The estate tax was reinstated in the Tax Relief Act. The credit for 30 percent of the cost of installing solar water heating equipment, solar electric equipment, geothermal heat pumps or small wind turbines in your primary residence or a second home is unlimited in It applies to qualified insulation, windows, outside doors, biomass fuel stoves and high-efficiency furnaces, water heaters and central air conditioners. If you convert a second home into a principal residence after , you may not be able to exclude all of your gain.
So if you have owned a vacation home for 18 years and make it your main residence in for two years before selling it, only 10 percent of the gain two years of non-qualified second home use divided by 20 years of total ownership is taxed. The usual estimated tax benchmarks of percent or percent of tax liability do not apply.
In , this deduction increases to nine percent of qualifying business net income. This deduction applies to businesses engaged in construction, engineering or architectural services, film production, or the lease, rental or sale of equipment you manufactured. However, the rate remains six percent for oil and gas companies. You must have worked at least hours a school year in a school that provides elementary or secondary education. You can take suspended losses in later years.
The caps will also apply to partners and S corporation owners. Beginning in , buyers of new vehicles no longer get a tax benefit for sales tax paid on new vehicles, unless they itemize and elect to deduct sales taxes instead of state income taxes.
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The Tax Relief Act extends through the end of the tax rates in effect in They had been scheduled to increase to the higher tax rates that were in effect prior to Temporary increases in the Earned Income Tax Credit for filers with three or more children and the higher income levels for the phase out of the credit have been extended through the end of The special itemized deduction for mortgage insurance premiums paid on mortgages taken out after expires on Dec.
The 30 percent tax credit of the cost of energy-saving home improvements was extended by the Tax Relief Act of through The current federal estate tax rules are scheduled to end after The credit was extended by two years by the Tax Relief Act. Employee payroll taxes will go back up to 6. Penalties are assessed for each month that any individual does not have the minimum essential health insurance coverage. Some taxpayers who obtain health insurance coverage through a qualified marketplace may qualify for health premium tax credits to subsidize the cost of coverage.
This was extended to the end of This can also apply to debt that is discharged in provided that there was a written agreement entered into in Debt cancelled from the short sale, foreclosure, or mortgage modification for Qualified Principal Residences is no longer excludable from income under the Mortgage Forgiveness Debt Relief Act.
This could also apply to debt that was discharged in provided that there was a written agreement entered into in The deduction for tuition and fees is no longer available. In and , all taxpayers, including those under 65, are now subject to the 7. Beginning Jan. These assets had to be purchased new, not used. After there is no further bonus depreciation. This bonus "expensing" should not be confused with expensing under Code Section which has entirely separate rules, see above.
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TurboTax Deluxe searches more than tax deductions and credits so you get your maximum refund, guaranteed. Summary of Business Tax Law Changes for - Make Withholding Changes Work for You. Inflation-Related Tax Law Changes for Guide to Filing Taxes as Head of Household. Video: What Are Tax Benefits? Estimate your tax refund and avoid any surprises. Adjust your W-4 for a bigger refund or paycheck. Find your tax bracket to make better financial decisions.
Enter your annual expenses to estimate your tax savings. Learn who you can claim as a dependent on your tax return. Turn your charitable donations into big deductions. Get a personalized list of the tax documents you'll need. Find out what you're eligible to claim on your tax return. The above article is intended to provide generalized financial information designed to educate a broad segment of the public; it does not give personalized tax, investment, legal, or other business and professional advice.
Intuit TurboTax. Sign In. Skip To Main Content. Payroll Tax Credit For and , Congress gave workers a credit of 6. Indexed Tax Brackets The 10 percent, 15 percent, 25 percent, 28 percent, 33 percent and 35 percent tax brackets all kick in at income levels that are more than 4 percent higher than they were in Income Phase Outs for Itemized Deductions and Personal Exemptions for High-Income Taxpayers The amount of itemized deductions and personal exemptions you can take are normally phased out as your income rises.
Tax Rate on Capital Gains The tax rate on capital gains from the sale of assets held longer than one year remains at zero percent for people in the 10 percent or 15 percent tax brackets. Tax Rate on Dividends Similarly, the special 5 percent maximum rate on dividends of taxpayers in the 10 percent and 15 percent tax brackets remains at zero percent. Estate Tax Exemption For , there is no federal estate tax. Credit for Residential Energy Efficient Property The credit for 30 percent of the cost of installing solar water heating equipment, solar electric equipment, geothermal heat pumps or small wind turbines in your primary residence or a second home is unlimited in Converting a Second Home to a Primary Home If you convert a second home into a principal residence after , you may not be able to exclude all of your gain.
Domestic Production Activities Deduction In , this deduction increases to nine percent of qualifying business net income. This deduction has been extended through the end of Sales Tax Deduction for New Vehicles Beginning in , buyers of new vehicles no longer get a tax benefit for sales tax paid on new vehicles, unless they itemize and elect to deduct sales taxes instead of state income taxes. Lower Capital Gains and Dividend Tax Rates Extended Through The tax rate reductions for long-term capital gains remain in effect for and Payroll Tax Credit Starting in , the partial credit for payroll taxes paid by employers is no longer available.
Earned Income Tax Credit EITC Temporary increases in the Earned Income Tax Credit for filers with three or more children and the higher income levels for the phase out of the credit have been extended through the end of Mortgage Insurance Premiums The special itemized deduction for mortgage insurance premiums paid on mortgages taken out after expires on Dec. Credit for Energy-Saving Home Improvements The 30 percent tax credit of the cost of energy-saving home improvements was extended by the Tax Relief Act of through Payroll Taxes Employee payroll taxes will go back up to 6.
