Avoid Tax Traps in Loans to Friends and Family
Lending to friends and relatives is a tricky business, and not only because of the stress it can place on your relationships. There are tax issues involved as well. If you have to lend money to someone close, here are some tips to do it right in the eyes of the tax code. Charge Interest,…
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A Tip on Tip Reporting
If you are like millions of taxpayers in the service industry, you may receive tips. The tax code is clear; if you receive tips you must report them as income. Some employers have systems to make this easy. Others do not. Here are some suggestions: Proper Tip Reporting Has Three Components (Think 1-2-3) Keeping a…
Avoid the Gambling Winnings Tax Surprise
With the increased popularity of lotteries and casinos, more unsuspecting winners are experiencing a lucky payday only to end up with a huge tax head-ache when filing their income taxes. Here is what you need to know: What Should Be Reported When it Comes to Gambling Wins? You are required to report as income any…
Income the IRS Can’t Touch
Wouldn’t it be nice to have a source of nontaxable income? You may be more fortunate than you realize. Listed here are a number of income items that the IRS does not tax. Tax-Free Interest. Municipal bond interest is federal tax-free. This includes bonds issued by a state or municipality. The tax-free benefit increases the higher…
Tips to Organize Your Tax Records
Creating order out of chaos As important tax records start filling mailboxes, how can you make sure your tax preparation goes smoothly and efficiently this year? Here are some tips: Keep it all in one place. It seems obvious, but how often have you found yourself going through piles of paper looking for that elusive missing…
Play the Match Game. Or Else…
A great tip to stay out of the audit spotlight. One of the best audit tips available can be summed up in one simple word. Match. Spend a minute or two pretending you work for the IRS. What would you do to identify tax returns worth auditing? If you suggest matching filed tax returns with…
