Category Archives: Income
Most individuals are aware of the tax benefits of selling a principal residence. Section 121 of the IRS code allows for the exclusion of up to $500,000 (for those filing married filing jointly) of the profit from the sale if the property was used for at least two in five years as a principal residence. […]
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Traditional and Roth IRA distributions are due a 10% penalty if you take them ahead of time, but there are exceptions for early withdrawal that let you skip the fine. In retirement when you look for a tax-advantageous way to save on retirement, an IRA can fit the bill. Typical IRAs offer an upfront tax […]
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Did you know that the IRS considers any forgiven debt as a source of income and that taxes must be paid on that “revenue.” And if you’ve ever settled a debt for less or had debt forgiven completely, you’ve likely received a surprise in the mail coming tax season the Form 1099-C. A 1099-C reports […]
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The overhaul made a significant change to the alimony payments tax status. For divorce and separation agreements signed after 2018, payers will not be able to deduct alimony on their tax returns. At the same time, future recipients will no longer be required to report these payments as income, making their tax treatment similar to […]
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The tax law did not changed the favorable rates for long-term capital gains and many dividends, and there is still a popular zero rate for these types of investment income. For 2018, the zero rate applies to jointly filed married couples who have a taxable income of up to $77,200 ($38,600 for singles). A rate […]
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The tax overhaul retained the existing benefit for home sellers. Jointly filing married couples can exclude $500,000 from taxes on the sale of a primary home. The exemption for single filers is $250,000 in profit. For inflation, these amounts are not indexed. For example, say Sam and Suzan bought a home for $150,000 many years […]
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If you try to determine the difference between taxable and non-taxable income, remember one basic fact: All income that is not specifically excluded by law is taxable. In essence, any money you receive in the form of wages or tips for work is taxable. In addition, any revenue you earn from property or services, whether […]
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It can be stressful to deal with the loss of a job, even if you have just been laid off. You’re struggling to find out how to meet the ends, and unemployment benefits can be the answer to the help you’re looking for. You must remember, though, that they are taxable. You must include any […]
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More people are required to submit 1099-MISC forms throughout the country, as the IRS is diligent in ensuring that you pay your taxes–even if you are an independent contractor. Your customer sends the IRS a 1099-MISC form, which the IRS compares with the form you submit. It’s a bad idea to ignore a 1099-MISC because […]
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There are a variety of Form 1099 one may receive when collecting their tax documents. If you’re a worker, you won’t fill out the form yourself, but will receive it from the party who paid you or holds your investment account. Its one of the few tax forms that simply report information and you aren’t […]
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