As mortgage rates fell, you may have refinanced your home several times over the last few years. You can generally still deduct all the mortgage interest on refinanced loans, up to the amount of outstanding principal. But if you were forced to pay the alternative minimum tax (AMT), you may forfeit the tax benefits on a second or third refinancing.
Small Business Tax
Section 179 vehicles should be a key part of your small business tax deduction strategies. Can Section 179 property fit in with your business tax strategies?
Let Business Management Daily help you get each and every rental property depreciation credit and business tax deduction you’re entitled to.
Q: We're confused about your item regarding a separated spouse who files as a "head of household" and claims the standard deduction (see 4/18/05 issue). You say that if the situation was "the other way around," the person would be required to itemize. Can you elaborate? P.B.S., via e-mail
The bonus-depreciation deduction was great while it lasted, but it's gone for 2005. Still, you can generate top-dollar deductions this year when buying equipment and other business assets. That's because your not-so-secret weapon—the Section 179 expensing allowance—lets you write off most or all of the cost of most business assets in the very first year of ownership! Here's the lowdown on the rules and four ways to maximize your deductions.
Taxpayer use of the Telefile system, which allows you to use a touch-tone phone to file simple IRS forms, has dropped due to other electronic-filing options.
Divorce isn't a pleasant undertaking. But at least you can minimize the tax fallout by taking a few key proactive steps.
A new IRS audit guide points out fringe-benefit issues that are ripe for abuse by execs, including club memberships, no-cost or low-cost loans and employer-paid vacations.
Make sure to keep your promotional expenses in line with the resulting income. If you try to grab a huge write-off for promotional costs that produce little income, the IRS could see your "promotional" efforts as something else, and deny the write-off.
If you've been thinking about donating your used car to charity, don't drop the idea just because of last year's law that put the squeeze on big-ticket donations. That law curbed your potential to be aggressive in placing a high value on the donated item. But by taking a different route, you can still get your money's worth.
In many U.S. cities, houses bought just a few years ago have more than doubled in value. But unless you plan to move soon, such a "paper windfall" means nothing other than a soaring property tax bill.
Q: I own an auto repair shop in Maryland. We've switched our compensation plan to a system in which technicians are paid a base salary, plus a bonus based upon billable hours. Since technicians routinely work a 45-hour workweek, must we pay them any overtime? R.B.S., via e-mail