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FEATURED CONTENT
Side Hustles and Tax Tussles: Tax in the Gig and Share Economy Part Three
The past month we've explored how side hustles can affect your client's taxes. You're now equipped to help them avoid most side hustle tax tussles, but there is one other major area of the gig economy that we must cover. That is when your clients decide to share their personal property for a fee. Don't confuse this concept of the share economy with your client renting out real estate, like we discussed in part 2. The IRS has a different definition for personal property, one that does not include real estate. Which, you guessed it, means there are different tax implications. To help you avoid tax tussles for your clients, we're going cover the following: ● What's the difference between personal property and real estate? ● Where do we report personal property rental income? ● What can we deduct from personal property rental income?
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CURRENT EDITION
Navigating IRS Penalty Relief and Forgiveness
Yes, the IRS does forgive some tax penalties. The IRS refers to this forgiveness as penalty abatement. Abatement is the act or process of reducing or removing something. In this case it is removing or reducing a penalty. But penalty forgiveness is not a blanket offer that everyone qualifies for the way the radio ads make it seem. There is a process that the IRS has for requesting and granting abatement. It is up to the taxpayer to prove that they qualify for abatement. That’s where you come in.
From The Government And Not There To Help You
The story of James J. Maggard has some interesting and possibly valuable lessons. The one that strikes me as particularly important is that it makes it crystal clear that disproportionate distributions contrary to a corporation’s governing documents will not blow its S election. That does not mean that disproportionate distributions are just fine and that you don’t need to address them. There is a practical lesson about being careful who you take on as fellow shareholders. And there is another slightly odd lesson, that almost makes me want to create a new law of tax planning: Don’t deliberately involve the IRS in your business disputes. Their job is not to help you.
Tax Policy and Reform Considerations for the Next President and 119th Congress
Something we never have a shortage of are proposals to change our tax systems. When it’s election time, we hear even more proposals, as well as how various parts of our tax system are flawed, usually due to actions or inactions of the opposing party. We also hear lots of incomplete statements, promises of tax changes too costly to be enacted, and ideas that will be replaced by the time the winner gets down to crafting a real set of tax and budget proposals. This article describes some of the tax proposals of the two presidential candidates along with suggestions on how we should analyze them against principles supporting effective tax systems, with highlights of some important facts seemingly missing from current tax discussions. These proposals are also relevant to members of Congress as to whether they support any of them and how they align with tax changes that the member would like to see enacted.
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Think Outside the Tax Box provides tax reduction strategies along with practical
implementation advice in order to reduce your clients’ federal tax bill with ease.
