Q: I bought a second home computer recently because my new job requires communication at all times, and my kids are always on our other computer. I use the new machine to interact with clients from home. Since my employer is all for it, can I deduct the computer’s cost? M.L.P., New York
Question: I’m retiring before the end of the year at age 64. My accountant says I’ve earned too much salary this year to receive any Social Security benefits. I thought the earnings test was eliminated years ago. If not, is there anything I can do now? Or do I have to work longer? — J.M.B., Boise, Idaho
Q: I’m thinking about retiring early and moving to a foreign country to avoid U.S. income taxes. Will I still be taxed on retirement income from my pension plan and IRAs? J.L.S., Spokane, Wash.
Q: I’m selling my house this year and moving into our beach condo. I’ll also eventually sell the condo, so I want to avoid paying tax on that sale, too. Can I call both of these houses my principal residence this year? T.H., Wilmington, Del.
Q: You’ve explained the wash-sale rule in the past. But I bought a stock that I had sold at a loss less than 30 days earlier. I did so because it suddenly rebounded and I couldn’t wait any longer. If I sell the stock again, but this time at a gain, is my basis adjusted for the prior loss? N.W., Deal, N.J.
The proliferation of S corporations has not gone unnoticed by the IRS. S corporations are now the most common corporate entity, accounting for nearly 60 percent of all corporate returns filed.
The push to audit S corporations (described above) is part of a larger IRS initiative to examine more returns, particularly of small business owners. Don’t think you’re immune just because you’ve been able to fly under the radar so far.
For busy businesspeople, cell phones, laptops, PDAs and other portable devices are essential. Usually, the company buys such devices and gives them to higher-ups and other employees who need them.
Normally, you must depreciate the cost of business or commercial real estate over 39 years. In comparison, you can depreciate residential rental property much faster over 27.5 years.
Unless you’re a CPA or a tax nerd, the term MACRS can be daunting. It stands for Modified Accelerated Cost Recovery System, which is the standard federal-income tax method for depreciating the cost of your business assets.