If you think you’ve been a victim of a tax identity theft, you should call the IRS immediately. The IRS Identity Protection Specialized Unit can be reached at 1-800-908-4490. The more paperwork you have to prove you are whom you claim to be, dating as far back as possible, will help your claim. You’ll also […]
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Are you investing in the cryptocurrency market? Last tax year, did you sell some Bitcoin or other type of cryptocurrency? If so, you treat the investment the same as capital assets, similar to a stock or bond. Any gains or losses are taken against the market value of the cryptocurrency when you first acquired it. […]
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A 529 plan is maintained by the state to help residents save for college. You aren’t eligible to deduct contributions made to a 529 plan, but your contributions will increase tax-free for as long as it remains saved in the plan. Even if you use the money for qualified educational expenses, earnings continue to be […]
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At tax time, you have to be cognizant of any sales of houses or other real estate that you made during the past year, as they can have tax implications. You’ll need to report the sale of your home or other structures, including land (with added improvements or not) and interest in condos and cooperative […]
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A homeowner who has a home in foreclosure can expect to receive a Form 1099-A from the lender. This form reports all the necessary information you’ll need to file your tax return in relation to your home foreclosure. Capital Gains In the eyes of the IRS, a foreclosure is the same as if you sold […]
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Saving for retirement with an IRA or other tax-advantaged account will generate a Form 5498 from your financial institution at the beginning of tax time. Your financial institution also sends the IRS a copy of the form, which documents how much you contributed to your IRA during the year. Information Reported The Form 5498 reports: […]
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You’ll receive a Form 1099-B from your broker whenever you sell investment securities. Form 1099-B lists the pertinent information about your sales, including date, description and proceeds, and if known, your cost basis. Investment gains and losses affect your taxes, so you’ll have to report all the required information about your investments when you file. […]
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There are many different Form-1099s that you may encounter when tax season rolls around. Some of the most common include: 1099-A: If your mortgage lender cancels some or all your mortgage, or your home was sold in a short sale, you’ll likely receive a 1099-A. Because the IRS considers canceled debt to be equivalent to […]
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Certain payments, depending on the circumstances, may be tax-free, despite other similar payments resulting in being taxed. The following three situations require special care to determine if the payment is tax-free. Legal Settlements: To determine if your court settlement should be taxed, you need to consider the reason the settlement was granted, and if it […]
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Gross income minus any deductions is defined as taxable income according to the IRS. Gross income is determined to be “all income from whatever source derived” according to federal law. That covers a large portion of income, including not just earned income such as your salary, but investment income and other unearned income. If you […]
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