Taxes 2016

Cad

Cad

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Picasso3 said:
I have got to start up a business or something and start pulling bullshit on taxes. What are the secrets, rich people?
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Basically the way to cheat on taxes while owning a business is to misreport income. Skim cash off the top so Uncle Sam never sees that income. No possible way to do this if you are a w2/1099 employee and the employer has an incentive to correctly report your income.

The other usual "tax shelters" are characterizing your income as capital gains (owning shares in something rather than taking income) or outright hiding income by overseas accounts.
 
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Picasso3

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Can't I claim my cars, half my house, my computer, my club membership, and a boat with a sleeping cabin as business use and depreciate them and deduct interest, taxes, and insurance?
 
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Cad

Cad

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Picasso3 said:
Can't I claim my cars, half my house, my computer, my club membership, and a boat with a sleeping cabin as business use and depreciate them and deduct interest, taxes, and insurance?
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Sure but if you get audited you're fucked. If you correctly skim they can't audit your books and "find" it.
 
Jysin

Jysin

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Blazin said:
I sincerely apologize if the back and forth turned into dick measuring, I don't think that has any place in these sub forums and my only goal when posting here is to be helpful to a forum that I have enjoyed being part of.

To those reading let me summarize by saying that whenever you sell a stock at a loss (outside of a retirement account) it would be prudent to make sure you are not creating an unintended wash sale.
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I'm legit glad you posted it. I had no idea WTF this was at all and I was trading 2-3 stocks all year in the 6 digit figures buying the lows and selling the highs. I think I should be fine with the 2 losses I had, as the 1st one I never rebought it and the 2nd one was a different stock right before election time and I have been sitting in cash since. I EASILY could have bought right back in though and had no clue about this wash sale rule... intended use of or otherwise.
 
Control

Control

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(This is from a US perspective, so depending on where you're from ymmv)

IANAL but there are legit ways/reasons to offshore too. If you sell products outside the US, it might make sense to handle those international transactions from a offshore location instead of your US office. If you have significant IP, it might make sense for an offshore holding company to own the IP and lease it back to you. Of course, if you want to repatriate all of the income immediately, then there's not much you can do, but if you don't need the money as personal income, there's something to be said for letting your money grow in a more favorable tax environment until you do.

Also, depending on how mobile you are, if you establish residence outside of the country, you can get a 100kish income exclusion (double if married) plus a housing credit. Of course, it's a bit ridiculous that we have to pay tax if we live outside of the country. (Americans are almost uniquely hosed in that regard.) Of course, as a long term play, you could always renounce. Once enough people realize that you can shop for and evaluate countries (for business environment, quality of life, or whatever's important to you) just like any other major life decision, governments will need to compete to keep their best people, and that sounds like a good thing to me.
 
Jysin

Jysin

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Yea, I have claimed Foreign Income Exclusion for the last ~15 years. While the ~$120k write off (Income + Housing Exclusions) is nice, the USA is one of the only countries to tax its citizens abroad. Every other non-US friend of mine enjoys everything they earn 100% tax free while abroad. Kind of sucks for us!
 
Jysin

Jysin

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Not to mention, the Foreign Earned Income Exclusion changed under GW Bush for the worse. For simplicities sake for this example, say the exclusion was a max of 100k. During the tax year if you earned 120k, you had the 100k write off, and you would pay taxes as if you only made 20k that year. Bush admin changed it so your tax rate on that remaining 20k was if you actually made 120k. So yea.. that sucked.

Uncle Sam takes a bite out of expatriate incomes - At Home Abroad - International Herald Tribune
 
Sludig

Sludig

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Simple question for my plebe self. Heard something and was wondering about it. I may have done it previous years because i quickly forget.

Work medical insurance premiums are deductible? Or conventionally that's usually figured when you get down to agi?

For me it's wierd as we get flat hourly plus a health and wellness. Used to be extra cash an hour that come obamacare became an insurance. Which this amount you used to earn to buy your own insurance now is basically the premium paid and a small amount leftover that goes to a401k.


