If you enjoy collecting antiques and collectibles or investing in fine art, wine, or vintage cars, there may be a time when you’re ready to cash in and reap the financial rewards. But you need to be aware of the tax impact of selling collectibles.
What Is the Net Investment Income Tax?
What Is the Net Investment Income Tax?
While the Net Investment Income Tax (NIIT) most often affects wealthier individuals, in certain circumstances, it can also affect moderate-income taxpayers whose income increases significantly in a given tax year.
Special Tax Rules for Children With Investment Income
Special tax rules may apply to some children who received investment income in 2022 or expect to receive it in 2023. Investment income generally includes interest, dividends, and capital gains. It also includes other unearned income, such as taxable scholarships or from a trust. These rules may affect the amount of tax and how to report the income.
What Are IRS Notices CP2100 And CP2100A?
If you received a CP2100 or CP2100A notice from the IRS this year, don’t ignore it. Here’s what you need to know:
Reporting Gambling Income and Losses on Your Tax Return
If you aren’t in the trade or business of gambling, you should be aware that gambling winnings are fully taxable and must be reported as income on your tax return. Gambling income includes but isn’t limited to winnings from lotteries, raffles, horse races, and casinos, and also includes cash winnings and the fair market value of prizes, such as cars and trips. Here is what you need to know:
Tips for Taxpayers With Hobby Income
Hobby activities are a source of income for many taxpayers. For instance, during the pandemic many people may have started making handmade items and selling them for a profit. As a reminder, this income must be reported on tax returns.
Are Taxes Two-Timing You? How to avoid dual-taxation…
The shift to remote working during the COVID-19 pandemic has been embraced by both employees and employers. This change will likely continue to varying degrees by many companies.
Although remote working offers great benefits, employees need to know about the possible tax consequences and how to navigate them.
Renting Out a Second Home
In general, income from renting a vacation home for 15 days or longer must be reported on your tax return on Schedule E, Supplemental Income, and Loss. You should also keep in mind that the definition of a “vacation home” is not limited to a house. Apartments, condominiums, mobile homes, and boats are also considered vacation homes in the eyes of the IRS. Tax rules on rental income from second homes can be confusing, especially if you rent the home out for several months of the year and use the home yourself.
Tips for Taxpayers Who Make Money From a Hobby
Many people enjoy hobbies that are also a source of income. From soap making to pottery and jewelry making to calligraphy, these activities can be sources of both fun and finances. Taxpayers who make money from a hobby must report that income on their tax return.
Avoid IRS Audits: Fix the 1099 Prepaid-Rent Mismatch
Two questions:
- Are you prepaying your 2020 rent so that you have a big 2019 tax deduction?
- How do you identify in your accounting records the monies you put on your IRS Form 1099-MISC for the business rent payments to your landlord?