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POST-RETIREMENT ROTH CONVERSION Many people believe it doesn’t make sense to convert a traditional IRA to a Roth IRA late in life. In reality, many retirees have a longer life expectancy than you might expect. What’s more, tax savings are possible even without an extended period of post-conversion ownership. The benefits aren’t present in all cases, so careful Continue reading "Post-Retirement Roth Conversion" CASHLESS EXERCISE OF ISOS Some employers make it easier for option holders to exercise their incentive stock options by providing a method of “cashless exercise.” Usually the company makes arrangements with a brokerage firm, which loans the money needed to buy the stock. The brokerage firm sells some or all of the stock immediately, with part of the proceeds Continue reading "Cashless Exercise of ISOs" TAX REPORTING FOR QUALIFYING DISPOSITIONS OF ESPP SHARES Step 1: Calculate compensation income. Your compensation income from ESPP shares in a qualifying disposition is the lesser of two amounts. The first is the discount allowed on your purchase, determined as of the “grant date,” which is normally the first day of the offering period. (Your company should inform you if a different grant date is GRANTS OR AWARDS OF STOCK If you work for a corporation, you may receive compensation in the form of stock of that corporation (or perhaps the parent of that corporation). If the stock is vested when you receive it, you have to report compensation income at that time. Otherwise the stock is restricted, and you won’t report compensation income until Continue reading "Grants or Awards of Stock" MULTIPLE LOTS OF SHARES Multiple Lots of Shares. For stock and mutual fund investors, owning multiple lots of shares raises multiple issues. All shares of a particular class issued by a corporation or mutual fund are identical. They confer the same rights and have the same DISTRIBUTIONS AFTER A ROTH IRA CONVERSION As a general rule, you can withdraw your contributions from a Roth IRA at any time without paying tax or penalty. If you withdraw money from a conversion too soon after that event, and before age 59½, you may incur a penalty. Early distribution penalty Subject to various exceptions, if you take a withdrawal from Continue reading "Distributions After a Roth IRA Conversion" CASH RECEIVED IN MERGERS The merger consideration was $107.50 per share, so your total consideration was $10,750, of which you received $900 in cash. If the total basis in your AirTouch shares before the merger was $8,000, your gain was $2,750. That’s more than the amount of cash you received, so you report gain of $900, and your basis in the new shares is

$8,000.

TAX REPORTING FOR DISQUALIFYING DISPOSITIONS OF ESPP Step 1: Calculate compensation income. Your compensation income from ESPP shares in a disqualifying disposition is the value of those shares on the date of purchase minus the amount paid for them. For example, if you paid $1,700 to acquire shares that had a value of $2,000 on the date of purchase, your compensation income from a

