A AARP (American Association of Retired Persons), Tax

Index
A
AARP (American Association of
Retired Persons), Tax-Aide locations of, 31, 248, 251, 270
ABLE. See Achieving Better Life
Experience (ABLE) programs
About.com, 99–100, 186
accordion files, 17
Achieving Better Life Experience
(ABLE) programs, 187, 188–90
acquisition debt, deducting interest
on, 46
activities of daily living in documenting medical expenses,
115
acupuncture as medical deduction,
111
ADA. See Americans with Disabilities Act (ADA)
Adams, Roger B., 237, 238, 239, 270
Adjusted Gross Income (AGI), 5, 43,
56, 83, 85, 138, 143, 157, 158,
160, 162, 195, 198, 214, 227, 235,
241–42, 245
limitations on tax deductions and,
139–40
medical deductions and, 109, 226
tangible effect of adding RMD or
retirement rollovers to, 160–61
advance premium tax credit payments, need for tax return and,
21
Affiliate Summit, 265
AFSP. See Annual Filing Season Program Certificate of Completion
(AFSP)
AGI. See Adjusted Gross Income
(AGI)
274
Index
AirBnB rentals, 10, 28, 263
guidelines in working with, 4, 81, 85
illegal rentals and, 79–80
Peer-Space program of, 75
alcohol consumption, quasi-car
services and, 106–7
alimony
income from, 10
need for tax professionals and, 28
Alternative Minimum Tax (AMT),
48, 157–58
amateur tax geniuses, falling prey to,
205–6
American Association of Retired
Persons. See AARP (American
Association of Retired Persons)
American Opportunity Credit, 36,
196, 198, 199
American Society of Tax Problem
Solvers (ASTPS), 35
Americans with Disabilities Act
(ADA), 242
service pets and, 217
See also disabilities
AMT. See Alternative Minimum Tax
(AMT)
animal sanctuaries, volunteering at,
143
Annual Filing Season Program Certificate of Completion (AFSP), 34
appointment calendar in documenting medical expenses, 112–13
appraisal fees as charitable contribution, 138
Archer MSA deductions, 229
Armed Forces Tax Council, 31
Asimov, Isaac, Laws of Robotics and
philosophy of tax preparation,
5–6, 271
assets, 12, 13, 88, 108, 139, 151, 153,
220, 233
claiming, 222–23
sales of, 10
need for tax professionals and, 28
Assistance Dogs International, 217,
271
ASTPS. See American Society of Tax
Problem Solvers (ASTPS)
attorney fees as tax deduction, 229,
231–32
audit roulette, playing, 204–5
audit trail, creating, 14–15
automobile insurance, rates for, 95
automobiles. See vehicles
award income, 10
B
baby, Social Security Number (SSN)
for, 209
Baby Boomers, 148
Baker, Linda, 142
Bankrate.com, 180
barter income, 10
bazaars, charitable contributions to,
134
Bean Counter site, 9, 216
Bell, Kay, 269
beneficial owner, tax deduction as, 51
beneficiary, 242
billboard, turning car into, 105
Birkenfeld, Bradley, 233
Bitcoin, 9
Blasingame, Jim, 267
bonds, investing in, 149
Bookkeeping Master, 9
breathing treatments as medical
deductions, 111
burnout, philosophy about, 3
business
income from, 9
mileage related to, 96, 97, 102–3
need for tax professionals, 27
starting, in raising income in your
Social Security account, 168–69
C
CAA. See Certified Acceptance
Agents (CAA)
Index
Cake Girl (Baker), 142
California
Mello-Roos fees in, 40
State Film Commission in, 75
California Society of Enrolled
Agents, 143
cameras, installing, in short-term
rentals, 79
canceled checks, keeping copies of, 11
canceled debt, income from, 10
capital gains, 237–38
capital losses, 237
caregivers
medical deductions and income
of, 125
philosophy about, 4
carrybacks, 214–15
carryovers, charitable contributions
and, 140
carryovers, net operating loss
(NOL), 214–16
cars. See vehicles
cash
in the collection plate, 133
expense requirements in record
keeping and, 11
paying, 11
for silent auctions, charity auctions, bazaars, etc., 134
to street people, 133–34
casual rentals, 83
casualties, need for tax professionals
and, 29
C corporations, controlling earned
income and, 164–65
CC&Rs. See Covenants, Conditions,
and Restrictions (CC&Rs)
Certified Acceptance Agents (CAA),
238, 256
certified public accountants (CPA),
32–33
CFR. See Code of Federal Regulations (CFR)
Chandel, Amit, 266
275
chaplains, contributions to section
403(b) plans, 229
charitable contributions, 127–45
appraisal fees as, 138
carryovers and, 140
cash for silent auctions, charity
auctions, bazaars, etc., 134
cash in the collection plate as, 133
cash to street people as, 133–34
confirming contributions to established charities, 128
contemporaneous acknowledgments and, 132–33
costs of volunteering, 141–42
disguised donations and, 133
documenting, 11
