What is a Tax Short Year?
A short tax year is a tax period that covers less than 12 months. This can happen for various reasons, such as when a business is established or terminated in the middle of a calendar year, when a taxpayer changes their accounting period, or when there are other circumstances that result in a tax period […]
Read MoreMarried Filing Joint or Separately?
Filing your taxes as “Married Filing Separately” (MFS) is generally less common than filing jointly for married couples because it often results in a higher tax liability and limits access to certain tax benefits. However, there are some situations where filing separately might make sense. Here are some reasons why you might consider filing MFS: […]
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Estimated Tax Penalty
The IRS (Internal Revenue Service) estimated tax underpayment penalty, also known as the underpayment penalty or the estimated tax penalty, is a penalty imposed on taxpayers who do not pay enough in estimated taxes throughout the year. Estimated taxes are payments made by individuals, self-employed individuals, and businesses to cover their tax liability when they […]
Read MoreThe Dreaded Depreciation Recapture
Depreciation recapture is a tax concept related to the sale of a rental property that has been depreciated for tax purposes. Depreciation is an accounting method that allows property owners to deduct a portion of the property’s cost as an expense over its useful life, which helps to offset taxable income. However, when the property […]
Read MoreDealer vs Investor
Article: Dealer vs Investor From the perspective of the Internal Revenue Service (IRS) in the United States, the distinction between a dealer and an investor is important for tax purposes, particularly in the context of buying and selling securities, real estate, or other assets. The categorization as a dealer or an investor can have significant […]
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