Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax

Team, Concerning the new 3.8 % Medicare Tax,do we need to

Customer Question
Team, Concerning the new 3.8...

Team, Concerning the new 3.8 % Medicare Tax,do we need to pay it? I believe we should be considered a Real Estate Professional My wife and have two retail Shopping centers and 4 Residential houses, I understand we need to spent over 751 hours per year on this real estate to in order not to pay the new tax. We have property managers but still we spent a lot of time dealing with insurance issues and driving 500 miles per month to visit the properties to take care of issues and dealing with the different managers When on vacation I can not escape it I still need to receive emails and answers questions. I am 72 and my wife 64 and the net income from these properties is our only income plus social Security and some income from stocks. When we sell one of these properties and do a search for a compatible 1031 exchange we work 15-16 hours a day to find a new property and do a lot of traveling. if you have any questions please ask. Joe XXXXX***@******.*** XXX-XXX-XXXX

Submitted: 4 years ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 17 minutes by:
4/29/2013
Tax Professional: Lev, Tax Advisor replied 4 years ago
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 30,132
Experience: Taxes, Immigration, Labor Relations
Verified
LEV :

Hi and welcome to Just Answer!
"3.8 % Medicare Tax" that you referred is officially named the Net Investment Income Tax (NIIT) which went into effect on Jan. 1, 2013. The NIIT will affect income tax returns of individuals, estates and trusts for their first tax year beginning on (or after) Jan. 1, 2013. It will not affect income tax returns for the 2012 taxable year that will be filed in 2013.

Individuals will owe the tax if they have Net Investment Income and also have modified adjusted gross income over a certain thresholds - assuming you are filing a joint tax return - the threshold amount is $250,000.

LEV :

If you are Real Estate Professionals - that makes no difference - unless you are in real estate business and report all your income as business income on schedule C.
If however - that is your Investment Income and your modified adjusted gross income is more than $250,000 - you will be subject of NIIT.

LEV :

To the extent that gains are not otherwise offset by capital losses - gain from the sale of investment real estate (including gain from the sale of a second home that is not a primary residence) - is taken into account in computing Net Investment Income.
The gain that is not recognized because of section 1031 exchange - is not subject of NIIT.

LEV :

Let me know if you need any clarification or if you need any help to estimate your possible tax liability.

JACUSTOMER-ec183e4z- :

please send my answer as i paid $35.00 for it

Ask Your Own Tax Question
Tax Professional: Lev, Tax Advisor replied 4 years ago

Just in case you were not able to use the chat - I am switching to Q&A mode and porting the answer below.
Please feel free to communicate if you need any clarification or have other tax related issues.

LEV : Hi and welcome to Just Answer! "3.8 % Medicare Tax" that you referred is officially named the Net Investment Income Tax (NIIT) which went into effect on Jan. 1, 2013. The NIIT will affect income tax returns of individuals, estates and trusts for their first tax year beginning on (or after) Jan. 1, 2013. It will not affect income tax returns for the 2012 taxable year that will be filed in 2013. Individuals will owe the tax if they have Net Investment Income and also have modified adjusted gross income over a certain thresholds - assuming you are filing a joint tax return - the threshold amount is $250,000.

LEV : If you are Real Estate Professionals - that makes no difference - unless you are in real estate business and report all your income as business income on schedule C. If however - that is your Investment Income and your modified adjusted gross income is more than $250,000 - you will be subject of NIIT.

LEV : To the extent that gains are not otherwise offset by capital losses - gain from the sale of investment real estate (including gain from the sale of a second home that is not a primary residence) - is taken into account in computing Net Investment Income. The gain that is not recognized because of section 1031 exchange - is not subject of NIIT.

LEV : Let me know if you need any clarification or if you need any help to estimate your possible tax liability.

