Friday, April 25, 2014

Work at Home? You May Qualify for the Home Office Deduction

IRS Tax Tip 2012-49, March 13, 2012

If you use part of your home for business, you may be able to deduct expenses for the business use of your home.

The IRS has the following six requirements to help you determine if you qualify for the home office deduction.
1. Generally, in order to claim a business deduction for your home, you must use part of your home exclusively and regularly:
• as your principal place of business, or
• as a place to meet or deal with patients, clients or customers in the normal course of your business, or
• in any connection with your trade or business where the business portion of your home is a separate structure not attached to your home.

2. For certain storage use, rental use or daycare-facility use, you are required to use the property regularly but not exclusively.

3.   Generally, the amount you can deduct depends on the percentage of your home used for business. Your deduction for certain expenses will be limited if your gross income from your business is less than your total business expenses.

4.   There are special rules for qualified daycare providers and for persons storing business inventory or product samples.

5.   If you are self-employed, use Form 8829, Expenses for Business Use of Your Home to figure your home office deduction and report those deductions on Form 1040 Schedule C, Profit or Loss From Business.

6.   If you are an employee, additional rules apply for claiming the home office deduction. For example, the regular and exclusive business use must be for the convenience of your employer.

For more information see IRS Publication 587, Business Use of Your Home, available at www.IRS.gov or by calling 800-TAX-FORM (800-829-3676)

WATCH VIDEO FROM IRS ON HOME OFFICE DEDUCTION


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Tax Quote

by admin on April 14, 2012

Tax Law Forum Tax Quote

“Because of the income tax, a penny saved is more than a penny earned.”

- Jeffery L. Yablon/

The Tax Law Forum is written by Attorney Rob Teuber of the law firm Weiss Berzowski Brady LLP. The blog discusses relevant Federal and Wisconsin tax law issues.

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DETAILS OF THE PAYROLL TAX EXTENSION

by admin on March 15, 2012

On December 23rd 2011, the United States Congress passed and President Barack Obama signed into law a two month continuation (into January and February 2012) of the 2% 2011 Social Security Payroll Tax reduction for employees.

The dynamics that the tax cut is limited to two months inherently creates a potential tax strategy for sharp taxpayers, tax lawyers, tax attorneys, tax accountants and tax advisors.  Had Congress not had the foresight to anticipate and close the opportunity for this tax strategy (tax loophole) taxpayers and tax professionals could have bunched their income into the first two months of 2012 to take advantage of the 2% reduction most or all of the year regardless of whether the Social Security Payroll Tax reduction is continued for the remainder of 2012.  To forestall this strategy, Congress included a “recapture” provision which essentially limits the 2% reduction to two twelfths of the $110,100 2012 Social Security Wage Base.  A parallel provision accomplishing the same result for self employment taxes is also included.  For employers who use payroll service or payroll software the additional computations should be hardly noticeable.  For employers who manually prepare their payroll this makes payroll preparation even more exciting.

For more information on payroll tax or other tax related legal concerns, contact the Chicago tax lawyers at Horowitz & Weinstein.

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PRESIDENT OBAMA’S BUDGET AND FAILURE TO FILE TAX RETURNS

March 15, 2012

President Barak Obama’s Budget proposal includes a provision to convert the crime of Willful Failure to File a Federal Tax Return from existing law where it is currently a Misdemeanor and make it a Felony for Willful Failure To File a Federal Tax Return in any 3 of a 5 consecutive year period and the [...]

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Reuters: Obama Welcomes Jobs Data, Urges Payroll Tax Cut

January 6, 2012

President Barack Obama welcomed a stronger than expected December unemployment report on Friday and urged Congress to extend a payroll tax cut until the end of 2012 to help the country’s economic recovery maintain momentum.
“We’re making progress. We’re moving in the right direction. And one of the reasons for this is the tax cut for [...]

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IRS: $385 Billion Unpaid Taxes in ’06

January 6, 2012

The Internal Revenue Service estimates that U.S. companies and individuals failed to pay $385 billion in taxes they owed in 2006, an increase from $290 billion five years earlier.
The agency said the rate of compliance remained almost unchanged at 85.5 percent, down slightly from 86.3 percent in 2001. The IRS announcement today is the first [...]

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Democrats Abandon Millionaire Surtax Proposal

December 15, 2011

Democrats are abandoning their demand for a surtax on millionaires to help finance payroll tax cuts in a sign that lawmakers are trying to broker a compromise on Congress’ highest-profile year-end dispute.
Even so, there is no clear path to quick bipartisan agreement on the legislation, which would prevent an automatic Social Security tax increase on [...]

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ILLINOIS SALES TAX NEWS

November 27, 2011

According to a  recent report in the Huffington Post, Illinois ranks in only the eighth position of the top ten highest sales tax States in the United States.  That may come as a surprise to many residents of Cook County and perhaps even more of a surprise to residents of the City of Chicago where [...]

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Find top Tax Lawyers

November 27, 2011

TAX LAWYER DIRECTORY

IRS AUDITS – POST AUDIT LITIGATION
IRS APPEALS – POST APPEAL LITIGATION
SALES TAX & USE TAX AUDITS
FEDERAL REFUND LITIGATION
TAX COURT PETITIONS
LITIGATION WITH ILLINOIS DEPARTMENT OF REVENUE

If you are in the need of civil or criminal tax attorney, check out the Tax Attorney Directory for top tax lawyers.

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LA Mayor Tests ‘Third Rail’ in Call for Proposition 13 Changes

August 17, 2011

Los Angeles Mayor Antonio Villaraigosa proposed dismantling California’s Proposition 13, which helped begin a nationwide anti-tax movement, in favor of a “grand bargain” that would boost levies on business property.
The Democrat who leads California’s largest city called on Governor Jerry Brown not to shrink from making sweeping changes in state tax laws that Villaraigosa, 58, [...]

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