TaxAudit Blog

Tag:

small child on swing

Simply stated, child support is not deductible. However, it is worth noting that identifying child support payments may not be so simple.

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Closing Costs

Real estate closing costs can be pesky things. And since you are paying for them, can you at least deduct them from your taxes?

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Tax Deduction written on a sticky-note

Tax deductions and credits serve the same purpose − to reduce the amount of a taxpayer's tax owed. The way that each serves this purpose is different.

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speedometer

In 2019 self-employed taxpayers can deduct their car expenses at the standard rate of 54.5 cents per mile driven for business. However, most employees cannot.

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Tax Debt Relief

Millions of individuals and business owners in America currently have unpaid IRS tax liabilities. Here are a few items to consider for tax debt relief options.

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Tax Refund Check and 1040

You can call the IRS to see if your refund has been flagged for garnishment. Then you can reach out to set up a payment plan − if warranted.

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boy selling lemonade

Yes, kids may have to pay taxes. No matter a person's age, if they have income that exceed certain IRS thresholds, the income should be reported.

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Mortgage sign and keys

In regard to the personal home mortgage interest deduction on the Schedule A, the answer is yes, but only if certain criteria are met.

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stethoscope on top of stack of cash over an Insurance Claims statement

One way to offset the rising costs of health care is by claiming an itemized deduction for qualified medical expenses paid during the year on your income taxes.

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Private Mortgage Insurance Paperwork

The PMI deduction was not permanent. This expiration date was extended twice, eventually to 12/31/17, and any PMI paid after that date is not deductible.

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child playing on a playground

If you paid someone to care for your child so that you could work or look for work, you may be able to take the credit for child and dependent care expenses.

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clock on an audit report

The fact is that there is no standard answer to how long it will take for the IRS to finish up your audit and tell you what, if anything, you owe.

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Man looking at tax return with magnifying glass

Audit defense is a service offered through TaxAudit to support our members in the event that their state or federal tax return is selected for review or audit.

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File folders - one with the word Audit on the tab

Responding to an IRS audit is not the easiest thing to do. Surviving an audit is much easier with professional representation.

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Bitcoin Tax

The IRS declared that any cryptocurrency with an equivalent cash value is to be treated as property for tax purposes, and transactions are therefore taxable.

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house

This seems a simple question, and it has a simple answer, which is probably. First, all the usual requirements of deducting mortgage interest must be met.

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Woman wearing eyeglasses

Prescription eyeglasses for correcting your vision are deductible as a medical expense, but you may not be able to deduct them based on other factors.

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IRS Audit

Generally, the IRS has three years form the date the return is filed to conduct an audit. However, there are exceptions to this three-year rule.

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Money, United States Treasury Check, 1040 Tax Form

If you paid off a prior year state or local tax obligation to your state, you can include these payments as a state tax deduction, subject to the $10,000 cap.

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standard deduction or itemized deduction

Most taxpayers are familiar with the terms standard deduction and itemized deductions, but many are unaware of the differences between the two.

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Couple with moving boxes on their heads with happy faces drawn on them

The moving expenses deduction was eliminated for all tax years from 2018 through to 2025 for all taxpayers except those who are members of the Armed Forces.

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Bitcoin Loss

Yes! Losses on bitcoin and other virtual currencies are deductible but be aware that in an audit the IRS can and will disallow any improperly claimed losses.

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irs agent examining a tax return

Besides official IRS examinations, the IRS also conducts other types of tax reviews that are not classified as official audits, and these are far more common.

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Tax Credits

Non-refundable credits can reduce your tax liability to zero. Refundable credits can give you money back if the amount of the credit is more than you owe.

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four people making a business deal

When it comes to the deductibility of business expenses the answer is likely to be “Yes, No, Maybe So, or Not Now.” Here are a few examples to consider.

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401k nest egg

401k loans aren't reported on your federal tax return unless you default on them. Then it becomes a distribution and subject to the rules of early withdrawal.

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Amend spelled out with white blocks

If you need to amend your federal tax return, this is done on Form 1040X. Here are some dos and don'ts when filing an amended tax return.

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student loans

Yes, you can deduct student loan interest on your tax return if you meet the specific requirements to claim this deduction. The amount you can claim will vary.

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Yellow house with white fence

Before signing on the dotted line, it’s important to understand the potential tax, liability, and equity issues of transferring your house deed to your child.

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1040 tax return with handcuffs laying on top

Inmates are responsible for filing taxes. While you can certainly help your boyfriend file his taxes, you can’t sign and submit the return on his behalf.

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Woman working from home at her desk.

As part of the tax reform laws, the home office deduction was eliminated for all tax years from 2018 through to 2025 for taxpayers who are employees.

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distressed business owner looking at paperwork

The fact is that running your own business increases your chances of being audited by the IRS or your state tax agency.

