The IRS Deductions Blog

Archive for the ‘List of Tax Deductions’ Category

Question: If I do file jointly for taxes, and my wife goes back to school (MBA), is it deductible?

Answer: Even better yet, they shouldn’t answer your question unless they are a tax professional.

The Lifetime Learning Tax Credit can be claimed for students in any year of study, which makes it appropriate for a lot of graduate students.

You can claim this credit for yourself, your spouse or your dependents. The credit is calculated by summing your tuition and related expenses, those of your spouse and those of all your dependents.

The amount of the lifetime learning credit is 20% of the first $10,000 of qualified education expenses you paid for all eligible students. The maximum amount of lifetime learning credit you can claim for 2005 is $2,000 (20% × $10,000). However, that amount may be reduced based on your modified adjusted gross income (MAGI).

Also, there is the Student Loan Interest deduction. if your modified adjusted gross income is less than $135,000 if filing a joint return, there is a special deduction allowed for paying interest on a student loan (also known as an education loan) used for higher education. For most taxpayers, MAGI is the adjusted gross income as figured on their federal income tax return before subtracting any deduction for student loan interest. This deduction can reduce the amount of your income subject to tax by up to $2,500 in 2005. The numbers arent in for 2006, but either it will be the same, or a little higher.

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The National Association of Professional Women’s Local Chapter in Jacksonville Has Successful Chapter Meeting Kicking …

Chapter President, Karem Mieses welcomed all members and guests and reviewed the Chapters goals to foster friendships, serve as a resource for ideas and support in our professional and personal lives.

Question: Am I better off paying off a student loan or put the $ in a savings acount.?

I would get 4% dividend in the savings account and my interest on my student loan is 8.5% with about a 3800 balance. The Interest from the student loan is tax deductible!

Answer: You are better off paying off your student loan. You end up paying more in interest on the loan then you would earn in your savings account. Using the numbers you provided you could earn about $155 in interest if you put the money in your savings account, but you would end up paying $165 in interest on the loan.

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Crossroads House is seeking funds to support its mission

Editor’s note: Officials of Crossroads House of Watertown have prepared the following article in an effort to focus its need for additional financial support for its mission.

Find out about a tax free savings account for education!

Question: Is interest on debt tax deductible in the UK?

Answer: If the loan was for a business purpose, then generally it is deductable against the income arising from that business.

There are complications on decucting interest on Buy to Let properties where if the mortgage is greater than the value of the property when first let and you have not reinvested the money extracted into buying more property within that taxable pool, then you may have to restrict the amount of interest you can claim.

Also if you work predominantly from home, then you can claim a proportion of the mortgage interest you pay against your business income. You need to make sure that you claim the right amount so that you dont fall foul of CGT rules but your accountant can guide you through this.

Kind regards

David Nicoll
“the accountant with attitude”

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Benny L. Kass Mailbag

Consider refinancing to pay credit debt Q:We will soon have our mortgage paid off. Our home is valued at $120,000. Unfortunately, we owe about $50,000 in credit-card debt. I took early Social Security and work part time. My husband will take full Social Security next March and continue to work full time. So we had planned to pay extra on the debt with his Social Security check and the fact that …

Self Employment Tax Tips : Debt Cancellation: Self Employment Tax

Question: Expense ratio in mutual funds tax deductible?

In a taxable personal account can you deduct the funds annual management expenses (the .5%,12b,etc..) as an expense against your gains? Like brokerage fee’s on stocks.

Answer: “Enter the total amount you paid to produce or collect taxable income…..” on line 23 of schedule A. “Examples of expenses to include on line 23 are……your share of investment expenses of a regulated investment company.”

Miscellaneous Itemized Deductions exceeding 2% of your AGI (line 38 form 1040) are deductible. See 1040 schedule A and the instructions.

Your brokerage fees should not reduce your 1099s. If that was what the IRS intended then you would be able to deduct them directly from your income on page 1 of the 1040 or from schedule B income, for example.

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6 End Of Year Tax Tips For A Bigger Refund In 2010

I know the last thing most people want to think about this holiday week is their taxes. But if you’re like me, and want the biggest refund possible next April, now is the time to make some year end tax moves that could mean more cash at tax time.

Personal Financial Planning Tips : How to Select a Good Mutual Fund

Question: Is artwork purchased at a charity art auction or charity art show tax deductible?

Answer: There could be but you would need to show that the price you paid was greatly over the Fair Market Value. That would be hard unless the same item was available elsewhere for a fixed price which was less than what you were paying and that difference was going directly to the charity. You however would not be the first person to have written a check to the charity for a product and take the full amount as a deduction because it is written to a charity. This is rather common if you also have other gifts to the same charity such as a church.

Items on Amazon Right Now for Auction Tax Deductible:

Irish tenor will sing at supper

Several seats are still available for the annual Art to Heart fundraiser Jan. 9.

EBAY JEWISH SECRETS LIBRARY FOR SALE TAX DEDUCTIBLE TOO!