A severance tax is a tax charged on the removal of natural resources, not based on profits but on the total amount removed. It can be levied on a graduated scale and is important for regions where natural resource exploitation is a large part of the economy. Critics argue it raises costs, but studies suggest […]
To calculate income tax liability, a person must add their income and subtract any deductions and credits. Taxpayers must also refer to tax agency guidelines to determine liability, which can be reduced with tax credits. To calculate the income tax liability, a person must consider a number of figures. Depending on where the taxpayer lives […]
Investors who own rental properties can use investment property tax deductions to reduce their taxable income, including mortgage interest payments, property tax costs, homeowners insurance premiums, and renovation expenses. They should consult with tax advisers and keep records of deductions to avoid penalties. People who own rental properties can use investment property tax deductions to […]
The break-even tax rate is the level of tax that neither encourages nor discourages investment. An equilibrium tax rate leaves investors indifferent, allowing brokers to focus on other aspects of the deal. It can also allow investors to focus on higher-risk investments without worrying about taxes. Brokers can advise on investments that create this tax […]
The IRS places a tax lien on property when taxes are not paid. Liens can be settled by paying the bill or through a payment agreement. The IRS may offer lien subordination to facilitate real estate transactions. Tax advisors or attorneys may be needed to resolve premature or improperly issued liens. The Internal Revenue Service […]
Investors may have to pay dividend reinvestment tax even if they don’t physically receive the dividends. Reinvesting dividends can also result in capital gains tax, but investing in tax-sheltered retirement accounts can defer taxes until withdrawal. Investors pay a dividend reinvestment tax even if they never take physical possession of the fund’s dividends. Mutual funds […]
Year-end tax planning involves managing finances to maximize annual tax benefits, including timing sales, purchases, and trades. External factors, such as government tax changes, can also impact planning. Deduction management, optimizing tax benefits, and considering both short and long-term effects are important aspects of effective planning. Year-end tax planning is the process of managing financial […]
Tax evasion is a serious crime in the US, with fines up to hundreds of thousands of dollars and up to five years in prison. Willful failure to pay taxes or submit documents can also result in fines and jail time. False declarations in tax returns can lead to imprisonment for up to three years […]
Governments may impose an insurance premium tax on companies that receive premium payments from customers, which can vary widely but is typically low. Insurance companies face strict regulations, and taxes may limit the number of policies sold. Companies must file with the government and may need to add new procedures for collecting and reporting premium […]
The Making Work Pay tax credit was a temporary measure to help reduce the financial burden on taxpayers caused by the 2008 recession. It was available for 2009 and 2010 and had set limits for eligibility. The full amount was $400 for individuals and $800 for married couples filing jointly, and it was refundable. The […]
A new car tax credit is a deduction or credit on taxes for purchasing a new car, often used to stimulate the economy and reduce reliance on oil. Qualifying factors and income limits apply, and it may be a deduction or credit. It is not consistently offered and varies by region. A new car tax […]
A trust tax return must be filed separately from an individual’s return in the US, and generates a K-1 form showing income to be included on the personal return. A trust is a separate entity subject to income tax, with four requirements: a grantor, assets, a trustee, and one or more beneficiaries. Taxes must be […]
International tax law deals with cross-border tax issues for individuals and entities operating in multiple countries. It requires a broad understanding of different tax structures and aims to minimize taxes while complying with national laws. An international tax lawyer advises clients on tax consequences and structures assets or businesses accordingly. Specialized experience and a law […]
Tax law regulates government collection of money from citizens and businesses, outlining who pays taxes and at what rate. It is often referred to as administrative or public law and includes regulations for exemptions and non-payment. The tax collection system must be fair, and rates are influenced by factors such as income and business type. […]
Taxpayers in the US can check their federal tax refund status using the IRS website’s “Where’s My Refund?” service, which requires their social security number, marital status and refund amount. The IRS also offers a toll-free number and has staff available at embassies or consulates in Frankfurt, London, Paris and Guaynabo. Taxpayers who used a […]
The US federal roofing tax credit encourages homeowners to use Energy Star products for re-roofing to create jobs in the construction industry and lower electricity costs. Only Energy Star products qualify, and pigmented coated metal roofing and cooling granule asphalt roofing are eligible. The aim is to reduce the amount of heat inside the house […]
Tax breaks reduce or eliminate taxes for individuals and organizations. To be tax-exempt, organizations must meet criteria defined by the US Internal Revenue Code. Non-profit organizations, including schools and churches, are generally tax-exempt at the federal level. Tax exemptions are granted to promote economic activity or reduce taxes for a particular segment of society. Various […]
The IRS recommends keeping tax records for 3-4 years after filing, but some experts suggest keeping them for 7-10 years. Keeping W-2s may be important for Social Security benefits and tax records may be needed for student loans or business disclosure. There is a lot of controversy about how long you should keep tax records […]
Tax attorneys advise clients on tax matters and help manage finances in compliance with local and national tax laws. There are different types of tax attorneys, including income tax attorneys who work with taxpayers, corporate tax attorneys who focus on businesses, and international tax attorneys who handle tax situations abroad. They may work for law […]
Property tax deferral allows temporary suspension of payment of property taxes, with repayment required at a later date. Eligibility criteria vary, and repayment plans typically involve interest and monthly payments. It is not the same as property tax forgiveness. A property tax deferral is an opportunity to receive a temporary suspension of payment of property […]
