The IRS Deductions Blog

Archive for June, 2008

Question: If I make 24 K 0n 1099 income, how much will my total tax be?

If I make 24K in 2009, how much will my total tax be including Federal income tax and Soc sec and medicare? Assuming that I can only claim myself as an exemption and take the standard deduction and have no other credits or deductions?

Answer: A little under $5,000 would be due on that income. You’d owe $1,602 in Federal income tax and $3,391 in Self-Employment tax for a grand total of $4,993. If your state assesses an income tax you’d owe that as well.

With that much tax you’d be required to make quarterly estimated tax payments of $1,250 using Form 1040-ES. The first payment is already overdue (April 15th). The remaining payments are due 6/30/2009, 9/30/2009 and 1/15/2010. You can skip the 1/15/2009 payment as long as you file and pay in full by 2/15/2010.

Block has a pretty decent estimator at http://www.hrblock.com/taxes/tax_calculators/index.html# . It works OK as long as you cannot be claimed as a dependent by another taxpayer.

Items on Amazon Right Now for 2009 Standard Tax Deduction Amount:

IRS Reminds Car Shoppers About 2009 Tax Break

Qualifying motor vehicles include new passenger automobiles, light trucks, motorcycles, and motor homes.

Car Donation Tax Deduction for 2009, 2010.mov

Question: Does interest payments for my second house’s mortgage count for tax credit?

Hi, I heard, the mortgage interest for your second property doen’t get any tax credit at all?

Answer: In general mortgage interest for 1st and 2nd homes are deductable. However, may subject to limitation if you have equity line(s). See IRS Publication 17:

Fully Deductible Interest. If all of your mortgages fit into one or more of the following three categories at all times during the year, you can deduct all of the interest on those mortgages. (If any one mortgage fits into more than one category, add the debt that fits in each category to your other debt in the same category.)

The three categories are:
Mortgages you took out on or before October 13, 1987 (called grandfathered debt).

Mortgages you took out after October 13, 1987, to buy, build, or improve your home (called home acquisition debt), but only if throughout 2006 these mortgages plus any grandfathered debt totaled $1 million or less ($500,000 or less if married filing separately).

Mortgages you took out after October 13, 1987, other than to buy, build, or improve your home (called home equity debt), but only if throughout 2006 these mortgages totaled $100,000 or less ($50,000 or less if married filing separately) and totaled no more than the fair market value of your home reduced by (1) and (2).

The dollar limits for the second and third categories apply to the combined mortgages on your main home and second home.

For more detail consult IRS publication 17:

http://www.irs.gov/publications/p17/ch23.html#d0e51740

If the NV home is 100% rental property, then it is not considered as your 1st (or 2nd) home. The interest is deducted on Schedule E rather than Schedule A.

Best wishes.

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TurboTax Basic Federal + e-File 2010 – [Old Version] $4.99 TurboTax Basic was designed to make doing your simple taxes easy, by guiding you step by step through your federal tax return. TurboTax guarantees its calculations are 100% accurate, or you’ll be paid any IRS penalties plus interest. TurboTax also double checks your return to help you get the deductions and credits you deserve. Everything you need to easily do your simple tax return. Does th…

Chunk Of Ice Falls From Plane, Smashes Home

A Nevada couple is stuck with a smashed garage roof and a outlandish story after a chunk of ice fell from the sky.

Question: How much will my stimulus payment be? All tax info is included. Need help with IRS calculator?

I don’t get the online calculator because I didn’t use any of the IRS forms, I filed online through HR Block. My main question is the about the amount of child tax credit that it asks you to enter. Is that the initial child tax credit or that plus the additional child tax credit combined? That makes a 600 dollar difference in the amount the calculator tells me I am going to receive. Child tax credit is 383 and the additional child tax credit is 1617. I am not sure which one they are asking for. All of my info is below, please let me know which amount I am to enter and how much that means I’ll get back if possible. My spouse did not work in 07 and I have 2 dependents. Thanks for your help.

Answer: Your rebate will be $383 plus $300 for child.
The rebate payment is equal the amount of tax liability on the return (tax liability on the return Form 1040 line 46 or Form 1040A line 28) with a minimum amount of $300 and a maximum amount of $600 for individuals.
For information on stimulus tax rebate read: http://taxipay.blogspot.com/2008/04/list-of-articles.html

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TurboTax Home & Business Federal + State + Federal efile 2009 $42.89 TURBOTAX HOME & BUSINESS WITH…

• Key numbers as you complete your taxes

The Associated Press Important numbers as you prepare to file your 2009 tax return: Personal exemption: Each personal or dependent exemption is now worth $3,650, up $150 from 2008. Standard deduction: $11,400 for married couples filing a joint ret …

Question: Tax Question: Does anyone know if fees paid in connection with Cord Blood banking are tax deductible?

