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February 6, 2018 8:59 pm

The Tax Cuts and Jobs Act of 2017 did not make any direct changes to the passive activity loss rules. Those with rental real estate and income below a set amount may still be able to deduct up to $25,...

February 6, 2018 8:58 pm

If the loss occurred in 2017 and it’s a personal loss, it may be deductible as a theft loss. The loss is treated as an itemized deduction allowable only to the extent it exceeds 10% of adjusted gros...

February 6, 2018 8:57 pm

Self-employed individuals can deduct premiums for their health coverage as an above-the-line deduction under certain conditions; no itemizing is required. While the IRS has never specifically said the...

January 15, 2018 12:27 am

If you are experiencing difficulties with the IRS, know your rights as a taxpayer. Read the Taxpayer Bill of Rights (https://www.irs.gov/pub/irs-pdf/p1.pdf). Also consider contacting the National Taxp...

January 15, 2018 12:25 am

It depends on whether you qualify for the home sale exclusion. This exclusion lets you omit from gross income up to $250,000 of gain ($500,000 on a joint return), but only if you meet certain conditio...

January 15, 2018 12:23 am

If one spouse uses “married filing separately” as the filing status, the other spouse must also use this filing status. The other spouse must file if his/her gross income is more than a set amount...

December 3, 2017 9:14 pm

Whether an employee is eligible to participate in a company’s 401(k) plan may depend on satisfying a period of service there. But once in the plan, an employee can make investments from the menu of ...

December 3, 2017 9:13 pm

If you are not the spouse of the person who set up the Roth IRA, you cannot roll over the funds to your own Roth IRA account. However, you can change investment companies; you aren’t limited to a pa...

December 3, 2017 9:11 pm

Contributions to an IRA are based on earned income, which includes net earnings from self-employment. If you have a qualified retirement plan, such as a SEP, for your business, you can contribute to a...

November 15, 2017 9:14 pm

Christian Health Care Ministries Program is a faith-based cost-sharing program for medical expenses. Payments from the program are treated like insurance reimbursements, so because your medical expens...

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In the case of a joint tenancy with someone who is not a spouse and who did not contribute anything, the basis depends on the estate tax value of the property (even if the estate is too small to be re...

Once you are enrolled in Medicare, you are no longer eligible to contribute to an HSA. Your contributions must be prorated for the period in which you have a high-deductible health plan (HDHP). Thus, ...

The IRS has yet to rule on the tax treatment of relocation payments under the Home Affordable Foreclosure Alternatives (HAFA) program, and some people in your situation have received a Form 1099-A or ...

There are several tax breaks for college tuition payments: an above-the-line deduction (this break expired at the end of 2013 but likely will be extended for 2014), education tax credits, an exclusion...

If you bought the time share for personal use, then just as in the case of a sale of a principal residence, no loss is allowed. If you bought the time share for investment purposes, you may be able to...

It depends on whether you’re viewed under the tax law as a developer. If you hold the lot as investment property, any gain you reap is taxed as capital gain. You may also owe an additional 3.8% tax ...

Married persons who file separately are barred from claiming certain tax credits, such as the adoption credit or education credits. However, there is no such bar for the low-income housing credit....

Sorry about your personal loss. The inheritance isn’t taxable, but receiving funds from the annuity is because your cousin never paid tax on this income. Sounds confusing, but it’s the same thing ...

No. It was your property that was donated, so the donation belongs to you. You could have given the items to your brother as a gift and let him make the donations....

Sorry about your personal loss. The settlement is tax free to you because it is compensation for personal physical injury. However, if any part of the settlement is for punitive damages, those are tax...

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Check with the plan administrator of your current employer to see whether the plan allows you to postpone RMDs until you retire. (This assumes you don’t own more than 5% of the company.) If the plan...

You can treat the distribution from the IRA as exempt from the penalty if you are disabled. Just be sure that you meet the strict definition of disability that applies in this case. To be disabled in ...