donations of money to specific
people as, 135
donations of things, 135–38
donations of vehicles as, 138–39
educating yourself on use of
money, 128–31
Foundation Center and, 129–30,
144
gifting of money for donations as,
139
information needed on receipts,
131
intangible rewards for, 142
limitations on, 139–40
need for tax professionals and, 29
nondeductible donations and, 140
retirement income and, 158–59
starting own nonprofit organizations and, 144–45
TechSoup and, 144
time donations as, 135
timing in getting receipts, 131–32
volunteering as fun and, 142–43
charitable mileage, 96
charitable parking, 96
checks, keeping copies of canceled, 11
child support, need for tax professionals, 28
276
Index
chiropractic treatments as medical
deduction, 111
Claim of Right, repayments under a,
234–35
cloud, storage of information in, 14, 16
Code of Federal Regulations (CFR),
242
collection plate, cash in, 133
college
College Application Training, 190,
262
using whole life insurance to save
for, 190
See also education
Collins, Shawn, 265
common area fees as tax deduction,
41
commuting mileage, 219–20
CompleteTax.com, 25–26
Computax, 195
computers, removing from short-
term rentals, 78
contact lenses as medical deductions, 110
contemporaneous acknowledgments, 132–33
contracts
keeping copies of, 13
provisions for stolen goods in, 79
convalescent home fees, as medical
deductions, 111, 115–16
cosmetic surgery
as medical deductions, 111
as nondeductible, 219
court costs as tax deduction, 229,
231–32
Covenants, Conditions, and Restrictions (CC&Rs), 242–43
Coverdell Education Savings
Accounts, 181–84, 183–84
strings on withdrawals, 182–83
CPA. See certified public accountants (CPA)
CPAP machines as medical deductions, 111
CPE Link, 46, 272
Crawford, Willie, 271
Crazy Cat Lady, 258
See also Van Dusen v. Commissioner
credit, philosophy about extending, 4
credit bureaus, 209
crowdfunding sites, 120, 121
CrunchBase.com, 84
D
death, early withdrawal penalties
and, 172
DeductR, 16
dental treatments, as not reimbursed by insurance as medical
deductions, 110, 116–17
dependents
medical deductions for, 112
need for tax professionals, 28
depreciation
getting new car and, 107
hidden, in mileage, 104
home rentals and, 86, 87–88
DirectInvesting.com. See The
MoneyPaper
disabilities, 10
Achieving Better Life Experience
(ABLE) programs and, 187,
188–90
allowable tax deductions for service pets and, 217
early withdrawal penalties and, 172
as medical deduction, 71–72
need for tax professionals, 28
disasters, need for tax professionals
and, 29
disguised donations, 133
dividend reinvestment programs
(DRIPs), 178, 179, 243
divorce, need for tax professionals, 28
divorce, TaxMama’s class at CPE
Link, 272
Doctors without Borders, 143, 271
documentation of tax return
records, 2
Index
DogVacay, signing up as pet-sitter
for, 89–90
Dome Record Books, 17
Dow Jones, MarketWatch.com
column at, 2, 132, 203, 233, 237,
239, 263, 265
DRIPs. See dividend reinvestment
programs (DRIPs)
E
early withdrawal penalties, 150, 172,
219
exceptions to, 172–73
earned income, 149, 243
controlling, 164–65
easements, need for tax professionals and, 29
eBay income, 10
education
Achieving Better Life Experience
(ABLE) programs, 188–90
Alternative Minimum Tax and, 196
American Opportunity Credit
(AOC) and, 196, 198
College Application Training, 190,
262
consequences of not getting financial help when needed, 185
costs of, 191–92
Coverdell Education Savings
Accounts and, 181–84
deducting interest expenses of
student loans, 194–95
direct gifts of costs, 184
early withdrawals in paying for,
219
eligible expenses for higher, 182
home schooling for, 201
letting student loans go into
default, 194
Lifetime Learning Credit and,
197–98
MAGI and, 194, 195, 198, 199
qualified expenses, 173
SavingForCollege.com, 263
277
saving for with whole life insurance, 190
scholarships and, 192
Section 529 plan and, 185–87
Section 529A plan and, 187–88
special needs, as medical deduction, 111
student loans and, 193–95, 198, 199
tax deductions and credits for, 195
tax-free work benefits and, 192
tax savings for, 191–201
vocational, 182
withdrawing money from retirement plans to pay for, 219
work-related, 192–93, 198, 200
education IRAs, 181
eligible access expenditures, 71–72
Emerson, Melinda (@SmallBizLady),
268
employees, 71, 114, 167, 181, 192, 193
business mileage, 102
household, 122
need for tax professionals and, 29
time test for moving expenses, 101
employers, matching of retirement
money, 148
energy credits, 60–70