If insurance premiums in addition to med expenses isdeductible that means i can take that basically paid for premium out? Would be nice as it's equivalent to like 650/m

What about missing work due to something more serious than a flu day?
 
Gravel

Gravel

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Health insurance premiums are non-taxable. The effect is that they lower your income on the W-2, so they're never calculated in your taxes.

If you're not a W-2 employee, however, I have no clue how to calculate that.
 
Ossoi

Ossoi

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so all of y'all have to submit a tax return every year, even if you're employed by someone else and not self employed?

My taxes, national insurance, student loans and pension deductions are all done automatically every month.

What kind of backward ass system do you guys have over there?
 
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Picasso3

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An exciting one where you see how much you can lie without getting caught
 
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TJT

TJT

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Need some expert advice. Just paid up my taxes for 2016 and today I got a lovely letter in the mail from the IRS saying I owe them another $6k due immediately... for fucking 2013. My first year out of university where I only worked from July and on my W2 was $40k

I made some calls and pulled the records on it. The IRS is claiming I under reported income on one of my accounts and walks me through some numbers, specifically mentioning how I didn't declare a $24k disbursement. This seems off as I have never taken money out of this account. So I pull the records on that account an this disbursement is a gross proceeds from some internal sale with a cost basis of $21k and a net gain of $3k. So at most I should be taxed on that $3k gain.

Now, I can totally believe that I forgot to fill in a box or something on 2013 Tax Slayer (that I used that year) but them taxing me on $24k when it should have been $3k gain at most is fucking bullshit. That, and why is the total amount they want so god damn high?

How do I go about correcting something like this? I'm going to call the IRS again today with my tax record on that account in my hand. But I am not sure how I should go about amending it. Or whatever, OR should I just suck it up and pay?
 
OneofOne

OneofOne

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If you have a high cost basis in that, it's up to you to show the IRS. Damn near everything they calculate on their own they do so from the worst position possible (not out of malice, but because they aren't simply going to make assumptions or dig deep on info they might actually otherwise have). The see a $24k disbursement, period. It's like people that don't file their taxes and the IRS catches you - their computer will create a 1040 for you based on income and that's it. If you have dependents, IRA deductions, mortgage interest, etc, that's on you to file correctly.

You can either hope you get a good agent on the line, hire help, or see about in-person/advocate assistance, depending upon your whole situation: Many Types of Free Tax Help Available From the IRS

It should be a relatively easy fix, though you will owe some.
 
Cad

Cad

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TJT said:
Need some expert advice. Just paid up my taxes for 2016 and today I got a lovely letter in the mail from the IRS saying I owe them another $6k due immediately... for fucking 2013. My first year out of university where I only worked from July and on my W2 was $40k

I made some calls and pulled the records on it. The IRS is claiming I under reported income on one of my accounts and walks me through some numbers, specifically mentioning how I didn't declare a $24k disbursement. This seems off as I have never taken money out of this account. So I pull the records on that account an this disbursement is a gross proceeds from some internal sale with a cost basis of $21k and a net gain of $3k. So at most I should be taxed on that $3k gain.

Now, I can totally believe that I forgot to fill in a box or something on 2013 Tax Slayer (that I used that year) but them taxing me on $24k when it should have been $3k gain at most is fucking bullshit. That, and why is the total amount they want so god damn high?

How do I go about correcting something like this? I'm going to call the IRS again today with my tax record on that account in my hand. But I am not sure how I should go about amending it. Or whatever, OR should I just suck it up and pay?
Click to expand...

If you contact them and show your paperwork and justify it, they adjust. They might have penalties by now also which might be accounting for some of the $6k. Taxable should $500-600 on a $3k gain depending on long term/short term cap gains, etc...
 
TJT

TJT

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They originally sent the notice to my old address from 2015, since I didn't update with the IRS until I filed taxes again (shame on me yeah?)
 
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