Investment-Related Deductions

Most Confusing Parts Of The Income Tax Code, Part 7: Green Tax Credits

Many provisions of the Internal Revenue Code are complicated. Proper interpretation of the rules and regulations contained in these provisions requires the assistance of an experienced and knowledgeable tax professional. This is another installment of our series about the most confusing provisions of the Internal Revenue Code. It addresses green or energy tax credits, such as the Solar Investment Tax Credit. A tax credit is a dollar-for-dollar reduction of the income taxes that an individual or business taxpayer claiming the credit would pay the federal government.

Why Are They Confusing?

  • Rule changes occur frequently causing taxpayer confusion

Trump’s Tax Plan Then And Now, Part 1

What specific tax plan will Donald Trump implement as President of the United States? Trump’s initial plan released in September 2015, set forth four tax brackets of 0%, 10%, 20% and 25%. In October, just prior to the election, he released a new plan that adopted the House Republicans’ approach using three tax brackets, 12%, 25% and 33%. Either plan seems to adopt aspects of the tax reform pursued by House Republicans, as the president-elect moves closer to the Republicans’ tax agenda. Here’s a look at Trump’s tax plan then and now.

The Effects Of Trump’s Tax Plan On Individuals And Businesses

Donald Trump’s most current tax plan promises to save taxes for most individual taxpayers. One way is the elimination of the alternative minimum tax. What are some other ways? Trump’s tax plan:

  • Adapts the current rates for qualified capital gains and dividends to the new brackets.
  • Eliminates the head of household filing status.
  • Eliminates the Net Investment Income Tax.
  • Increases the standard deduction from $6,300 to $15,000 for singles and from $12,600 to $30,000 for married couples filing jointly.

The Most Overlooked Tax Deductions, Part 8

This is the eighth part of our series of blogs on the most overlooked tax deductions. In this blog, we will attempt to summarize the first half or group of prior articles in the series. For a more a detailed overview, see the blogs themselves!

JOB & MOVING DEDUCTIONS

Job Search Expenses

As long as the position of employment sought is in the same line of work as a current or most recent job, job search expenses may be deducted as miscellaneous expenses if itemized.

Moving Expenses for a First Job

Finally! Congress Enacts Tax Extends Part 2

The Consolidated Appropriations Act of 2016, enacted Dec. 18, 2015, extends a long list of expired tax provisions into the future. Unlike past extension legislation, Congress extended many provisions permanently. In more traditional fashion, some of the others were extended for five years, and many for two years. The Joint Committee on Taxation estimates that the total cost of the tax provisions in the bill will be $622 billion over 10 years.

These tax breaks include but are not limited to savings for teachers, parking and transit benefits, and certain charitable contributions which will be discussed in this blog. Without Congress extending these various provisions, millions of Americans were in danger of losing these beneficial tax breaks by 2017.

Top Tax Deductions for Seniors and Retirees

Here are some of the most important tax deductions for seniors and retirees. 

  1. Higher standard deduction.

Any taxpayer that is 65 and older by December 31 of the tax year is entitled to a higher standard deduction. Taxpayers may take the higher standard deduction if a spouse is age 65 or older and together they file a joint return. Also, the higher standard deduction may be taken if the taxpayer files a separate return and can claim an exemption for a spouse because the spouse had no gross income and can’t be claimed as a dependent by another taxpayer. 

The Most Overlooked Tax Deductions, Part 2

Many taxpayers overlook the long list of deductions that they may take when completing and filing their tax returns. The IRS has estimated that millions of taxpayers overpay their taxes each year because they fail to avail themselves of all of the possible deductions. Here is the second part of our multi-part blog on the most overlooked tax deductions:

 INVESTMENT RELATED DEDUCTIONS

Amortizing Bond Premiums

The IRS offers assistance for taxpayers who purchase taxable bonds for more than face value. The purpose of such a purchase is to capture a yield higher than any offered by current market rates. Down the road, the IRS will tax the extra interest that this higher yield produces.

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