Tax Advice
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From deductions to tax credits, WalletPop experts answer your questions. Get the tax advice you need.
Latest Tax Advice
IRS has no information on missing stimulus checks
After the popular "stimulus checks" issued as part of efforts to jump start the economy in 2001 and 2008, many taxpayers were again looking forward to a check in 2009. This year, however, checks weren't in the cards for most Americans. Most of the taxpayer relief for American Recovery and Reinvestment Act of 2009 (ARRA) focused on the Making Work Pay credit. The Making Work Pay credit allows up to $400 per individual worker and $800 per working married couple and is figured on your tax return. Those who did not work during the year are not eligible for the credit.
The pitfalls of Refund Anticipation Loans
Anyone fortunate enough to be getting a tax refund will probably want that money sooner rather than later. But don't let your haste cloud your good judgment. There are a number of less-than-scrupulous outfits out there that are waiting to prey on your desire (or need) for quick cash. One of my clients is a good example.
When she learned she was getting a refund on her taxes this year -- money she desperately needed to pay the oil bill -- it was all she could do to fight back the tears of joy. Last year, it had been a whole different story.
WalletPop experts take on your questions, from capital gains to back taxes
The Internal Revenue Service collected $56.4 billion from "enforcement efforts" in 2008. Peter Pappas of The Tax Lawyer's Blog expects the figure for 2009 to be even higher. Don't be another auditing statistic. WalletPop experts are on hand to answer some of your burning questions, from capital gains on property sales to back taxes on a business.Question:
If my wife and I sold our two family houses of 25 years and had a rental 10 of those years, how much capital gains are we allowed to claim?
A two-family home can be treated as one or two separate properties for purposes of a sale, depending on the facts. This is important, because only a home used as your principal residence for at least three of five years before the date of sale can qualify you to claim an exclusion of up to $500,000 of gain on the sale (a $250,000 limit applies to singles). If rental use was longer than three years within this five-year period, then any gain related to this portion of the home will be taxable and won't qualify for the home sale exclusion. Any depreciation claimed on the rental portion of the home after May 6, 1997, is subject to "recapture," which means this amount is taxed at a 25% rate; the balance of your gain is taxed at a 15% rate. And even if rental use during the five years doesn't exceed three years, any gain related to rental use after 2008 won't qualify for the home sale exclusion.
10 ways to maximize your tax deductions -- without itemizing
Too often, taxpayers are led to believe that if they don't itemize, then there are no real deductions available to them beyond the standard deduction. In reality, there are a number of deductions that a taxpayer can claim without itemizing. Here are 10 ways to maximize your tax deductions -- without going through the trouble of itemizing:
From health deductions to mortgages, WalletPop experts answer your questions
Calculating taxes has become so complicated that it's not surprising many of us turn to professionals for help. According to the IRS' national tax advocate, more than 80% of individual taxpayers pay others to prepare their taxes. But that still means we have to get our paperwork together. With W-2s and 1099s on hand or in the mail, there's no excuse to procrastinate. To help you, WalletPop experts have answered some of your urgent questions about health insurance, dependent credits and IRA conversions.
Question:
I run a small business as a Sub S. Is it better to run my personal health insurance through the company or pay for it out of personal funds?
-- Robert Clark, 48, Atlanta
Your tax questions answered
It's an annual rite of passage that almost every taxpayer goes through: Interpreting the latest and greatest IRS rules. Of course, that leads to lots of tax questions. Luckily, we have the answers. Below tax blogger and attorney Kelly Phillips Erb tackles some of your top tax questions.
10 tax tips for seniors
Every year about this time, I receive a lot of mail from seniors who are confused about whether they should file a tax return. The confusion stems from the fact that many seniors receive income from sources that might not be taxable, such as Social Security and tax-exempt bonds. Whether you're a retiree or someone helping a senior family member or friend with taxes, here are 10 tax tips to help ease you through the tax season and maximize your deductions:
Overlooked deductions: job search expenses
The national unemployment rate stands at a whopping 10% -- higher than it has been for years. Despite all the talk in Washington about creating new jobs, the outlook is pretty scary: When the economy was recovering from the 2001 recession, it took two years to reduce the unemployment rate by nearly a full percentage point. For that to happen in 2010, a net total of about 3 million jobs would have to be created. Realistically, that means tens of millions of Americans were searching for new jobs in 2009. Job interviews, resumes, and fees related to a job search can add up. Fortunately, those expenses are deductible on your federal income tax return. Here's what you need to know:
Help! I don't have all my tax documents!
Even though the online filing season for the IRS officially began Jan. 15, many taxpayers don't yet have their necessary tax forms. That's because the law allows employers and others charged with preparing tax forms to taxpayers to distribute those forms up until Jan. 31 -- unless Jan. 31 falls on a holiday or weekend, in which case the deadline is the next business day. That's the case this year, so that means that the deadline is Monday, Feb. 1.What do you do if Monday comes and goes and you don't have your forms W-2, 1099, and other documents you need to file your tax return? Here are a few answers:
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Electronic Filing
Free Electronic Filing & Tax ToolsTaxes: Basics
Anyone seeking help with taxes should start with the fundamentals. Here are the basics of taxes.
IRS has no information on missing stimulus checks
After the popular "stimulus checks" issued as part of efforts to jump start the economy in 2001 and 2008, many taxpayers...
The pitfalls of Refund Anticipation Loans
Anyone fortunate enough to be getting a tax refund will probably want that money sooner rather than later. But don't let...
10 ways to maximize your tax deductions -- without itemizing
Too often, taxpayers are led to believe that if they don't itemize, then there are no real deductions available to them beyond...
Taxes: Sources of income you might not have thought of
With piles and piles of fine-print, the IRS is here to make understanding tax code easy: just spend a few hours flipping...
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