Tax

Focus on inflation-hedged assets. Precious metals, I-Bonds and real estate are all considered inflation hedges. Crypto is a speculation not an investment as can be seen by both its recent downfall and the increasing number of crypto thefts. 1. Precious Metals: a. Stock in mining companies i. PRO – familiar and safe market ii. CON…

Once your tax lien is fully paid off, you must still ask the IRS to withdraw the lien. The IRS will withdraw the lien immediately if the lien is paid in full and you have been tax compliant for the past three years. The cool thing about the removal of the lien is it is…

Sweet Deal Businesses can deduct the full cost of new and used qualifying assets with lives of 20 years or less that they buy and place in service during the year. A used asset can not have been depreciated by the previous owner. So, for all practical purposes, the asset purchased cannot be real estate,…

To qualify as a real estate professional, you must meet two time requirements. 1. You must spend more than 50 percent of your time in real estate activities in which you materially participate. 2. You must spend more than 750 hours in real estate activities in which you materially participate. Real estate activities include real…

First, does it even matter? Yes, it does. If the sale is classified as an investment sale you pay only income taxes on the gain. If you held the property for over one year you would get favorable long term capital gains treatment. On the other hand, if the sale is classified as a sale…

The $250,000 ($500,000, if married) home sale gain exclusion break is one of the great tax-saving opportunities. The $250,000 ($500,000, if married) home sale gain exclusion break is one of the great tax-saving opportunities. To take full advantage of the principal residence gain exclusion break, you must pass two tests: the ownership test and the…

Because cryptocurrencies are classified as “property” rather than as securities, the wash-sale rule does not apply to them. (The wash-sale rule prohibits a taxpayer from deducting a loss on a sale of an investment that was replaced with the same or a “substantially identical” investment 30 days before, on the day of the sale, or…

WHAT’S ALL THE FUSS ABOUT BEING A REAL ESTATE PROFESSIONAL (OR FOR SHORT AN REP)? (There are so many traps for the unwary) You, as a taxpayer, may only offset losses from a passive activity against income from a passive activity. Passive activities include all businesses of a taxpayer that you don’t materially participate in…

What do You do if You Don’t have Enough Money To pay your Taxes? Maybe you should apply for a Payment Plan. What is a payment plan? A payment plan is an agreement with the IRS to pay the taxes you owe within an extended time frame. You should request a payment plan if you…

What is a Health Reimbursement Arrangement? A health reimbursement arrangement (HRA) is a legal plan that reimburses employees for qualified medical expenses up to an IRS approved amount. The reimbursements are deductible by the company. The HRA must be funded solely by an employer. The contribution cannot be paid through a voluntary salary reduction agreement…