Make Your Hobby a Business … Carefully
Many people dream of making money pursuing a favorite hobby. By starting a sideline business, you could be eligible for a treasure chest of tax deductions. Warning: The IRS and the U.S. Tax Court often denies losses if the taxpayers have no written business plans, don’t do any advertising, and keep poor records. If you follow certain…
Collect Tax-Free Profit From Selling Your Home
Whether the residential real estate market is up or down, there are always homeowners who want to — or have to — sell their homes. If you’re a prospective seller making your property look like a model home in the hopes of raking in a nice profit, now is a good time to review how taxes…
Bad Debt Losses: Can You Deduct Loans Gone Bad?
The IRS is always skeptical when individual taxpayers claim deductions for bad debt losses. Why? Losses from purported loan transactions often fail to meet the tax-law requirements for bad debt loss deductions. For example, a taxpayer might try to write off a capital contribution to a business entity that underperformed. Or a taxpayer might have advanced…
IRS Increases Annual Gift Tax Exclusion for 2018
The IRS has announced that the annual gift tax exclusion is increasing next year due to inflation. After five years of being stuck at $14,000, the exclusion will be $15,000 per recipient for 2018 — its highest point ever. Section 529 Plans: Make Five Years of Gifts in a Year Normally, a gift made directly to…
Keep Tax Reform Proposals in Mind When Making Last-Minute Year-End Moves
As 2017 winds down, it’s time to consider making some moves to lower your federal income tax bill and position yourself for tax savings in future years. This year, the big unknown factor is whether major tax reform proposals will be enacted. Even if all goes according to the GOP timeline, the changes generally won’t take…
HSAs: A Great Tax-Saving Opportunity
Health Savings Accounts (HSAs) are gaining popularity. These accounts were originally created in 2003, to provide tax-favored coverage for individuals with high-deductible plans. Later HSAs got a facelift when a law was passed which made these accounts even more beneficial. Thanks to the Tax Relief and Health Care Act of 2006, HSA participants are now allowed greater deductible…
Get the Money You Need
You know the drill: It’s midnight and your grant proposal is due tomorrow. Your assistant left hours ago, and the words on the computer screen start to blur. “It’s not worth it,” you think. And besides, only a few grants pan out anyway. Grants are a big part of the not-for-profit world. And yet, according to…
Yes, You Need a Contract
Whether you’re an environmental organization raising funds for a lawsuit or a community group needing new equipment, you may want to sell something to raise money. You may not think it’s necessary for product vendors and not-for-profit groups to have written agreements, but most professionals generally agree that some form of contract is prudent and accomplishes…
Rx for Itemizing Medical Expenses
Medical expenses can be costly — and they’re not always covered by insurance. But there may be a silver lining: You may be able to claim an itemized deduction for the amounts you pay for medical, dental and vision care, if you incur enough costs to exceed the applicable threshold for the tax year. Here are…
How Does Divorce Affect Social Security?
If you’re divorced, it’s possible to claim Social Security spousal and survivor benefits from your ex-spouse, and to keep the entire matter private. The Social Security Administration (SSA) will not inform your former spouse about the application or the payment of benefits. Gaining access to this benefit can provide an extra boost in income when it’s…