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Woman reading letter

A Notice of Deficiency (aka Statutory Notice of Deficiency, Stat Notice, 90-day letter) is the last letter the IRS sends before making its assessment of tax due

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Family under umbrella that says Life Insurance

Life insurance premiums are generally not deductible on your tax return. However, there are few exceptions, such as life insurance premiums paid by a business.

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Wedding cake split with the groom on one side and the bride on the other

Some people can, and some people can’t. It depends on the date your divorce was finalized whether you fall under the new TCJA tax law.

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Top half of a clock drawn on a chalkboard with the word 'TAX' written above it.

The IRS’s  “Where’s My Refund” app should be your first your first destination to find out the status of your refund.

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Gift box wrapped in a five dollar bill with a red ribbon and bow on top

A bonus is considered a supplemental wage payment and is therefore subject to slightly different withholding guidelines under federal rules.  

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Boy standing in front of chalkboard with a finger on his chin

The first thing to do is to check every name and Social Security number listed on the return with what is listed on their Social Security cards.

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Money being handed over

While increasing allowances leaves you with more available funds throughout the year, it will have a rippling effect and your tax refund will decrease.

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Internal Revenue Service sign next to traffic light

Returns are being processed, and refunds are being issued. Things seem back to normal.

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Woman at desk with head down on tax forms, holding a pencil and calculator.

Below is a list of misconceptions and examples of misinformation taxpayers may encounter during the upcoming tax season.

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Victory

Here is a list of some of the taxpayers who will generally benefit from the new tax law.

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tablet with tax words displayed on it

Many people will likely owe extra money as a result of inadequate withholding because the new withholding tables were not accurate.

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Tax forms and a calculator that says Tax Help?

TCJA (The Tax Cuts and Jobs Act). Not since the Tax Reform Act of 1986 has there been a more sweeping reform of the tax code.

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Alimony spelled out with blocks with a stack of money next to it

Divorces finalized after 1/1/19 no longer required the spouse receiving alimony to report the income, and in turn, did away with the deduction for the payer.  

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1095-A Form

The Tax Cuts and Job Act presents many substantial changes to filing requirements; however, the reporting of healthcare coverage remains consistent. 

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Four Ice Cream Cones

So, what happens if you miss an Installment Agreement payment and/or can no longer make the agreed upon payments?

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Ice Cream Sundae

Of all the types of Installment Agreement requests, Streamlined Installment Agreements are the most varied and provide a bit of flexibility for the taxpayer.

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Magnifying glass over tax forms with crime scene tape

You can reduce your risk of falling victim to scammer's schemes by developing a basic understanding of what the IRS can and cannot do.

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Graduation Hats

For the American Opportunity Credit, a student is required to be in pursuit of a degree or recognized education credential and be enrolled at least half-time

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Woman on the phone holding nephew

When more than one person wants to claim a child on their tax return, sorting it out becomes complicated. Not only are there five tests to meet for a child...

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Colorful balls with numbers

Lottery earnings are generally reported on Form W-2G, taxed as ordinary income, and expected to be reported as “other income” on the federal tax return.

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Two bowls of ice cream

This blog post discusses the rules and fees regarding Guaranteed Installment Agreements for taxpayers whose tax debt is $10,000 or less.

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Bowl of Ice Cream

Sometimes it only takes six little letters to strike fear in the bravest of taxpayers: IRS IOU (technically, it's not an IOU, but rather a bill).

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Driver pointing to a smart-phone attached to the windshield

With the increasing popularity of ridesharing services such as Lyft and Uber, you may be asking yourself, “Can I make extra money doing this?”

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Pencil pointing to the words Amount You Owe on tax form

Congress reauthorized the IRS to use private debt collection agencies, or PDC, to collect outstanding tax liabilities.

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Path going through the woods

When a person is ineligible to receive a Social Security number, an Individual Tax Identification Number or ITIN must be obtained in order to file a tax return.

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Passport with Denied stamped across it

The IRS can request the State Department to revoke a currently active passport of a U.S. taxpayer with severely delinquent tax debt.

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$100 bills with magnifying glass and stock price chart

Your company offers you employee stock options. The paperwork says they are Nonqualified Stock Options (NQSO’s). You don’t quite understand what that means...

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Person backpacking in mountains

This scam involves cybercriminals approaching a tax preparer in the guise of a potential client, sending an email which asks about using the preparer’s services

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Money background with SCAM written on top with block letters

Thieves are creating convincing IRS CP2000 letters and sending them to unsuspecting taxpayers via the postal service and as an email attachment from the “IRS.”

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Person walking down steps with arrows going different directions

President-elect Trump has listed a series of major changes and reforms that he aims to make during the first 100 days of his presidency.

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Person receiving fast food

The IRS is currently offering this cash payment alternative at participating 7-Eleven stores in 34 states.