alternative energy devices as, 61,
64–65
cost analysis form for, 66–69
do-it-yourself installations and, 63
Energy Star certification and, 64, 70
hiring of casual help and, 63
hiring of professionals and, 63
leasing of systems in, 69–70
lifetime credit amount and, 61–62
Nonbusiness Energy Property
Credit and, 61–62
residual energy property credit
and, 62, 65
swimming pools or hot tub energy
costs and, 218
Energy Star certification, 64, 70
enrolled agents, 23, 24, 32, 35, 143,
153, 177, 222, 238, 251
278
Index
ePage income, 10
Equifax, 209
equitable owner, tax deduction as, 51
Equivalent Railroad Retirement
Benefits, taxability of, 159
escrow costs as tax deduction, 41
estate taxes, avoiding with medical
deductions, 119
estimated tax payments, 11
Etsy income, 10
even, philosophy about getting, 3
Excel, 16
expense requirements in record
keeping, 11–12
charity deductions, 11
credit card statements, 11
estimated tax payments, 11
home improvement invoices and
proofs of payment, 12
keeping copies of canceled checks,
11
mileage logs, 11
paying cash, 11
property tax bills, 11
tip details, 12
vehicle registration bills, 11
Expensify, 16
expensive things, donation of, 137–38
Experian, 209
eyeglasses as medical deduction, 110
F
FAFSA (Free Application for Federal
Student Aid) form for financial
aid, 187, 259
family support, need for tax professionals, 28
FICO, Fair Isaac, 61, 193, 263
film location, renting property for,
75–76
financial transactions, need for complete records, 8
FIRE (Filing Information Returns
Electronically), 92
First-Time Penalty Abatement
(FTA), 208, 243, 257
flexible spending accounts, medical
deductions and, 121–23, 218
flipped real estate, 28
foreign income taxes as tax deduction, 45–46
Foundation Center, 129–30, 144
14-day rental loophole, 74–75
401(k), withdrawing money from,
219
free apps, drawbacks of, 15
Frequently Asked Questions (FAQs),
244
FreshBooks, 16, 251
frivolous. See tax protester movement
Fromm, Steven J., 270
FTA. See First-Time Penalty Abatement (FTA)
funding fee, 56
G
gambling income, 10
need for tax professionals and, 29
Garber, Julie, 186
gifts
income from, 10
need for tax professionals and, 29
gift taxes, avoiding with medical
deductions, 119
GiveForward, 120, 264
Glink, Ilyce, 267
GoFundMe, 120, 265
government officials, writing letters
of commendation to, 3
GPS, tracking mileage with your, 15
GrantSpace.org, 131, 258
guarantee fee, 56
GuideStar, 128–29, 258
H
H&R Block, 23–24, 195
Hatch, Richard, 212
health care marketplace, 256
Index
health insurance premiums as medical deductions, 110
health saving accounts or arrangements, medical deductions and,
121, 123–24, 218
HELOC. See home equity line of
credit (HELOC), tax deductions
and
hobby income, 10
need for tax professionals, 28
Holtgrefe, Susan, 270
home-based businesses, disabled
access credits and, 71–72
home buyers, first-time, need for tax
professionals, 28
home equity line of credit (HELOC),
tax deductions and, 46–47
home improvements, documenting
expenses for, 12
home office for pet daycare, 90–91
home rental, 14-day rental loophole
for, 74–75
home schooling, 201
hotel-type rentals, 82–83
hot tubs, residential energy credits
and, 218
house
change in value of, 73, 74
down payment on first, 173
withdrawal money from retirement plans to pay for first, 219
household income, extra, 73–93
AirBnB rentals as, 79–81, 85
casual rentals as, 83
depreciation and, 86, 87–88
filing of 1099-MISC and, 92–93
film location as, 75–76
for-profit rentals as, 83–84
14-day rental loophole and, 74–75
hotel-type rentals as, 82–83
paying for services and, 91–92
pet care income and, 89–90
pet daycare home offices and,
90–91
279
pet hosting and, 88–89
residential rentals as, 81–82
roommate as, 74
short-term rentals as, 76–80
tax deductions and, 85–86
tracking of pet daycare direct
costs, 90
household records, need for knowledge of, 8–9
HUD-1 summary, 41–42, 262
Humanity and Pets Partnered
Through the Years Act, 217
I
identity theft
Stolen Identity Refund Fraud
(SIRF) and, 209–10, 248
tax return preparation and, 20, 26
illegal aliens, hiring of, 63
income
adjusted gross, 5, 160–61
barter, 10
from canceled debt, 10
caregiver, 125
deductible expenses related to,
229
disability, 10, 28
earned, 149, 164–65, 243
earning of additional, in order to
raise Social Security benefits,
169–70
eBay, 10
ePage, 10
Etsy, 10
extra household, 73–93
gambling, 10, 29
gift, 10
hobby, 10, 28
inheritance, 10
from jury pay, 10, 229, 230–31
from pet care, 89–90
phantom, 173–74
