The Tax Professionals Blog
Using a Traditional IRA as an Income Diversion Tool
Posted by Lee Reams Sr. on
Making a deductible Traditional IRA contribution in one year and then converting it to a Roth IRA in the next year has the effect of moving the income from the first year to the second year. For example, a taxpayer made a Roth contribution in 2016 and then later it is determined his income in 2017 iwill be in a substantiallyDeducting Local (Within Tax Home) Lodging
Posted by Lee Reams Sr. on
IRS regulations permit certain non-away-from-home lodging expenses to be treated as deductible business expenses by the employer and tax-free working condition fringe benefits or accountable-plan reimbursements to the employee. The regulations provide a safe harbor; local lodging expenses are treated as ordinary and necessary business expenses if all these conditions are met (Home Office, Bonus Depreciation & Sec 179 Considerations
Posted by Lee Reams Sr. on
Where a taxpayer’s Schedule C is negative or close to negative, there are issues that should be considered when claiming the home office, the Sec 179 expense, and the 50% bonus depreciation. Determining which combination produces the best current result while preserving future deductions may require trial and error with combinations in your tax software.Home Sale Exclusion – Unforeseen Circumstances
Posted by Bold Apps on
A reduced exclusion applies to any sale or exchange if a taxpayer doesn’t meet the ownership, use or once-every-two-years requirements due to a change in the place of employment, health or (to the extent provided in regs) unforeseen circumstances. The reduced exclusion applies if any of the following are true:
Timing the Moving Deduction
Posted by Lee Reams Sr. on
Taxpayers who move because of a change of work location may deduct certain related expenses. The moving expense deduction is available for both employees and self-employed individuals if specific conditions are met; this includes taxpayers starting their first job. When moving expenses exceed reimbursements, the excess is an adjustment to gross income.