Business | Best Tax Tips

Cost Basis Complications

You can sell investments held in tax-deferred retirement accounts without worrying about income taxes. But that’s not the case with investments you own outside of tax-deferred accounts. To figure your capital gain or loss on the sale of mutual fund, stock, real estate, and other investments, you have to compare the amount you realize on the sale to your “adjusted basis” in the investment. Understanding...

October 5th, 2009 by The Tax Man

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Internal Revenue Service issues standard letters and notices

The Internal Revenue Service issues standard letters and notices on a routine basis. Some will require specific actions on your part if you have received one of these letters. It is of course best to act on these as soon as possible so you do not lose any of your rights. Below is a list of standard letters and notices and actions you may take regarding each: Image via Wikipedia Letter...

April 7th, 2009 by The Tax Man

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Seal of the United States Internal Revenue Ser...

Did you sell stock in an Insurance Company that had demutualized?

What does this recent case mean for you? If you sold shares from a demutualization, you may also be eligible for a refund of tax paid. You must file an amended federal tax return and it must be timely filed. The rules for filing amended returns, just like the facts of this case, are complex. Also, keep in mind that the IRS Image via Wikipedia may appeal the court’s decision. A higher...

April 2nd, 2009 by The Tax Man

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Independent Contractor vs. Employee

Understanding the difference between an employee and an independent contractor is very important. If you are an employer, you are required to withhold and contribute a matching amount of FICA and Medicare taxes from your employee’s income. However, if your workers are independent contractors, you are only required to report payments of $600 or more on a Form 1099-MISC (Miscellaneous Income)....

January 15th, 2009 by The Tax Man

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