The IRS Deductions Blog

Archive for January, 2009

When it comes to getting affordable auto insurance quote, ignorance is not bliss. One of the simple reasons why most first time car insurance holders find they have been cheated after taking the policy is the fact that they often fail to learn all they can about what it takes to obtain a good vehicle insurance plan. If you have ever paid higher premiums than you could afford, then you are in a better position to appreciate the title of this article.

The truth about the way we live presently is that the less you know of a service like auto insurance package or packages the more advantage that will be taken of you. One of the best ways to avoid hurting yourself when considering vehicle insurance coverage is to learn all you can about the service. This article promises to provide you with the basic information you need and if you will religiously stick to the tips there in, then there is no reason why you should not get the best auto insurance quote. This means you will not only be satisfied with what you end up with, you will have saved your financial plan from being jeopardized.

The good thing about car insurance coverage is that there are lots of insurance companies providing the service. What this implies is that you can obtain affordable vehicle insurance at competitive prices. But you can not accomplish this feat without carrying out certain actions. The major step or action you require to achieve this is through auto insurance quote comparison. This is one of the most essential things you need to do in order to avoid hurting your finance.

Additionally, it goes without any misgivings that the best way to obtain cheap auto insurance quote is to evaluate several car insurance estimates available. There are lots of them and if there is anything the Internet had made easier it is the art of comparison shopping. So all you need is to put in some time carryout your comparison with care and ease. And before you know it you will be the better for it. The truth is that until you do this; the probability that you might end up paying more on your auto insurance policy is high.

Aside from conducting auto insurance quote, you will need to demand or bargain for discount with your insurance provider. Make no mistake about this, every policy holder deserves discount and until you are ready to demand or negotiate for it; most insurance firms will let it ride. If you are not bothered, then why should they, after all they are out to make money. You don’t have to blame it on any body if you fail to bargain with your insurance provider for discount. But note that there are certain criteria you must meet in order to enjoy the benefits that come with having discount. So pick the insurance agent on this so you can be fully aware of your rights.

Finally, you may not approve of this point, but the basic fact is that raising the level of your deductible will stand you in good stead. Hold on a moment, I will explain. You probably know that deductible is the amount a customer pays out for a claim before his or her auto insurance provider pays them in the event of a claim. Now, if you decide to increase your deductible it means, you stand a higher chance of paying reduced premiums on the coverage. Although, this may appear to you a bit expensive an option, but consider the heavy burden that will be taken off your shoulders, when compared to the amount you have to pay as premiums every now and then.

Items on Amazon Right Now for Cigna High Deductible Plan:

Obama Takes Health Care Deadline to Democrats

The New York Times President Obama met with insurance executives and selected House Democrats, as party leaders struggled to figure out whether they can meet his timetable.

Obama’s loan modification plan is available for borrowers facing financial hardship and at risk of losing their home. Under this program, your home loan could be revised so that your monthly payment is reduced to an affordable amount. The goal is to keep families in their homes, stop foreclosures and allow the economy to recover.

The plan is called Home Affordable Modification Program-or HAMP. This home retention plan is paid for by the federal government-your tax dollars-so do not hesitate to take advantage of this helping hand. Over 5 million homeowners are expected to benefit under this $75 billion government program. Here’s the basics of the plan:

The banks are motivated to modify as many loans as possible for a couple of reasons. The lenders will be paid by the Treasury Department for each loan they modify using the standard federal terms. Also, President Obama has strongly encouraged all banks to reach out to homeowners to offer this plan-whether they are behind on their payments or not. If a financial hardship exists, then a homeowner is encouraged to begin the application process.

What should you do if you need a 2% mortgage modification? The first step is to learn more about the federal guidelines for approval and just what it takes to meet those guidelines. Do not complete your paperwork or disclose your financial information until you understand the 4 step formula your bank will use to qualify you. This is not the time to take any chances. Learn, prepare, then apply-this is too important to risk denial.

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

Westwood Beacon Hill Roll Call

THE HOUSE AND SENATE There were no roll call votes in the House or Senate last week. Beacon Hill Roll Call has obtained the official list from the state treasurer’s office of the “per diem” travel, meals and lodging reimbursements collected by the 40 state senators in 2009. The list reveals that senators have collected a total of $90,502.