disqualifying

REGULAR CONTRIBUTION TO A CONVERSION ROTH IRA For a while after the Roth IRA was created there was some confusion about whether you might be creating a problem if you made regular contributions to a conversion Roth IRA, but a law passed long ago cleared up that situation. You can use the same Roth IRA for both purposes, avoiding the extra paperwork, Continue reading "Regular Contribution to a Conversion Roth IRA" THE MINOR'S RIGHT TO THE MONEY Every so often I get a question like this one: Years ago my parent (or other relative) set up a custodial account in my name. Now I’ve reached the age where I’m supposed to receive the money (or I’m about to reach that age) and they refuse to turn it over to me. Don’t I Continue reading "The Minor’s Right to the Money" POST-RETIREMENT ROTH CONVERSION Many people believe it doesn’t make sense to convert a traditional IRA to a Roth IRA late in life. In reality, many retirees have a longer life expectancy than you might expect. What’s more, tax savings are possible even without an extended period of post-conversion ownership. The benefits aren’t present in all cases, so careful Continue reading "Post-Retirement Roth Conversion" CASHLESS EXERCISE OF ISOS Some employers make it easier for option holders to exercise their incentive stock options by providing a method of “cashless exercise.” Usually the company makes arrangements with a brokerage firm, which loans the money needed to buy the stock. The brokerage firm sells some or all of the stock immediately, with part of the proceeds Continue reading "Cashless Exercise of ISOs" TAX REPORTING FOR QUALIFYING DISPOSITIONS OF ESPP SHARES Step 1: Calculate compensation income. Your compensation income from ESPP shares in a qualifying disposition is the lesser of two amounts. The first is the discount allowed on your purchase, determined as of the “grant date,” which is normally the first day of the offering period. (Your company should inform you if a different grant date is GRANTS OR AWARDS OF STOCK If you work for a corporation, you may receive compensation in the form of stock of that corporation (or perhaps the parent of that corporation). If the stock is vested when you receive it, you have to report compensation income at that time. Otherwise the stock is restricted, and you won’t report compensation income until Continue reading "Grants or Awards of Stock" MULTIPLE LOTS OF SHARES Multiple Lots of Shares. For stock and mutual fund investors, owning multiple lots of shares raises multiple issues. All shares of a particular class issued by a corporation or mutual fund are identical. They confer the same rights and have the same DISTRIBUTIONS AFTER A ROTH IRA CONVERSION As a general rule, you can withdraw your contributions from a Roth IRA at any time without paying tax or penalty. If you withdraw money from a conversion too soon after that event, and before age 59½, you may incur a penalty. Early distribution penalty Subject to various exceptions, if you take a withdrawal from Continue reading "Distributions After a Roth IRA Conversion" CASH RECEIVED IN MERGERS The merger consideration was $107.50 per share, so your total consideration was $10,750, of which you received $900 in cash. If the total basis in your AirTouch shares before the merger was $8,000, your gain was $2,750. That’s more than the amount of cash you received, so you report gain of $900, and your basis in the new shares is

$8,000.

disqualifying

EXERCISING ISOS

One of the key differences between incentive stock options (ISOs) and nonqualified stock options is that you don’t have to report compensation income when you exercise an ISO. But you may have to pay a significant amount of tax anyway, because of the alternative minimum tax (AMT). The description on this page assumes you’re using Continue reading "Exercising ISOs" TAX REPORTING FOR DISQUALIFYING DISPOSITIONS OF ESPP Step 1: Calculate compensation income. Your compensation income from ESPP shares in a disqualifying disposition is the value of those shares on the date of purchase minus the amount paid for them. For example, if you paid $1,700 to acquire shares that had a value of $2,000 on the date of purchase, your compensation income from a

disqualifying

WITHHOLDING ON STOCK COMPENSATION Example: You receive stock valued at $20,000 and the withholding obligation is $6,600. If the company covers this withholding for you, then you have another $6,600 of compensation income (and the company has to withhold on that). The company would have to provide about $10,000 to cover all the bases at this rate of withholding. TAX-FREE WITHDRAWALS FROM COVERDELL ACCOUNTS If all goes as planned, the investment earnings of a Coverdell account can be entirely tax-free. To achieve that happy result, you need to have qualified education expenses at least equal to the amount of the distribution. The rules here are fairly generous, but not infinitelygenerous. Here’s what you need to know. Timing the Expenses You Continue reading "Tax-Free Withdrawals from

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Forums. Last Activity: 18 minutes ago. Topics Started: 0. Replies Created: 1. Forum Role: Participant EXCESS CONTRIBUTIONS TO ROTH IRAS This is a 6% tax you’re required to pay each year the excess contribution remains uncorrected. For example, suppose you made a $5,500 contribution to a Roth IRA early in 2021, then got a larger bonus than you expected and found that due to the income limitation your permitted contribution was only $4,300. Your excess contribution

was $1,200.

