Owner: Gina's Tax Blog URL:http://glgcpa.blogspot.com/ Join Date: Tue, 08 Aug 2006 11:21:09 -0500 Rating:1 Site Description: This blog provides general information about U.S. and Texas taxes by Gina L. Gwozdz, CPA. Gina is the owner of Gina's Tax Service. Her main goal is to help all her clients minimize their tax liability within the constraints of the law. Site statistics:Click here
Withholding & Estimated Tax Payments 1970-01-01 00:59:59 As far as income taxes are concerned, we have a "pay as you go" system. We called it this because income taxes are required to be paid as you generate taxable income either withholding or estimated tax payments.
Withholding is the amount of taxes that are taken out of your paycheck as you earn your money. This allows the government to track how much money you are making and how much taxes they Read more:Estimated
Income Averaging 1970-01-01 00:59:59 Bill from San Antonio, Texas asks:
Hi!
Do you know if there is any way for me to average my taxes between two years, like if I had a really good year last year and a really bad year this year, can I average the two years?
This may be a silly question, but I thought I would ask to make sure because I heard it's possible.
Thanks,
Bill
My reply:
Hello Bill! Thanks for stopping by.
I have no Read more:Income
Estimate Your Home Office Benefit 1970-01-01 00:59:59 I have received several requests from readers of my article, "Is the Home Office
Deduction Worth It" on help estimating their potential benefit of this deduction. Thus, I created a spreadsheet (available as a download from my main website) to help all my readers estimate your possible benefit of claiming the home office deduction. This spreadsheet is provided without any warranties.
This Read more:Estimate
Why file a return? 1970-01-01 00:59:59 Hank from Plano, Texas asks:
Hi,
If I'm reading Publication 17 correctly, I can pay in all the taxes that I owe and then there is no late filing penalty if the tax return is submitted late (after the extension date). Right?
If so, then this seems to be saying that if there is no tax due there will NEVER be a late filing penalty. So why submit the return at all?
Hank
My response:
Whoa!
The Penultimate Blog..... 1970-01-01 00:59:59 Thank you to Dan Meyer of Tick Marks who recently named my blog as the "Penultimate 2006 Blog" in his "12 Blogs of Christmas".
If you haven't already visited his blog, please do so. He posts short to the point entries on accounting (tax and personal finance) related topics.
Hiring Professionals 1970-01-01 00:59:59 Danielle at Small Business Branding has written an excellent article on how to choose professional advisors, consultants and suppliers that is definately worth reading. She provides you with questions you should ask and how to make sure they are answering the question you wanted answered. Read more:Hiring
Beware of AMT 1970-01-01 00:59:59 You have already been bombarded with "tips" and ideas of how to get those last minute tax deductions in order to reduce your taxes or even get yourself a nice refund. These tips usually include:
Paying property taxes in December instead of January to increase your itemized deductionsMaking an extra mortgage payment to increase your interest expense deduction.
Now that sales tax has been Read more:Beware
IRA funds donated to Charity 1970-01-01 00:59:59 Randy inquires:
I realize with the passage of the Pension Act of 2006 a taxpayer can make a contribution directly to charity, have it excluded from their taxable income, included in their required minimum distributions, and not deductible on Schedule A. Is there an exception to the deductibility on Schedule for taxpayers with an IRA which has been completely funded with non-deductible Read more:Charity
, donated
Overview of Tax Credits 1970-01-01 00:59:59 Tax credits cut your actual tax - dollar for dollar. There are way more tax credits available then most taxpayers are aware exist. The following is a general overview of some of the tax credits that are available to you. Tax credits generally come with complex guidelines, so if you do think you may qualify for one or more, please consult your tax professional to make sure you claim it Read more:Overview
, Credits
Depreciation in Year of Sale 1970-01-01 00:59:59 Karen from Ohio asks:
I have a question about how much depreciation I should use on a rental property that I sold. I placed the property in service on Nov. 1, 2000, using MACRS (GDS), straight line depreciation, mid-month convention. If this were a normal year, as the past few have been, I could depreciate 3.636% of the basis. The date of the sale was 4-23-06.