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Application for Health Coverage form

Some people can claim an exemption from the health insurance requirement, but everyone else needs to show the IRS that they are covered or else pay a penalty.

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Handcuffs laying on a 1040 form

I got a phone call from the IRS last week; well, the very-computer-sounding voice said it was the IRS. "Hello, this is the IRS. We've been trying to reach you"

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Man in swimming pool holding up trophy and Gold Medal

The IRS is well aware that the U.S. Olympic Committee pays medalists a cash bonus of $25,000 for winning gold, $15,000 for silver, and $10,000 for bronze.

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$20 bill, American Flag, and Capital Building

Did you know that when you owe money to the IRS that cannot be paid in full within four months or within six years on a monthly payment plan?

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Woman in white hat in a swimming pool

If my ex-wife lives with me and I provided more than half of her financial support will I be considered single status or head of household? 

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glasses and pen laying on top of tax form

You have three extra days this year to file, as 2015 federal tax returns are not due until April 18th(or April 19th for residents of Maine or Massachusetts).

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Woman relaxing by a lake

Form 1095-A, Health Insurance Marketplace Statement, is issued by the federal and state healthcare marketplace exchanges.

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Mom blowing bubbles with daughter on a couch

I’m legally married and live with my spouse. We file our taxes separately.Can I file as head of household while he files as married filing separately...

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Woman in white sweater

I have a question about a head of household. My ex-husband passed away, which left his mother needing someone to care for her. I took her into my home…

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Roof on brick house

I spent 30K on a new roof last winter after my old one collapsed under 100 inches of snow. Where do I report the cost of the roof on my taxes?

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Stock Chart

Hello fellow taxpayers. The Wily Tax Blogger is back to kick off 2016 with a new blog about an investment management tool I’ve discovered.

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Four glasses

Part of the return review may include the IRS contacting other third parties in order to validate the information listed on the return.

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Lite Christmas tree on the floating barge

Were you a good tax planner this year? We hope so. January is right around the corner, so let’s make a tax list and check it twice for last minute tax saving...

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Wrapped gift

We have our own marketing and design business. This year we ordered expensive gourmet chocolate gift baskets for each of our ten clients to thank them...

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Man working at desk holding a calculator

There is a lot of talk today in the press and on the campaign trail about corporate taxes. Where America stacks up in the world as far as corporate tax rates...

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Pencil on Monthly Expense Guidelines paper

There are only two months left in the year. What can I do now to avoid paying a big tax liablity on my Schedule C business next year?

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Block with Tax words on it

The letter you hoped would never come arrived. You open it and discover the IRS has graciously sent you an invitation to their work mileage deduction review.

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Crime scene tape and magnifying glass over 1040 tax forms

Tax nightmares aren’t just for scammers. They can happen to people who make innocent mistakes, and even to those who believe they are doing the right thing.

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$20 bill, American Flag, and Capital Building

In essence, the flat tax is a system of taxation where one tax rate is applied to some types of income with no deductions.

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books

Are Education Tax Credits Available When the Education Expenses are Covered by a Scholarship or Grant?

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hat

What do “Scarface” Capone and a tax audit have to do with each other? They actually do have a bit of a connection. Scarface went to prison for TAX EVASION!

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Stock Chart

I got a CP2000 notice from the IRS. It says I owe $12,269 for securities I sold in 2013. I purchased the stock in 2005 and sold it at a loss of almost $10,000..

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diamond ring

While I was working out at the gym, someone broke into my locker and stole my diamond ring. It’s my wedding ring and I always take it off before doing...

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house on top of a green hill

My boyfriend and I are buying a house together, and the property includes a rental apartment above the garage. How should we report our rental income?

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Glass globe on financial statements

I’m hoping you are relaxing somewhere with an umbrella drink after tax season. My wife and I are considering installing a solar electrical system on our house..

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hot cup of coffee

Starbucks? Coffee beans? Lattes? What do they have to do with taxes? Don’t worry, we will get to that! But first, let’s discuss your Golden Years again...

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businessman in wheelchair

Are disability payments taxable? This is a good question, but there is no correct general yes or no answer. The taxability of disability payments depends on...

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Woman

I do PR in the Bay Area. My hairstylist says I can deduct my entire salon bill on my taxes because it helps me look good at events. Is this correct?

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Couple sitting in chairs relaxing on the beach

You remember you hit the snooze button on preparing your 2014 return in April and filed an extension. As you put the chips and salsa in the car, scenes...

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path going through forest

I want to donate to my favorite politician’s 2016 campaign for our state’s House of Representatives. Are there limits to how much I can deduct?

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1040 Pie Chart

To increase the business offerings at my mailbox rental business, I became a Notary Public this year. So far I made about $1,000 from my notary service.

