134
votes
Accepted
I have sole custody of my child but the child's father's brother claimed him as a tax deduction
Your E-file return will be rejected if you are the second person to file, so you should file a paper return claiming your child, and you'll get your refund as you filed it.
You and the other party ...
108
votes
How can I achieve a 13% U.S. Federal tax rate?
Sanders had the following itemized deductions on his 2014 return:
$22,946 on home mortgage interest
$14,843 on real estate taxes
$9,666 on state and local income taxes
$8,000 in monetary gifts to ...
- 116k
107
votes
Accepted
Tax on gambling winnings with social security number
This was a really bad idea, on so many levels for so many reasons.
Your friend accepted a tax liability that was more than the cash he got.
Your friend involved himself in a fraud. When the IRS comes ...
100
votes
Accepted
Isn't "I bought [blank] as a tax writeoff" complete nonsense?
I would say yes and no. I have spoken with people that don't want to pay off their home because they are getting a tax deduction on the interest. I've done the math for all of them and none of them ...
- 1,444
91
votes
Accepted
selling appreciated stock vs gifting it to charity
This might be a strange notion but people donate to charity because they... want to donate to charity.
That's it.
Now, if you are going to donate to charity, donating an appreciated stock may be ...
- 1,588
88
votes
Tax on gambling winnings with social security number
To expand on RonJohn's answer (and make it more explicit):
Your friend met a complete stranger who asked for his SSN. The stranger promised him $20k. The best case scenario is that your friend loses ...
- 962
77
votes
I have sole custody of my child but the child's father's brother claimed him as a tax deduction
You need to call the IRS at 1-800-829-1040 and explain that you are the custodial parent. The IRS service representative will tell you what to do.
Generally what will happen is that you will re-...
- 9,795
70
votes
Is the Standard Deduction better than Itemized when both are the same amount?
Another reason to use standard: audit
If you get selected for an audit of your itemized deduction or a specific category (e.g. all medical expenses or all charitable contributions) then at best you ...
- 1,337
61
votes
Minimize taxes now that I earn more
Congratulations on an amazing rise on salary. Please pat yourself on the back for such an accomplishment.
The best thing you can do is to hire a competent tax specialist. Here in the US, it is ...
- 78.5k
57
votes
How can I achieve a 13% U.S. Federal tax rate?
There are two big problems with your complaint from the start: You are comparing federal taxes with total taxes, and you compare the tax rate with the marginal tax rate. Normally you pay a low tax ...
- 23.8k
51
votes
Borrowing money to buy shares for cashflow?
Buying individual/small basket of high dividend shares is exposing you to 50%+ and very fast potential downswings in capital/margin calls. There is no free lunch in returns in this respect: nothing ...
- 5,768
48
votes
Deducting charitable donations under new U.S. tax law
I’m in the same boat as you. Charitable contributions make up the majority of my itemized deductions, and I probably won’t be itemizing next year. Here is how I look at it:
If I end up taking the ...
- 116k
45
votes
Accepted
Why did the federal government ever allow taxpayers to deduct their state taxes from their federal taxes?
At the end of 2017, President Trump signed into law the Tax Cuts and
Jobs Act with among other things eliminated the federal tax deduction
for state taxes paid.
The state and local tax (SALT) ...
- 70.8k
40
votes
Isn't "I bought [blank] as a tax writeoff" complete nonsense?
It is possible that some people may avoid additional income out of fear they may lose welfare benefits. If you currently have $30k of income and $5k of benefits, you might not want to earn an ...
- 2,781
37
votes
Someone offered tax deductible donation as a payment method for something I am selling. Am I getting scammed?
Is it worth considering? It's up to you, of course, how can we tell.
The proposal is this:
You donate your camera to the non profit. The non-profit provides you an appropriate receipt for the donation....
- 181k
35
votes
What's my tax situation if I earned $20k, age 22, and live with parents?
There are no pure income requirements when claiming someone as a dependent - the main requirement is that your parents need to have provided more than half of your support for the year. Since they ...
- 140k
35
votes
Tax on gambling winnings with social security number
Gambling winnings are taxed when you file just like normal income so your roommate will now have to pay federal tax on $100,000 income (between 24% and 40% federal, depending on when it is reported ...
- 140k
34
votes
Accepted
Married filing jointly, can one of us take the standard deduction while the other itemizes?
The standard deduction for married filing jointly is 2x the standard deduction for filing single or married filing separately.
When filing jointly you either itemize or take the standard deduction ...
- 70.8k
32
votes
Accepted
Can I expense when buying my own lunch
It depends. If you’re on a business trip or entertaining a client then yes. However, regular lunches are not deductible on your taxes since it isn’t a business need.
As always, when in doubt, work ...
- 10.2k
30
votes
Why would a previous year's tax deductions affect the current year's taxes?
Last year you deducted all of the state tax that was withheld from your paycheck in 2016 off of your income.
But then you did your 2016 state income tax return, and the state sent you some of that ...
- 116k
28
votes
How can I achieve a 13% U.S. Federal tax rate?
The premise that the Sanders' effective tax rate of about 13% is "amazingly low" is also false.
In tables assembled from tax data by the Tax Policy Center, we can see that the average effective ...
- 1,997
28
votes
Accepted
Can I deduct my rent from UK taxes when working from home?
You can't use rent as a tax deduction, after all you'd need somewhere to live whether you worked at home or not.
You can claim for additional costs if your employer has asked you to work from home ...
- 5,085
28
votes
Accepted
The Government might have seized my investment assets, how do I treat them on my tax return?
Can I declare them as stolen?
Of course not, it wasn't stolen.
Just 100% capital loss?
No, you haven't yet incurred the loss.
According to the guidance from the Fund manager (Franklin Templenton), ...
- 181k
26
votes
Does the IRS reprieve those who have to commute for work?
No. Regular W2 employees cannot deduct housing or transportation costs related to their employment.
However, in the US, many employers offer Parking and/or Transit FSA programs which are usually ...
- 49k
25
votes
Accepted
How will getting married before the end of the year impact this year's taxes?
First off, the decision about marriage should be first and foremost about what is best for the both of you personally, rather than financially.
That said, my guess is that it's not in your ...
- 35.9k
24
votes
Can I take the self employment healthcare deduction if I get my insurance through my employer?
The amount the employee pays for health insurance premiums is not included in your W-2 Box 1 income. As a result, it is automatically deducted, and you do not pay tax on that portion of your income. ...
- 116k
24
votes
Deducting charitable donations under new U.S. tax law
Probably the best approach which can work very well depending on your cashflow and the giving in question (whether it's time sensitive or not):
2018: save all $20k in the bank
January 1, 2019: give ...
- 4,186
24
votes
Why did the federal government ever allow taxpayers to deduct their state taxes from their federal taxes?
The state tax deduction lets you deduct state taxes paid from your taxable income for calculating the federal tax that’s due, not from the federal tax paid. Suppose you pay state taxes of $2,000 and ...
- 23.5k
23
votes
Accepted
Can I use the new tax law to help with private school?
I think you are misunderstanding how a 529 plan works. Contributions to a 529 plan are not tax deductible on your federal return. The money you put in there is after tax. The tax advantage comes as ...
- 116k
Only top scored, non community-wiki answers of a minimum length are eligible