By: Diane Avila
There are three areas where knowing the ins and outs of the traditional IRA distribution rules can make a big difference in how much you and your family will keep after taxes:
If you maintain your office in your home and your home is your principal place of business, you may be entitled to a special tax break on your commuting costs. Taxpayers can deduct daily costs of travel between their home and another work location in the same business, regardless of whether the other location is regular or temporary. Simply remember to keep adequate records, via a diary or log, of your expenses and mileage during the year and you will be eligible to deduct one or the other at the end of the year.
Aging is a fact of life. One that some of us would rather not recognize in ourselves. Yet, it is inevitable. What may be even more difficult is seeing our parents’ age and become more dependent on us, their children, and qualified professionals. A nursing home might prove to be the best option. There are several tax aspects of a parent entering into a nursing home.
By: Theresa A. Smith
Education costs are on the rise, but you will be happy to know there are education tax deductions and credits that can help offset the costs.
Work related education expenses:
A deduction is available if the education maintains or improves the skills related to your trade or business. Educational costs are also deductible if the education is required to keep your position or job. Work related educational costs are not deductible if the education is required to get into the field or qualifies you for a new trade or business. If your educational costs are deductible under these tests, you can include the transportation costs involved. If you’re away from home for deductible education, you can include the costs of travel, meals (at 50%), and lodging as well. In the case of an employee, education expenses that are deductible under these tests may be claimed as an itemized deduction, but only to the extent the expenses, along with other miscellaneous itemized deductions, exceed 2% of the taxpayer’s adjusted gross income (AGI).
In our hustle and bustle lives, working 40 or more hours a week has become the norm, leaving limited time for taking care of duties at home. This has led to an increased need for a nanny, housekeeper, gardener, or perhaps all three! What many people don’t realize, however, is that while their responsibilities at home may be going down, their tax bill could be going up.