Taxes - My Tax Return

How could I have taxable capital gains on a mutual fund that is worth less today than it was last year?

Asked Sunday, October 01, 2000 by an anonymous user

CPA Answer:

Fund managers buy and sell stocks throughout the year. When the managers sell stocks with a large gain, that share of the capital gain must be allocated to you and everyone else in the fund even though the balance of the portfolio includes unrealized losses and the fund is down in value.
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Miscellaneous Income

Coin collection

Asked Friday, September 29, 2000 by an anonymous user

CPA Answer:

The sale of your coin collection would be a sale of a capital asset reportable on IRS Schedule D.
It would fall into the category of collectibles and be taxed at a maximum rate of 28%.
Certain newly minted silver or gold coins issued by the government qualify for the lower 20% maximum capital gains rate even though they are considered collectibles.
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Miscellaneous Income

Stamp collection

Asked Friday, September 29, 2000 by an anonymous user

CPA Answer:

The sale of your stamp collection would be a capital asset reportable on IRS Schedule D. It would fall into the category of collectibles and be taxed at a maximum rate of 28%.
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Miscellaneous Income

Antique vase - Sale

Asked Friday, September 29, 2000 by an anonymous user

CPA Answer:

The sale of your antique vase would be a sale of a capital asset reportable on IRS Schedule D. It would fall into the category of collectibles and be taxed at a maximum rate of 28%.
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Taxes - My Tax Return

Is there a limit to the amount I elect to rollover into a SSBIC ?

Asked Friday, September 29, 2000 by an anonymous user

CPA Answer:

The amount of the annual rollover gain to an SSBIC is limited to $50,000 (25,000 if filing MFS).
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Rental Expenses

Are the Lawyer fees I paid at my residence property closing deductible?

Asked Friday, September 29, 2000 by an anonymous user

CPA Answer:

For a residence, the additional costs you incurred are not deductible in the current year. They will be added to your basis for use in the calculation of gain or loss upon disposition. Examples of additional costs are lawyer fees, commissions, survey costs, title insurance, and recording fees. Any mortgage interest and or real estate taxes are deductible in the current year.
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Rental Expenses

Is the advanced rental income I received reportable in the current year?

Asked Friday, September 29, 2000 by an anonymous user

CPA Answer:

Generally yes, For Cash basis taxpayers, prepaid rents or advances of rental income are reportable in the current year. Enter your total rental income and expenses on IRS Schedule E.
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Rental Expenses

Is the security deposit I received on my rental property taxable in the current year?

Asked Friday, September 29, 2000 by an anonymous user

CPA Answer:

If there is an agreement between you and the tenant that the security deposit will be used for the final rent payment, then it is included as rental income in the current year. If this is not the case, then it should not be included as income.
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Rental Expenses

Are my rental losses fully deductible?

Asked Friday, September 29, 2000 by an anonymous user

CPA Answer:

The total amount of your rental losses may be limited in the current year. If they are limited, the limited amount may be carried forward to future years. There are "passive loss" limitations involved with rental properties.
If you have rental income from other rental properties or other passive entities, you may use the rental loss to offset that passive income.
If the rental loss exceeds the passive income, the excess loss of up to $25,000 may be allowed if there is "active participation" associated with the activity and if your Adjusted Gross Income is less than $100,000 ($50,000 for Married Filing Separately).
For Adjusted Gross Income between $100,000 and $150,000 there is a phase out. If the Adjusted Gross Income is more than $150,000, then no part of the $25,000 Special Allowance is allowed in the current year.
Any disallowed loss in the current year may be carried over to future years. In general, "active participation" means you make management decisions. The passive loss limitation calculation is done on IRS Form 8582 and the 8582 worksheets.
Speak to your local CPA about your rental loss deductibility.
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