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Rx bottle that says Affordable Care Act

I received a 1095-A form for health insurance info from the Vermont Health Insurance Exchange/Marketplace after I had already filed my taxes.

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Pen, calculator, and blocks that spell out TAX on financial papers

I would really appreciate some advice on filing estimated taxes. Please let me know if you provide this service.

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Person on computer attempting ID theft

The IRS estimates they received over 2.4 million fraudulent returns for the 2013 filing year. If you’ve been the victim of this type of crime…

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stacked books, diploma, and graduation hat

Since 2008, college costs in the U.S. have risen 30%.Many folks' salaries are not keeping pace.

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inside of church

My husband spends a lot of time printing church service bulletins and other special design and print jobs. Can he deduct the time he works as a volunteer?

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Old orange truck

What is the best option are for getting rid of an old vehicle? Should I donate it for the auto valuation guide value of $ 3,000 or sell it now for $1,500? 

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houses

My husband and I bought a home. We sold our old house a few months later. Will the profit on the old house be taxed if we do not roll it into the new house?

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Roof on brick house

The expenses I paid out on my rental were $12,000 more than my rental income, yet my tax return shows a deductible rental loss of zero. Why?

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Tax scammer

These thieves use a legitimate taxpayer’s name, address and social security number to file a fraudulent return claiming a large refund, and then divert...

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Internal Revenue Service building with traffic signal in front displaying a red light

If you get audited, do they send a letter or do they call you? In most instances, the IRS will send you a letter notifying you of the audit.

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Yellow sign that says Retirement Ahead

You want to save money towards your retirement, but your employer does not offer a retirement plan, such as a 401(k). You are not alone...

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Two men fixing a roof

I inherited a home in 1988 from my father. I sold that home during the 2014 tax year at a gain. I did considerable renovations on this property...

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young toddler girl in a swing

What do I do with a stepdaughter who doesn't live with us? She is in college and lives with her mom. How do I list that? My husband pays child support.

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Block with Tax words on it

You have your traditional IRA account invested at your bank but you are not happy with the rate of return. You’ve heard that it’s possible to move your IRA...

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Calculator and pen on top of 1040 tax forms

My wife made a $5,000 contribution to her IRA in last year. Through using TurboTax, we learned that we don't have the earned income to support a deduction...

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Green sign that says Retirement Next Exit

You just found out your Uncle Jerry passed away and that he had listed you as the sole beneficiary to his traditional IRA account. You go down to the bank...

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Personal Development, Guiding Skills, Help, Coaching, Learning

My wife is training to begin her career as a life coach. Can the expenses of her training, including tuition, room, board & travel, be tax deductible?

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boy with glasses thinking

In the Fall my son will go to college and I will be paying his tuition. Can I still claim Head of Household status for my taxes while he is attending college?

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woman hitting the snooze button on alarm

You may not be feeling the groove just yet. It’s been a long winter, and you are hoping that maybe the deep freeze caused the IRS to forget about you this year.

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Woman

My boyfriend and I have been living together for nine years. Can we file a joint tax return this year? 

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Rx bottle that says Affordable Care Act

You might have thought that with the new Health Care Reform more of all the money you spend on health insurance and medical expenses would be deductible.

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woman on the phone holding baby

I am a policy and procedure writer for a company. Due to my long commute, my boss lets me work from home one day a week. Can I write off my home office?

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Couple sitting in chairs relaxing on the beach

You have been talking to your financial advisor or hear in the news how great Roth IRAs are and that you should be contributing to a Roth IRA.

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Calculator that says Tax Help? on top of 1040 tax forms

How long does it take to get my refund if I e-filed my taxes? It seems like I should have received it by now.

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keyboard that says Crowd Funding

Crowdfunding is a popular way to raise funds for businesses, charities and individuals. It occurs when someone asks others to contribute to their idea or cause.

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man and woman getting married

My wife and I are preparing our taxes, and, due to her employment situation(s) and our investments, we have received a number of 1099s...

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Retired couple relaxing on a boat

I have a confession to make: I’m thirty, single and have about a hundred dollars in my savings account. In addition, I have no retirement plan!

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speedometer

I do not a get car allowance for my job in media sales. I do not log a report of my driving but typically I average 20k miles a year due to all the driving...

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Students wearing graduation hats

With the costs of obtaining a Master of Business Administration skyrocketing, often costing up to $80,000, you might be wondering, is my MBA tax deductible?

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Doctors and nurses walking down hospital hallway

My brother was moved to a nursing home/memory care unit. He had to live in the nursing home area until the memory care unit had an opening. When he was in...

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Internal Revenue Service building with traffic signal in front displaying a red light

Are you short on cash and don’t have the money to pay your tax bill? The IRS does have a few options for the taxpayer who is cash short at tax time.

