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The federal income tax tables do not give you your “true” tax rates. Here’s one example: the net investment income tax (NIIT). It’s a hefty 3.8 percent on top of what you pay according to the table rates. If you own rental property, you’re one of the NIIT’s prime...

Do you give money to your church? Do you get a tax benefit from those donations? How about your donations to other charities? Recent changes in the tax code have done much to destroy your benefits from church and other tax-deductible 501(c)(3) donations. But there’s a way to donate...

The IRS Classification Settlement Program (CSP) offers a chance to settle your employment tax debt due to worker misclassification if you do not qualify for Section 530 relief. CSP agreements typically result in a substantial reduction of assessed employment taxes, especially if you misclassified workers over several years. The...

It isn’t easy to make predictions, especially about the future. But there is one prediction we’re confident in making: you will have substantial out-of-pocket expenses for health care after you retire. Personal finance experts estimate that an average retired couple age 65 will need at least $300,000 to cover...

You have heard the horror stories about mail sent to the IRS that remains unanswered for months. Reportedly, the IRS has mountains of unanswered mail pieces in storage trailers, waiting for IRS employees to process them. Because the understaffed IRS is having so much trouble processing all the documents...

The generally favorable partnership federal income tax rules are a common reason for choosing to operate as a partnership with multiple partners instead of as a corporation with multiple shareholders. The most important partnership tax rules can be summarized as follows: You get pass-through taxation. You can deduct partnership...

If you have a home that you both rent out and use personally, you have a tax-code-defined vacation home. Under the tax code rules, that vacation home is either a personal residence, or a rental property. The tax code classifies your vacation home as a rental property if you...

When you own more than one business, you need to consider the grouping rules that apply for passive-loss purposes. Should one of your businesses lose money, you may not deduct the losses from that business during the current tax year unless you materially participate in the business or, if...

Tax law has an amazing break for unconventional homeowners. You can deduct your mortgage interest payments even when the deed to the house and the mortgage are in someone else’s name. Here’s what happened to Sue Davis. Sue could not personally qualify for a home loan. Her parents stepped...

Don’t let this happen to you. Here’s what happened to Mr. Kazmi. First, a little background. Urgent Care Center Inc., an Illinois corporation, employed Mr. Kazmi as a part-time hourly bookkeeper. He had no ownership interest in Urgent Care.He was not an officer of Urgent Care.His name was not...

Working at a tender age is an American tradition. What isn’t so traditional is the notion of kids contributing to their own IRA, especially a Roth IRA. But it should be a tradition, because it’s a really good idea.  Here’s what you need to know about IRAs for kids....

Let’s say you own the building.  Now, let’s say that you rent this building to your business. With no tax planning, you have a self-rental, and that makes rental income from this building nonpassive, meaning that it cannot offset any passive losses (very bad); and makes rental losses from...