MAKING THE MARK-TO-MARKET ELECTION (PART 2) John Smith SSN 123-45-6789 Attachment to Form 3115 In accordance with Rev. Proc. 99-17 and section 475(f) of the Internal Revenue Code, the taxpayer filed an election with his 1999 income tax return to use the mark-to-market method of accounting in connection with his trade or business of trading securities, effective beginning with the taxable year commencing January 1, 2000. THE MINOR'S RIGHT TO THE MONEY Every so often I get a question like this one: Years ago my parent (or other relative) set up a custodial account in my name. Now I’ve reached the age where I’m supposed to receive the money (or I’m about to reach that age) and they refuse to turn it over to me. Don’t I Continue reading "The Minor’s Right to the Money" CHANGING THE BENEFICIARY OF A COVERDELL ACCOUNT The beneficiary’s spouse, son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law or sister-in-law. Beginning in 2002, the beneficiary’s first cousin. You can rename the beneficiary as part of a rollover, or simply redesignate the beneficiary by contacting the financial institution where the Coverdell account is now POST-RETIREMENT ROTH CONVERSION Many people believe it doesn’t make sense to convert a traditional IRA to a Roth IRA late in life. In reality, many retirees have a longer life expectancy than you might expect. What’s more, tax savings are possible even without an extended period of post-conversion ownership. The benefits aren’t present in all cases, so careful Continue reading "Post-Retirement Roth Conversion" TAX REPORTING FOR QUALIFYING DISPOSITIONS OF ESPP SHARES Step 1: Calculate compensation income. Your compensation income from ESPP shares in a qualifying disposition is the lesser of two amounts. The first is the discount allowed on your purchase, determined as of the “grant date,” which is normally the first day of the offering period. (Your company should inform you if a different grant date is CASHLESS EXERCISE OF ISOS Some employers make it easier for option holders to exercise their incentive stock options by providing a method of “cashless exercise.” Usually the company makes arrangements with a brokerage firm, which loans the money needed to buy the stock. The brokerage firm sells some or all of the stock immediately, with part of the proceeds Continue reading "Cashless Exercise of ISOs" GRANTS OR AWARDS OF STOCK If you work for a corporation, you may receive compensation in the form of stock of that corporation (or perhaps the parent of that corporation). If the stock is vested when you receive it, you have to report compensation income at that time. Otherwise the stock is restricted, and you won’t report compensation income until Continue reading "Grants or Awards of Stock" MULTIPLE LOTS OF SHARES Multiple Lots of Shares. For stock and mutual fund investors, owning multiple lots of shares raises multiple issues. All shares of a particular class issued by a corporation or mutual fund are identical. They confer the same rights and have the same DISTRIBUTIONS AFTER A ROTH IRA CONVERSION As a general rule, you can withdraw your contributions from a Roth IRA at any time without paying tax or penalty. If you withdraw money from a conversion too soon after that event, and before age 59½, you may incur a penalty. Early distribution penalty Subject to various exceptions, if you take a withdrawal from Continue reading "Distributions After a Roth IRA Conversion" CASH RECEIVED IN MERGERS The merger consideration was $107.50 per share, so your total consideration was $10,750, of which you received $900 in cash. If the total basis in your AirTouch shares before the merger was $8,000, your gain was $2,750. That’s more than the amount of cash you received, so you report gain of $900, and your basis in the new shares is

$8,000.