Question: I am starting a small business – do I need to get a business license to claim Tax Deductions?

I am starting a small business and wondering if I need to get the license before end of year to claim business tax deductions

Answer: READ ENTIRE ANSWER

You will not need a business license to claim income on schedule E for state and federal income- BUT read on completely.

You may need to resister with the State Sales Tax Department if your business is required to collect and pay sales tax – (most do) and not doing so if you should is against the law. So be sure to call them and find out. If you do you will receive a sale tax certificate of authority. Besides that you may need to file with your county a DBA
( Doing Business As ). Without this DBA you will probably not get business financing from a bank today.

Besides that you will need to contact your village or town to be sure you can operate the business in the area. I say that because some zoning laws prohibit some types of business from being in a residential area. Usually home based business where No customers come to the home or where No excess trucks park or No auto repair is being done for example are okay. If you have a web based business it is an example of a business you can operate from home.

IMPORTANT!!!!!
The reason I say you need to file these other forms if needed is because your federal and state income tax people “may or probably will” report your schedule E to the sales tax people. And you do not want to get caught not collecting or not reporting your business to the state sales tax people. Big fines!!!!

The IRS is not stupid so don’t try to claim business expenses without sales income. And don’t try to claim income without collecting and paying sales taxes due the state if you are required to. You can only claim a loss in business for so many years to ask a CPA.

Items on Amazon Right Now for Tax Deduction Business:

Griffin Coal goes into administration

ONE of Western Australia’s biggest privately owned companies, Griffin Coal, last night appointed administrators after missing $30 million in debt and tax payments due to be made on December 31.

Tax Deduction Tips for Businesses : Business Gifts in Tax Deductions

Question: In the cash flow statement where would I reflect property tax?

If i am in construction business and i purchase a land – i will treat that land as my raw material right ? Now if i want to prepare a project report, wherein i need to make a business plan on a property purchased then —-

First of all i wanted to know property tax on that land is deductible ?

Secondly, if i prepare cash flow statement where should i reflect the property tax ? Operating activities, Investing activities or financing activities ?

Answer: under expenses or credits under taxes!

Items on Amazon Right Now for Tax Deductible Statement:

DVD Review: ‘The Hip Hop Project’

Chris ‘Kazi’ Rolle was born in the Bahamas where he was abandoned soon after birth by his mother who decided to start over on her own and set out for America. Understandably, Kazi grew up with a hole in his soul, and headed for New York City at the age of 14 to track her down.

Chairman of the Senate Foreign Relations Committee J. William Fulbright on Senator John F. Kennedy

Question: Assisted Living Expenses Deductiblity ?

My Mom and Dad (both 87YO) pay $5000/month for Assisted Living. The cost for 1 person is $4200/month. He has advanced dementia and qualifies for IRS tax deductibility. My mother has chronic congestive heart failure, but, is somewhat functional in that she assists Dad. Without her helping he would not be able to stay in Assisted Living.
I would like to deduct the entire $5000/month less the 7.5% of gross income deductible. I know the IRS has not refined their regulations and there are a lot of gray areas. How can I qualify my Mom for the deduction? If she can’t qualify, can I deduct the amount he would have to pay if he were alone? Can anyone give me some insights as there are so many conflicting opinions?

Answer: If the cost for one person is $4200, then that is the deduction for them at minimum as that is what Dad would pay.

If Mother can still feed herself, dress herself, move around by herself and use the toilet by herself, she will not be considered disabled and her portion ($800 a month) would not be deductible.

Helen, EA in PA
Enrolled Agents – Licensed by the IRS

BTW – the post saying that you must claim your parents if you pay the medical bill is wrong. If the ONLY reason you cannot claim your parents as your dependents is because their income is too high, yet you pay the medical bills, you can claim the medical bills you paid.

Items on Amazon Right Now for Assisted Living Costs Deductible:

Tax Tips: Keep track of pension records

Knoxville-area accountants are offering advice through our Tax Tips columns, which will appear each Saturday in the Business section through the April 15 IRS deadline. This week, Friendsville CPA Peter Towle answers readers’ questions. If you have a tax-related question you would like answered, e-mail it to news@knoxvillebiz.com or write to the News Sentinel, Attention …

Long Term Care – Spotlight December 2009