The IRS Deductions Blog

Archive for February, 2010

Question: Please show the calculation of income tax on salary.(men)?

basic 8325, HRA-3330, SPECIAL ALLOWANCE-5044, CONVEYANCE-1000, MEDICLE-1250, Deductions(employee)-PF-999,PT-200, take home is 17750. Insurance Premiumpaid is Rs. 8000 pa. Please calculate the taxable amount( men).

Answer: Available for free download at: http://www.ynithya.com/taxcalc/
This excellent IT calculator. This is in excel format. Just you have to put monthly salary component figures. That’s all.

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A win-win way of claiming tax exemptions

Here’s why you can claim tax deduction on interest paid on your home loan as well as claim deduction on house rent alowance.

Question: Won’t a tax deduction diminish the rebate one receives?

I am able to deduct the interest I paid on student loans, which reduces the amount of taxable income, which makes it look like I made less money, which reduces the amount of refund I will receive because if its a percentage of that income, the higher the amount the better. It seems to me, a tax deduction only helps if you owe the IRS,not it owing you, right???

Answer: T tax deduction lower the amount you pay tax on. This means you owe less taxes. The difference between what you what have owed without the deduction and the lower amount with the deduction means more money in your pocket.

It increases your refund(or the amount you owe).

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Noranda Income Fund Reports Fourth Quarter Net Earnings of $1.4 Million

VALLEYFIELD, QUEBEC–(Marketwire – Feb. 16, 2010) – The Noranda Income Fund (the “Fund”) (TSX:NIF.UN) reported net earnings of $1.4 million for the fourth quarter of 2009, compared to net earnings of …

Herger Discusses His Amendment to Repeal the “Three Percent Withholding” Tax Provision

Question: Is the annual county/town Personal Property tax I pay for my Cars deductible when itemizing?

If I paid 1000 in car tax/personal property tax for my cars last year, can I deduct that on my schedule A?

Answer: Yes. There is a provision for that information to be included on line “7″ of schedule A. And if you are e-filing, there is a specific section asking for that info also.

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English floats further taxes on property investors

The Government is considering ways to squeeze extra tax from property investors, by bringing more into the existing capital gains net.

Question: How much does my dad earn roughly?

My dad won’t tell me his income but I’m just curious as to what he makes so I’ll give you what I do know and maybe someone will have an idea:

He is in business and owns a self storage company that has about 1300 units that rent at an avg. of 100.00 a month and I have read his financial reports that say his company brings in on avg. 150 000 a month. He has 4 employees that probly make on avg. 3000 a month. About 1/2 the units are heated. The business is located in Edmonton, Alberta Canada. So with taxes and other deductions how much do you think he can pocket a year if each month the company brings in raw 150 thousand?

Answer: He probably makes 75k/month… btw people who wont tell their kids how much they make are insecure…

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Penn West Announces Its Results for the Fourth Quarter Ended December 31, 2009

CALGARY, ALBERTA–(Marketwire – Feb. 18, 2010) – PENN WEST ENERGY TRUST (TSX:PWT.UN) (NYSE:PWE) is pleased to announce its results for the fourth quarter ended December 31, 2009 O

Question: I need help with just one figure on my 1040 Schedule A?

(Itemized Deductions). It is #5 under “taxes you paid”. It says “state and local income taxes”.

Last year I had a tax preparer do them for me. I have all the forms and everything perfect, except I’m not sure how he got this figure. He has $928.00.

I live in Texas and we don’t pay state tax, except for in sales tax, which is 6.25% and local sales tax which is 1.875% for a total of 8.125%.

Does it have something to do with my adjusted gross income? Is there a table somewhere to find a standard deduction for this? I can’t find one and I’ve been at it all day and I’m getting a headache.

Please help
state and local tax are blank on the W2. Texas doesn’t collect state or local tax out of anyone’s pay. We only pay state and local sales tax when we buy something.

Answer: I think he screwed it up last year. If you don’t pay state or local INCOME tax, then it should be 0.00.

Section 5 has a and b subsections. Section b would be sales taxes. Section a would be state and local taxes income taxes.

Items on Amazon Right Now for Standard Deduction Tables:

Just Energy Income Fund: Third Quarter Results for 3 Months and 9 Months Ended December 31, 2009

TORONTO, ONTARIO–(Marketwire – 02/11/10) – Just Energy Income Fund (TSX: JE.UN – News ) – Highlights for the third quarter ended December 31, 2009 included: – Record Operating Results — Sales (seasonally adjusted) – Up 7% per unit — Gross Margin (seasonally adjusted) – Up 17% per unit — Average margin per customer – Up 11% — Distributable Cash after Gross Margin Replacement – Up 2% per unit …