Posts Tagged ‘Residence’


How to Declare Your State of Residence for Tax Purposes

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Some taxpayers will have more than one home.  For them it’s important to declare their state of residence. There are no specific rules to follow to declare your residence. Establishing residence is actually what your intentions are.


How to Save $267,892 of Income Tax, Penalties and Interest

A new client came to us late last summer.

She dropped off a notice from the Internal Revenue Service (“IRS”). It indicated her and her husband owed $267,892 of back taxes, penalties and interest. I don’t know about you, but that’s a lot of money to me.

As we reviewed the paperwork she provided, it quickly became apparent she did not declare the sale of … Continue reading »


When (and How) to Declare the Sale of Your Primary Residence

Recently a new client came to us.  The Internal Revenue Service (“IRS”) was looking for $262,532 in back taxes.  This was from the sale of their home two years ago.

Form 1099-S Reporting Requirements

Attorneys that handle real estate closings must report the proceeds on IRS Form 1099-S, Sale of Real Estate Property.  There is an exception to this however. If the seller of the real estate signs a certification, the attorney does not need to issue the 1099.  … Continue reading »


3 Reasons You Likely Won’t Pay Income Taxes When You Sell Your Home

1) You Don’t Have a Capital Gain

 

Due to the housing market, many homeowners no longer have a gain in their home. A gain is the sales price minus the cost basis. The cost basis is generally the purchase price of the property plus improvements. Improvements would include things like a new roof, new heating system or a deck being added to the home. Unfortunately many people have seen any potential capital gain disappear in recent years due to … Continue reading »


When is Cancelled or Forgiven Debt Taxable?

If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable. This type of debt includes mortgages, credit cards, car loans and student loans. Lenders are required to send Form 1099-C, Cancellation of Debt, when they cancel any debt of $600 or more. The amount cancelled will be in box 2 of the form. If you disagree with the amount reported contact your lender to work out any discrepancies … Continue reading »