Individual Responsibility Penalties Penalties are assessed for each month that any individual does not have the minimum essential health insurance coverage. Premium Tax Credits for Health Coverage Some taxpayers who obtain health insurance coverage through a qualified marketplace may qualify for health premium tax credits to subsidize the cost of coverage. Deduction for State and Local Income Taxes State and local income taxes paid is no longer an itemized deduction. Deduction for State and Local Income Taxes State and local income taxes paid remains an itemized deduction.
Deduction for State and Local Income Taxes State and local income taxes remains an itemized deduction. Tuition and Fees Deduction The deduction for tuition and fees is no longer available. Deduction for Medical Expenses In and , all taxpayers, including those under 65, are now subject to the 7. Get every deduction you deserve TurboTax Deluxe searches more than tax deductions and credits so you get your maximum refund, guaranteed.
Looking for more information? Get more with these free tax calculators and money-finding tools. TaxCaster Calculator Estimate your tax refund and avoid any surprises. Use of any information from this article or any other web site referred to is for general information only and does not represent personal tax advice either express or implied. You are encouraged to seek professional tax advice for personal income tax questions and assistance.
Looking for more business tips to improve your photography business? About Matthew T. Whatley, Esq. Whatley is licensed by the California Bar Association. Follow him on Twitter at heygrover. Learn something from this post? Are you a professional photographer? Not just the cost of the DVD. I have to collect sales tax on my fee, expenses, etc, and anything else on my invoice, because all of that went into the final DVD.
The notion of collecting sales tax on my fees seemed weird to me, so we doublechecked with the NY Treasury. They confirmed that the entire invoice should be taxed. A lot of it applies to photographers. Wish I had this four years ago. One other tip, photographers should contribute to a SEP retirement plan.
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Granted there are other considerations, but you can fully reimburse yourself for any expenses you deem appropriate keeping receipts, of course and be freed from some of the more arcane rules like the mile driving considerations. For tax issues, you need to realize that state and sales tax issues vary by location. For example, delivery of images by a download or FTP given as an example above of not being taxable is explicitly taxed in Washington state.
Would you please point me to the official information on this? I was reading graphic design work may not require me to charge sales tax, but I want to be sure. To qualify, we provide clients with an exemption form that they sign and we keep on file. WA does not have a personal income tax, so the sales tax here is quite high: currently We only license and one advantage of that is that it makes clear there is not a delivery of something that could be construed as physical goods.
David You and your accountant are exactly correct. However, if you deliver the images electronically, via FTP upload, you do not have to collect and remit the sales tax. In fact, in the state sent self-audits to all photography business owners requiring back taxes to be paid with interest for the last 3 years.
In Colorado a similar practise is being implemented by the state where photography business owners are being audited. Super helpful stuff.
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I just tweeted it out to our followers. Thanks for sharing and this will definitely help a lot of people. Worked for me this morning. What if my clients came to my studio with their own storage device or shipped it to me? Thanks for the great info!!! With regard to California photographers, I believe the Tax Ninja could provide some better sales tax info. His item number 1 on sales tax is incomplete and vague, likely because he is trying to accommodate different sales tax laws in different states. Ok, I have done a lot of research on NY State Sales Tax for photographers and it is still as confusing as at the beginning!
Only one client editorial ever disputed collecting tax like this. So I called the tax office and they basically were reading info from some tax literature that I could get online. Question, who knows the real deal? Each time they buy another product that holds any number of the images I took? Can I charge sales tax on the photo service once even if it is on a separate invoice from the other items that may be bought at separate times? Thank You. I shoot in my freetime and have somewhat started a business. Do I need to claim this? As a photography enthusiasts and a tax accountant, I feel the need to put in my 2 cents in here.
Photographer invoices should separately state the photography service fees labor , production expenses camera, lights, eqpt rental, etc , and the cost for the actual photos. You do not charge tax on the service fee. Expenses can be taxable depending on the taxability status of the photos. The photos are tax exempt if delivered electronically or shipped outside the State. Photos are taxable if delivered onto a CD or other tangible formats and shipped in State.
Likewise, if the photographs are tax exempt, the photographer pays tax on all expenses and passes the entire cost to its client without tax. I find it easier to just collect sales tax on everything then guess on what is tangible any give time. Worse case is they will audit me and tell me I am over taxing no fine or back tax penalty.
So even if I shoot a job for somebody on my digital cameras, and then ftp the images to them, or have them download the images from PhotoShelter, I have to charge state and municipal sales tax on everything. I was audited and had to pay several years in back taxes for not charging sales tax on portrait sessions and emailed digital files.
Suffice it to say, anything and everything that I produce for my clients is taxed. How do sales taxes enter the picture with online sales sites like photoshelter? I mean, I live in New Hampshire no sales taxes , photoshelter is based somewhere , and a customer in California buys my work from photoshelter. Is there sales tax due? To California?
Or where Photoshelter is located? Who collects it and pays it? You multiply it by. It is in the Illinois Sales Tax Manual. Those that live in another state, check with your CPA and make sure they know the rules for your state. If I charge a Print Order Fee where I charge a certain fee to order whatever size photo digitally through the internet and delivered from that company me being the middle man directly to the customer, do I collect and charge sales tax on my fee as well as photograph charge? If I keep everything digital, do I have to pay sales tax at all- and do I need to bother with a sales tax number?
Right now I am just wanting to start out and would like to start out right, but NOT over pay or have a bunch of needless paperwork. With that said, I do want to have everything on the up and up — no issues down the road. The way I see from above I would have to charge Sales tax on the sitting fee if I did it that way- am I correct?
Services for Photography Labor is the main part of the bill. Hi, I have a question about the dvd or digital images and even albums. I have come across a few instances where these days couples are paying for their own weddings. I have also had several parents purchase the dvd of images. Do I charge them tax on the DVD sale? Thank you so much for posting this information.