Posts Tagged ‘tax deductions’
Monday, May 16th, 2011
The IRS has spoken. It has has no current plans to increase the standard mileage rate of 51¢ per mile for business miles driven, despite the big boost in gasoline prices.
Simplified deduction method. The optional mileage allowance for owned or leased autos (including vans, pickups or panel trucks) is 51¢ per mile for business travel after 2010. (The 2011 rate for using a car to get medical care or in connection with a move that qualifies for the moving expense deduction is 19¢ per mile, 2.5¢ more per mile than the 16.5¢ for 2010.) ( Rev Proc 2010-51, 2010-51 IRB 883 )
The mileage allowance deduction replaces separate deductions for lease payments (or depreciation if the car is purchased), maintenance, repairs, tires, gas, oil, insurance, and license and registration fees. The taxpayer may, however, still claim separate deductions for parking fees and tolls connected to business driving. ( Rev Proc 2010-51 )
The standard mileage rate may not be used for a purchased auto if: it was previously depreciated using a method other than straight-line for its estimated useful life; a Code Sec. 179 expensing deduction was claimed for the auto; the taxpayer has claimed the additional first-year depreciation allowance; or the taxpayer depreciated it using MACRS under Code Sec. 168.
A taxpayer who uses the mileage allowance method for an auto he owns may switch in a later year to deducting the business connected portion of actual expenses, so long as he depreciates it from that point on using straight-line depreciation over the auto’s remaining life. The depreciation deductions would still be subject to the Code Sec. 280F dollar caps. ( Rev Proc 2010-51 )
Additionally, employers may reimburse employees who are required to provide their own cars for business use at a rate that doesn’t exceed the standard mileage rate. A mileage rate that doesn’t exceed the standard mileage rate is treated as made under an accountable plan if the mileage is properly substantiated (time, place, mileage, and business purpose).
I handle IRS problems for my clients. If you get a letter from the IRS, and you are worried or have questions, send me an e-mail or, if urgent, call me.
Bill Lowrance
Lowrance Law LLC
McLean, VA
Tags: IRS, IRS Mileage Rate, tax deductions, tax law, tax news, Tax Problems
Posted in Attorney, Controversy, IRS, IRS Audits, Tax Attorney, income tax, tax deductions, tax news | No Comments »
Thursday, March 31st, 2011
On March 22, 2011 I gave a lecture for the Fairfax Bar Association (Fairfax Bar) Tax and Family Law Section at the Fairfax County Courthouse on key issues of Divorce Taxation that supplied Continuing Legal Education Credit for all Virginia attorneys present. The event was very well attended. My presentation on divorce taxes, which may seem boring to some, was spiced up with unusual tax court opinions, anecdotes and humorous comments. I did not include a lot of Internal Revenue Code citations, though they did form the basis for my talk. Rather my goal was to explain a complex tax area in a clear, understandable manner.
The attendees left with a fresher, more accurate perspective of how to handle the realities of the divorce process in light of the client’s best tax interest. Topics included: filing status, alimony, child support, retirement benefits, the distribution of property, and other tax topics to include in a property settlement agreement such as household employer taxes, the kiddie tax, child tax exemptions and child tax credits.
Tomorrow I will upload the power point for the tax talk I gave, as well as the written foundation for the talk for your benefit. I am happy to discuss your particular divorce tax situation with you. Feel free to contact me by email, by telephone, or by mail. Please see the contact page on my website for the details.
Bill Lowrance
Tax Attorney
Lowrance Law LLC
McLean, VA
703 506 1600
Disclaimer: No legal opinion here.
Tags: Add new tag, Divorce, income tax, IRS, Tax, tax deductions, tax news
Posted in Attorney, Divorce, IRS, Tax Attorney, Tax Problems, income tax, tax deductions, tax news | No Comments »
Wednesday, October 7th, 2009
The IRS is reminding everyone that there are special, limited deductions for state and local sales and excise taxes paid on the purchase of new cars, light trucks, motor homes and motorcycles. The deduction is available on new vehicles purchased from Feb. 17, 2009, through Dec. 31, 2009. In states that don’t have a sales tax, the law provides a deduction for other taxes or fees paid. This deduction is available whether or not a taxpayer itemizes deductions on Schedule A.
The deduction is limited to the taxes and fees paid on up to $49,500 of the purchase price of an eligible vehicle. The deduction is reduced for joint filers with modified adjusted gross incomes (MAGI) between $250,000 and $260,000 and other taxpayers with MAGI between $125,000 and $135,000. Taxpayers with higher incomes do not qualify. See IRS information at IRS Announcement
Check the IRS Video on You Tube at http://tinyurl.com/ydg9q69
Bill Lowrance
Lowrance Law LLC
No legal opinion here
Tags: Tax, tax deductions, tax news
Posted in IRS, income tax, tax deductions, tax news | No Comments »
Thursday, November 13th, 2008
The Economic Stimulus Act of 2008 contains two provisions that provide tax benefits for businesses. The first provision increases the limit up to which a business can expense property purchased and placed in service during its 2008 tax year. The second provision provides an additional 50 percent special depreciation allowance for property acquired and placed in service during calendar year 2008.
Unlike the economic stimulus payments that millions of individuals have already received, the tax benefits for businesses are not automatic; businesses must act to take advantage of the new provisions by purchasing qualifying property.
The Joint Committee on Taxation estimates that businesses stand to lower their 2008 tax bills by roughly $45 billion as a result of the two business provisions in the Economic Stimulus Act of 2008; these provisions accelerate into 2008 the tax benefits that otherwise would not have been available until future years.
See IRS Small Business
Bill Lowrance
Tags: business deductions, IRS, Small Business, Tax, tax deductions
Posted in Attorney, IRS, IRS Audits, Tax Attorney, Tax Crime, Tax Litigation, Tax Problems, Tax Research | No Comments »
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