Currently, the estate tax exemption is large enough ($11.4 million for decedents dying in 2019; $11.5 million for those dying in 2020) to protect most estates from having to pay any federal estate tax. This exemption amount is the result of applying t…
The IRS has announced cost of living adjustments for more than 60 tax items for 2020 Act (Rev. Proc. 2019-44). All of the tax brackets have been affected, as well as the taxable income breakpoints for the favorable capital gains rate for long-term cap…
Each year, the IRS can adjust various amounts used to figure contributions, benefits, deductions, and credits related to qualified retirement plans and IRAs. The IRS has now done so for 2020 amounts (Notice 2019-59). The adjustments are modest in view…
Homeowners who meet ownership and use tests can exclude gain on the sale of a principal residence up to $250,000 ($500,000 on a joint return). Taxpayers who hold property for investment can defer gain on a like-kind exchange of real property. Can both…
A home office deduction can be claimed only if space is used regularly and exclusively for business. But can a taxpayer who has two businesses claim a home office deduction for the same space?
In a recent case, a taxpayer claimed to run a horse busine…
The basic Part B premium amount for 2020 is $144.60 per month. The Part D premium for drug coverage in 2020 ranges from $13 to $83 per month (depending on the drug plan selected). However, high-income taxpayers with modified adjusted gross income abov…
In 2014, the IRS said that virtual currency, such as Bitcoin, is property and not currency (Notice 2014-21). Thus, individuals receiving payments in cryptocurrency held for investment means reporting them as property transactions on Form 8949 and Sche…
ABLE accounts are special savings accounts for certain disabled individuals that can be used without causing the loss of government benefits related to the disability. In 2018, the IRS indicated it would issue proposed regulations on these accounts (N…
More than 69 million Social Security beneficiaries will receive a cost-of-living adjustment (COLA) of 1.6% starting with the December 2019 benefits, which are payable in January 2020. This COLA adjustment is less than the 2.8% increase last year (Soci…
Compensatory damages received for a personal physical injury or sickness are excludable from gross income. Damages for any other personal reason, such as defamation, as well punitive damages for any reason, are taxable. In one recent case, a homeowner…