What Affects OIC
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What Affects OIC

On February 23rd, the U.S. Tax Court filed T.C. Memo. 2022-5 deciding whether the Office of Appeals abused its discretion in rejecting an offer-in-compromise (OIC) . The United States Tax Court found no abuse of discretion and granted summary judgment in favor of the IRS. Why? The petitioner submitted form 12153 timely requesting Collection Due…

When a husband says, “We are partners,” what does he REALLY mean?
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When a husband says, “We are partners,” what does he REALLY mean?

The husband ran a successful medical practice earning over $650,000 in gross income. He employed his wife as a sales representative and paid her a little over $30,000/year. The couple had four small children. The wife didn’t participate in her husband’s meeting over finances and management.
The IRS found that the medical practice underreported its income by over $100,000. Over $40,000 tax liability notice of deficiency was mailed to the couple. The couple also faced a significant penalty for the underreporting/ underpayment.

IRS’ application of petitioner’s remittance after the tax liabilities has been assessed constituted a payment of that tax liability.
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IRS’ application of petitioner’s remittance after the tax liabilities has been assessed constituted a payment of that tax liability.

On December 28th, 2021 the US Tax Court reviewed and decided whether “the taxpayer has paid more than was owed, where such a determination is necessary for a correct and complete determination of whether the proposed collection action should proceed”. (per T.C. Memo. 2021-142 UNITED STATES TAX COURT Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent…

Investment Strategy
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Investment Strategy

Investment Strategy. Options. Important. This post is NOT investment advice. Investments in Etrade options are NOT FDIC-insured and may lose value all the way to $0. Buying puts/shorting a stock has severe or unlimited risks.  Day trading option has very big leverage and serious potential to profit (or to lose money). One of my favorite…

What is new in tax filings for 2020 tax period?
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What is new in tax filings for 2020 tax period?

IRS tax forms change all the time. The most beneficial way to find the latest forms is: IRS.gov/latestforms IRS.gov/allforms IRS.gov/draftforms IRS.gov/formchanges IRS.gov/formsupdates Sometimes forms are not updated by the April 15th. You can view a draft of the form to see approximate expectations of what might be new and changed. For example, in 2018 form…

What’s New In 2020 Tax
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What’s New In 2020 Tax

What’s new in 2020 tax? Let’s recap 2020 deductions from adjusted gross income: jury duty 199A deduction capital losses unemployment benefits repayments foreign housing (limitations applies) unreimbursed travel expenses (National Guards and Reserve members) certain attorney fees unreimbursed employee expenses self-employment medical insurance certain moving expenses (limitations apply) 50% SE tax now you can deduct…

Loopholes of your 2020 tax return. Plan for them now!
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Loopholes of your 2020 tax return. Plan for them now!

Energy credits for home and vehicle: (IRS source)?Internal Revenue Code Section 30D provides a credit for Qualified Plug-in Electric Drive Motor Vehicles, including passenger vehicles and light trucks. For vehicles acquired after 12/31/2009, the credit is equal to $2,500 plus a car that draws propulsion energy from a battery with at least 5-kilowatt hours of…

College Tax Credit
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College Tax Credit

College Tax Credits What does the U.S. tax code say about college tax credits? 26 U.S. Code ??25A.American Opportunity and Lifetime Learning credits The code says, there are two credits that shall be allowed against the tax imposed by this chapter for the taxable year the amount equal to the sum of? (1)the American Opportunity…

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What’s New at Qualified Business Income Deduction?

Section 199A -Qualified Business Income Deduction What business are eligible: available to individuals with Qualified Business Income C-Corporations and pass-through entities are not eligible. Qualified Business Income may be generated by Sole proprietors S-Corporation partnerships trusts estates and reduced by self-employment tax, self-employed health insurance, contributions to retirement plans, etc Real estate – taxpayer chooses…

Like-kind Exchanges

IMPORTANT! There are new updates to this tax topic that have not been added here yet. As you already know, the Tax Cuts and Jobs Act removed personal property from the deferred tax treatment for like-kind exchanges. In most real-estate changes some amount of personal property is still included.? Likely, there is a proposed regulation…

Like-Kind Exchanges

Like-Kind Exchanges As you already know, the Tax Cuts and Jobs Act removed personal property from the deferred tax treatment for like-kind exchanges. In most real-estate changes some amount of personal property is still included.? Likely, there is a proposed regulation that states that if the personal property was transferred together with the real estate…

Financial Planning

Financial Planning

Financial Planning Financial Planning Doesn?t Start One Day Before the April 15th Tax Filing Deadline. Is it April 15th and you are dragging your tax files to your accountant, thinking, ?I wish I put money in a retirement account this year so I don?t have this huge tax bill now??Right? So, let?s review what retirement…

Tax Saving Strategy

Tax Saving Strategy

Tax Saving Strategy HSA as a tax savings strategy. I?m sure you have heard of HSA as a tax savings strategy. Now, let?s talk more about it, in case, you missed out on the key benefits of it. ? Let?s start by saying that a Health Savings Account (HSA) is a tax-advantaged (pre-tax) savings account….