Internal Revenue Service

QUESTION NO 1: Jack and Jill who own a business called Bed and breakfast in a partnership. During their financial year they bought some of the assets for their bed and breakfast business, on the other hand they bought one more asset for their investment property which is own by both in partnership as well. Below are the assets they bought for their bed and breakfast business and the cost (depreciation) they can claim on their taxable income of the year. There are two methods that they can…

The IRS added the innocent spouse relief option to its Internal Revenue Code to relieve one spouse's responsibility for paying any of the understatement of taxes owed. It does not even require separation to qualify for the "Classic" innocent spouse relief. Requirements: 1. The two of you filed a joint return that…

After researching taxable and non-taxable income, the Pontiac G6 awarded to Oprah’s audience would be subject to federal taxation. According to treasury regulations, it states that: “Section 74(a) requires the inclusion in gross income of all amounts received as prizes and awards, unless such prizes or awards qualify as an exclusion from gross income under subsection (b), or unless such prize or award is a scholarship or fellowship grant excluded from gross income by section 117 (Reg §…

Thank you for choosing our company, Ma’s Tax Services, for your tax preparing needs. In response to your recent correspondence regarding travel business deductions, tax preparers have a duty to file tax returns with accurate and complete information. Furthermore, under federal tax law, trade or business deductions are disallowed if the taxpayer cannot substantiate the deductions. Unfortunately, since you do not have substantiation regarding your business travel expenses, the travel expenses are…

Essay Question 1— Sarah and John have filed timely tax returns for the tax years 2010-2015 as married filing jointly. In November 2016, Sarah has engaged me for some tax advice. She tells me that in January 2014, she discovered that her husband was running an illegal side business and that he has intentionally not reported the extra income on any of his tax returns. She is scared because they have received a notice that the IRS will audit their 2015 return. She wants to know how far they can…

The IRS requires that individuals and businesses must sign a federal tax return in order to register with the IRS and obtain a PTIN (Preparer tax identification number). Anyone who prepares or assists federal tax returns must have a valid 2015 PTIN. You would also need to successfully complete tests for all paid tax return unless you are a CPA, attorney, or enrolled agents. Any tax return who engage in unethical conduct would be suspended by the IRS. If you are trying to renew a PTIN, you would…

There are various tax preparers available in each state; however, not everyone will provide you with excellent service. The onus is, therefore, on you to do your research and select a preparer who will listen to what you have to say and file the appropriate forms, getting you the most sufficient returns. Rule 5: Begin preparing for future tax seasons – As was mentioned…

Conservatives have continuously pushed for a balanced budget. With a stance of lowering taxes, opponents dispute how fiscal conservatives can actually balance the budget, as it is difficult to balance the budget while also lowering taxes. The loss of tax revenue, without economic growth, puts more pressure on the government to fund programs and expands the debt required to fund current government spending. However, according to the economic theory – the Laffer Curve – proposed by Chicago…

Welcome to Sales Tax Services for states – Search by zip codes or state names in order to get instant values for sales taxes. How to calculate sales tax amounts for US States – An introduction Getting Sales tax values to be paid, is easy as this remains to be one of the most generic information. In the US, it is most common that, you get an US sales tax calculator, which helps you to calculate the state tax to be given. Tax amounts obviously vary from one state to the other, and hence, the zip…

Facts: Your friend stole the money from his employer last year and he promised he would pay back them all with interest, however, you don’t know he returned or not. And now he is searching for some ways to exclude the amount from his taxable income. Question: • Whether the $175,000 is illegal or not • Whether the $175,00 is taxable or not • If your friend paid them back with interest, is there any way to exclude the amount from taxable income. • Is there any way to deduct the taxable income…