Well, it’s not … I don’t know how to explain it, what it is is the collection of stem cells from a newborn’s umbilical cord. It is saved and stored in a cryogenic type freezer for future use in case of certain types of cancer and other illnesses. My medical expenses did exceed 7.5% of our income last year, and that’s why I am enquiring about this, it is almost $2000, and it could improve the outcome of our return It’s worth a shot.
Thanks for trying

Answer: Cord Blood Banking?
I am going to assume that is a medical procedure. If it is a necessary procedure then it is deductible…however, that doesn’t mean it will pay to deduct it.
First, it has to more than 7.5% of you income…anything over that is deductible. But, you still have to have more deductions than your standard deduction for it to be worth it.

Hope this helps.

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Loan fees: deductible even if proceeds of loan are used for a redemption.: An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA’s on June 1, 1992. The length of the article is 559 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.From the supplier: A US…

Retainer fees not deductible when applied to acquisition costs.(corporate acquisitions): An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA’s on November 1, 1999. The length of the article is 313 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.Citation DetailsTit…

Administrative expenses of bankruptcy estate are deductible from gross income.: An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA’s on January 1, 2002. The length of the article is 621 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.Citation DetailsTitl…

Quicken Rental Property Manager 2011 – [Old Version] $65.96 It shows how your rental properties are doing and where you’re spending at a glance. The Intuit Quicken Rental Property Manager 2011 Software identifies tax-deductible rental property expenses so you can maximize your tax deductions. It shows which rents have been paid so you know who owes you money and stores lease terms, rental rates and security deposits for each tenant….

$25k donated to bushfire victims

MORE than $25,000 has been donated to the Toodyay Bushfire Appeal less than 24 hours after the call went out to help victims of the year-end blaze in WA.

2007 Chrysler PT Cruiser in Huntington Beach – Anaheim, CA

Question: can i include my health insurance premium and deductible for tax refunds?

Answer: Like the above answerer states, you are only allowed to deduct medical expenses if you itemize your deductions. You are not allowed to deduct medical expenses if you take the standard deduction.

However, its not limited to 7.5% of your adjusted gross income, rather you may only deduct amounts that are OVER 7.5% of your adjusted gross income. So, for example, if your adjusted gross income is $30,000, 7.5% of that is $2,250.00. You may only deduct amounts that are over that $2,250.00. So, if you have $3000.00 in medical payments, you may only deduct $750.00. If you have $2,000 in medical payments, you may not deduct anything.

Hope that makes sense.

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A voluntary deductible in social health insurance with risk equalization: community-rated or risk-rated premium rebate?.: An article from: Journal of Risk and Insurance $9.95 This digital document is an article from Journal of Risk and Insurance, published by Thomson Gale on September 1, 2006. The length of the article is 9463 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.Citation DetailsTi…

B&M premiums, deductibles are on the rise. (boiler and machinery insurance): An article from: National Underwriter Property & Casualty-Risk & Benefits Management $5.95 This digital document is an article from National Underwriter Property & Casualty-Risk & Benefits Management, published by The National Underwriter Company on January 17, 1994. The length of the article is 648 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase….

Smaller buyers still at market’s mercy; agents must depend on deductibles, credits to help contain rising premiums.(BIGGER IS BETTER): An article … & Casualty-Risk & Benefits Management $5.95 This digital document is an article from National Underwriter Property & Casualty-Risk & Benefits Management, published by The National Underwriter Company on May 16, 2005. The length of the article is 1543 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. Yo…

SquareTrade 2-Year Cell Phone Accidental Protection Warranty $124.99 Accidental Damage from Handling (ADH) guards you against life’s little mishaps, whether you drop your cell phone on the street or splash coffee on your laptop.  ADH must also be purchased within 30 days of when you bought your item. ADH coverage begins on the 31st day after the item’s purchase – issues in the first 30 days are not covered. Upon purchase, you will get an email confirmation.  You …

Prepare yourself: Insurance bills on the rise

Jeremy Alford Capitol Correspondent BATON ROUGE — If you think insurance coverage is already complex enough, you probably don’t want to hear about the changes that will impact automobile coverage, hurricane deductibles, home-service contracts and fire policies. The changes went into effect Friday.

Let’s Talk About Homeowners Insurance