Income tax is a personal tax levied on all income and wages. Different amounts and types of income are subject to difference kinds of regulations from the IRS. Learn more here about different situations involving income tax from the articles, blog posts, radio shows and videos.
There are several legal ways to save money on your income taxes and give less to the IRS. One way to legally save money on your income taxes and give less to the IRS is by paying your January mortgage payment in December. You can also save money legally on your income taxes and give less to the IRS by donating appreciated stock to your favorite charity.
A new real estate investor has questions about the taxes they will be required to pay when flipping a property. If you are able to make a successful business out of buying, rehabbing and flipping properties, you may want to talk to your attorney and your tax preparer about whether it makes sense to start a company, which may help clarify your tax and any future liability issues.
Typically, you have to live in your home as a primary resident for two of the past five years in order to take a certain amount of profits capital gains tax-free. However, the IRS has recently loosened some of these restrictions for people who have to sell for medical reasons, divorce and other personal calamities. The IRS allows you to take a proportionate share of the sale tax free.
When you win a contest, it's like winning the lottery. You get the goods but you have to pay tax on your winnings as personal income rather than capital gains. The difference can be pretty dramatic in terms of taxes owed. Many people choose to take a cash payment instead of the prize, because they will have the cash to pay any applicable taxes.
When it comes to stocks, inheritance and other assets that have appreciated over time, you inherit these assets at the value they had at the time of inheritance or acquisition. Unless one of these accounts was of a type that had designated you as a beneficiary and are taxable to you directly, you should not have to pay any tax on the amounts you received.
Tax time again! Whether you are using a paid tax preparer or filing solo, you'll need to stay on top of the tax laws. Using software and filing online helps keep track of the myriad of changes to the tax laws each year. If you don't know what deductions you can take, the IRS's website offers hundreds of publications that explain the deductions available for each profession.
A couple bought a home on a 2-acre lot. They lived in it while they built a second home, and then moved into the second home after it was completed. They now rent out the original home to another couple. If they sell the property and both homes, how will the transaction be treated at tax time?