Ask Your Own Tax Question
Customer reply replied 4 years ago

lev I have a question

Tax Professional: Lev, Tax Advisor replied 4 years ago
Please post your question.
I am here to help you.
I will address all your tax related questions.
Ask Your Own Tax Question
Ask Lev Your Own Question
Lev
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 30,132
30,132 Satisfied Customers
Experience: Taxes, Immigration, Labor Relations

Lev is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,310 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,695 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
Can I report rental income in my tax return on a property
Can I report rental income in my tax return on a property thar is owned by my father? He does not live in the US is not a US citizen and can sign a document to allow me to receive the rental… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
For a ny state partnership tax return, if you file an
For a ny state partnership tax return, if you file an extension but don't pay anything and then end up owing a lot. Do they still recognize the extension or do they charge a failure to pay penalty (fo… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I just efiled a joint tax return for me and my wife.
I just efiled a joint tax return for me and my wife. Federal, Non Resident Hawaii, and Resident Massachusetts. My wife is a resident alien living in Thailand. Turbotax didnt allow me to e file my Mass… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
Small schedule c business donates fully depreciated
small schedule c business donates fully depreciated furniture to charity. They've been told that the FMV is $1,000. What is the deduction for contributed property? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I filed for an extension to file my 2017 income tax return.
I filed for an extension to file my 2017 income tax return. I recently suffered a stroke - 6 weeks ago - and have been unable to finalize my return. I should be able to file it within the next 30 days… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
Adjusted individual tax return for 2014(Iowa),says no
Adjusted individual tax return for 2014(Iowa),says no response to letter of inquiry,disallowed health insurance. deduction.says my wife and I owe$600.00.she called # and was told to show proof of insu… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I am trying to figure out the net income from the following
Hi. I am trying to figure out the net income from the following part-time jobs in MARYLAND and then the total net income. If possible, will you please send me how you arrived at the figures (the calcu… read more
Lev
Lev
Tax Advisor
30,132 satisfied customers
Sell of property tax liability. Ca. Bought home 25 yrs ago
bought home 400,000 selling 2.5 mil. Invested 500,000 owe 800,000… read more
Richard
Richard
Tax Attorney
Doctoral Degree
4,310 satisfied customers
Wife owns property individual, picks up rental income on
wife owns property individual, picks up rental income on Sched E - husband and wife live together in another home. Wife wants to rent husband the house for his business - both Sched C - does this make… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
Since my adjusted gross income is over $100,000, I can't
Since my adjusted gross income is over $100,000, I can't take the rental loss that I have even though I was actively maintaining the property. Since I have a mortgage and property taxes on that rental… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
Is a 1040 US Individual Income Tax Return federal income
Hi Is a 1040 US Individual Income Tax Return federal income taxes owed to the US government? Or is it FICA? I received a letter owing some back taxes and since I'm a priest with a weird set of tax exc… read more
ABC Accounting Group
ABC Accounting Group
Bachelor\u0027s Degree
682 satisfied customers
Dependent Children. 1. Taxpayer's adjusted gross income is
Dependent Children.1. Taxpayer's adjusted gross income is over $ 800K so personal exemptions are phased out. 2. Taxpayer's children are between ages 12 - 17. 3. All three children have earned income o… read more
emc011075
emc011075
Senior Tax Specialist
Bachelor's Degree
16 satisfied customers
Do I reduce my adjusted gross income by the amount of a
Do I reduce my adjusted gross income by the amount of a forgiven debt(1099-c) before figuring the EIC? … read more
keeperumiami
keeperumiami
Sr Financial & Tax Consultant
Bachelor\u0027s Degree
1 satisfied customers
Received a 1099-c after filing 1040 2016 joint tax return.
Received a 1099-c after filing 1040 2016 joint tax return. The 1099-c is for bankruptcy discharged in 2014. The event date they listed on form is 10-17-2016? This was a equity line on home that was fo… read more
Lev
Lev
Tax Advisor
30,132 satisfied customers
I am trying to file joint tax return, but my husband does
I am trying to file joint tax return, but my husband does not work and he owes child support. Per turbo tax, I will get $20k refund, if I file injured spouse form, do I get my refund? … read more
Megan C
Megan C
Certified Public Accountant (CPA)
Master's Degree
8,651 satisfied customers
My adjusted gross income from 2016 was $199,397. If I take
My adjusted gross income from 2016 was $199,397. If I take an early withdraw of $26,700 from a 401k I know I will pay a 10% penalty but if I have them take an additional 20% Federal Tax will that sati… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
My mothers adjusted gross income is 6033, her standard
my mothers adjusted gross income is 6033, her standard deduction is 6300, where will the 2000 that she won in the lottery be entered on the 1040 form and does she have to pay a tax on this money … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
A couple filed a joint tax return for 2015. It now requires
A young couple filed a joint tax return for 2015. It now requires an amendment. They are separated now and the wife has a restraining order against the husband. Is there something they can do separate… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x