August 15, 2017

Tips to Keep in Mind on Income Taxes and Selling a Home

Tips to Keep in Mind on Income Taxes and Selling a Home Homeowners may qualify to exclude from their income all or part of any gain from the sale of their main home. Below are tips to keep in mind when selling a home: Ownership and Use. To claim the exclusion, the homeowner must meet the ownership and use tests. This means that during the five-year period ending on the date of the sale, the homeowner must have: Owned the home for at least two years Lived in the home as their main home for at least two years    Gain.  If there is a gain from the sale of their main home, the homeowner may be able to exclude up to $250,000 of the gain from income or $500,000 on a joint return in most cases. Homeowners who can exclude all of the gains do not need to report the sale on their tax return Loss.  A main home that sells for lower than purchased is not deductible. Reporting a Sale.  Reporting the sale of a home on a tax return is required if all or part of the gain is not excludable. A sale must also be reported on a […]
August 8, 2017

Tips to Protect Taxpayers from Identity Theft

Eight Tips to Protect Taxpayers from Identity Theft Identity theft happens when someone steals personal information for financial gain. Tax-related identity theft happens when someone uses another person’s stolen Social Security number (SSN) or Employer Identification Number (EIN) to file a tax return to obtain a fraudulent refund. Many people first find out they are victims of identity theft when they submit their tax returns. That’s because the IRS lets them know someone else already used their SSN to file. The IRS continues to work hard to stop identity theft with a strategy of prevention, detection and victim assistance. So far, the agency has stopped millions of dollars from getting into the hands of thieves. Check out these eight tips on how to protect against identity theft: 1. Taxes. Security. Together. The IRS, the states, and the tax industry need everyone’s help. The IRS launched The Taxes. Security. Together. awareness campaign in 2015 to inform people about ways to protect their personal, tax and financial data. Learn more at www.IRS.gov/TaxesSecurityTogether. 2. Protect Personal and Financial Records. Taxpayers should not carry their Social Security card in their wallet or purse. They should only provide their Social Security number if it’s necessary. Protect personal […]
August 1, 2017

How to Get Tax Transcripts and Copies of Tax Returns from the IRS

Taxpayers should keep copies of their tax returns for at least three years. Those who need a copy of their tax return should check with their software provider or tax preparer. If all else fails though, here how getting tax transcripts and copies of returns from the IRS works. Tax Transcripts A transcript summarizes return information and includes Adjusted Gross Income (AGI). They are available for the most current tax year after the IRS has processed the return. People can also get them for the past three years. When applying for home mortgages or college financial aid, transcripts are often necessary. Mortgage companies, however, normally arrange to get one for a homeowner or potential homeowner. For people applying for college financial aid, see IRS Offers Help to Students, Families to Get Tax Information for Student Financial Aid Applications on IRS website for the latest options. Taxpayers can get two types of transcripts from the IRS: Tax Return Transcript. A tax return transcript shows most line items including AGI from an original tax return (Form 1040, 1040A or 1040EZ) as filed, along with any forms and schedules. It doesn’t show changes made after the filing of the original return. This transcript […]
July 4, 2017

Deducting Losses from a Disaster

The IRS wants taxpayers to know it stands ready to help in the event of a disaster. If a taxpayer suffers damage to their home or personal property, they may be able to deduct the loss they incur on their federal income tax return. If their area receives a federal disaster designation, they may be able to claim the loss sooner. Ordinarily, a deduction is available only if the loss is major and not covered by insurance or other reimbursements. Here are 10 tips taxpayers should know for deducting losses from a disaster: 1. Casualty loss. A taxpayer may be able to deduct a loss based on the damage done to their property during a disaster. A casualty is a sudden, unexpected or unusual event. This may include natural disasters like hurricanes, tornadoes, floods, and earthquakes. It can also include losses from fires, accidents, thefts or vandalism. 2. Normal wear and tear. A casualty loss does not include losses from normal wear and tear. It does not include progressive deterioration from age or termite damage. 3. Covered by insurance. If a taxpayer insured their property, they must file a timely claim for reimbursement of their loss. If they don’t, they […]