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October 6, 2019 10:47 pm

When you have a casualty event and receive insurance reimbursements that are greater than your adjusted basis in the property, for tax purposes you have a gain (even though you may feel like you’ve ...

October 6, 2019 10:45 pm

If you are reimbursed under an accountable plan, then reimbursements may be tax free. For example, if reimbursements for your mileage exceed the IRS standard mileage rate, then only amounts up to the ...

August 20, 2019 12:02 am

No. Depending on your income (including tax-exempt interest) and your filing status, as much as 85% of Social Security benefits may be includible in gross income. If your income is lower, you may only...

August 20, 2019 12:00 am

The deduction from gross income (no itemizing required) for tuition and fees expired at the end of 2017. However, there is still some hope that it may be extended retroactively for 2018. And there is ...

August 19, 2019 11:58 pm

Cash contributions made to charity in 2018 and beyond are deductible up to 60% of adjusted gross income. If you have a carryover of a cash contribution because of the application of the 50% limit that...

July 22, 2019 3:26 am

Yes. If you have a health savings account (HSA), your contribution to a self-only plan is permissible up to set annual limits (in 2019 it’s $3,500, plus $1,000 if you’re age 55 or older by year en...

July 22, 2019 3:24 am

Fortunately, no. The amount of the benefits includible in gross income may be zero, somewhere between zero and 50%, or somewhere between 50% and 85%; 85% is the maximum taxable percentage. The exact a...

July 22, 2019 3:23 am

Gifts you make to people are not tax deductible. However, it’s good to know that the recipient of a gift is not subject to income tax on it, regardless of the size of the gift. If the gift is more t...

July 22, 2019 3:14 am

Yes. There is no exclusion from income for the payment from an employer to an employee who opts not to take company health coverage. This is so even though you would not have been taxed on the health ...

July 22, 2019 3:11 am

The M&IE is broken down to breakfast, lunch, and dinner, plus incidental costs. The IRS hasn’t said whether you can use the M&IE rates for some meals and actual costs for others on the same ...

The favorable rule allowing debt forgiveness on a principal residence mortgage up to $2 million expired at the end of 2013. It could be extended, but given the resurgence in the housing market, it may...

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...

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...

Yes. The deductions for mortgage interest and real estate taxes are separate items. Claiming one has no impact on claiming the other. The only limitation on the deduction for property taxes is the app...

Yes, assuming you each meet the eligibility tests for the home office deduction. Each of you would need to complete a separate Form 8829 and attach it to your separate Schedule Cs if you figure the de...

Unfortunately, no. The fees were payable by the estate and deductible only by the estate. If there had been a federal estate tax, you would have been entitled to a write-off for the federal estate tax...

While the fundamental rules are the same for estates of those who died in 2012 and those who die this year, some of the important numbers are different. For example, the exemption amount (the value of...

No. The first-time homebuyer credit ended in 2010 and it has not been extended. There’s probably no chance that Congress will change its mind anytime soon because the housing market has picked up....

The IRS says: “For the year of the account owner’s death, use the RMD the account owner would have received. For the year following the owner’s death, the RMD will depend on the identity of the ...

Yes. The deductions for mortgage interest and real estate taxes are separate items. Claiming one has no impact on claiming the other. The only limitation on the deduction for property taxes is the app...

No. Gifts are not taxed to the recipient, regardless of amount or whether they are from people in or outside the United States. If you make gifts, you need to check on whether you must pay any gift ta...

Probably not. A revocable trust of which you are a trustee and beneficiary is a grantor trust. You are taxed on the income from this trust to the same extent that you would be if there were no trust. ...

Yes, assuming you each meet the eligibility tests for the home office deduction. Each of you would need to complete a separate Form 8829 and attach it to your separate Schedule Cs if you figure the de...

Unfortunately, no. The fees were payable by the estate and deductible only by the estate. If there had been a federal estate tax, you would have been entitled to a write-off for the federal estate tax...

If you take a deduction for a bond premium, you must reduce the basis of the bond by this amount. If you sell the bond before maturity, you’ll have a capital gain if the selling price exceeds your b...

While the fundamental rules are the same for estates of those who died in 2012 and those who die this year, some of the important numbers are different. For example, the exemption amount (the value of...

The annual exclusion for 2013 is $14,000 per recipient. This amount is doubled if you are married and your spouse consents to split the gift. If your children are married, you can effectively multiply...

No. The first-time homebuyer credit ended in 2010 and it has not been extended. There’s probably no chance that Congress will change its mind anytime soon because the housing market has picked up....

The annual exclusion for 2013 is $14,000 per recipient. This amount is doubled if you are married and your spouse consents to split the gift. If your children are married, you can effectively multiply...

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 ...

No. The first-time homebuyer credit ended in 2010 and it has not been extended. There’s probably no chance that Congress will change its mind anytime soon because the housing market has picked up....

Usually, the IRS is rather prompt in asking for additional money. You can contact the IRS by calling 800-829-1040 (Monday–Friday, 7:00 a.m.–7:00 p.m. your local time). When calling, have a copy of...

Mortgage insurance paid in 2013 can be deductible as mortgage interest (the deduction is scheduled to expire at the end of this year). However, income limits apply to limit or prevent a deduction....

No, unless your disability is blindness. This is the only condition for which an additional personal exemption can be claimed on a federal income tax return. However, if your income is very modest and...

It’s not clear. The IRS has not issued any official guidance on this very common question as yet. The law says that the policy must be established, or considered to be established, under her busines...

In 2013, the AGI floor for someone under age 65 is 10% of AGI. The 7.5% floor applies to those 65 or older. Since it is you, and not your mom, who is taking the deduction, you must use the 10%-of-AGI ...

If you sell before or after you marry and the sales take place in the year of your wedding, on a joint return you can each use the $250,000 home exclusion. However, if either excludes less than $250,0...

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...

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