Charitable Giving Information

Posts Tagged ‘planning’

Tax Planning Attorney

Question: No federal tax taken out of paycheck…what to do?

A friend of mine just found out that no federal tax was taken out all year and now owes the IRS almost $5K. In hindsight, she should’ve checked her paystub, but when she approached her boss, she blamed my friend saying it’s because she only took 1 withholding (which is not true), then said it was the paycheck company’s fault. She knows she can get on a payment plan with the IRS, but she’s still really upset about how her boss handled it. Wouldn’t an employer who uses Quickbooks catch an employee who didn’t have a “federal tax” line on their paystub? Should she see a tax attorney?
Update – SS and Medicare was taken out properly.

Answer: It's possible for an employee not to need to have federal tax taken out, so no, the software would not flag that as an error. And if she had filed a W-4 with one allowance, and made enough money that she now owes $5K, then something would have bene deducted.

In any case, even though it sounds like her boss really handled her complaint badly, the problem is hers. She owes the money and will have to pay it. There's no point in seeing a tax attorney.

Fort Worth Business Planning Attorney Dallas Tax Law Lawyer

If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!

Inheritance Tax Planning Advice

Inheritance tax (IHT) is something that is unavoidable for most people. And for property owners, the position is likely to be worse than many others, largely because they are likely to have significant assets that cannot easily and quickly be realised, in the event of death, in order to meet IHT charges. These cut in at 40p in every pound, once the threshold has been reached. For 2009-10, the threshold is £325,000.

For married couples (and civil partners) there is no IHT on gifts between them, so it is possible to pass the entire estate without any liability to the tax. Similarly, a recent change in the law means that the value of any money under the threshold not passed outside the relationship on the death of the first ‘partner’ can be passed to the survivor and added to their threshold on death. The calculation is slightly complicated, because it is the proportion of the threshold retained within the relationship that passes over, not the amount.

Are there any reliefs available? Some forms of property obtain 50% (or even 100%) relief against IHT. Buildings owned by a partner or controlling shareholder and used wholly or mainly in the business of the partnership or company immediately before the transfer falls within the 50% category. However, it is most unlikely that HM Revenue and Customs would consider property owned for letting, even if owned by a partnership or company, would qualify. After all, the income generated is not accepted as from a trade profession or employment, for the purposes of justifying pension contributions and the same considerations would apply for IHT.

It is important to understand there are some exemptions against IHT; these are gifts of any size made at least seven years before the death of the donor (called Potentially Exempt Transfers, or PETs) and modest gifts made out or normal income expenditure plus up to £3,000 a year for each donor. Other small gifts and modest amounts paid in consideration of marriage are also exempt.

For most property owners, the exemptions are unlikely to be of much assistance if assets are largely held in property, as this cannot easily be converted into small amounts for early distribution. Giving away properties while retaining the income from them will also prove ineffective from an IHT planning.

Another issue that will affect many property owners is that IHT is generally payable within six months of death. This can often be difficult, given how long it can take to obtain probate, and could involve a ‘forced sale’ in order to raise the required sum – which could be very large from some property landlords. It is normally possible to pay by annual instalments, but in this case interest is charged by HM Revenue & Customs (as in the case of late payment). Having liquid assets, in addition to the property portfolio, can make life a lot easier.

It is important to seek independent professional advice before making any decision about your personal finances, especially which landlords insurance you decide on. You should always ask your insurance advisers what experience they have of dealing in this area.

About the Author:

Adam Singleton writes for a digital marketing agency. This article has been commissioned by a client of said agency. This article is not designed to promote, but should be considered professional content.

Article Source: ArticlesBase.com – Inheritance Tax for Property Owners

Inheritance Tax Planning

Tax Planning Excel

Question: New computer?

I am getting a new laptop this weekend because of the tax free weekend. I ama university student, so will it be classified as school supplies in order to recieve the no tax discount?
Also, I need some advice on what kind of computer. I want a Mac, but is it very difficult to learn? Is it useful at the collegiate level? I plan on getting Microsoft office for it so that I can have word and excel for assignments. Is it worth it? Or should I go with a PC such as Dell or HP. If you say PC please tell me which brand and model and why. Thanks for your help!

Answer: First of all congrats on getting the new laptop idea. Ok here are the answers to your many questions,

1. Yes it should qualify as a school supplies.
2. Ok some people love MAC and some love PC. I was a PC fan for long time until now when I bought the new macbook air. If you are using MAC for first time, then yes it will be little difficult to get acquainted with the MAC interface. But hey once you know the game, its all fun. Best part is you dont need to worry about any VIRUS on MAC.
3. I think both MAC and PC can be used same at college level . All depends on how much money you willing to spend. MAC are more expensive then PC in general.
4. Yes its is worth to buy MS office for MAC or PC.if your plan to use excel or word or powerpoint etc.
5. If you plan to buy PC, my recommendation is to get HP or DELL. But this is really depend on what you are comfortable with. Some ppl go for style, slickness, color etc in addition to the specs. Why i say PC or DEll is that I also own an HP and its super. Keys are really soft, screen is very durable, and ofcourse HP customer support is awesome. Good luck.

EPMP Word Template Demo (4:57)

Year End Tax Planning Tips

Question: How can I get back on track (get healthy)?

I’ve been run down now for about 4 – 5 months. I’m a second year law student who at the end of my first year – this past May – burned out. I started working at a large firm this past summer and was extremely stressed out every day. I also started a new relationship this summer, and while wonderful in many ways, it is also very taxing on my energy reserves. I used to work out daily but I no longer do. It’s been about a year since I’ve had a consistent workout schedule and “healthish” diet. I’ve gained 20 lbs. in the past year. Can you can give me some tips on getting my health/life back on track? Also, if you have a detailed plan, could you tell how long it will be before I feel better.

Thank you so much!!

Answer: maybe if you see a nutritionist i heard that is a good idea! i know someone that did that and they lost all kinds of weight the healthy way! good luck!=)

Tax Tips: Year-End Tax Tips (ASL, Captions & Voice Over) - December 09

Tax Planning For 2009

Question: Getting married and I own a house. Does my fiancee qualify for the $8000 tax credit?

We plan on closing prior to the wedding but I will still be a co-borrower on the mortgage. I am selling my house before the wedding as well. Can she still get the credit? We will be married by the time we do 2009 taxes.

Answer: As long as you close on the sale prior to the 11/30/2009 deadline AND prior to your marriage AND your fiancee claims the credit by amending her 2008 return she will be able to claim the entire $8,000 credit.

You will NOT be able to claim it on your 2009 return since you will be married by then. When the buyers are married to each other, BOTH spouses must qualify for the credit.

The financing details are irrelevant to the issue of eligibility for the credit in this case.

Edit: From the TD ratings it's pretty obvious that there are plenty of clueless folks lurking in the background. When 2 unmarried persons purchase a home they can split the credit any way that they wish. If only one of them is eligible for the credit, that person may claim the ENTIRE credit on their return.

As a deviation from normal policy the $8k credit for purchases in 2009 CAN be claimed on the taxpayer's 2008 return as long as they close on the purchase BEFORE claiming the credit. If they have already filed their 2008 return they can amend by filing Form 1040-X and attaching Form 5405.

Edit 2: For your benefit and that of the mullet heads who seem to think that this is a bad answer, please see the following link: http://www.irs.gov/pub/irs-irbs/irb09-06.pdf Scroll down to page 446 (it's about half way down) and it will explain it all to you in excruciating detail. This is an IRS bulletin that proves that this is a CORRECT answer.

Luscombe: Year-end Tax Planning for 2009