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Adam’s Tax Accounting Service Blog

Note: Tax advice, articles, and content contained on this site are intended for informational and educational purposes only. They are not a substitute for professional advice. Tax matters are can be extremely complex and vary greatly for each individual or company. Please click here to read our complete disclosure and disclaimer for the information presented on this site.

Saving Tax With Home-Related Deductions and Exclusions

Posted by on Apr 6, 2017 in Blog, General, Management, Tax Tips | 0 comments

Saving Tax With Home-Related Deductions and Exclusions

Currently, home ownership comes with several tax-saving opportunities. Consider both deductions and exclusions when you’re filing your 2016 return and tax planning for 2017: Property tax deduction. Property tax is generally fully deductible — unless you’re subject to the alternative minimum tax (AMT). Mortgage interest deduction. You generally can deduct interest on up to a combined total of $1 million of mortgage debt incurred to purchase, build, or improve your principal residence and a second residence. Points paid related to your...

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Victims of a Disaster, Fire or Theft May be Able to Claim a Casualty Loss Deduction

Posted by on Mar 30, 2017 in Blog, General, Management, Tax Tips | 0 comments

Victims of a Disaster, Fire or Theft May be Able to Claim a Casualty Loss Deduction

If you suffered damage to your home or personal property last year, you may be able to deduct these “casualty” losses on your 2016 federal income tax return. A casualty is defined as a sudden, unexpected or unusual event, such as a natural disaster (hurricane, tornado, flood, earthquake, etc.), fire, accident, theft, or vandalism. A casualty loss doesn’t include losses from normal wear and tear or progressive deterioration from age or termite damage. Here are some things you should know about deducting casualty losses: When to deduct....

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Who Can — and Who Should — Take the American Opportunity Credit?

Posted by on Mar 27, 2017 in Blog, General, Management, Tax Tips | 0 comments

Who Can — and Who Should — Take the American Opportunity Credit?

If you have a child in college, you may be eligible to claim the American Opportunity credit on your 2016 income tax return. However, if your income is too high you won’t qualify for the credit — but your child might. There’s one potential downside: If your dependent child claims the credit, you must forgo your dependency exemption for him or her. And the child can’t take the exemption. The limits The maximum American Opportunity credit is $2,500 per student, per year for the first four years of postsecondary education. It equals 100% of the...

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Make Sure the IRS Won’t Consider Your Business To Be a “Hobby”

Posted by on Mar 24, 2017 in Blog, General, Management, Tax Tips | Comments Off on Make Sure the IRS Won’t Consider Your Business To Be a “Hobby”

Make Sure the IRS Won’t Consider Your Business To Be a “Hobby”

If you run a business “on the side” and derive most of your income from another source (another business you own, employment or investments), you may face a peculiar risk: Under certain circumstances, this on-the-side business might not be a business in the eyes of the IRS. It may be considered a hobby. The hobby loss rules Generally, a taxpayer can deduct losses from profit-motivated activities, either from other income in the same tax year or by carrying the loss back to a previous tax year or forward to a future tax year. But, to ensure...

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The Section 1031 Exchange: Why It’s Such a Great Tax Planning Tool

Posted by on Mar 20, 2017 in Blog, General, Management, Tax Tips | Comments Off on The Section 1031 Exchange: Why It’s Such a Great Tax Planning Tool

The Section 1031 Exchange: Why It’s Such a Great Tax Planning Tool

If you’re like many business owners, you might also own highly appreciated business or investment real estate. Fortunately, there’s an effective tax planning strategy at your disposal: the Section 1031 “like kind” exchange. It can help you defer capital gains tax on appreciated property indefinitely. How it works Section 1031 of the Internal Revenue Code allows you to defer gains on real or personal property used in a business or held for investment if, instead of selling it, you exchange it solely for property of a “like kind.” In fact,...

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2016 IRA Contributions — It’s Not Too Late!

Posted by on Mar 16, 2017 in Blog, General, Management, Tax Tips | Comments Off on 2016 IRA Contributions — It’s Not Too Late!

2016 IRA Contributions — It’s Not Too Late!

There’s still time for you to make 2016 contributions to your IRA. The deadline for such contributions is April 18, 2017. If the contribution is deductible, it will lower your 2016 tax bill. But even if it isn’t, making a 2016 contribution is probably a good idea. Benefits beyond a deduction Tax-advantaged retirement plans like IRAs allow your money to grow tax-deferred — or, in the case of Roth accounts, tax-free. But annual contributions are limited by tax law, and any unused limit can’t be carried forward to make larger contributions in...

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When an Elderly Parent Might Qualify as Your Dependent

Posted by on Mar 9, 2017 in Blog, General, Management, Tax Tips | Comments Off on When an Elderly Parent Might Qualify as Your Dependent

When an Elderly Parent Might Qualify as Your Dependent

It’s not uncommon for adult children to help support their aging parents. If you’re in this position, you might qualify for the adult-dependent exemption. It allows eligible taxpayers to deduct up to $4,050 for each adult dependent claimed on their 2016 tax return. Basic qualifications In order for you to qualify for the adult-dependent exemption, in most cases your parent must have less gross income for the tax year than the exemption amount. (Exceptions may apply if your parent is permanently and totally disabled.) Generally Social Security...

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Filing Deadline Rapidly Approaching for Flow-Through Entities

Posted by on Mar 7, 2017 in Blog, General, Management, Tax Tips | Comments Off on Filing Deadline Rapidly Approaching for Flow-Through Entities

Filing Deadline Rapidly Approaching for Flow-Through Entities

The federal income tax filing deadline for calendar-year partnerships, C and S corporations and limited liability companies (LLCs) treated as partnerships or S corporations for tax purposes is March 15. Note: While this deadline is nothing new for S corporation returns, it’s earlier than previous years for partnership returns. In addition to providing continued funding for federal transportation projects, the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 changed the due dates for several types of tax and...

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When It Comes to Charitable Deductions, All Donations Aren’t Created Equal

Posted by on Mar 6, 2017 in Blog, General, Management, Tax Tips | Comments Off on When It Comes to Charitable Deductions, All Donations Aren’t Created Equal

When It Comes to Charitable Deductions, All Donations Aren’t Created Equal

As you file your 2016 income tax return and plan your charitable giving for 2017, it’s important to keep in mind the available deduction. It can vary significantly depending on a variety of factors. What you give Other than the actual amount you donate, one of the biggest factors that could affect your deduction is what you give: Cash. This includes not just actual cash but gifts made by check, credit card or payroll deduction. You may deduct 100%. Ordinary-income property. Examples include stocks and bonds held one year or less, inventory,...

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Tangible Property Safe Harbors Help Maximize Deductions

Posted by on Mar 2, 2017 in Blog, General, Management, Tax Tips | Comments Off on Tangible Property Safe Harbors Help Maximize Deductions

Tangible Property Safe Harbors Help Maximize Deductions

If your business made repairs to tangible property last year, such as buildings, machinery, equipment or vehicles, you may be eligible for a valuable deduction on your 2016 income tax return. However, you must make sure they were truly “repairs,” and not actually “improvements.” Why? Costs incurred to improve tangible property must be depreciated over a period of years. But costs incurred on incidental repairs and maintenance can be expensed and immediately deducted. What’s an “improvement”? In general, costs that result in an improvement to...

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