disqualifying

REGULAR CONTRIBUTION TO A CONVERSION ROTH IRA For a while after the Roth IRA was created there was some confusion about whether you might be creating a problem if you made regular contributions to a conversion Roth IRA, but a law passed long ago cleared up that situation. You can use the same Roth IRA for both purposes, avoiding the extra paperwork, Continue reading "Regular Contribution to a Conversion Roth IRA" THE MINOR'S RIGHT TO THE MONEY Every so often I get a question like this one: Years ago my parent (or other relative) set up a custodial account in my name. Now I’ve reached the age where I’m supposed to receive the money (or I’m about to reach that age) and they refuse to turn it over to me. Don’t I Continue reading "The Minor’s Right to the Money" POST-RETIREMENT ROTH CONVERSION Many people believe it doesn’t make sense to convert a traditional IRA to a Roth IRA late in life. In reality, many retirees have a longer life expectancy than you might expect. What’s more, tax savings are possible even without an extended period of post-conversion ownership. The benefits aren’t present in all cases, so careful Continue reading "Post-Retirement Roth Conversion" TAX REPORTING FOR QUALIFYING DISPOSITIONS OF ESPP SHARES Step 1: Calculate compensation income. Your compensation income from ESPP shares in a qualifying disposition is the lesser of two amounts. The first is the discount allowed on your purchase, determined as of the “grant date,” which is normally the first day of the offering period. (Your company should inform you if a different grant date is CASHLESS EXERCISE OF ISOS Some employers make it easier for option holders to exercise their incentive stock options by providing a method of “cashless exercise.” Usually the company makes arrangements with a brokerage firm, which loans the money needed to buy the stock. The brokerage firm sells some or all of the stock immediately, with part of the proceeds Continue reading "Cashless Exercise of ISOs" GRANTS OR AWARDS OF STOCK If you work for a corporation, you may receive compensation in the form of stock of that corporation (or perhaps the parent of that corporation). If the stock is vested when you receive it, you have to report compensation income at that time. Otherwise the stock is restricted, and you won’t report compensation income until Continue reading "Grants or Awards of Stock" MULTIPLE LOTS OF SHARES Multiple Lots of Shares. For stock and mutual fund investors, owning multiple lots of shares raises multiple issues. All shares of a particular class issued by a corporation or mutual fund are identical. They confer the same rights and have the same DISTRIBUTIONS AFTER A ROTH IRA CONVERSION As a general rule, you can withdraw your contributions from a Roth IRA at any time without paying tax or penalty. If you withdraw money from a conversion too soon after that event, and before age 59½, you may incur a penalty. Early distribution penalty Subject to various exceptions, if you take a withdrawal from Continue reading "Distributions After a Roth IRA Conversion" CASH RECEIVED IN MERGERS The merger consideration was $107.50 per share, so your total consideration was $10,750, of which you received $900 in cash. If the total basis in your AirTouch shares before the merger was $8,000, your gain was $2,750. That’s more than the amount of cash you received, so you report gain of $900, and your basis in the new shares is

$8,000.

disqualifying

EXERCISING ISOS

disqualifying

FAIRMARK.COM

was $1,200.

sales.

CASH RECEIVED IN MERGERS The merger consideration was $107.50 per share, so your total consideration was $10,750, of which you received $900 in cash. If the total basis in your AirTouch shares before the merger was $8,000, your gain was $2,750. That’s more than the amount of cash you received, so you report gain of $900, and your basis in the new shares is

$8,000.

MULTIPLE LOTS OF SHARES Multiple Lots of Shares. For stock and mutual fund investors, owning multiple lots of shares raises multiple issues. All shares of a particular class issued by a corporation or mutual fund are identical. They confer the same rights and have the same TAX REPORTING FOR DISQUALIFYING DISPOSITIONS OF ESPP Step 1: Calculate compensation income. Your compensation income from ESPP shares in a disqualifying disposition is the value of those shares on the date of purchase minus the amount paid for them. For example, if you paid $1,700 to acquire shares that had a value of $2,000 on the date of purchase, your compensation income from a

disqualifying

CASHLESS EXERCISE OF ISOS Some employers make it easier for option holders to exercise their incentive stock options by providing a method of “cashless exercise.” Usually the company makes arrangements with a brokerage firm, which loans the money needed to buy the stock. The brokerage firm sells some or all of the stock immediately, with part of the proceeds Continue reading "Cashless Exercise of ISOs" THE SECTION 481(A) ADJUSTMENT There’s an arcane aspect of the mark-to-market election that confuses many people, including knowledgeable tax professionals. The question is what you report as the section 481(a) adjustment when you file Form 3115 for the mark-to-market election. Here’s an explanation of this adjustment. Purpose of the Adjustment When you change a method of accounting, it’s possible you’ll have CAPITAL LOSSES FOR MINORS One of the frequent questions on our message board is how to handle a capital loss in a custodial account under the Uniform Transfers to Minors Act (UTMA). In the typical situation, a parent or other relative set up the account and contributed money that was invested in stocks or mutual funds. Later they sell Continue reading "Capital

