Image from www.mightytaxes.com If you own a property that you rent out for an average of less than 7 days for the calendar year, you may not have to report it like a rental property, aka business. It’s a tricky situation that requires careful evaluation of how often you rent the home throughout the… Continue reading CRUCIAL TAX REPORTING TIPS FOR AIRBNB PROPERTY OWNERS
Image from www.goqbo.com Do you have a sideline activity that you think of as a business? From this sideline activity, are you claiming tax losses on your Form 1040? Will the IRS consider your sideline a business and allow your loss deductions? The IRS likes to claim that money-losing sideline activities are hobbies rather than… Continue reading Crucial Tax Tip for Business Owners
Image from www.cedaradu.com Personal Use of a Dwelling If you have a home you rent out, but also use as a personal residence, the tax deductions you can take are slightly different than if you just rented the property out and never used it for personal use. A dwelling unit is considered used for personal… Continue reading Tax Treatment of a Dwelling Unit
Image from www.https://elderpark.org If you work for yourself, you know how hard it is to swallow the 15.3% self-employment tax you must pay. But did you know there are ways to lower it and one way is to rent to your spouse? It sounds crazy, but if you own an office building or other… Continue reading Killer Tax Saving Strategy for the Self-Employed
Image from www.henssler.com Many business people don’t realize the tax benefits they’re passing up when they don’t take a deduction for 100% of their business meals, thanks to the new IRS rules. Thanks to COVID, for the calendar years 2021 and 2022, most business meals can be deducted at 100% versus 50%. Of… Continue reading How to Deduct 100% of Your Business Meals
Image from web.blockadvisors.com Before you deduct your travel expenses, it’s important to determine if they are truly business expenses or the IRS will consider it a personal day. There is a fine line between both and understanding the differences will ensure you file your taxes correctly. To be clear, we are talking about overnight business… Continue reading How to Claim Tax Deduction for Business Travel
Image from www.premieroffshore.com What would it be like to have the IRS owe you money? Great, right? While it seems too good to be true, there are ways to lower your tax liabilities so you pay the IRS less money. Here are the top ways to make it happen. Use the IRS Safe Harbor… Continue reading Last Minute Tax Deductions
Did you know you can hire employees for your Schedule C business, and you’ll get several tax credits as a result? If you offer any of the following, learn the tax credits you may be eligible to receive. Family Medical Leave – You can offer your employees paid time off to deal with family… Continue reading Killer Tax Credits for 2021
Each year we get closer to our retirement, giving us less and less time to make sure we have plenty of money saved up for our golden years. Retirement planning can be a very valuable tool when it comes to tax planning and wealth building. Here are some additional tax benefits: Claim the Retirement Plan… Continue reading New Retirement Planning Tax Credits
If you’re a real estate agent, you’re likely self-employed, which means you’re responsible for both sides of the taxes. The self-employment tax is 15.3%, versus the 7.65%, W-2 employees pay with the other half being paid by their boss. When you are paid as an independent contractor (1099), you are both the employee and… Continue reading Simple But Vital Tax Saving Strategy for Real Estate Agents
Essential Tax Tips for First-Time Homebuyers
First-time homebuyers often face a unique set of tax challenges and opportunities that can significantly impact their financial situation. Understanding the available deductions and credits can help new homeowners save money and reduce their tax liabilities.
For instance, first-time homebuyers may qualify for the Mortgage Interest Deduction, which allows them to deduct interest paid on their mortgage. Additionally, they can benefit from the First-Time Homebuyer Credit, which provides a tax break for those purchasing their first home, making it crucial to consult a tax professional to maximize these benefits.
Maximizing Deductions for Home-Based Businesses
Home-based businesses can take advantage of various tax deductions that can lower taxable income significantly. By understanding what qualifies as a business expense, entrepreneurs can ensure they are maximizing their deductions and keeping more of their earnings.
Common deductions for home-based businesses include a portion of home utilities, internet expenses, and home office costs, provided that the space is used exclusively for business activities. Keeping thorough records and receipts is essential to substantiate these claims during tax season.
Understanding Capital Gains Tax on Real Estate Sales
When selling real estate, understanding capital gains tax is crucial for property owners to avoid unexpected tax liabilities. Capital gains tax applies to the profit made from the sale of a property, and knowing how it works can help sellers make informed decisions.
Homeowners may qualify for the primary residence exclusion, which allows them to exclude up to $250,000 of capital gains ($500,000 for married couples) if they meet certain ownership and use criteria. This can significantly reduce the tax burden upon selling a home, highlighting the importance of strategic planning in real estate transactions.
Tax Implications of Real Estate Investment Trusts (REITs)
Investing in Real Estate Investment Trusts (REITs) can provide significant tax advantages for investors looking to diversify their portfolios. Understanding the tax implications of REITs is essential for maximizing returns and ensuring compliance with tax regulations.
REITs often distribute most of their taxable income to shareholders in the form of dividends, which are typically taxed at a lower rate than ordinary income. Additionally, investors can benefit from the 20% Qualified Business Income deduction under certain conditions, making REITs an attractive option for income-seeking investors.
Essential Tax Tips for First-Time Homebuyers
First-time homebuyers often face a unique set of tax challenges and opportunities that can significantly impact their financial situation. Understanding the available deductions and credits can help new homeowners save money and reduce their tax liabilities.
For instance, first-time homebuyers may qualify for the Mortgage Interest Deduction, which allows them to deduct interest paid on their mortgage. Additionally, they can benefit from the First-Time Homebuyer Credit, which provides a tax break for those purchasing their first home, making it crucial to consult a tax professional to maximize these benefits.
Maximizing Deductions for Home-Based Businesses
Home-based businesses can take advantage of various tax deductions that can lower taxable income significantly. By understanding what qualifies as a business expense, entrepreneurs can ensure they are maximizing their deductions and keeping more of their earnings.
Common deductions for home-based businesses include a portion of home utilities, internet expenses, and home office costs, provided that the space is used exclusively for business activities. Keeping thorough records and receipts is essential to substantiate these claims during tax season.
Understanding Capital Gains Tax on Real Estate Sales
When selling real estate, understanding capital gains tax is crucial for property owners to avoid unexpected tax liabilities. Capital gains tax applies to the profit made from the sale of a property, and knowing how it works can help sellers make informed decisions.
Homeowners may qualify for the primary residence exclusion, which allows them to exclude up to $250,000 of capital gains ($500,000 for married couples) if they meet certain ownership and use criteria. This can significantly reduce the tax burden upon selling a home, highlighting the importance of strategic planning in real estate transactions.
Tax Implications of Real Estate Investment Trusts (REITs)
Investing in Real Estate Investment Trusts (REITs) can provide significant tax advantages for investors looking to diversify their portfolios. Understanding the tax implications of REITs is essential for maximizing returns and ensuring compliance with tax regulations.
REITs often distribute most of their taxable income to shareholders in the form of dividends, which are typically taxed at a lower rate than ordinary income. Additionally, investors can benefit from the 20% Qualified Business Income deduction under certain conditions, making REITs an attractive option for income-seeking investors.
