “spouse” Read More

Written by | Posted in Income Tax • Individual • IRS

8 Facts To Know If You Receive An IRS Letter

The IRS sends millions of letters and notices to taxpayers for a variety of reasons. Many of these letters and notices can be easily dealt with without having to call or visit an IRS office. Here are eight things you should know about if you receive a notice or letter from the IRS.

1. Don’t panic. There are a number of reasons why the IRS might send you a notice. Notices may request payment, notify you of account changes, or request additional information. A notice normally covers a very specific issue about your account or tax return. Most of the time, you can take care of a notice simply by responding to it.

2. Each letter and notice offer specific instructions on what action you need to take. Read More

Written by | Posted in Individual • IRS

What To Do If You Haven’t Filed A Tax Return

Filing a past due return may not be as difficult as you think.

Taxpayers should file all tax returns that are due, regardless of whether full payment can be made with the return. Depending on an individual’s circumstances, a taxpayer filing late may qualify for a payment plan. It is important, however, to know that full payment of taxes upfront saves you money.

Here’s What to Do When Your Return Is Late

Gather Past Due Return Information

Gather return information and contact me via TaxConnections. You should bring any and all information related to income and deductions for the tax years for which a return is Read More

Written by | Posted in Income Tax • Individual • IRS • Tax Provision/Tax Reporting

10 Tax Sins That Could Land You In Jail

Carelessness on your tax return might get you whacked with a 20% penalty. But that’s nothing compared to the 75% civil penalty for willful tax fraud and possibly facing criminal charges of tax evasion that if convicted could land you in jail.

It’s one thing to make an innocent mistake on your taxes, or to overlook a tax break that could lower what you owe the IRS. While such innocent mistakes will still cost you, they usually won’t invoke the ire of the IRS to pursue criminal prosecution or assess a Civil Fraud Penalty.

When you intentionally disregard tax law, however, such willful neglect will get you in real trouble. The IRS defines “willfulness” as a voluntary, intentional violation of a known Read More

Written by | Posted in Individual • IRS • Tax Fraud/Evasion/Crimes

Claiming The American Opportunity Credit

This is a very valuable credit for students who are pursuing a first degree in college. You can claim this credit for yourself, your spouse, or any dependent that you claim on your tax return.

It is very important to note that the American opportunity credit can be claimed ONLY for the first four years of post-secondary education for each eligible student. This means, then, that this credit is applicable only to college students who are in their freshman, sophomore, junior, and senior years. This credit is therefore not available to post-grad students.

To be eligible to claim the American opportunity credit, the following conditions Read More

Written by | Posted in Individual • Specialty Tax Incentives
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