raising in your Social Security
account, 167–69
280
Index
income (continued )
rental, 10
retirement (see retirement
income)
scholarship, 10, 28
unemployment, 10
income requirements in
record-keeping
awards, prizes, scholarships, 10
bank and brokerage statements, 9
business income, 9
canceled debt, 10
gambling income, 10
hobby income, 10
inheritances and gifts, 10
miscellaneous income sources, 10
partnership distributions, 9
pay stubs, 9
rental income, 10
retirement income, 10
sales of assets, 10
securities trades, 9
W-2s, 1099s, 1098s, K-1s, and
other third-party notifications, 9
In Compliance, 244
Indian tribal government, taxes
imposed by, 45
Individual Retirement Accounts
(IRAs), 148, 244
comparing with Roth IRAs, 149,
152–54
deductions for funding, 13–14
education, 181
establishing self-directed, 150
fees related to transfers, 220–21
instant gratification with, 150–51
medical deductions and reduction
of account balances, 118–19
rolling over balances and, 149–50
self-directed, 175
See also myRA
inheritances, income from, 10
in-home nursing care, as medical
deductions, 111, 113–15
insurance
automobile, 95
buying whole life, 149
Medicare premiums as medical
deduction, 110
moving, 99–100
premiums on health as medical
deduction, 110
private mortgage, 55–58
whole life, 190
insurance contracts, keeping copies
of, 13
interest, mortgage. See mortgages
Internal Revenue Code (IRC), 6, 81,
132, 140, 157, 185, 214, 221, 240,
244–45, 255
knowledge of, 2
Medicaid waiver, 125
size of, 1, 240
Internal Revenue Manual (IRM), 92,
257
Internal Revenue Service (IRS)
acceptance of appraisals and,
137–38
Criminal Investigation, 206, 257
foreign currency rates, 257
Free File Alliance system of, 22, 257
Free File Fillable Forms system
of, 22
free tax filing systems offered by, 19
lawsuit settlements, awards and
judgments, Audit Technique
Guide, 257
levies
steps to release (TaxMama
course), 272
looking beyond, for tax credits
and rebates, 59
philosophy about dealing with, 3
Sales Tax Calculator of, 43
tracing and, 50
Internal Revenue Service (IRS)
instructions, 222
Internet millionaire provision, 174
Index
Intuit, ItsDeductible software of, 136
Intuit Payroll, 92
investment offers, evaluation of, 223
IRC. See Internal Revenue Code
(IRC)
IRM. See Internal Revenue Manual
(IRM)
IRS Form 211, 30, 233
IRS Form 990, 128, 129
IRS Form 1023, 145
IRS Form 1024, 145
IRS Form 1040, 43, 227–28
adjustments and, 227–28
IRS Form 1040X, 125, 216
IRS Form 1045, 216, 217
IRS Form 1098-C, 138
IRS Form 1098s, as source of income
information, 9
IRS Form 1099-MISCs, 9
avoiding filing of, 92–93
filing of, 92
IRS Form 2120, 117–18
IRS Form 3903, 100
IRS Form 5498-SA, 123
IRS Form 5695, 218
IRS Form 8275, 213
IRS Form 8453, 36
IRS Form 8826, 71
IRS Form 8829, 90
IRS Form 8863, 197
IRS Form 8879, 36
IRS Form 14157, 30
IRS Notice 2004–27, 239
IRS Publication 17, 12, 230
IRS Publication 463, 104
IRS Publication 502, 72, 111, 218
IRS Publication 521, 102
IRS Publication 525, 235
IRS Publication 526, 140
IRS Publication 527, 81
IRS Publication 561, 138
IRS Publication 587, 90
IRS Publication 915, 160
IRS Publication 925, 82
281
IRS Publication 946, 88
IRS Publication 969, 123, 124
IRS Publication 4524, 210
Israel, solar water heaters in, 64
Itex, 9
J
Jensen, Steven, 212
jobs
getting new, in raising income in
your Social Security account,
167–68
getting second, in raising income
in your social security account,
168
jury pay, income from, 10, 229,
230–31
K
K-1s as source of income information, 9
kiddie tax, 10
need for l tax professionals and, 28
kid’s portfolio, 179
Kirchheimer, Sid, 270
L
laetrile as nondeductible, 218–19
Lang v. Commissioner, 121
laundering costs as charitable donation, 141
Lawrence, Virginia, 142–43, 270
levy. See Internal Revenue Service:
levies
Lewis, Rita, 269
license fees as tax deduction, 43
lifetime learning credit, 61–62, 197–
98, 199
LITC. See Low Income Taxpayer
Clinics (LITC)
live-in schools as medical deductions, 111
loan modification documents, costs
of fees related to, 220–21
282
Index
loans
documentation of, 13
paying off, 220
long-term savings and retirement
tax issues, 177–90
Lori Singleton v. Commissioner, 200,
265
Los Angeles Conservancy, 142, 271
Los Angeles Tall Ships, 142–43, 271
Low Income Taxpayer Clinics
(LITC), 31–32
lump sum income
need for tax professionals, 28
from Social Security, 162–63
Lyft, 105, 106–7, 264
Lynch, Pat, 269
M
Madoff, Bernie, 240
MAGI. See Modified Adjusted Gross
Income (MAGI)
mail, stopping, in short-term rentals,