Losses for Minors"

TAX-FREE WITHDRAWALS FROM COVERDELL ACCOUNTS TAX REPORTING FOR QUALIFYING DISPOSITIONS OF ESPP SHARES Step 1: Calculate compensation income. Your compensation income from ESPP shares in a qualifying disposition is the lesser of two amounts. The first is the discount allowed on your purchase, determined as of the “grant date,” which is normally the first day of the offering period. (Your company should inform you if a different grant date is POST-RETIREMENT ROTH CONVERSION Many people believe it doesn’t make sense to convert a traditional IRA to a Roth IRA late in life. In reality, many retirees have a longer life expectancy than you might expect. What’s more, tax savings are possible even without an extended period of post-conversion ownership. The benefits aren’t present in all cases, so careful Continue reading "Post-Retirement Roth Conversion" WASH SALES AND OPTIONS Wash Sales and Options. The wash sale rule can apply to trades involving stock options. Options present two different types of problems in connection with the wash sale rule. First, if you sell stock at a loss, you can turn that sale into a wash sale by trading in options. And second, losses from the options themselves can be wash

sales.

$8,000.

disqualifying

Losses for Minors"

disqualifying

MAKING THE MARK-TO-MARKET ELECTION (PART 1) Making the election is a two-step process (with the second step being in two parts). The first step is to file an election, on or before the unextended due date of your tax return for the year before the year to which the election applies. If you file your tax return by the regular due date, attach the election to TRADERS AND WASH SALES Most investors run into the wash sale rule only occasionally. If you’re an active trader, you’re likely to have a large number of wash sales each year. Discussion of many tax rules for traders appears in our online Tax Guide for Traders, and a more detailed discussion appears in our book, Capital Gains, Minimal Taxes. Overview Generally, Continue reading "Traders and Wash Sales" WITHHOLDING ON STOCK COMPENSATION Example: You receive stock valued at $20,000 and the withholding obligation is $6,600. If the company covers this withholding for you, then you have another $6,600 of compensation income (and the company has to withhold on that). The company would have to provide about $10,000 to cover all the bases at this rate of withholding. THE SECTION 481(A) ADJUSTMENT There’s an arcane aspect of the mark-to-market election that confuses many people, including knowledgeable tax professionals. The question is what you report as the section 481(a) adjustment when you file Form 3115 for the mark-to-market election. Here’s an explanation of this adjustment. Purpose of the Adjustment When you change a method of accounting, it’s possible you’ll have CAPITAL LOSS WITH LITTLE OR NO INCOME For a single taxpayer in 2018 this would be $12,000. The result is -$14,500. Now we add back the $3,000 capital loss to see that even without the capital loss you have no positive taxable income. That means your entire capital loss of $8,000 carries over to the next year, even though you show a $3,000 capital loss deduction on your

return.

SECTION 83B ELECTION As explained below, the tax rules for restricted stock provide both an advantage and a disadvantage when compared to the rules for vested stock. If you don’t like the trade-off, you can make the section 83b election. When you do, you’ll be treated (mostly) as if you received vested stock. But you have to act Continue reading "Section 83b

Election"

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* Relief from Spousal Liability * Equity Compensation * Tax Cuts and Jobs Act KEY RETIREMENT SAVINGS FIGURES UNCHANGED FOR 2021 Here’s the reason some key retirement contribution figures didn’t

change for 2021.

