Tax Filing Tips

Tax Filing Tips

Implications for Responsible party using SSN for filing with IRS for EIN/TIN

We’ve set up a VA corp wholly owned by our UK parent. One US citizen officer (VP of Growth) could be listed as IRS responsible party to get EIN instantly, or we can file with a foreign director (slower). What are the implications for her if she’s the responsible party now and later removed via 8822-B? Any ongoing exposure/liability? Or if indeed she remains as responsible party and isn't removed? What are the implications if she leaves the business?

Tax Filing Tips

Sales Tax in Florida

I am an independent author and want to sell my books at a local convention. How do I collect and then submit the sales tax?

Tax Filing Tips

Tax Implications of Family Funding for EB-5 Visa

Hi All: I am trying to understand the tax implications around borrowing vs receiving as a gift, half a million dollars from my family (brother). I am exploring options to apply for an EB-5 visa and need $800,000 to do so. I am partially funding it through my savings, and the rest will be covered with help from my family. I want to understand what the most tax-efficient way of doing so is (both for my brother, who will be gifting the money, and me, who will be receiving it). Thank you, Best, Abh

Tax Filing Tips

Taxes on gambling winnings

I am getting some confusing information on gambling winnings that I hope you can clarify. I have approximately $28,000 in W2G events in a casino app. But, in the app my year end win/loss shows a win of only approximately $3,000. Do I report the whole $28,000 in income? And if so, can I also deduct the $25,000 loss if I itemize?

CPA Answer:

How you heard about me?

Answer Provided by: CPAdirectory

Tax Filing Tips

Filing cash income

If I am being paid cash to work for someone (who says they will not be claiming that on their taxes) how do I file mine? Am I considered self employed and should expect to pay self employment taxes on a 1040? Something else? Do I have to say who paid me, and if so, will that get them in trouble? I'm trying to prepare but also figure out if I've gotten myself in a bad situation or not. Thank you for your help!

CPA Answer:

Without knowing anything about the type of work involved, it’s a little more difficult to give an answer.

First, presumably, you’re working and being paid as an individual and not working through a company. Second, I assume you’re not going to receive a Form W-2 at year-end from the individual who is paying you. If both of those assumptions are correct, then, you would be considered self-employed. I am not getting into the issue of whether you should be properly classified as an employee or as an independent contractor, as that issue has its own intricacies. By nature of the fact that the person paying you says he/she will not claim any write-off on his/her taxes, it sounds like you’re not being treated as an employee (as treating you as an employee would involve its own paperwork). In that case, you would report any money you received (and any corresponding expenses you pay in order to generate that income) on Schedule C on your individual income tax return, subject to income tax. Also, you should expect any money you receive to be subject to self-employment tax, unless your net earnings from self-employment for the year were less than $400. You do not have to say who paid you. I wish you the best in your endeavors!

Answer Provided by: Adam Dickreiter

Five Last Minute Refund Tips

Check to see if you have worthless stock or loans that are completely uncollectible

CPA Answer:

You can deduct the loss on a worthless security without selling it but only if the stock or loan is completely worthless. If it is truly worthless, you can treat the item on your return as if it were a short term capital asset you sold for $0 on the last day of the tax year. In fact you can take a write-off over and above your gains to the extent of $3,000 this year.

Answer Provided by: CPAdirectory

Five Last Minute Refund Tips

If you itemize, don't forget the non-cash contribution deductions.

CPA Answer:

Be sure to itemize any donations of clothing and household items that you made to charities throughout the year, as non- cash donations over $500 require you to file form 8283 with your return. Non-cash donations up to $500 do not need special documentation with the filing of your return.

Answer Provided by: CPAdirectory

Five Last Minute Refund Tips

Don't Overlook the value of the IRA deduction

CPA Answer:

An IRA deduction can save you from $650 to $2,574 depending on your filing status and tax bracket on your federal tax return.
If you are under 50 you can put up to $5,500, Over 50 you can put up to $6,500.

Answer Provided by: CPAdirectory

Five Last Minute Refund Tips

If you are self-employed, take advantage of an SEP plan

CPA Answer:

Employers can contribute up to a quarter of the salaries that each employee earns (25%)up to an annual maximum limit. For 2017, that maximum will be $54,000, up $1,000 from its 2016 level. That's the first rise in the SEP IRA limit since 2015,
For self-employed. the 25% refers to the self-employed worker's "net earnings" from the business. The net result of the math is that the 25% limitation on "net earnings" works out to 20% of your adjusted profit after the self-employment tax adjustment in a Simplified Employee's Pension Plan. Self- employed individuals can even take the deduction on their 2016 tax return and fund the pension plan as late as six months from April 18, 2016 if they file for an extension to file their return.

Answer Provided by: CPAdirectory