Big tax cuts aren't coming in 2005; neither the money nor the political willpower is there. But look for Congress, at the very least, to extend several tax breaks that are scheduled to go off the books at the end of the year
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.
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.
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.
Divorce isn't a pleasant undertaking. But at least you can minimize the tax fallout by taking a few key proactive steps.
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.
Where can you turn if you're retired and strapped for cash? When you've exhausted all other possibilities, you may hear pitches to tap into your home's equity by securing a "reverse mortgage."
Is your child going off to college or prep school this fall? If so, write off the portion of the tuition that's attributable to health care as a medical expense. If the school doesn't automatically provide a breakdown of your child's tuition costs, ask for one.
Despite the chummy-sounding acronym, PALs (short for passive-activity losses) are anything but friendly to taxpayers, particularly those who invest in real estate. Fortunately, you can gain more tax saving value from your PALs with some astute tax planning.
Eureka! Your company has created a new gizmo that's a vast improvement on the competition's product. Once you work out the bugs, you expect to patent the invention to protect your interests. Then, you hope it will start selling faster than hot cakes.