Once upon a time, inflation went hand-in-hand with tax increases. Wages and prices would rise while tax brackets and deduction limits remained unchanged. The same amount of real, inflation-adjusted income would produce a higher payment to the IRS. Taxpayers would fall behind while standing still. Nowadays we get annual adjustments in most tax figures. Some of these numbers stay the same because of rounding rules, however. They may go up only when accumulated inflation is enough to push them over the next $500 increment, for example. This is what happened to the key retirement savings figures for 2021. The IRA contribution limit remains at $6,000 ($7,000 if age 50 or older). The ceiling on contributions to 401k and similar plans, including the Thrift Savings Plan for federal employees, stays at $19,500, with the 50-and-over catch-up contribution capped at $6,500. Inflation wasn’t enough to budge the $13,500 limitation for SIMPLE retirement accounts. Aggressive savers will be disappointed to see these figures repeat for 2021. Look at the bright side, though. We’re stuck on these numbers because of historically tame inflation ⚊ and when it comes to retirement savings, that’s a Very Good Thing. More retirement plan figures, and other inflation adjustments, are available in our Reference Room

.

Author Kaye Thomas Posted on January 1, 2021January 14, 2021

401k , IRAs

, Retirement

, Roth Accounts

,

Uncategorized

THREE THINGS ABOUT THAT SPECIAL CHARITABLE CONTRIBUTION DEDUCTION For 2020 only, we have a special charitable contribution deduction, allowing up to $300 for those who don’t itemize. This allowance doesn’t follow the usual rules, though. Here are three things you’ll want to know about this charitable deduction. Continue reading “Three Things About That Special Charitable Contribution Deduction” Author Kaye Thomas Posted on December 11, 2020March 1, 2021

, deductions

, general taxation

CONSIDER YOUR OPTIONS 2019

Our best-selling

explanation of restricted stock units, employee stock options, and other equity compensation is now available in a 2019 edition that includes explanation of how last year’s tax changes will affect

strategies.

more info

shop for paperback

shop for kindle version Author Kaye Thomas Posted on February 1, 2019February 1, 2019

Compensation

A TAX BENEFIT RESERVED FOR THE RICH An extraordinary provision added by the Tax Cuts and Jobs Act makes it possible for taxpayers to defer almost any kind of capital gain and potentially secure additional tax benefits if they invest in a _qualified opportunity fund_. (Proposed regulations make exceptions for gain from section 1256 contracts or offsetting positions.) You need to make this election during the 180-day period beginning on the day you have the gain, and then show on your tax return that you elect to invoke this provision. Your gain, up to the amount you invest, will not be taxable that year, but instead will become taxable when you sell this investment, or on December 31, 2026, if the investment remains unsold on that date. Depending on how long you hold this investment, some of that gain may disappear. After five years your basis is increased by 10% of the amount that was deferred, eliminating 10% of the gain from the original sale. Another 5% of that gain disappears if your holding period stretches to seven years. As a final kicker, reaching the ten-year milestone lets you avoid paying tax on any gain from an increase in the value of this investment during your holding period. A qualified opportunity fund has to be at least 90% invested in properties and businesses in certain low-income areas or adjoining areas. That’s the underlying idea: to revitalize these areas by attracting investment dollars. Those dollars are not targeted to particular types of projects, however. Funds will pursue properties and businesses that provide the highest returns for their investors. As written in the law, this tax benefit is available to all taxpayers. Anyone who has a capital gain of almost any kind can defer reporting the gain by investing in one of these funds. Yet as of this writing, these investments are available only to _accredited investors_—those who make over $200,000 per year (or $300,000 with their spouse), or have net worth, excluding their home, above $1,000,000. Members of the general public can’t buy in because the funds haven’t gone through the lengthy, expensive process of getting their offerings registered with the SEC. At least one firm has made an SEC filing that could lead it to become publicly traded as a qualified opportunity fund REIT, so this deferral benefit could eventually become available to all investors. For now, however, this extraordinary new tax benefit is reserved for the wealthy. Author Kaye Thomas Posted on January 25, 2019February 2, 2019

,

Taxation of Investments

Tags qualified

opportunity fund

ROLLOVER DEADLINE RELIEF

Missing

the 60-day deadline to complete a rollover after receiving a distribution from a retirement plan or IRA can have painful consequences. There’s a simple solution, though, if you meet the

requirements.

