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In general, the IRS is only interested in value retained from sales or services. If the sale or service you are involved in does not result in any gain to you and is the result of the mere change of the form of an investment, then it is nontaxable. This status of certain investments is conferred by what are called non-recognition provisions that occur throughout the tax code.
→ Read MoreThe question of what types of interest payments are tax deductible used to be a simple one, but since 1986, the law governing tax deductible interest payments has become very complicated. The general rule is that interest payments are tax deductible, but there are many exceptions to consider when filing taxes.
→ Read MoreIf your silent partner in your corporation has mismanaged corporate funds, the funds you invest in the corporation may be used to pay unpaid taxes from periods in which you held stock in the corporation. If you are aware of errors in accounting or tax payments in a corporation in which you hold stock, contact an experienced business attorney immediately.
→ Read MoreIRS audits are among the most feared situations for most taxpayers, in part because they are so invasive and carry with them the potential for back taxes to be assessed, as well as the potential for additional interest, fines and other penalties to be assessed. Fortunately, there are far more taxpayers than there are IRS employees available to do audits, so the IRS must be choosy about who it decides to audit in any given year.
→ Read MoreForgetting to send tax documents with a tax return is a common occurrence. You can rest assured that no adverse action will be taken against you for forgetting to attach a W-2 form or other forms as long as you submit the forgotten tax documents when the IRS requests them. Generally, the Internal Revenue Service (IRS) considers most tax returns filed as valid and may or may not require taxpayers to submit additional tax documents.
→ Read MoreA capital gains tax is essentially a tax on a profit made from the sale of a capital asset, and is assessed depending on the nature of the asset sold. For example, if you sell a rental house at a substantial profit, the proceeds would be subject to a capital gains tax. Capital gains taxes do not cover the general sale of inventory, so if you operate a small business out of your home the proceeds on the sale of your product would not be subject to a capital gains tax.
→ Read MoreIf you believe that someone is violating federal tax laws, the best way to report to the IRS is by filling out a 3949-A form. Fill out and print the form and mail it to the Internal Revenue Service Center, Fresno, CA 93888. Another way to report IRS fraud is to call the IRS at 1-800-829-1040 for the Criminal Investigation Hotline in your area. Failure to file tax returns is a form of tax evasion. Tax evasion amounts to using illegal means to avoid paying owed taxes, and is a federal crime.
→ Read MoreThe overall limitation on miscellaneous itemized deductions, captured on Schedule A, based on your adjusted gross income, no longer applies in 2018 because of the 2017 Tax Cuts and Jobs Act. However there may be other limitations that impact the amount you can claim.
→ Read MoreThere are four main types of deductions available on your pesornal income tax return: business deductions, above-the-line deductions, itmemized deductions, and the standard deduction. Business deductions are deductions for the cost of operating a business or being self-employed. Above-the-line deductions, on the front page of Form 1040, may be deducted whether you are able to itemize deductions or not. Itemized deductions are deductions that you may use in place of your standard deduction. Standard deduction is available to taxpayers who choose or cannot take itemized deductions.
→ Read MoreHow are alimony and child support payments taxed?
→ Read MoreFind the right lawyer for your legal issue.
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