Taxes are what you pay to the federal, state and local governments where you live. Different types of taxes include income taxes, capital gains tax, sales tax, estate tax and real estate taxes such as property tax. Learn how to bequest property and do transactions in a way that will help you pay less taxes and follow the law.
Should I Buy a Home for Tax Purposes?
The house next door to me just sold for $369,000. The owners bought it in the 1970s and paid $27,000. After all costs and fees, their profit will be over $300,000. That’s good for them—but what about for you? Is buying a home the right move? The real estate market is still good for buyers [...]
Tax Questions: Is Your Hobby Really a Business?
Over the years, I have regularly helped my clients with their tax audits after the IRS determined that their businesses were really hobbies. Filing taxes as a sole proprietor of a business means you can take advantage of tax deductions you may not have access to if your activity is a hobby, so it’s important [...]
Tax Implications of Converting Your IRA to a Roth IRA
A couple of years ago, I was invited to a presentation put on by an aggressive financial planner about all the reasons I and other tax professionals should try to convince our clients to begin investing in Roth IRAs instead of traditional IRAs and 401(k) plans. What did I learn? That if those of us [...]
Rules for Saving on Taxes with a Home Office
Home Office: Rules for Saving on Taxes Working from home? Here are the rules you should follow for saving on taxes with a home office. Insuring a home office Have you ever dreamed of working from home full time? No more commuting, no more office politics, and no more take-out dinners when you’re stuck at [...]
Four Ways to Live Tax-Free
Four ways to Live Tax-free. Here are a few strategies for those who want to live a tax-free life without breaking the law. We all know that paying taxes is a necessary part of life. Yet the news is constantly filled with reports of people being caught with offshore, untaxed funds in an effort to [...]
Putting a Rental Property in an LLC to Minimize Taxes
Before putting a rental property in an LLC to minimize taxes, be sure you can depreciate the building to reduce your tax liability. Q: I recently inherited a rental property. The property is rented and cash flow is positive, despite the fact that there is a mortgage on the property. Currently, I do not need [...]
Can I Afford a Condo? Is a Condo Right for Me?
Can I afford a condo, is a condo right for me? Condos are more affordable than single-family homes, but you have to pay monthly assessments. Comment: Just read your column in today's paper responding to a question for advice whether to buy a home at age 66 or continue renting. I was surprised you didn't make two [...]
How to Adjust Your Tax Withholding if You Receive a Big Refund
At an IRS tax workshop several years ago, someone asked the speaker if the IRS has a problem with taxpayers who get large refunds. We attendees were surprised to learn that the IRS does look upon large refunds with suspicion. Why? According to a discussion I had with an IRS professional, a refund of $3,000 [...]
Tax Tips: Settling Your Outstanding Tax Debt With the IRS
When I started in the tax field, working with the IRS on installment agreements and Offers in Compromise was like standing in quicksand. The IRS made obscure rules and changed them arbitrarily. It acted as an utter tyrant. Then, in the 1980s, there were a series of Senate hearings about the problems, and what emerged [...]
Tax Mistakes: What To Do When Your 1099 or W-2 is Wrong
This article was written by guest blogger Eva Rosenberg. Have you ever received an incorrect W-2 or 1099? Scary, isn’t it? You know you have to file taxes, but you’re nervous about giving incorrect information to the IRS. Then, when you call the person or company issuing your tax forms, he or she may refuse [...]