Relief from the 60-Day Rollover Deadline Author Kaye Thomas Posted on January 20, 2019January 20, 2019 Categories Retirement

Tags rollover

SHUTDOWN WON’T PREVENT TAX REFUNDS

Updated

Reversing course, the Trump Administration announced today that the government shutdown will not prevent the IRS from sending income tax refunds to taxpayers. The first posting of this item mentioned that a question had been raised as to whether it is legal to do so. In a subsequent information release, the IRS says Congress directed the payment of all tax refunds through a permanent, indefinite appropriation, and that the Office of Management and Budget, which had previously directed the IRS not to pay refunds during a budget impasse has reviewed the law and concluded that it may so so. The release also sets January 28 as the date it will begin processing

returns.

In their words: irs information release Author Kaye Thomas Posted on January 7, 2019January 8, 2019

Filing Season

AMT REPEAL?

Have you heard that the Tax Cuts and Jobs Act repealed the alternative minimum tax (AMT)? Probably not, because the AMT survived. Yet it’s been whittled down to a shadow of its former self. For nearly all taxpayers, AMT repeal is a practical

reality.

featured article: AMT Repeal, for Most NOTE: This article kicks off a series on the profound changes made by the Tax Cuts and Jobs Act. Author Kaye Thomas Posted on January 7, 2019January 17, 2019 Categories Equity Compensation

, General Taxation

Tags alternative

minimum tax , amt

, incentive stock options SHUTDOWN MAY DELAY REFUNDS UPDATE: as explained here

, the IRS now

says it will be able to pay refunds during the shutdown. The 2019 tax season was already bound to be challenging. We can expect plenty of confusion in the first filing season under a law that made sweeping changes affecting taxpayers in all categories. Add to that a complete redesign of Form 1040, taking a modular, block-building approach and eliminating the 1040-EZ and 1040-A versions. The IRS is still scrambling to get its form instructions and information publications in final form, and has yet to announce a date for the start of the filing season. Now the IRS faces these challenges under the handicap of a partial government shutdown. Essential functions at the agency continue, including — when they’re ready — accepting tax returns and payments. According to the _Wall Street Journal_, however, the IRS generally doesn’t pay refunds during a shutdown. Any substantial delay in paying refunds would produce hardship for millions of Americans who depend on receiving a substantial check as early as possible in the year. Tax refunds, which total hundreds of billions of dollars, also boost retail sales and the general economy. A shutdown that delays those refunds would have consequences for all

of us.

Author Kaye Thomas Posted on January 3, 2019January 8, 2019

Categories Filing

Season Tags shutdown NEW FORM 1040 NOW AVAILABLE The IRS has completely redesigned Form 1040, using what they call a building block approach, where the form itself is much shorter but is supplemented as needed by up to six new schedules. As a result, the same form can be used by all taxpayers, from those with the simplest to the most complicated returns. The new form, its 117-page instructions, and the new schedules are available now: About Form 1040 Author Kaye Thomas Posted on

December 14, 2018

Categories Filing

Season

WASH SALE DETAILS

Articles on year-end tax planning for investors inevitably mention the opportunity to harvest losses from stocks and other securities that may have declined in value. Recent stock market declines have increased the potential value of this opportunity, along with the importance of understanding the _wash sale rule_, which can stand in the way of efforts to harvest losses while maintaining a consistent investment strategy. No doubt you’ve seen brief summaries of this provision, but there’s a lot more to the wash sale rule than meets the eye. Get the full details here: details: Wash Sale Rule Author Kaye Thomas Posted on November 23, 2018November 23, 2018 Categories Capital Gains and

Losses

,

Taxation of Investments

POSTS NAVIGATION

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Text

$8,000.

disqualifying

$8,000.

disqualifying

EXERCISING ISOS

disqualifying

FAIRMARK.COM

was $1,200.

$8,000.

disqualifying

$8,000.

disqualifying

EXERCISING ISOS

disqualifying

FAIRMARK.COM

was $1,200.

sales.

$8,000.

disqualifying

Losses for Minors"

sales.

$8,000.

disqualifying

Losses for Minors"

disqualifying

return.

Election"

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