Income Tax
Frequently Asked Questions
Navigating the world of taxes can be complex and sometimes confusing.
Key Tax Planning is here to demistify the process by offering answers to the most frequently asked tax questions.
Personal Income Tax
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Most property you own and use for personal or investment purposes is a capital asset. For example, a house, furniture,car, stocks, and bonds are capital assets. | |
Your filing status is based on your marital status as of December 31. | |
If you pay tuition, fees, and other costs for attendance at an eligible educational institution for yourself, your spouse, or your dependent, you may be able to take advantage of one | |
In addition to being subject to higher federal tax rates, taxpayers whose income exceeds certain levels have tax deductions and credits that are reduced or eliminated. | |
A principal residence is your main home, which is the home where you ordinarily live most of the time. | |
The standard deduction reduces taxable income. It is a benefit that eliminates the need for many taxpayers to itemize actual deductions, such as medical expenses, taxes, interest, and charitable contributions, on Schedule A (Form 1040). | |
You should keep information that you and the IRS need to determine your correct tax. Everyone should keep the following records. |
Rental Real Estate
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If you spend significant time in activities related to real estate, you may qualify as a “real estate professional,” which can provide tax benefits. | |
Rental income includes any payment received for the use or occupancy of property. | |
Income and expenses related to rental of your home, a room in your home, or a vacation home, must be reported on your tax return. | |
Generally, a current business deduction is allowed for the cost of repairs and maintenance incurred during the year. |
Self-Employment
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Learn when you should file a 1099 for your business. | |
Learn if you qualify for a "Business Use of Home' deduction and understand which deductions and expenses are applicable. | |
A worker’s status determines what taxes are paid and who is responsible for reporting and paying those taxes. | |
A limited liability company (LLC) is a business entity organized under state law. | |
You pay self-employment (SE) tax when net earnings from self-employement are $400 or more. | |
If you own your business, you may be able to deduct the cost of operating and maintaining your vehicle. |
