Alpha’s Tax Tips

Shift Tax Gears on Car Donation

Are you thinking about donating a car or other vehicle to charity? If you give away the car without any strings attached, you might forfeit some extra-tax saving mileage. Specify that the charity must use your vehicle in furtherance of its tax exempt-purpose. As a result, you can deduct an amount equal to the vehicle’s […]

Rescue Tax Loss for Worthless Stock

Do you own stock that has become worthless in these uncertain times? At least you may be able to salvage some tax relief on your 2020 return. Prepare to claim a capital loss for the worthless stock. The loss can offset capital gains racked up this year plus up to $3,000 of highly taxed ordinary […]

New Form Used to Report COVID-19

Filers get a new form to report a COVID-19 retirement-related easing. The 10% fine on pre-age 59 ½ payouts from retirement accounts in 2020 is waived on up to $100,000 of Coronavirus-related distributions from 401(k)’s, 403(b)’s and IRA’s. Tax on these distributions can be paid over three years, beginning with the payout year, unless the […]

Combine Benefits with Roth 401(k)

With a 401(k) plan, you can accumulate a tidy nest egg for retirement without any current tax erosion. Another retirement planning option, the Roth IRA, provides tax-free distributions in the future. But you can combine the best of both worlds. Strategy: Switch your regular 401(k) account to a Roth 401(k). If your company doesn’t offer […]

4 Ways to Max Out Biz Gifts

As a small business owner, you may give gifts to clients and customers to show your appreciation. Unfortunately, however the deduction for business gifts is limited to a paltry $25 per recipient per year. Learn all the tax angles. Then, by planning ahead, you can get the most bang for your bucks. Here are four […]

Closing a Struggling Business?

Hopefully not !! Are you thinking of shuttering your struggling business? Don’t forget taxes. The IRS is aware of the many small-business closures during the coronavirus pandemic and has redesigned its “Closing a Business” page on its website to help. The agency has information and procedures for sole proprietorships, partnerships and corporations. Among the to-dos: […]

Short Term Rental Property

The passive loss rules are strict for short-term rentals of real estate, meaning average rentals of seven days or less. A couple owned beachfront property that they rented out over the years for an average rental period of seven days or less. They paid a management company to get tenants, collect rents, clean and the […]

Social Security Changes

Social Security recipients get a 1.3% increase in their benefits in 2021. The earnings test limits are heading up. Individuals who turn 66 next year will not lose any benefits if they earn $50.520 or less before they reach that age. Individuals who are 62 through 65 by the end of 2021 can make up […]

Virtual Currency Tax Update

Covid-19 has stifled the IRS’s enforcement arm. Many of the agency’s audit activities were curbed from mid-March to July 15 because of the pandemic, and the IRS is slowly stepping back into doing exams. But the IRS hasn’t lost focus of its key priorities. On that list are virtual currency transactions. According to the IRS […]

Ask the IRS to Remove an Old Tax Lien

You must ask the IRS to withdraw a tax lien once the tax liability is fully paid. The Service will withdraw the lien: Provided you have paid your tax bill The IRS has released the lien You have been tax-compliant for the past three years A withdrawal of a tax lien expunges the lien immediately […]