78
Make-a-Complaint-About-a-Tax-
Return-Preparer, 30
Mammen, Jean, 267
mantra, TaxMama’s, about keeping
records, 3
marijuana
medical, as nondeductible, 218–19
TaxMama’s class at CPE Link, 272
massages, doctor-prescribed, 124
McCotter, Thaddeus, 217
medical copays as medical deductions, 110
medical deductions, 109–25
AGI and, 109, 226
avoiding gift and estate taxes and,
119
breathing treatments as, 111
caregiver income and, 125
cosmetic surgery for medical purposes as, 111
CPAP machines as, 111
dependent costs as, 112
disabled access deductions as, 72
eyeglasses, contacts, etc., 110
flexible spending accounts and,
121–23
health insurance premiums as,
110
health saving accounts or arrangements and, 121, 123–24
in-home nursing care as, 111,
113–15
live-in schools as, 111
medical copays as, 110
medical mileage as, 96, 97, 110
medical travel as, 110, 116–17
Medicare insurance premiums as,
110
need for money in paying medical
bills, 120–21
nonconventional medical treatments as, 111
nursing home and convalescent
home fees as, 111, 115–16
parking fees and tolls for medical
care as, 112–13
prescribed drugs as, 110
reducing IRA account and retirement plan balances and, 118–19
routine medical and dental
treatments not reimbursed by
insurance, 110
sandwich generation and, 117–18
special needs tutoring, education,
or therapy as, 111
TENS muscle stimulators as, 111
time of payment and, 109–11
tolls and parking fees for medical
care or treatment as, 110
medical marijuana as nondeductible,
218–19
medical treatments not reimbursed
by insurance, as medical deductions, 110
Medicare benefits, fees for, 161
Index
Medicare insurance premiums as
medical deductions, 110
Medicare Secondary Payer statute,
legal fees paid for private cause
of action under, 233–34
Mello-Roos fees in California, 40
MetroMile’s mileage app, 16
mileage
charitable, 96
commuting, 219–20
hidden depreciation in, 104
medical, as medical deduction, 96,
97, 110
moving, 96, 97, 98–99
noting on odometer, 97–98
related to business, 96, 97, 102–3
tracking with GPS, 15
mileage logs, 11
GPS in keeping, 15
top applications for, 16
military service, need for tax professionals and, 29
Mint (personal record-keeping system), 16, 24
mobile record applications
benefits of, 14–15
drawbacks, 15
Modified Adjusted Gross Income
(MAGI), 151, 181, 245
education and, 194, 195, 198, 199
money
educating yourself on use of,
128–31
gifting of, for donations, 139
need for, in paying medical bills,
120–21
The MoneyPaper (DirectInvesting.
com), 177, 178, 262
mortgages, 21
need for tax professionals, 28, 36
points, 54–55
reverse mortgages, 53–54
tax deductions for interest on, 46–
53, 226–27, 256, 262, 272
283
moving costs
insurance costs in, 99–100
nondeductible, 100
reimbursements and, 100
tax deductions for, 99
time tests in, 101–2
moving insurance, 99–100
moving mileage, 96, 97, 98–99
myRA, 179–81, 263
N
National Association of Enrolled
Agents (NAEA), 32, 35
National Association of Tax Consultants (NATC), 35
National Association of Tax Professionals (NATP), 35
National Society of Accountants
(NSA), 35
negatively amortizing loans, 53
NetBasis, 263
Net Investment Income Tax (NIIT),
29
Net Operating Loss (NOLs), 214–
16, 238, 245, 255
Neugart, Layne, 76–77
NIIT. See Net Investment Income
Tax (NIIT)
NOLs. See Net Operating Loss
(NOLs)
Nonbusiness Energy Property
Credit, 61–62
nonconventional medical treatments,
as medical deductions, 111
nondeductible donations, 140
nonprofit organizations, 144–46
NSA. See National Society of
Accountants (NSA)
nursing home fees as medical
deductions, 111, 115–16
O
OANDA Foreign Currency
Resource, 263
284
Index
odometer, noting mileage shown on,
97–98
Olson, Nina, 1
Outright, 16
overseas educational institutions,
182
over-the-counter drugs as nondeductible, 218
P
PACE (property-assessed clean
energy) program, 61
Paine v. Commissioner, 240
Palma, Miquel, 190
paper records, storing, 16–17
Paradise Regained in Utila, Honduras, 84, 271
parking fees for medical care or
treatment as medical deductions, 103–4, 110, 112–13
partnership distributions, income
from, 9
Pasadena Doo Dah Parade, 143
PATH. See Protecting Americans
from Tax Hikes Act (PATH)
(2015)
PayPal, 9, 11
paystubs as source of income information, 9
Pender, Kathleen, 267
pension plans, tax deductions and,
229
people in general, philosophy about, 3
Perez, William, 271
Perry, Gail, 266
personal property
deductible expenses related to
rental of, 231
taxes on, as tax deduction, 41–42
