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Comments on this
website are informational in nature and are not intended to
be interpreted as
specific tax advice. The comments cannot be used to avoid
taxes under the Internal Revenue Code or the regulations of other tax
authorities. Furthermore, this website is not intended, and should not be interpreted, to support
the promotion or marketing of any tax avoidance schemes.
Date last modified:
01/24/22
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TAX FRAUD
will
rob you of precious dollars. The IRS NEVER uses email or
telephone calls to tell individual taxpayers that they owe money and
must pay immediately. You are always entitled to representation
by a tax professional and/or attorney in
order to determine the validity of the "claim".
DO NOT respond to
these emails and DO NOT engage in conversation when a fraudster
calls. Also, protect your sensitive personal information so it
cannot be stolen and a false tax return filed in your name.
- Some high income
taxpayers will be subject to a 3.8 percent Medicare Surcharge
on
investment earnings. Households with incomes over $250,000 joint
filers, $200,000 singles filers and $125,000 married filing separate
will be assessed this tax on certain investment earnings.
- Taxpayers with wages and/or self-employment net income greater
than $200,000 single filers, $250,000 joint filers or $125,000 married
filing separate will be subject to a
.9%
Medicare tax. Employers cannot withhold
the extra tax unless the employee earns $200,000 or more in a calendar
year. Taxpayers can opt for additional federal withholding to
cover this surcharge.
- Generally, the
sale of personal residence
is not taxable if certain conditions are met. If the taxpayer's primary
residence has been used as
a rental, vacation or second home it has periods of "nonqualified use". Taxpayers may not be able to exclude
all the gain
from the sale of a residence that has periods of nonqualified use.
Some states tax home sales when the seller lives in another state.
- Debt Forgiveness/Cancellation can generate taxable income. Generally, this is reported on a 1099-C.
It is important to include this information on your tax return, even if
it turns out you don't have additional income to claim.
- Selling online (such as via Ebay)
is considered a taxable
activity. If you are a 'casual seller', meaning you sell
occasionally without intent to make a profit, you probably don't need
to report the activity. If you are a more active seller, selling items at a profit or you are selling collectibles, you
must report the income either as a hobby venture or a business.
Merchants will receive 1099-K forms reporting
payments/income received from third-party handlers.
- Barter and Trading for services and/or products
is considered taxable income and must be counted as such.
-
The Child Tax Credit
for federal returns in 2021 returns, is temporarily increased to $3,000 per child
age 6-17. For children under 6, the credit is $3,500 per qualifying
child. Income limits apply. Unless Congress extends the
temporary credit increase, it will revert to $2,000 per qualifying child
age 16 and under in the 2022 filing year.
-
Health Savings Accounts (HSA)
help alleviate the burden of medical expenses and provide some tax
advantages. Only high deductible health insurance policies qualify.
- Teachers can deduct up to $300 worth of classroom supplies
in 2022. If both spouses are teachers and file jointly, they can
deduct up to $600.
- Washington State residents do not pay individual
income tax. Businesses need to collect sales tax and fulfill other
reporting requirements. Visit the
Washington State Department of Revenue's website for more information.
If you are an Oregon-based business and conducting operations in Washington, you
may be subject to sales and excise tax reporting and payments.
- Absolutely, DO NOT ignore letters from the IRS or state revenue
agencies. Respond promptly, or seek professional assistance, when information
is requested. Procrastination can be costly because you can lose certain
rights and even potential refunds by missing key deadlines. Incorrect
mailing address is never accepted as a reasonable excuse, so be sure to keep
your mailing address current.
- If you are
chosen for a tax audit, it is important to realize you may need to prove some
or all of your tax deductions. If you file as Head of Household and/or
receive Earned Income Credit, you may need to show that your provided a home
to a dependent and/or supported a dependent. You may need to
provide records that substantiate the income you reported. Be sure
your records will stand up to scrutiny.
- Employer's wishing to provide non-taxable fringe benefits for their employees can reference
IRS Publication 15-B.
Links to More Tax Tips and Information
◊
Social Security
◊
Rental Income and Expenses
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Education Deductions and Tax Breaks
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Tips for Sole Proprietors and Business Owners
◊
Tax Filing Deadlines, Extensions and Quarterly
Estimates
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Life Planning in the 21st
Century
◊
Important Documents to Keep
Resources You Can Use
- You can download forms, publications and information
from the IRS website. Go to www.irs.gov
- For the Oregon Department of Revenue, go to
http://www.oregon.gov/DOR/.
You should be able to access other states from the IRS website.
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