Are you lucky to be alive and taking care of your taxes? Toby Mathis and Jeff Webb of Anderson Advisors answer your tax questions. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

If a non-profit (NP) organization opened a trading account and got options income less than $50,000, does the NP file an income tax return (besides a 990-N)? If you have gross receipts less than $50,000, you only need to file a 990-N (e-Postcard)

Are losses from gambling deductible? If you have gambling losses, they are deductible on Schedule A as long as you have gambling winnings on tax return

I have a rental property that is owned by my self-directed IRA. Does it need to be in an entity or is it safe in the IRA? Individual owner of an IRA is always personally reliable for the acts of the IRA, so put in an LLC or self-directed IRA

How do you claim the solar credit on your personal residence? Use Form 5695 - Residential Energy Credits; put in how much you paid for solar and multiply times percentage credit (26%)

Doing a cost segregation on a condo that was purchased out of my inherited trust to pay off other beneficiaries. Can I take bonus depreciation? Yes, and you can write-it off twice if you inherit it

Can I include my roof replacement for the solar tax credit? You can write-off roof if for dual usage; roof replacement is not part of the solar installation and labor

How is the in-home office deduction being treated since most of us have been working from home? Still a red flag for realtors? If you are an employee, there is no home-office deduction; the home office is only for sole proprietors and if you’re being taxed on Schedule C and receive a 1099, then you can deduct reasonable expenses

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Resources:

 

Anderson Advisors Tax and Asset Protection Workshop (Free 1-day virtual event on March 27)

http://aba.link/MarchTAP

Infinity Investing: How The Rich Get Richer And How You Can Do The Same by Toby Mathis

http://aba.link/infinitybook

IRS - Coronavirus (COVID) Tax Relief

https://www.irs.gov/coronavirus-tax-relief-and-economic-impact-payments

Bonus Depreciation

https://www.irs.gov/newsroom/new-rules-and-limitations-for-depreciation-and-expensing-under-the-tax-cuts-and-jobs-act

Depreciation Recapture

https://www.investopedia.com/terms/d/depreciationrecapture.asp

Charitable Organizations

https://www.irs.gov/charities-non-profits/charitable-organizations

990-N

https://www.irs.gov/charities-non-profits/annual-electronic-filing-requirement-for-small-exempt-organizations-form-990-n-e-postcard

26 U.S. Code Section 168K

https://www.law.cornell.edu/uscode/text/26/168

Section 179

https://www.section179.org/

Retirement Plans

https://andersonadvisors.com/retirement_plan/

Self-Directed IRA (SDIRA)

https://www.investopedia.com/terms/s/self-directed-ira.asp

Entity Formation

https://andersonadvisors.com/entity_formation/

Cost Segregation

https://andersonadvisors.com/using-cost-segregation-residential-real-estate/

Wills and Trusts

https://andersonadvisors.com/living_trusts/

Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics

https://www.energy.gov/sites/prod/files/2020/01/f70/Guide to Federal Tax Credit for Residential Solar PV.pdf

Real Estate Professional Requirements

https://www.irs.gov/pub/irs-utl/33-Real Estate Professionals.pdf

Home Office Deduction

https://www.irs.gov/businesses/small-businesses-self-employed/home-office-deduction

Section 1245

https://www.investopedia.com/terms/s/section1245.asp

Section 1250

https://www.investopedia.com/terms/u/unrecaptured-1250-gain.asp

Capital Gains and Losses

https://www.irs.gov/newsroom/capital-gains-and-losses-10-helpful-facts-to-know-0

Step-Up in Basis

https://www.investopedia.com/terms/s/stepupinbasis.asp#:~:text=A%20step%2Dup%20in%20basis%20is%20the%20readjustment%20of%20the,for%20tax%20purposes%20upon%20inheritance.&tex