Deducting Un-reimbursed Professional Expenses

by | Nov 17, 2015 | 2015 Year End Newsletter, Deductions

According to the IRS, to be deductible, an expenditure must be both “ordinary” and “necessary” in connection with your profession.? The IRS defines “ordinary” as common and accepted in a particular profession and “necessary” as helpful and appropriate for a particular profession.

Here?s a list of 16 professional expenditures commonly incurred by young health care professionals:

  • Automobile expenses
  • Beepers and pagers
  • Books/library
  • Cellular telephones?
  • Computer purchases
  • Education, examinations & licenses
  • Equipment & instruments
  • Job search
  • Malpractice insurance
  • Meals & entertainment
  • Parking & tolls
  • Professional dues, journals & subscriptions
  • Psychoanalysis as part of training
  • Supplies
  • ?Travel & lodging
  • Uniforms & cleaning

?Please note:? Employees may not deduct professional expenses that are eligible for reimbursement from their employer.

8 Tax Savers for Parents

by | Mar 4, 2014 | Education, Savings, Taxes

From IRS Tax Tips:

Your children may help you qualify for valuable tax benefits. Here are eight tax benefits parents should look out for when filing their federal tax returns this year.

1.?Dependents.? In most cases, you can claim your child as a dependent. This applies even if your child was born anytime in 2013. For more details, see Publication 501, Exemptions, Standard Deduction and Filing Information.

2.?Child Tax Credit.? You may be able to claim the Child Tax Credit for each of your qualifying children under the age of 17 at the end of 2013. The maximum credit is $1,000 per child. If you get less than the full amount of the credit, you may be eligible for the Additional Child Tax Credit. For more about both credits, see the instructions for Schedule 8812, Child Tax Credit, and Publication 972, Child Tax Credit.

3.?Child and Dependent Care Credit.? You may be able to claim this credit if you paid someone to care for one or more qualifying persons. Your dependent child or children under age 13 are among those who are qualified. You must have paid for care so you could work or look for work. For more, see Publication 503, Child and Dependent Care Expenses.

4.?Earned Income Tax Credit.? If you worked but earned less than $51,567 last year, you may qualify for EITC. If you have three qualifying children, you may get up to $6,044 as EITC when you file and claim it on your tax return. Use the EITC Assistant tool at IRS.gov to find out if you qualify or see Publication 596, Earned Income Tax Credit.

5.?Adoption Credit.? You may be able to claim a tax credit for certain expenses you paid to adopt a child. For details, see the instructions for Form 8839, Qualified Adoption Expenses.

6.?Higher education credits.? If you paid for higher education for yourself or an immediate family member, you may qualify for either of two education tax credits. Both the American Opportunity Credit and the Lifetime Learning Credit may reduce the amount of tax you owe. If the American Opportunity Credit is more than the tax you owe, you could be eligible for a refund of up to $1,000. See Publication 970, Tax Benefits for Education.

7.?Student loan interest.? You may be able to deduct interest you paid on a qualified student loan, even if you don?t itemize deductions on your tax return. For more information, see Publication 970.

8.?Self-employed health insurance deduction.? If you were self-employed and paid for health insurance, you may be able to deduct premiums you paid to cover your child under the Affordable Care Act. It applies to children under age 27 at the end of the year, even if not your dependent. See IRS Notice 2010-38 for information.

You can also watch IRS YouTube Videos on these subjects:

 

SS Tax101: Choosing the Right Filing Status

by | Feb 19, 2014 | SS Tax 101, Taxes

ss101We’re happy to start a monthly “Tax 101” Series!

We’ll feature?basic topics of taxes and hopefully answer those questions that you maybe felt were “too silly to ask” a CPA in person.?

And please let us know if there are topics you’d like us to cover.

Topic 1: Filing Statuses

(from IRS Tax Tips)

Using the correct filing status is very important when you file your tax return. You need to use the right status because it affects how much you pay in taxes. It may even affect whether you must file a tax return.

When choosing a filing status, keep in mind that your marital status on Dec. 31 is your status for the whole year. If more than one filing status applies to you, choose the one that will result in the lowest tax.

Note for same-sex married couples: New rules apply to you if you were legally married in a state or foreign country that recognizes same-sex marriage. You and your spouse generally must use a married filing status on your 2013 federal tax return. This is true even if you and your spouse now live in a state or foreign country that does not recognize same-sex marriage. See irs.gov and the instructions for your tax return for more information.

Here is a list of the five filing statuses to help you choose:

1.?Single.? This status normally applies if you aren?t married or are divorced or legally separated under state law.

2.?Married Filing Jointly.? A married couple can file one tax return together. If your spouse died in 2013, you usually can still file a joint return for that year.

3.?Married Filing Separately.? A married couple can choose to file two separate tax returns instead of one joint return. This status may be to your benefit if it results in less tax. You can also use it if you want to be responsible only for your own tax.

4.?Head of Household.? This status normally applies if you are not married. You also must have paid more than half the cost of keeping up a home for yourself and a qualifying person. Some people choose this status by mistake. Be sure to check all the rules before you file.

5.?Qualifying Widow(er) with Dependent Child.? If your spouse died during 2011 or 2012 and you have a dependent child, this status may apply. Certain other conditions also apply.