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W-2 Wage Statement

 filed my tax return, and then a W-2 came in the mail for a job I worked earlier this year that I had forgotten about. How do I file this? 

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three bars of gold

I am considering buying Gold Bullion. I am 68 and do not plan on using an IRA of any kind for this. What are the tax implications of buying gold?

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Woman exhausted doing taxes

Are you gathering all your necessary tax documentation now? Great time of year, isn’t it? Ha ha. Preparing your taxes will be a piece of cake...

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books, diploma, and graduation hat

If you have started a family, you know there are many things to take into consideration, including planning for your child’s education. 

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house on top of a green hill

My wife and I bought a townhouse in 2014. What tax deductions can we take?

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two people looking over financial charts

My wife has an IRA under professional management with a financial advisor here in Portland. Can we deduct the fees charged for his services?

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bacon

There is some misconception in the words “head of household.” Yes, in the ordinary sense of the term you may be head of household, but when it comes to taxes...

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Pie Chart with 1/3 a 1040 tax form

Is this additional income from Social Security tax-free, or will it be added to my Gross Income for the year and be taxed as such?

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$100 bill

The holidays have come and gone, footballs are filling the air as bowl games and playoffs are well underway, and it’s time to start thinking about…taxes.

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Tax scammer

What form do I file with the IRS for 2014 for a fraud case where I lost lots of money. The fraud case was adjudicated and the offender now sits in Fed Prison.

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glasses and pen laying on top of tax form

I retired from my main source of employment due to some health issues, but I am not ready for Social Security and I am not yet retirement age at 57.

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people examining retirement portfolios and graphs

You inherited a retirement account, and you opted to transfer the assets into a beneficiary or inherited IRA. What now? The “what now” depends on whether RMDs..

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Woman looking at receipts with calculator and 1040 tax forms on desk

Is there a threshold as to when a married couple filing jointly would fall under the AMT? There is not a threshold, per se. AMT, or Alternative Minimum Tax...

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TAX spelled out with tiles

Want to pay less taxes on inherited retirement accounts? Beneficiaries have options available that  may result in increased benefits and less taxes due.

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Dress Shirts

I use suits for work, and the dry cleaning expense is substantial. I don't use the suits outside of work. Can I deduct the dry cleaning as a business expense?

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The Grinch

The holiday season is a time for giving, but if you don’t follow the carefully prescribed rules for charitable giving, the IRS may disallow your deduction.

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Gift wrapped in five dollar bill

I’ve never been married and I have no children. I’ve been successful in my career and have some money saved. I want to give my six nieces and nephews $20,000

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Yellow house with white fence

I just had my home refinanced to a lower interest rate and to a 15-year fixed mortgage. What are some of the things that are associated with refinancing...

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Retirement Ahead Sign

Did you retire this year or turn 70 prior to July 1st? You may have think about Required Minimum Distributions (RMDs).

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houses

We had solar put on our house this year. Is it tax deductible? A tax credit is available for qualified solar electric property costs and qualified solar water..

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401k nest egg

As the end of the year approaches, the holidays are probably more on your on your mind than saving on your taxes.

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$100 bill wrapped in a bow

Inheriting money is kind of nice for people. You have usually done nothing to earn it but be born. You most likely have not worked for it. 

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identity theft

 received a phone call from IRS telling me that I owe them $2,500. They said they sent me a letter in January of 2014 that I signed for telling me the errors...

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Rx bottle that says Affordable Care Act

We heard about it all the way back in 2010, but the Individual Mandate − or Minimum Essential Coverage − did not go into effect until this year.

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Block with Tax words on it

My husband passed in February of this 2104. We have always filed a joint return. What do I need to do this year?

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Hands holding a heart

We loaned our car to a missionary home for a visit and fundraising. Can we deduct the mileage as a charitable contribution?

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Man using a calculator

This installment of Know Your Pro will introduce you to a different kind of Pro here at TaxAudit.com. With in-depth knowledge of all the services we offer...

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Student desk with books and apple on it

I have a daughter who is eligible for the American Opportunity Tax Credit of $2,500.00. Can she also use the Lifetime Educational Tax Credit of $4,000.00?

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Football Field

Sunday during the fall is a huge day of the week for many Americans. Namely, the sporting fiends with professional football fever. The National Football...

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Roof on brick house

I had a new roof put on the house. Is it tax deductible? A new roof is generally considered to be an improvement to the structure.

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Ocean

We have an off-shore account, set up in 1998 when they weren't reportable. But now under the Foreign Account Tax Compliance Act, the accounts are reportable.

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Calculator that says Tax Help? on top of 1040 tax forms

A long time ago, before there were tax software programs, before our social welfare programs were written into the Internal Revenue code, and when Federal...

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Nurse helping woman

My wife is a nurse, but she does not have a degree. She is interested in taking classes to get a BSN degree - a bachelor of science in nursing.