personal record-keeping systems,
recommended, 16
personal residence
points as tax deduction, 54
short-term rental of, 76–80
pets
allowable deduction for service,
217
daycare for
home office for, 90–91
tracking direct costs in, 90
hosting of, 88–89
income from care of, 89–90
short-term rentals and, 78
tax deductions related to, 217, 271
PFICs, 28
phantom income, 173–74
philharmonic venues, volunteering
at, 143
philosophy
about burnout, 3
about caregivers who don’t report
income, 4
about dealing with the IRS and
state officials, 3
about extending credit, 4
about finding treasure, 4
about getting even, 3
about not filing, 3–4
about people in general, 3
about taxes, 2
about tax filing, 3
about working outside the system, 4
PMI. See private mortgage insurance
(PMI) as tax deduction
points. See mortgages: points
Ponzi scheme losses, 240, 260
Porter, “Uncle Bill,” 270
Preparer Tax Identification Number
(PTIN), 30–35, 245, 248, 252
prescribed drugs as medical deductions, 110
private lenders, mortgage interest
paid to, 52
private mortgage insurance (PMI) as
tax deduction, 40, 52, 55–58
prize income, 10
Probate Referee, 137
Index
Professional Tax Identification
Number (PTIN), 30, 34–35
profit, rentals for, 83–84
property tax bills, 11
Protecting Americans from Tax
Hikes Act (PATH) (2015), 1–2,
56, 62, 88, 236
PTIN. See Preparer Tax Identification Number (PTIN)
Pummer, Chris, 239
Q
Qualified Direct Transfer (QDT),
140, 157, 196
Qualified Domestic Relations Order
(QDRO), 173
Qualified Education Expenses
(QEE), 173, 245–46
Qualified Tuition Program (QTP),
185–87
quasi-cab services, 105, 106–7
QuickBooks, 16, 24, 250
Quicken, 16, 24, 250
R
racehorse investment, 28
real estate
flipped, 28
investing in, 149
need for tax professionals for
rental, 28
real property taxes, as tax deduction,
39–41
receipt
information needed on, 131
timing in getting, 131–32
record-keeping tips and tools, 7–17
expense requirements, 11–12
importance of, 8
income requirements, 9–10
keeping of tax preparation
records, 14
keeping of tax returns, 12,
13–14
285
knowledge about household
records, 8–9
mobile applications
benefits of, 14–15
drawbacks of, 15
need for complete records, 8
recommended applications for, 16
saving of paper records, 16–17
saving records in the Cloud, 16
time permitted for audit of tax
returns, 12–13
top personal record-keeping
systems, 16
Reed, Mike, 269
refinancing
increasing deduction for mortgage
interest and, 49–50
points as tax deduction, 54–55
reforestation amortization and
expenses, 229
refundable credits, 246
refund anticipation loans (RALs),
avoiding tax offices that push,
35–36
reiki treatments as medical deduction, 111
reimbursements for moving
expenses, 100
religious schools, IRS audit of, 133
rental income, 10
rental real estate, need for tax professionals and, 28
Required Minimum Distributions
(RMDs), 140, 152, 155–61, 246
avoiding taxes on, 156–57
legitimate delay for, 155
Roth IRAs and, 156
tangible effect of adding to AGI,
160–61
Residential Energy Credit, 65
retail establishments, tax preparation outfits in, 35
retirement, timing in starting to save
for, 178–79
286
Index
retirement income, 10, 147–75
adding money to your draw, 171–72
Alternative Minimum Taxes as,
157–58
collection of Social Security benefits, 163–64
commonly used exceptions and,
172–73
comparison of Roth and regular
IRAs, 149–51, 152–54
controlling your earned income,
164–65
deficiencies in Social Security
payments and, 166
distributions from all accounts,
155–56
drawing money from accounts
early, 170–71
early withdrawal penalties and,
150, 172–73
Equivalent Railroad Retirement
Benefits as, 159
Internet millionaire provision and,
174
lump sum payments from Social
Security as, 162–63
medical deductions and reduction
of, 118–19
Medicare benefits as, 161
need for tax professionals, 28
paying back and, 164, 165–66
paying tax on IRA contributions,
151
phantom income and, 173–74
raising income in Social Security
account and, 167–70
reducing IRA and retirement
account balances as, 156
Required Minimum Distributions
(RMDs) as, 140, 152, 155–61, 246
Roth IRA contributions as savings
vehicle, 152
self-directed IRAs and, 175
self-employment and, 166–67
setting aside money toward retirement and, 148–49
Social Security benefits as, 159, 160
Social Security Disability Income
payments as, 163
taxes on drawing money out of
retirement account, 170–71
using money prior to retirement,
170
retirement plans, withdrawing
money from, 219
retirement rollovers, tangible effect
