Wife just asked if we can deduct her car payment, i guess there's someone at her office running wild and she's taking it as pro tips
Taxes 2016
- Thread starter TJT
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Hobby losses are a Schedule A deduction with a 2% limitation. You can only deduct up to the gross income gained from the hobby during the year(remember gross is different than net), and then only the amount that exceeds two percent of your AGI can be used. You don't actually have to report the income to do it. I'd imagine someone would get audited if it was actually a substantial amount.
It's to prevent people from taking a loss on Schedule C when what they're doing isn't actually a business. I've had exactly 0 clients ever use it because they usually put it on Schedule C for a few years and then quit doing it, or start another new dipshit hobby/"business". If they don't show net income in 3 out of the past 5 years, then it would only be allowed to be taken as a hobby loss.
It's to prevent people from taking a loss on Schedule C when what they're doing isn't actually a business. I've had exactly 0 clients ever use it because they usually put it on Schedule C for a few years and then quit doing it, or start another new dipshit hobby/"business". If they don't show net income in 3 out of the past 5 years, then it would only be allowed to be taken as a hobby loss.
So I am sitting on a $7k debt to federal this year. We have been deducting at Married + 0 for both of us and have two kids yet still can't seem to get down to $0 owed at the end of the year.
I need something creative to fix this because I am getting tired of it. We made $225k combined and get fucked in the ass for it.
What are the rules on deducting a portion of the home for business? I have a c-corp in my name that I work from home on.
I need something creative to fix this because I am getting tired of it. We made $225k combined and get fucked in the ass for it.
What are the rules on deducting a portion of the home for business? I have a c-corp in my name that I work from home on.
Cad
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Cad
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Depending on how much you use your mobile phone for work, you can deduct a portion of your annual bill for that and a portion of your home internet costs.
If you work from home a lot whats your primary job site? Can you deduct mileage?
Cad
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You can deduct various charitable contributions without receipts as long as they are under a certain amount. Not that I'm suggesting you don't have such receipts. I'm just saying.
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Frenzied Wombat
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That's weird, any reason why you're owing that much if you're deducting the appropriate amount? Between your child deductions, mortgage interest, and property taxes I would figure you'd end up with a refund... I usually owe about 4k at the end of the year after all my deductions, but only because half of my gross income is from bonuses which are taxed at a flat 25% at source, which is insufficient.
Cad
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The best tax year is one in which, after all justifiably legal deductions have been applied, you owe just under the maximum amount that'll get you penalized. I have no idea why you'd want a refund or to give the govt your money early.
Frenzied Wombat
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Agreed, which is why I find his situation curious.. If you're not "under-deducting" on your W-4, you should pretty much owe nothing with no further deductions, and actually get a refund if you do have any. Between his kids and house he should be getting a refund if he's doing married + 0 with his W-4.
Cad
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Maybe his home business income but he paid no quarterlies so there's no withholding on that?
I want to get back $1 every year.
The reason I think we get boned every year is because our income is split between three jobs. They take M+0 out at the rate for that income and not the combined. Only thing that I can think of.
We also usually hit 10-15% in charity but not this year.
The reason I think we get boned every year is because our income is split between three jobs. They take M+0 out at the rate for that income and not the combined. Only thing that I can think of.
We also usually hit 10-15% in charity but not this year.
Frenzied Wombat
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Yeah, that would certainly explain it. I just got the impression from his post that he doesn't understand why he owes 7k.. If he has another stream of income that he's doing no withholding on, he's definitely not getting "fucked in the ass" lol.. Quite the opposite-- like you stated there's no reason to give the government in advance when you can hold onto it and then pay it out at filing time.
Frenzied Wombat
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Well yeah that's it.. If you've got three revenue streams, and each is having a tax rate applied independently rather than based on the aggregate gross amount, you are being undertaxed..
I just don't know how to fix that.
I am doing nothing creative though to ease my tax burden and I think we are at the income level where I need to be sheltering it better.
Cad
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There's really nothing legal you can do as long as your income is accurately reported to the govt. The tax cheats all own small businesses that they skim income off of to underreport.
Frenzied Wombat
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You can ask each employer to deduct more, but there's no point, it's better to just owe the 7K at year end.
If you're looking to get the actual burden (effective rate) lowered, home office deductions as well as vehicle deductions are the easiest to get away with.. If you invest in equities/ETF's, a good strat is to sell shit that's lost money at year end, as the losses are tax deductible. Typically I dump any poor performing stocks each year for this purpose.