Governments offer investment tax credits to incentivize certain types of investments, such as energy and business projects, to boost the economy. Qualifications and credit percentages vary by government and project type. Individuals and businesses can obtain information from local tax authorities and submit a tax credit form with supporting documents. An investment tax credit (ITC) […]
Excise duties are taxes on specific goods, often added to raise funds or penalize harmful consumption. Merchants collect and remit them to the government, and they can be charged per unit or ad valorem. They are often levied on goods that indirectly cost society, such as alcohol, tobacco, and gasoline. Excise taxes have been around […]
Self-employed workers can benefit from tax deductions on Social Security and Medicare withholding, as well as business expenses such as home office costs, supplies, and health insurance. Deductions can also be made for phone and internet usage, but only for business-specific expenses. Health insurance costs for the self-employed and their family members can also be […]
Most taxpayers are safe from audits, but high-risk or high-income occupations, self-employed individuals with significant business deductions, and those who enter information that raises flags are more likely to be audited. To avoid audits, accurately report income and keep deductions within acceptable limits, avoid disreputable occupations, and check for math errors and personal information mistakes. […]
Property tax depreciation allows owners of commercial properties to write off the loss in value over time on their tax returns. The straight-line method is used to calculate depreciation over 27.5 years for residential buildings and 39 years for non-residential buildings. Land is not depreciable. Depreciation reduces the appraised value of the building, resulting in […]
Taxpayers can request a tax return transcript by calling or filling out a form and mailing or faxing it to the correct agency. US taxpayers can call the IRS or fill out form 4506-T to request a federal tax return transcript. The transcript does not include amendments or addendums, which can be requested through a […]
Car taxation is the collection of taxes on motor vehicles to fund road maintenance and public transport. Taxes vary by government and vehicle type, and can include sales tax, registration fees, and renewal fees. Some regions also have congestion charges or taxes for crossing borders. Tax rates are generally progressive and can be based on […]
To claim a medical expense tax deduction, one must have incurred tax-deductible medical expenses and complete the appropriate forms. The types of medical deductions vary by jurisdiction and may depend on factors such as illness and treatment. Eligible expenses include doctor’s fees, hospital stays, exams, dental expenses, and medically necessary aids. Medical miles may also […]
A rehabilitation tax credit is a financial incentive given by governments to individuals or entities who restore or repair certain types of buildings, including historic sites and properties in low-income areas. The amount of the credit is often limited and can be claimed during the year construction-related costs were incurred or over several years. The […]
US tax law allows for real estate deductions, including mortgage interest, home repairs, and home office expenses. Deductions for home improvements and moving expenses are also available. It is recommended to seek advice from a CPA to navigate these deductions. United States tax law provides for several real estate deductions. In general, there are more […]
The annual gift tax exclusion allows American taxpayers to give up to $13,000 USD per year to any person without being subject to gift tax. Charitable donations and gifts between spouses are also excluded. The Unified Credit exempts the first $1 million USD in gifts during a person’s lifetime or upon their death. Gift tax […]
The home improvement tax credit was a deduction for American taxpayers who made energy-efficient improvements to their homes. It was established in 2009 and had a maturity of one year. Some states also offered similar incentives. The tax credit is no longer available, but future incentives may be provided. A home improvement tax credit is […]
Two types of flat tax systems have been proposed for the US: a flat sales tax and a flat income tax. The former would make purchases easier to manage, but some areas could lose revenue. The latter would create a sense of fairness, but families exempt from taxes would end up spending more. No tax […]
Intangible assets like patents and copyrights require an intangible tax, which is a form of sales tax. These assets are difficult to value, making it challenging to enforce the tax. Some companies avoid the tax by selling the rights to foreign subsidiaries. Some assets are intangible, meaning they lack physical characteristics; however, such items have […]
The tax base for capital assets is usually the purchase cost, minus any previously claimed deductions, and is depreciated over the asset’s useful life. Other factors affecting the tax base include purchase costs, loan costs, and improvements. Similar exchanges and gifts also impact the tax base. The tax base is normally the cost of buying […]
Proper preparation for a tax audit can help relieve anxiety and reassure the auditor. There are two types of audits, and it’s important to have all necessary documents organized. Consulting a tax expert may be beneficial, and it’s important to avoid being rude or lying during the audit. A tax audit can be an exciting […]
Matrícula fiscal credit is a federal credit for those who pay university fees, reducing the amount of taxes paid. There are two types of credits: estadounidenses opportunity credits and lifelong learning credits, with different eligibility requirements and limitations. Taxpayers cannot claim multiple life learning credits for various children, but may combine them with state-specific opportunity […]
Partnership taxation varies globally, with the most common approach being a pass-through model. Partnerships must file tax returns, and in some countries, this determines tax liability. The US uses the pass-through system, and accurate tax records are necessary to avoid tax fraud investigations. Larger partnerships may employ an accountant experienced in partnership taxation. Taxation of […]
The IRS charges an estimated tax penalty when a person fails to pay estimated taxes on time. Individuals must pay estimated taxes on income not subject to automatic withholding. Waivers may be granted in certain circumstances. The penalty can be calculated using Form 2210 or by hiring an accountant. An estimated tax fine is a […]
The additional child tax credit is a portion of the child tax credit that can be claimed on a US tax return. To qualify, parents must meet specific eligibility requirements, including a citizenship and residency test. The credit can be repaid above the taxable income bill and may require additional tax documents. Professional tax preparers […]