of adding to AGI, 160–61
returns, 246
reverse mortgages as tax deduction,
53–54
roommate, getting a, 74
Rosenberg, Eva, 1, 273
Rosenberg, Dr. Judy, 266
Roth IRA, 118, 148
comparison with regular IRAs,
149, 152–54
myRAs and, 179–81
Required Minimum Distributions
(RMDs) and, 156
rolling over balances and, 149–50
as savings vehicle, 152
Rural Housing Service, 56
S
SafeGuard One-Write Systems, 17
sales taxes, as tax deduction, 42–43
sandwich generation, medical
deductions and, 117–18
SavingForCollege.com, 263
savings account, opening of, 148
savings in small increments, 179
Schneiderman, Eric, 79–80
scholarships, 192
income from, 10
need for tax professionals and, 28
Scientific American, 272
S corporations, controlling earned
income and, 164–65
Index
Section 529A plans, 187–88
securities
investing in, 149
purchase information on, 13
securities trades, income from, 9
security, as drawback with mobile
applications, 15
self-directed IRAs, 175
self-employed losses, 149
self-employment
retirement income and, 166–67
time test for, 101–2
service pets, allowable tax deductions for, 217
services, paying for, 91–92
Shelters for Israel, 129–31, 144,
258–59
Shoeboxed, 16, 250
short sales, 28
short-term home rentals, 76–80
Sidecar, 105, 106–7
signature requirements, professional
tax preparation and, 30
silent auctions, donations to, 142
SIRF. See Stolen Identity Refund
Fraud (SIRF)
smbiz.com, Small Business & Management website, 97, 187, 265
Snipes, Wesley, 213
Social Security
deficiencies in, 166
delay in collecting, 169
early collection of benefits,
163–64
earning of additional income in
order to raise benefits, 169–70
income level and, 160
lump sum payments from, 162–63
paying back, 164, 165–66
raising income in your account,
167–69
taxability of benefits, 159, 160
Social Security Administration
(SSA), 248
287
Social Security Disability Income
(SSDI), 163
Social Security Form SSA-1099, fees
for Medicare benefits on, 161
Social Security Number (SSN)
for baby, 209
disclosure of, 208–9
special needs tutoring, education, or
therapy, as medical deductions,
111
specific people, donations to, 135
SSDI. See Social Security Disability
Income (SSDI)
Stack, Joseph Andrew, III, 213
state income taxes, as tax deduction,
43–46, 226
state-licensed tax professionals, 34
state officials, philosophy about
dealing with, 3
state refunds, income from, 10
state renter’s or homeowners credits, 60
state tax refunds as tax deduction, 44
stocks
investing in, 149
purchase information on, 13
stock splits, 28
stolen goods, provisions for, in contracts, 79
Stolen Identity Refund Fraud (SIRF),
209–10, 248
street people, cash to, 133–34
student loans
deducting interest expenses of,
194–95, 198, 199
in default, 194
working off, 193–94
swimming pools
residential energy credits and, 218
short-term rentals and, 78–79
T
taxable income, tax filing and, 3
TaxAct.com, 25, 195, 252
288
Index
tax attorneys, 33–34
tax audits
audit roulette and, 204, 205–6
repeating year after year, 221–22
time permitted for, 12–13
Tax Aware, 7, 19, 85, 175
tax basis, 247
tax cheats, turning in, 232–33
Tax Counseling for the Elderly
centers, 31
tax credits
disabled access credit and, 71–72
energy credits and, 60–70
looking beyond IRS for, 59
need for tax professionals and, 29
state renter’s or homeowners
credits, 60
tax deductions
attorney fees as, 229, 231–32
charitable (see charitable
contributions)
common area fees as, 41
costs related to pets and, 217
court costs as, 229, 231–32
escrow and, 41
foreign income taxes as, 45–46
home rentals and, 85–86
investment interest, 226
itemized, 226, 227
license fees as, 43
medical (see medical deductions)
mortgage in another’s name as,
50–52
mortgage interest paid as, 46–53,
226–27
pension plans and, 229
personal property taxes as, 41–42
personal residence points as, 54
private mortgage insurance as,
55–58
problems with itemized, 225–27
real property taxes as, 39–41
refinanced points as, 54–55
reverse mortgages as, 53–54
sales taxes as, 42–43
standard, 225
state income taxes as, 43–46, 226
state tax refunds and, 44
student loan interest as, 198
time-share fees as, 40–41, 50
unpaid interest as, 52–53
vehicle-related (see vehicle-related
tax deductions)
taxes
disclosures and, 213
philosophy about, 3
tax filing
philosophy about, 3
tax refunds and, 3–4
tax geniuses, falling prey to amateur,
205–6
tax liability, 247
TaxMama, 1
resources in the book, 249–72
website of, 1, 204
TaxMama’s Enrolled Agent Exam
students, 23–24
Tax MiniMiser, 17, 251
Taxpayer Assistance Centers, 211
