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Recent Tax Burden questions

I am a retired 72 year old with a $178, 000.00 IRA with

I am a retired 72 year old with a $178, 000.00 IRA with current MRD of about $7000.00 a year. I owe $53,000.00 on my children's student loans paying close to $1000.00 a month2015 taxable income (with MRD) $54,890.00, Total Tax $7309.002016 will be about the same as 2015My financial advisor recommended I contact a professional tax advisor and ask this basic question: What would be the Federal tax burden for withdrawing $53,000.00 from the IRA in 2017 instead of the standard MRD? That is, is there an additional penalty over and above the tax for the regular MRD? Knowing that I can determine if the additional tax would be burdensome or whether it would offset sufficiently by the savings of closing the Student loans in one year.Thank you.

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

19,754 satisfied customers
I'm a expat (US citizen) living/working abroad (and paying

Hello, I'm a expat (US citizen) living/working abroad (and paying income tax) in Finland. For the 2016 tax year, I did have US income from stock sale. I understand that I can use the Foreign Earned Income exclusion (form 2055) and the taxes paid in Finland to reduce my adjusted gross income in the US, thus reducing my tax burden there. Is this correct? I appear to qualify for this exclusion as I pass the residence test.Is there a limit to my income in Finland where I would not be allowed to use the Foreign Earned Income exclusion or is it simply that the max allowable inclusion for 2016 is $101,300? I earned > $250K in Finland in 2016 and paid about $100K in taxes (to Finland).For years when there is zero US income made, do I still need to file a US return? If so, do I report the earnings made in the foreign country using the same form 2055 each and every year I'm living/working abroad?Thanks.

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Barbara

Enrolled Agent, Paralegal

5,986 satisfied customers
Well, I am getting close to retirement, and my employer, a

Well, I am getting close to retirement, and my employer, a city government offers the option to purchase service, thus boosting your pension. I made a nice profit a few years ago with the sale of my home, so I used some of the after tax profit and purchased 4 years of service, thinking that my only tax burden would be on the income once I retire. Usually people transfer from another pension or from a 401k Was I wrong? Will I have to pay taxes on the purchase?JA: The Accountant will know how to help. Is there anything else important you think the Accountant should know?Customer: Not that I can think of.

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Barbara

Enrolled Agent, Paralegal

5,986 satisfied customers
My husband and I own property in Costa Rica. A new law is

My husband and I own property in Costa Rica. A new law is about to be enacted, putting a 15% capital gains tax on all real estate sales in the country. Because we bought our property 30 years ago at a very low price compared to what it will sell for now, we'll have to pay 15% on about $400,000 sale price. Our property is owned by our Costa Rican corporation, which will pay the 15% tax. We've filed the proper US tax/foreign corporation forms with the US government from 2003 to present--the FBARS, TD90s, Form 5471, so it's established that the corporation and stock belongs entirely to my husband and me. Our question is: will the IRS accept that the fact that our corporation has already paid a 15% tax is the same as if we paid it, and not expect us to pay another 15% in US taxes on the same money? Or will the IRS say that the corporation paid the tax in Costa Rica, we didn't, so we must pay another 15% to IRS? I know there's a tax treaty where we don't have to pay two governments on the same money, but I'm worried whether they'll accept our corporation paying it as being the same as us personally paying it.

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

19,754 satisfied customers
My brother is the executor of my mother's estate. He has a

my brother is the executor of my mother's estate. He has a large part of it but won't disperse it and is getting ready to file another year's income tax. Is that right? Assistant: Thanks. Can you give me any more details about your issue? Customer: He's got about $100,000 in cash, the bills are paid, my mom has been dead for almost 2 years. there still are 2 pieces of property that need to be sold and a bunch of jewelry. Can't he disperse what he has to lesson the tax burden?

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PDtax

Owner

Master's Degree

7,370 satisfied customers
In 2017 I will receive 24,000 on social security benefits.

Hi. In 2017 I will receive 24,000 on social security benefits. My wife will receive 19,200 in pension payments . How much tax will we owe based on 2016 rules?JA: The Accountant will know how to help. Please tell me more, so we can help you best.Customer: I am trying to figure out whatour tax burden will be. We will be living outside the USJA: Is there anything else important you think the Accountant should know?Customer: Just that we will have no dependents

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

19,754 satisfied customers
I have a condo which I have lived in 4 years. It has

I have a condo which I have lived in 4 years. It has increased in value. Now I am going to use it as a rental. If it appreciates further over the next few years and I sell how would the taxes work on the gain?

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emc011075

Tax advisor and Enrolled Agent

Bachelor's Degree

4,942 satisfied customers
We bought our home in 1987 and lived in it until 2010 when

Hello. We bought our home in 1987 and lived in it until 2010 when we bought our present home. When we left our first home we rented it way under market value to our son. The house was considered rental property on our tax returns. Losses and depreciation saved us about $6000 through 2015. We sold the home in march 2016 to our son and daughter-in-law for the low side of appraised value, $220,000, and gifted equity of $44,000 to them in lieu of the 20% down payment. All told their loan was $176,000 and we netted a bit less (closing costs and such). After taking cost basis into account, our tax preparer estimates our tax burden on capital gains will be $26,000. We will have to pay taxes on the gifted amount of $44,000 since it is considered part of the capital gains. We did receive a 1099 on the sale. Essentially this home has been in our family since 1987 and leased for a pittance to our son while he was in school and getting on his feet financially. Is there any gray area in the tax laws that could help us avoid paying such a steep penalty for not selling our first home within 5 years after buying our second home so our son could have an affordable place to live?

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Mark Taylor

Certified Public Accountant

Masters

2,666 satisfied customers
I'm curious about how much I'm gonna owe covered California

I'm curious about how much I'm gonna owe covered California because of an additional unexpected income for 2016I reported 17,000 but my actual income was filed for 27000My fees were 292.00 per month and my portion was only 44 per month.Now cc is telling me to ask a tax consultant to calculate the difference , not them.Can somebody please give me a number so I can start setting aside some money for that day

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