Self-employed individuals, including qualifying sole proprietors, partners, and more-than-2% S corporation shareholder-employees, can deduct premiums paid for qualified health insurance (within limits) in computing their adjusted gross incomes (AGI). There had been some confusion concerning whether certain Medicare premiums counted for this rule. Recent IRS guidance indicates that premiums for all parts of Medicare [...]
For married taxpayers, the implications of filing a joint or separate return extend beyond tax rates and the standard deduction. Like many aspects of income taxation, there is usually more than one approach to finding the optimal solution. We have listed some of the more common implications of filing either a joint or separate return. [...]
January 15—Individual taxpayers’ final 2012 estimated tax payment is due unless Form 1040 is filed by January 31, 2013, and any tax due is paid with the return. January 31—Most employers must file Form 941 (Employer’s Quarterly Federal Tax Return) to report Medicare, social security, and income taxes withheld in the fourth quarter of [...]
The political debate on federal tax reform touches many topics, including the tax deduction for interest on home mortgage loans. At the time of publication, there was no way to determine if this deduction will continue or at what level, but we thought it would be a good time to review current federal law on [...]
Many taxpayers bought a second home, such as a vacation home, with the intention of later converting the second home into their principal residence. Under pre-2008 Housing Act law, those taxpayers could have excluded up to $250,000 ($500,000 for certain joint filers) upon a later sale of that former vacation home as long as the [...]
Variable annuity contract distributions generally contain two components, taxable income and nontaxable return of basis (investment). However, distributions received before the annuity starting date (nonannuity distributions) are likely to be less taxpayer-friendly. Initially, these generally consist entirely of taxable income until all of the annuity contract’s earnings have been distributed. Subsequent payments are considered to [...]