TAX IMPLICATIONS OF INVESTOR OR TRADER STATUS Most taxpayers who trade stocks are classified as investors for tax purposes. This means any net gains are going to be treated as capital gains versus ordinary income. That’s good if your net gains are long-term from positions held more than a year. However, any investment-related expenses (such [...]
TAXPAYER ADVOCATE REPORTS TO CONGRESS National Taxpayer Advocate Nina E. Olson recently released her annual report to Congress, urging the Internal Revenue Service to adopt a comprehensive Taxpayer Bill of Rights (TBOR)-a step she said would increase trust in the agency and, more generally, strengthen its ability to serve taxpayers and collect tax. The Advocate [...]
WHEN IS A MARRIAGE TERMINATED FOR TAX PURPOSES? A couple remains married for tax purposes until a final decree of divorce is issued by a domestic relations court; a domestic relations court issues a final decree constituting a legal separation under local law, requiring the couple to live apart; or the abandoned spouse rule applies. [...]
LIFETIME VERSUS TESTAMENTARY CONTRIBUTIONS Many taxpayers with charitable intentions struggle with the decisions of whether to donate property to charity during their lifetimes or to make a charitable bequest in their wills that will be fulfilled from property included in their estates (testamentary bequests). While taxpayers frequently base their choice between lifetime charitable gifts and [...]
Start Planning Now for 2014 Income Taxes You may not have even completed your 2013 taxes yet. But now is an ideal time to start getting ready for your 2014 returns. We know that you’re in some stage of preparation for your 2013 income taxes. It may seem odd to start thinking about 2014 [...]
COVERDELL EDUCATION SAVINGS ACCOUNTS The Coverdell Education Savings Account (ESA) was created as an incentive to help parents and students save for education expenses. The total contributions for the beneficiary of this account cannot be more than $2,000 in any year, no matter how many accounts have been established. A beneficiary is someone who is [...]