So, I figure that I can use
Hire Your Child and Deposit into 529 Plan 1970-01-01 00:59:59 Rosemarie from Saugus, MA inquires:
Re: your article on Hiring your children...Can you pay them by depositing money directly into a 529 plan for their education each month - as opposed to a pay check?
I reply:
Hello Rosemarie! Thank you for visiting my blog.
If you hire your children to work for you, in your business, and pay them a reasonable wage for their age and the service they perform, Read more:Deposit
Deducting Property Taxes 1970-01-01 00:59:59 Dales writes:
Hello,
Have a question about deducting property tax. I purchased property from my sister. I have been paying her property taxes for some time now, and I understand that I was not able to deduct this from my federal taxes (even though she could deduct what I paid since she owns the property). Since I purchased her property this year, I want to know if I can now deduct all Read more:Taxes
Happy New Year.... 1970-01-01 00:59:59 I wanted to take this post to wish my readers a Happy
New Year.
I hope your taxes are minimized, your IRS notices are nonexistent, your time for family and friends is plentiful and your health is favorable.
Gina Read more:Happy New Year
Do I Need To File A Tax Return? 1970-01-01 00:59:59 The most commonly asked question I receive during tax season from random callers is, "Do I Need to File a Tax Return
?". Random callers assume this is a quick and easy question that should be answered fast and free.
Any answer to any tax question that you have, which you have received "fast and free" should be taken with a grain of salt.
However, this year my answer will be fast and free - if Read more:Tax Return
Child Support, Alimony & Other Monies 1970-01-01 00:59:59 efh said... Gina-
I have an ex-wife in the State of CT and am paying non-allocated child support and alimony which I can deduct 100%. My question is if I give additional monies such as for my daughter's camp or a loan on my son's car or a car payment for my ex- wife on a jointly held vehicle but one which she drives 100%. Can I also deduct these for tax purposes? What are the rules? Read more:Support
Exchange or Involuntary Conversion? 1970-01-01 00:59:59 Paul from Phoenix, Arizona would like to know:
In 2006, I replaced various parts of my computer (power supply, memory upgrade, etc.) either because they broke or I wanted better performance. Do I report these as "like-kind exchanges or involuntary conversions"?
My reply:
Hello Paul! Happy Tax Season!
The fact that you are even considering that this activity may either be a "like-kind Read more:Exchange
, Conversion
Filing Status 1970-01-01 00:59:59 One of the first items that you need to determine when completing your tax return is your filing status. Your correct filing status must be known in order to determine whether or not you need to file a return, when certain deductions, adjustments and credits phase-out and what tax bracket your income falls within.
Since we have a "voluntary" tax system, if more than one tax filing status happens Read more:Filing
, Status
Who pays SS & Medicare? 1970-01-01 00:59:59 Oscar writes:
My wife owns a small home-daycare, never more than 15 children. She operates out of our house. She has one full-time (employee) for whom she pays all taxes and medicare and two other part-time contract employees. Her business is legally registered as an LLC partnership.
One of the part-time contract employees is demanding that my wife pay SS and Medicare because her tax
Roth & Traditional IRA 1970-01-01 00:59:59 Chris ponders:
I'm so glad I found your blog!
I'm still eligible for contributing to a Roth IRA. I'm married, but due to my household income I can only deduct $3500. Can I put the remaining $500 into a non-deductible traditional IRA?
Also, assuming I could put the remaining $500 into a traditional IRA, would I really want to? Thanks.
I respond:
Hello Chris! I'm glad you found my blog too! Read more:Traditional
Reclassify Income as Donation? 1970-01-01 00:59:59 Dale from Ohio asks:
I found your blog from searching google and I was wondering if you could help me. I have a client that is having a difficult time paying me. I know they have the ability to pay me, but actually receiving payment for my services is a problem. This is a nonprofit organization that I have some fondness for. Could I ask for a receipt for the work as a charitable donation? I do Read more:Income
, Donation
Exemptions 1970-01-01 00:59:59 Most taxpayers are allowed to take a personal exemption for themselves (up to $3,300 in 2006) and their spouses, which is subtracted from their income before their tax is computed. Taxpayers are also allowed to take an exemption for each of their dependents.