You can take distributions from your IRA to satisfy required minimum distributions (RMDs) in cash or in kind, meaning in stock. The option you use depends on what’s in your account and what you want...

While interest on municipal bonds is tax free for federal income tax purposes, gain or loss on the sale of the bonds must be reported. The loss is treated as a capital loss, which is deductible within...

It depends. If you qualify for the home sale exclusion, then gain up to $250,000 ($500,000 on a joint return) is tax free; there is no capital gain. If your gain excludes your applicable exclusion amo...

Roth IRAs are designed for retirement savings. While contributions are not tax deductible, withdrawals of earnings after age 591/2 are tax free as long as the account has been open for at least 5 year...

No. The deadline for 2012 contributions was April 15, 2013, regardless of filing extensions. However, you can make a 2013 contribution now; you don’t have to wait until the end of the year or even u...

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Not really. Most of the taxes you refer to (as well as taxes on airline tickets, gasoline at the pump, and cable and Internet access) are excise taxes, which are not deductible as itemized deductions ...

The law doesn’t put a cap on generosity. However, when gifts to an individual exceed a certain amount, you’ll have to deal with federal gift taxes. In 2014, you can give up to $14,000 per individu...

While the interest on municipal bonds is tax free, this doesn’t mean gain or loss on the sale of bonds is excludable from gross income. Gain or loss on the sale of municipal bonds is figured in the ...

A child who is unrelated to the person who provides support may be able to claim a dependency exemption if the child is a qualifying relative. Even though there are no blood ties, a qualifying relativ...

The starting point is determining whether you have a gain or loss. If you have a gain, your other buying or selling activities have no impact on reporting the gain. If you have a loss and buy substant...

It depends. HH bonds were issued in exchange for E and certain other bonds to enable bondholders to continue deferring the tax on the interest that accrued. The Treasury stopped issuing HH bonds in 20...

It depends on whether you’re viewed under the tax law as a developer. If you hold the lot as investment property, any gain you reap is taxed as capital gain. You may also owe an additional 3.8% tax ...

Sorry about your personal loss. The inheritance isn’t taxable, but receiving funds from the annuity is because your cousin never paid tax on this income. Sounds confusing, but it’s the same thing ...

Yes. While there are certain ordering rules for applying capital losses against capital gains, ultimately, long-term capital losses can offset any short-term gains....

No. It was your property that was donated, so the donation belongs to you. You could have given the items to your brother as a gift and let him make the donations....

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First, you must determine whether this was a business or nonbusiness bad debt. A business bad debt is fully deductible as an ordinary loss; a nonbusiness bad debt is treated as a short-term capital lo...

If you have a C corporation that files Form 1120, you only report compensation (including wages, bonuses, and taxable fringe benefits), dividends, and other taxable distributions received. The corpora...

It depends. Whether you owe income taxes depends not only on your wages, but on all of your income. If your gross income is below the filing threshold for your filing status, you’ll obtain a full re...

You’re not asking the right question. You should be asking whether your spouse is your employee. Under the circumstances described, where your spouse is working solely for you and you have control o...

No. The requirement to issue a Form 1099 for the payment of services of $600 or more to an independent contractor applies only to businesses. It does not apply to services for individuals....

Medical expenses can be deducted as itemized medical expenses only in the year in which they are paid. If you can’t use them in the year of payment because you don’t itemize or total medical costs...

No. An individual’s charitable contributions can be deducted only as an itemized deduction. Even if the rental property is a trade or business, with income and expenses reported on Schedule C rather...

Yes. Even though there is an age limit for making deductible IRA contributions, there is no age limit for making a conversion from a traditional IRA to a Roth IRA. There is no need to have earned inco...

High-income taxpayers pay an additional charge for Medicare Parts B and D. The Part B surcharges for 2014 are unchanged from 2013; those for Part D are only slightly higher for 2014 than in 2013.  ...

Gifts up to $14,000 in 2013 are not taxable for gift tax purposes (they are never taxable for income tax purposes, regardless of amount). The additional $1,000 per child could be taxable, although you...

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