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Little boy blowing bubbles

I took care of my three nieces and a nephew (all under 17 years of age) up until the end of last month, August 28, 2014, to be exact. I claimed these kids...

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Blender

Uncle Sam expects to see that Fair Market Value (FMV) listed on your tax return for that tax year as income.

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RV driving on the road

Can I claim the interest I pay on my RV on Schedule A as mortgage interest on a second home? As long as your RV loan is secured by the RV and the...

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Flood

Casualty losses can happen to taxpayers, such as a fire caused by a faulty heater. Do you have copies of your important documents in a safe place? 

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House on top of stack of money

If I'm going to do home repairs, such as a roof and heating, which will cost about $15,000, would it be better to take out a home equity loan to pay for it or..

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Woman filling out a tax form

When it comes to proving deductions taken on a tax return, the burden of proof is on the taxpayer, according to the Internal Revenue Code (IRC). 

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Spoon full of vitamins

I had bariatric surgery and must take a number of vitamins daily. These vitamins are purchased over the counter without a prescription.

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Dictionary with the focus on the word Taxpayer

If you made an mistake on your taxes or omitted required information, such as a late-received W-2 or K-1, you can file an amended return on Form 1040X.

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Woman filling out a tax form

It’s still not too late to make adjustments to your withholding or estimates to make sure your 2014 taxes will be done correctly and you will not be surprised..

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Wooden walkway towards beach with palm trees

We live in Florida, and we are thinking about buying a second home in Maine for the summer months. Will we be able to deduct the mortgage interest on our taxes?

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Woman holding house keys

We bought our home in 2009, in Arkansas, did major improvements, and then leased it out from 2010 though 2014. We now have the place up for sale...

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Clock pointing the time hands towards the word TAX

The overall percentage of individual tax returns examined in 2013, published by IRS, is about 1%; however, this number only takes into account “examinations”

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Nurse helping woman

My brother is in assisted living; what part of his expenses can be deducted? He needs assistance with getting dressed and all daily hygiene activities.

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Soldier Saluting the American Flag

Let’s talk about business deductions for members of the military. The same rules apply for active duty personnel and reservists.

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houses

My personal residence cost basis is higher than the expected sale price. Is there a way to get a tax benefit from a loss on this property?

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3 Armed Forces Members

If you are a member of the U.S. Armed Forces, there are tax breaks written just for you. Merchant Mariners and American Red Cross employees do not qualify...

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Ocean

We have been asked to build some basic boxes to be used as a stage for a company. They plan to pay us but are not placing us on their payroll as employees.

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Dice

If you like to gamble, you probably already know that your gambling winnings are considered income, especially if you gamble within the United States.

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Yellow house with white fence

I completed a short sale in 2014 and was wondering if it’s possible to avoid taxes on the difference. I sold it for $142,000, the bank got $127,000, and the...

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Man asleep at desk

Years ago, I was just like most people when it came to taxes. Just the thought of doing my tax return gave me hives. I had been burned twice at tax time...

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Flooded street with sign that says High Water

My house got water in it this past month. I needed to clean up the mess, replace the carpet, pad and doors.  My insurance would not cover the loss.

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boy with glasses thinking

1. Taxes Might Be Your Biggest Expenditure 2. Many Major Life Decisions Have Tax Consequences 3. Knowing About the Latest Tax Breaks Could Save Money 4. Taxes..

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Application for Health Coverage form

Now that the furor, for the most part, over the Affordable Care Act has subsided a bit, let's take a quick look at the PENALTY for not abiding by this law?

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Lake at the base of mountains

I live in Georgia but work in the oilfields of Alaska as a Form 1099-MISC contractor.  Am I allowed to deduct my airfare and hotel and meal expenses for travel?

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Supreme Court

This decision is likely to impact many taxpayers, particularly anyone expecting to inherit an IRA from a parent or someone else.

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Retirement Ahead Sign

I would like to know if I need to declare my Roth IRA and traditional IRA accounts on my tax return even if I haven't contributed to them in the last 4 years.

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Dress Shirts

Could you advise on how the value of items is determined for charitable contributions? I am about to donate several of my designer suits to charity. 

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Gavel

Yes, Uncle Sam loves lawsuit settlements just like plaintiffs do. Before you start spending the money, there are some things you need to know.

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Man with ball and chain attached to leg

Tired of feeling like the government is taking your last penny? Having trouble making ends meet? There is a solution – provided you are willing to move.

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stacked books, diploma, and graduation hat

We adopted our grandson three years ago - he is now a freshman in high school. When he goes to college, will his tuition be tax deductible? 

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Woman in white hat in a swimming pool

I bet you all do not want to even see the word TAX right now! I know what you are doing. Lying in your hammock or lounging by the pool drinking a lemonade.