If you can be claimed on another taxpayer's tax return as a dependent, then you are not allowed to take an exemption for yourself. This
Your Refund May Be Delayed 1970-01-01 00:59:59 If you send the IRS either a paper tax return or an electronically filed tax return before Feb. 3, 2007 and you are claiming a benefit from one of the "key tax provisions" (such as a deduction for local sales tax and educator expenses) which were enacted last December, your return will be accepted, but not processed. This of course, will delay the processing of any refund you may be entitled to Read more:Refund
Why Hire A Tax Professional? 1970-01-01 00:59:59 With tax software so cheap, so many online tax filing options, resources and help all over the Internet, why hire a tax professional?
Are you a leader or a follower? Do you need to be told what to do? Software does not have the ability to think for you, even if it seems like it does. Yes, the program is designed to ask you a bunch of questions, but you can't discuss your specific situation
Basis of Home 1970-01-01 00:59:59 Maria wonders:
I purchased a new shed for my backyard. Should I be keeping the receipt for the shed, and when I sell my house I'll add that to the basis and it will potentially reduces the tax I will owe on the profits of the house?
My response:
Unless you live in California or Florida or some other area where houses are appreciating very nicely, you probably don't have to worry about paying Read more:Basis
Sale of Rental Property 1970-01-01 00:59:59 Megan asks:
I have rental property which I plan on selling. I'm estimating that I'll have about $100K in profit. How will this affect me taxwise? I would also like to know if I should buy another property or use the money to pay down my mortgage. Any suggestions? Please respond.
Thanks in advance,
Megan
My response:
Hello Megan, thanks for writing.
I think it's excellent that you're Read more:Rental
Tax Carnival #10... 1970-01-01 00:59:59 The Wondering Tax Pro has relieved Don't Mess with Taxes and is hosting TAX CARNIVAL #10: PUTTING IT TOGETHER!
He has done a great job of gathering articles that provide you with tips and advice you will need now that you're getting ready to prepare your return. He started the carnival with my article, "Do I Need To File a Tax Return?" and then followed it up with these excellent selections: Read more:Carnival
Tax on Trust Distributions? 1970-01-01 00:59:59 John from Oklahoma writes:
Hello! I found your blog while search the net and was hoping you could answer a question for me. My wife is one of five beneficiaries of a trust established over 30 years ago by her father when he died. Her mom had access to the income generated since the trust was established. A couple of months ago her mom passed away and the trust will be divided among her and
The President on Health Insurance 1970-01-01 00:59:59 As the TaxProf points out, several bloggers have already blogged regarding their opinion on the President
's proposal to allow a limited deduction for health insurance whether purchased themselves or through their employer. As a break from my typical tax posting, I wish to comment on the President's proposal regarding health insurance as well.
William Perez from About.com and Kay Bell from Read more:Health
, Health Insurance
Medical deduction? 1970-01-01 00:59:59 Shelley wonders:
It has been recommended by my mother's doctor that she get a 4-wheeled walker. Because she got one without wheels earlier in the year, medicare will not cover it. With the doctor's note that it is medically necessary, can this be added to the medical expenses for the year ? (I know about the limit but this year, I suspect she will hit it.)
thanks,
Shelley
My reply:
Thanks for
Is My Son My Dependent? 1970-01-01 00:59:59 Ted writes:
My son is 20. He dropped out of college and has been home doing some Online School to try and get a degree, can I still claim him as my dependent?
My response:
Hello Ted, thanks for writing.
Online School is not a qualified school, but you said that your son did go to college. If he attended college for at least 5 months during the year, being enrolled full-time, and the college Read more:Dependent
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