The IRS Deductions Blog

Posts Tagged ‘taxes’

Question: How much of a donation is tax deductible?

Sorry if this has been asked,

For the first time time i have found myself in a job where taxes are not automatically taken from my pay check and I am nervous about tax time. So, if i donate $1,000 to a charity how much of that will be removed from the amount I will owe at tax time.
On the IRS website it states the charities I am looking at are “a public charity with a 50% deductibility limitation”…… Does this mean that out of the $1,000 i donate I should expect $500 dollars deducted from the amount I owe?

Thanks in advance….

Answer: Forget about the 50% rule. That doesn’t apply to your situation.

Your $1000 donation would be an itemized deduction. If you take the standard deduction, then your donation doesn’t help you at all (this is the case for most people who do not own a home with a mortgage). If you itemize deductions anyway, then the donation will reduce your taxable income by $1000. The reduction in tax owed is based on your tax rate. For example, if you’re in the 25% tax bracket, it will save you $250.

Most of the time, charitable contributions do little or no good in terms of saving people money on their tax bill.

You REALLY need to get some professional tax advice and DO IT NOW! It sounds like you’re being treated as an independent contractor, which means you have to file taxes as though you are self employed. You’ll need good records of income and expenses. You’ll owe self employment taxes on top of ordinary taxes, and you may be hit with a penalty if you’re not making quarterly estimated payments. You are setting yourself up for a HUGE bill from the IRS if you’re not careful. Do some research about independent contractors and pay a tax adviser to explain it to you if necessary.

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IRS says what’s deductible, what’s not. (Internal Revenue Service): An article from: Fund Raising Management $5.95 This digital document is an article from Fund Raising Management, published by Hoke Communications, Inc. on April 1, 1990. The length of the article is 473 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 Details…

Christmas Traditions For Kids Given To Foster Children by Cherish The Children

Tampa – Christmas traditions for kids (http://www.cherishthechildren.org) presented to Pinellas County foster children by Cherish The Children in their 22nd annual December holiday event.

Tips from the IRS – Charitable Contributions

Question: past year online gambling totals. +5300 winnings, -9800= -4500 total. can i claim all of it as a deductible?

Answer: I assume you’re asking about USA federal taxes. You can deduct gambling losses up to the amount of your gambling winnings, so in your case you can take a $5300 deduction.

Also, be aware that this is an itemized deduction, so if you don’t itemize you can’t take it at all.

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O Bee Credit Union Partners with Frontstream Payments to Pioneer Credit Card Charity Donating On Financial Institution …

O Bee Credit Union has partnered with Frontstream Payments to make available online charitable donations to help feed the hungry. Credit card donations are made securely via Obee Credit Union’s website and 100% of the donations go directly to the charity. (PRWeb December 19, 2010) Read the full story at http://www.prweb.com/releases/2010/12/prweb4910044.htm

Remembering Elvis? Do it with Honor

Question: Schedule E tax questions?

Am I required to file Schedule E if I only have real property rental losses and no income (i.e., no one rented my house in 2009)? I do qualify as “actively participating” in the passive activity, but the amount of loss allowed after limitations on Form 8582 is $0. I don’t have any other passive activity. So I don’t see the point in filing Schedule E but I don’t know if it’s required; plus I’d like to include the taxes and interest deductions on Schedule A.

Second question in anticipation of next year:

Someone has rented my house for the second half of this year. I should have enough expenses, including repairs and maintenance, insurance, travel, management fees, etc., to negate all of the income for this year. So can I just include these things on Schedule E and then put the mortgage interest and property taxes on Schedule A? Any excess losses on Schedule E will not be allowed next year, like this year, and I don’t want to lose those valuable deductions.

Answer: On schedule A you can only take interest and property taxes on your main or second residence, not on rental property. To deduct it on rental property, you have to use schedule E. Were you trying to rent it in 2009 but just couldn’t find a renter, or weren’t you trying? If you weren’t trying, you can’t deduct expenses.

For your second question: NO you can’t take rental expenses on schedule A. If you don’t have income to offset the rental loss against, you just lose it. But if putting it on schedule A would help you, then you DO have income to offset – the income doesn’t have to be just rental income.

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KAHLER: Gain financial freedom by reducing your mortgage

One of the keys to financial independence is affordable housing.In many cases, you can gain valuable financial breathing room bypaying off or refinancing your mortgage.

Mortgages and Interest Rates Revised | WAHomeowners.com

Question: Are there any really cheap tax programs for pretty easy taxes?

I have been using H&R block for the past few years but I don’t have many deductions or anything like that, pretty easy from what I’ve looked at and I want to do my own this year to save some money. I’ve seen some tax programs out the but there a little more than i want to pay so I want to know of some cheap tax programs that you’ve used and liked. Thanks

Answer: If your adjusted gross income is below $52,000.00 you can go to the IRS website and use H&R Block’s TaxCut for FREE by clicking on the Free File link at the top of the page.

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Many Winners, a Few Losers

The passage by the House of a bipartisan tax bill resolves many urgent questions weighing on individuals and businessesbut also creates groups of winners and losers.

How to File Your Taxes Online : Online Tax Deduction & Credit Tips

Question: I have a simple question about deducting property taxes on form 1040.?

Greetings,

I’ve always been able to figure out my own taxes with no problems or questions, but last summer I bought my very first home. As I puzzle over the tax forms this year, and what I can deduct, I have some questions:

#1: Can I deduct on my 1040 A Form (Itemized Deductions) the property taxes I paid in November of 2007? The entire amount I paid? Really?

For example, back in November I paid a total of $1,898.64 ($711.01 and then an additional $1,187.63 for the supplemental assessed values.) Is this all deductable on this form?

If so, what I don’t understand is when IRS eventually sends this same amount back to me, then it’s like I’m not really paying these property taxes at all. (Not if I get the money back from the IRS.)

That can’t be right. I can’t believe that my property taxes are all deductable.

#2… Is any amount of the $270.00 each month I pay for my Association Dues deductable?

Thanks in advance for any help.

Answer: You can deduct your property taxes. All of it. But you don’t get it back! It just comes off your taxable income. Example:

$25,000.00 income less $1898.64 = $23,101.36 taxable income. So you just pay taxes on a lower amount than you would have.

HOA dues are not deductible. If you had mortgage insurance charged it is deductible for 2007 – this is a new deduction- only for 07. I am not talking about your homeowners insurance for fire- but for PMI.
Good luck!

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Year End Tax Tips for Holiday Charitable Giving

MOUNTAINSIDE -The spirit of giving seems to grow during the holiday season, and many donations are made to charitable causes at this special time of year. The IRS reminds taxpayers to keep some important points in mind when making donations with the expectation of deducting them on a federal tax return.

Tax Help : How to Calculate Estate Tax Deduction