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Dictionary with the focus on the word Taxpayer

For several years, National Taxpayer Advocate Nina Olson has been arguing for the simplification and codification of taxpayer rights and responsibilities.

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Man on couch talking to Psychotherapist

My wife has her own business as a psychotherapist and is the only person involved, i.e., she has no employees. She frequently has to submit claims to insurers..

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glasses and pen laying on top of tax form

There are so many ways that taxpayers have tried to do an end run on the tax system that the IRS issues an updated consumer alert each year titled...

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Divided wedding cake with groom on one side and the bride on the other

Taxpayers who must pay alimony to a former spouse may deduct it from his/her tax return as an adjustment to income.

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Room partially painted

How do you know if you have spent substantially full time repairing and maintaining a rental property when you stay in it so it doesn't count as a personal day?

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Internal Revenue Service building with traffic signal in front displaying a red light

The IRS generally won’t look for you unless you owe them money. If you don’t file for a refund within 3 years of the original due date of the return...

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Tax Return Preparer Credentials

All paid tax return preparers are required to have an IRS PTIN (Preparer Tax Identification Number) which they must enter on the tax returns they prepare.

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Rolled up receipt

If you have a dedicated credit card for your business, can you use the statement as the receipt for your business entertainment, meals, travel, etc.?

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change button on a keyboard

Do feel motivated to give money to an organization after the last hurricane/tornado/flood/fire? Did you get a phone call, email, personal appeal by someone?

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Basketball resting on a Basketball Court

While we call it the “Jock Tax,” it really is a tax that does affect a variety of people, but we are focusing on the NBA because of the extensive travel habits.

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The word TAX spelled out with tiles on paper money and next to a stack of coins

I hate allowing the government an interest free loan. This year I had a penalty for owing too much at the end of the year. So my question is: how…

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drive through window

First job ever? What do you do about those pesky tax forms they gave you at the job? How do you fill them out? Why are they taking all that money out!?

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Handcuffs laying on a 1040 form

We took out a home equity loan to redo our basement. The contractor did not perform the work as agreed and what was performed had to be torn out...

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The Capital

Some of the more popular tax breaks the bill would have extended are the tuition and fees deduction; the state and local sales tax deduction...

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Handcuffs laying on a 1040 form

My son was arrested in December of 2012 and spent the entire year of 2013 in jail awaiting trial. During that year I paid his attorney fees, car payments...

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man laying on grass relaxed

You may have heard that if you are self-employed, or you are expected to entertain clients as part of your job, you can deduct the costs of those meals...

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Woman until holding up key by model of house

I have a good friend who owns two rental homes here in California. The tales he tells regarding these “assets” are not for the faint of heart.

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church

Is there a tax benefit to making a charitable contribution to my church directly from my IRA rather than writing a check and deducting it from my tax return? 

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Piggy bank with handcuffs hanging on it

Continuing on with Scams 8-12, let’s look at the third set of scams in The Dirty Dozen. False Income, Expenses or Exemptions: Another set of scams...

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Handcuffs laying on a 1040 form

Continuing on with Scams 5-7, let’s look at the second set of scams in The Dirty Dozen:  Return Preparer Fraud: Most preparers are honest, and want the best...

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Homes surrounded by mountains

I bought a house in Arizona in 1996 for $95,000. I did two cash-out refi’s totaling about $30,000 through 2004. I sold the house in 2014 for $165,000, and..

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Crime scene tape and magnifying glass over 1040 tax forms

Every year during awards season, the IRS announces its list of the Top Twelve Scams of the Year, or, The Dirty Dozen. Watch for these scams and report them...

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Clock pointing the time hands towards the word TAX

You got your return filed on time and you’ve got a nice big refund coming. But the funds don’t show up in your bank account when you expected them to. Now what?

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Woman blowing bubbles on couch with child

My two children live with my ex. He is the custodial parent but we have joint custody. I pay child support and they come over to my house almost every weekend.

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Financial charts and graphs

I recently filled out an online tool on a financial advisor website. It had some catchy feel good name like Dream Catcher or something of the like.

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Retirement Ahead Sign

If you are a 20 or 30 something - people in this age group should have saving for retirement at the top of their list of things to do.

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Woman at the Dentist

I took out a medical loan for $36,000 dollars for full mouth restoration by two dentists due to infections. My insurance only covered $890. Can I deduct it?

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TAX DAY written with blocks

You owe money to the IRS – now what? Don’t faint, don’t freak out, and don’t worry! There are simple ways to take care of that balance due.

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Tax Day and April 15th stamps by stack of papers

The April 15th deadline is approaching. Taxpayers are most likely to make errors on returns when they are rushing to finish their returns before the deadline.