taxpayer identification numbers
(TINs), 189, 247–48
tax penalties, 206–8, 257
tax preparation records, keeping, 14
tax professionals, 27–37
avoiding retail establishments for,
35
business need for, 27
communication between, 203–4
consulting with before financial
steps, 37
establishing long-term relationship with, 37
financial issues requiring, 27–29
kinds of, 32–35
need for Professional Tax Identification Number (PTIN), 30
not falling for “too good to be
true,” 223
Index
reading tax return before signing,
36
refund anticipation loans and,
35–36
signature requirements and, 30
too-good-to-be true refunds and,
36
volunteer tax preparation services,
30–32
tax protester movement, 212, 257
Tax Pushover, 7, 19
Tax Reform Act (1986), 81
tax refunds, 246
avoiding refund mills, 206
filing of taxes and, 3–4
filing on time, 222
too-good-to-be-true, 36
tax reporting, importance of record
keeping in, 8
tax return preparation, 19–26
advantages of using paid services,
23
being good candidate in filing
own, 21
CompleteTax.com and, 25–26
free filing options, 19, 22–23
H&R Block and, 23–24, 25, 195, 252
identity theft and, 15, 20, 26, 209–
10, 248, 254, 256
importance of always filing, 3, 20
IRS questioning of tax returns, 20
IRS’s Free File Alliance system
and, 22, 26, 252
TaxAct.com and, 25, 252
TaxSlayer.com and, 25–26, 252
1040.com in (Drake), 25–26, 252
TurboTax and, 24–25, 252
tax returns
documentation of records, 2
including “election statement” in,
215
keeping copies of, 12
time permitted for audit of, 12–13
TaxSlayer.com, 25–26, 252
289
tax software companies, free filing
options of, 19, 22–23, 252
Tax Theft Loss, 260, 263
Tax Vigilante, 7, 19, 85, 175, 208
Tax Watch column. See Dow Jones,
MarketWatch.com column at
TechSoup, 144, 259
telephone
giving out information over the,
210–11
sending money to people calling
you, 211–12
turning off landline in short-term
residence rental, 77
1040.com (Drake), 25–26, 252
TENS muscle stimulators, as Medical deductions, 111
things, donations of, 135–36
third-party notifications, as source
of income information, 9
time, donations of, 135
time of payment, medical deductions and, 109–11
time shares
fees as tax deduction, 40–41, 50
renting your, 75
time test, moving
for employees, 101
for self-employed persons, 101–2
TINs. See taxpayer identification
numbers (TINs)
tips, documenting, 12
tolls
as business deduction, 103–4
as medical deduction, 110,
112–13
tracing, 50
Trade Act (1974), repayment of
supplemental unemployment
benefits under, 229
Trade Preferences Extension Act
(2015), 92
transfer fees, 221
Trans Union, 209, 263
290
Index
treasure, philosophy about finding, 4
TurboTax, 24–25, 30, 195, 252
U
Uber, 105, 106–7, 263
unclaimed money, searching site, 4,
264
unemployment income, 10, 234
uniform costs as charitable donation, 141
United Way Worldwide, 144
unlicensed tax professionals, 34–35
unpaid interest as tax deduction,
52–53
US Savings Bonds, 179
buying, 148
V
vacation property, 14-day rental
loophole for, 74–75
Van Dusen v. Commissioner, 142
See also Crazy Cat Lady
Veen, Rita, 177–78
vehicle registration bills, 11
vehicle-related tax deductions, 96–108
business mileage, 102–3
charitable mileage, 96
charitable parking, 96
depreciation in mileage in, 104
getting new car, 107
moving costs, 96–99
noting mileage shown on odometer, 97–98
parking lot, parking meter, and toll
fees in, 103–4
selling car, 108
tracking mileage in, 103
turning car into billboard, 105
Uber, Lyft, Sidecar, and related
quasi-cab services, 105–7, 264
vehicles
costs associated with, 108
donations of, 138–39
getting new, 107
getting rid of, 108
turning, into billboard, 105
Vgo Robots, 272
vocational schools, 182
Volunteer Income Tax Assistance
Program (VITA), 31, 248
volunteering, 11, 29, 30, 31, 96, 132,
144, 145, 248, 269, 270, 271
costs of, 141–42
as fun, 142–43
opportunities, 143, 259
volunteer tax preparation services,
30–32
W
W-2G, 10
W-2s, as source of income information, 9
Ward, Missy, 265
warranties, keeping copies of, 13
wash sales, 28
whistleblower reward, 232, 233
Whitaker, Bob, 17
whole life insurance
buying policy, 149
using, to save for college, 190
Wilson Jones columnar pads and
binders, 17
Wood, Robert W., 222, 250
work
retirement plans offered at, 148
tax-free education benefits at, 192
working outside the system, philosophy about, 4
work-related education, 198, 200
Wrapify, 105, 264
Y
YouCaring, 120, 264
Z
zoos, volunteering at, 143

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