Specialty Taxes

Every industry has some form of IRS code and regulation attached. Learn about these specialty taxes, from the local revenue tax to federal credits associated with particular industries.

Basis in Business

Basis in Business

Basis is a business term used to identify the value of an individual or entity’s investment in an entrepreneurial endeavor.   It is customarily linked to taxation as this term is used by the Internal Revenue Code to determine gain or loss.   To further compound its meaning  ‘basis’  is sometimes substituted for the term  ‘equity’.

Basis for Tax Purposes

Basis for Tax Purposes

Basis is a term used in computing gains and losses on the disposition of an asset.  For any business owner or individual taxpayer it is important to understand what the Internal Revenue Service (IRS) is really seeking.  What is your tax basis in an asset? 

Hobbies – Business Perspective and Tax Compliance

Hobbies

Many people turn their hobbies into a business operation.  Not so much to make a living or make big profits, but more to help offset the costs of the hobby.  Whenever you go to one of those community fairs, the vendors at the respective booths are mostly folks selling a product that is direct outcome of their hobby.  The bands that play on stage, they make some money, but never enough to offset the cost of instruments, gear and transportation.  But they enjoy entertaining folks and they hope someday they’ll get discovered. 

Estate Tax – The Basics

Estate Tax

Even after death, your heirs may still have to file a separate tax return for you with the Internal Revenue Service.  If your accumulated wealth is greater than $5.25 Million, then your executor must file Form 706 – The Estate Tax Return.

Form 990 – Return of Organization Exempt from Income Tax

Form 990

Section 6033 of the Internal Revenue Code requires tax exempt organizations to file an annual report.  Form 990 fulfills this requirement.  Many citizens utilize the information from Form 990 to evaluate the non-profit organization they donate to annually.  The 990 covers much of the information any citizen desires to know about the charity of their choice.

Form 1041 – Income Tax Return for Estates

Form 1041

When an individual passes away, his/her will or trust identifies a representative to administer his/her estate.  This representative is referred to as the executor (male) or executrix (female) and is generally approved or assigned by the local circuit court.  The Internal Revenue Service tasks this representative to file a final personal return and information returns until the estate is completely transferred to the heirs.

Fuel Tax Credit

Fuel Tax Credit

The fuel tax credit is a federal refundable tax credit for taxes paid on fuel purchased for off road use.  Every gallon of fuel sold at the pump has an 18.3 cent tax assessed by the federal government designated to highway construction and maintenance.  When that gallon of fuel is purchased for non-transportation purposes, the purchaser is allowed to receive a refund for the tax paid.

What is a Living Trust?

Living Trust

A tool in estate planning used to minimize probate costs upon the death of the grantor is the living trust.   A Living Trust is created while the grantor is alive and typically is revocable in nature. It is designed to manage assets for the best interest of a beneficiary, usually the grantor.

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