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dog sitting on green chair

I travel for a living and my company knows I have pets. I have to have them kenneled when I am traveling for work.  Can I expense the cost of the kennel stay? 

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Piggy bank

Under 59½? Need some extra cash? Don’t use your retirement! It isn’t a savings account or a piggy bank to be used to buy an extra pizza on Saturday night

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Money

If you are upset about the national debt, you can make a deductible charitable contribution to the Bureau of the Public Debt to help out.

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401k nest egg

If your employer allows you to borrow money against your 401(k), you are essentially using the 401(k) balance as collateral for the loan and you usually make...

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Man and Woman riding in a red car

I use my car in my business. How much of it is tax deductible, and what type of travel is deductible? Are my trips going back and forth to work deductible?

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Cube with Tax words on written on it

A refund is NOT a bonus and a balance due is NOT a penalty. When you began working, you filled out a W-4 stating how many exemptions you wanted.

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Woman blowing bubbles on couch with child

Household employers: Did you hire someone to care for your children in your home? Do you have a gardener, a handyman, or a chauffeur?

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Yellow house with white fence

I gave my daughter $10,000.00 for a down payment on her house. It was earmarked in our trust to be paid to her on our death. I inherited the money from her...

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TAX spelled out with tiles

They say that happy employees make for happy customers, and at TaxAudit.com those happy employees start with managers like Eric.

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Pie Chart with 1/3 a 1040 tax form

Enter Dave Du Val! Dave is our Vice President of Customer Advocacy and among many other things, a tax expert. He sat down with me and set my head straight.

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houses

We recently bought our 1st home via FHA mortgage, which included monthly mortgage insurance premium (MIP). In addition, an "up-front" MIP amount (UFMIP)...

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Calculator and Stethoscope

Feeling sick? Broke a foot? Broke a tooth? Kids in braces? Are these deductible on your taxes? Well – maybe. Medical, dental, and even alternative health care..

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Key in locked box

The fastest way to get your money without paying additional fees is to e-file your return and have the money Direct Deposited to your bank account.

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Partially painted room

I was an owner contractor on the restoration of my house. I bought some used construction equipment to do the work, items like gas powered pressure washer...

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Silhouette of Micheal Jackson

Michael Jackson stirs up many good memories for me. I mean he is the Elvis of my generation. I vividly remember getting his Thriller record for Christmas...

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city

In a recent case of tax evasion, Ty Warner, the creator of “Beanie Babies” was hit with $53.6 million in penalties for hiding money offshore.

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Money wrapped in a bow

Our adult Sunday School class had a Christmas project of supplying Christmas clothes and toys for a needy family with several children and a disabled father. 

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identity theft

Tax scams increase exponentially during the income tax filing season. If you want to avoid being a victim, be aware that when someone offers you a “chance of...

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Family in swimming pool on a raft

I lived with my younger cousins, ages 11 and 4, in 2013 except for about 2 months when I stayed with my father while he was sick. I provided more than...

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Scammer

Phone Scams: There are numerous phone and internet scams claiming to be the IRS (or other government agencies). Do not give personal information to anyone...

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Hand holding stack of 100 dollar bills giving it to another hand

In order to qualify for an Earned Income Tax Credit (EITC) of up to $6,044, you must first meet these two qualifications: You must have earned income...

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ipad

As for an individual with a business, it is beneficial to research what is on the market in regards to business accounting software. There are numerous...

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Gold Record

I’m sure you remember when Susan Boyle became an overnight web sensation. Since then, thousands of hopeful musicians, writers, artists, and dancers...

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stack of large books

 It’s a long story that begins long before the arrival of the first Form 1040 Income Tax Return of Annual Net Income of Individuals...

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expert highlighted

Introducing Carolyn Richardson! Our highly effective and experienced tax audit professional from Hawaii! With her three decades of tax experience,…

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Donation Box full of sweaters

You cleaned out your closets, attic and garage this year and took all of those piles down to your local charity drop-off location. (I bet that felt good.) 

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Tips

Here are some simple tips to help you reduce your audit risk: Proofread your tax return A mistake on just one figure or item can present IRS audit flags…

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1040EZ

Taxes! Usually, this word creates a strong emotive reaction. We older people tend to not remember the days back when we first filed our very first 1040 EZ.

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Woman filling out a tax form

It’s that time of year when taxpayers begin to get massive headaches. If you feel your head pounding, following these simple tips could save you more pain.

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Tax Time written out on a calculator

Have you ever thought about New Year’s Tax Resolutions? What can I do better when it comes to my personal and business taxes?

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This blog does not provide legal, financial, accounting, or tax advice. The content on this blog is “as is” and carries no warranties. TaxAudit does not warrant or guarantee the accuracy, reliability, and completeness of the content of this blog. Content may become out of date as tax laws change. TaxAudit may, but has no obligation to monitor or respond to comments.