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But a savvy business guy told me he is "really pushing the envelope" this year because of the government shutdown. Home office deduction, "hiring" his kids as models for his website.. Any type of questionable deduction that would normally throw up a red flag he's going for it.
The IRS is releasing statements that the shutdown is going to have them backed up like crazy. He figures they're not going to bother with audits on anyone that is making less than $1mm. Not doing anything illegal, just deductions he never bothered with before because of the "red flag" he's going for...
The two item he mentioned are both perfectly legal, at least before the latest tax law changes, but required documentation to support them. Such as: square footage of the home office as a percent of the total home area and zero evidence any residential activity takes place in the office area; proof that the wages paid to family members are in line with market norms and evidence documenting their hours worked as well as the income being claimed by the family member employees (1099 etc).
The two items he mentioned are both perfectly legal, at least before the latest tax law changes, but required documentation to support them.
I agree but I see his point; the IRS typically flags those types of deductions as an indication that the taxpayer might have interpreted the laws very liberally and an audit might be fruitful so this is the year to take them. Decreased IRS => decreased chance of audit.
Most of our information has been entered into TurboTax. I had feared that the new tax law would hurt us far more than it did, but it still was a slight negative on balance. We live in a very high property tax area outside of NYC, and the $10,000 SALT deduction cap is a killer for us and is not offset by the higher standard deduction or slightly lower tax rates. The tax law would have been a disaster for us if not for the new rule allowing a 20% deduction for certain types of freelance income below a certain threshold. (My wife is a freelance worker and this did not make up for the SALT cap, but certainly helped out.) So on balance we were harmed only slightly by the new tax law, and not nearly as badly as I had feared.
My wife is the CFO of a largish company, so she has to deal with corporate taxes and shareholders between now and April 15. Corporate audits, K1s, the works. So the last thing she needs to do in the midst of her busy life is to get things together for our own return. We own commercial property and I have my own business.
So we won't get serious about matters until August. We'll ask for an extension file in September, per our usual custom.
Holy mother of accurate calculations!
Thats oretty good....as close to 0 ive seen it get....what income level are we talking here? The higher, the more impressive your exact math will seem to me
I netted -$1 last year with filing jointly with spouse and combined income of about $160k. That was with taxable investments and wife owning her own business. I don't think I'll ever duplicate that again but it was pretty cool.
I netted -$1 last year with filing jointly with spouse and combined income of about $160k. That was with taxable investments and wife owning her own business. I don't think I'll ever duplicate that again but it was pretty cool.
That's sick! lol
at that point, my first thought would be 'did i fk something up....???'
I have a feeling that the need for tax preparers is going to go way down. People will see how easy their taxes are this year and not use them next year.
I have a feeling that the need for tax preparers is going to go way down. People will see how easy their taxes are this year and not use them next year.
People who didn’t do their own taxes for the 2017 tax year most likely aren’t going to just up and decide to do them now so I don’t think the impact will be anywhere near the feeling you have
We're still waiting for 2 items. One for 401K income and one for stock dividends. Then I'll get started with my TurboTax. Not sure what's going to happen with the new laws yet, but shouldn't be bad since we have less than $50K gross income.
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