Q: I read your recent article about filing separate tax returns. If my wife and I file separately, do we simply split our itemized deductions? G.S., Manchester, N.H.
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: For years, I've been giving away appreciated stock to my low-bracket children. I recently gave $11,000 worth of my C corporation stock to my daughter, who sold it. My CPA says this technique is not allowed. Is that correct? T.J., Virginia Beach, Va.
Q: My husband and I collectively earn $85,000 a year. Neither of us participates in any retirement plans. Can we both make deductible IRA contributions for 2003? I.M., Thomasville, N.C.
For many U.S. taxpayers, "March Mad-ness" has nothing to do with college basketball. It's all about dashing around gathering receipts, filling out forms, meeting with your tax guru and hoping you'll emerge victorious in the 1040 game.
Lower rates. The 27, 30, 35 and 38.6 percent individual federal rates that applied for 2002 are reduced to 25, 28, 33 and 35 percent, respectively, for 2003. The 10 and 15 percent federal rates are unchanged.
Mark mid-April on your calendar. That's when Tax Freedom Day, the symbolic day when U.S. taxpayers' annual earnings to date surpass the taxes they'll pay that year.
Q: I use my cell phone a lot for charitable activities. In fact, that's the reason I bought it. Can I deduct the phone costs as a charitable donation? N.B., Kansas City, Mo.
Calendar-year 2003 is over, and you can't do anything to change it. But the book isn't closed on tax year 2003.
Q: My husband and I have lived in our home for 32 years. We bought it for about $80,000, and now it's worth more than $500,000. My husband died last year, and I'm planning to sell the home. I read about the $250,000 home-sale tax exclusion for single people and $500,000 for married people. Am I limited to $250,000? A.T., Rockaway, N.J.
The March 15 deadline for filing a 2003 corporation tax return is approaching quickly. (See tax calendar, page 5.) Rather than slapping together your tax paperwork at the last minute, punt. You can earn a six-month extension by filing Form 7004, Application for Automatic Extension of Time To File Corporate Income Tax Return, and paying what you estimate you owe.