Author Topic: any accountants out there that i can ask a question?  (Read 632018 times)

Offline Definitions2

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Re: any accountants out there that i can ask a question?
« Reply #2520 on: April 15, 2024, 11:10:24 PM »
donate appreciated shares to charity and keep the cash you were going to donate
Can you ELI5. How does donating your stocks help? Don't you lose everything then?

What cash is there in this situation?

Online ushdadude

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Re: any accountants out there that i can ask a question?
« Reply #2521 on: April 15, 2024, 11:41:27 PM »
Can you ELI5. How does donating your stocks help? Don't you lose everything then?

What cash is there in this situation?
This strategy works with the assumption that he would be donating money to charity regardless. So instead of donating cash, donate appreciated shares and keep the cash you planned on donating.

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Re: any accountants out there that i can ask a question?
« Reply #2522 on: April 16, 2024, 02:28:23 AM »

Can you ELI5. How does donating your stocks help? Don't you lose everything then?

What cash is there in this situation?
This strategy works with the assumption that he would be donating money to charity regardless. So instead of donating cash, donate appreciated shares and keep the cash you planned on donating.
The donation value for tax purposes is the current value, yet you paid less, so your gains are tax free.
This is only good up to the amount you would have donated anyway.  After that, you're losing principal.
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Offline Help

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Re: any accountants out there that i can ask a question?
« Reply #2523 on: April 16, 2024, 08:43:54 AM »
Can you ELI5. How does donating your stocks help? Don't you lose everything then?

What cash is there in this situation?
Say you bought 100 shares of XYZ stock for $50 per share (total cost: $5,000). The stock has now appreciated to $100 per share (total value: $10,000). If you sell the stock, you'll have a gain of $5,000 ($10,000 - $5,000) and potentially pay capital gains tax on that amount, say 20%. You are now left with $9,000.

If you usually give $10,000 to charity, the better option would be to donate the 100 shares directly to charity.

If you donate the stock directly to a charity, you'll get a tax deduction for the full fair market value (FMV) of $10,000, without paying tax on the gain. (People save millions this way!)

Of course, this only makes sense in cases where you were planning to give 10,000 to charity regardless. Otherwise you’re spending $1 to save $0.37. Don’t do it!

(The number of people that don’t seem to get this is staggering. Never spend on crap you don’t need just to save on taxes! Congrats, You’re now poorer but at least you didn’t pay taxes 🙄)

Offline Help

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Re: any accountants out there that i can ask a question?
« Reply #2524 on: April 16, 2024, 08:52:14 AM »
Say you bought 100 shares of XYZ stock for $50 per share (total cost: $5,000). The stock has now appreciated to $100 per share (total value: $10,000). If you sell the stock, you'll have a gain of $5,000 ($10,000 - $5,000) and potentially pay capital gains tax on that amount, say 20%. You are now left with $9,000.

If you usually give $10,000 to charity, the better option would be to donate the 100 shares directly to charity.

If you donate the stock directly to a charity, you'll get a tax deduction for the full fair market value (FMV) of $10,000, without paying tax on the gain. (People save millions this way!)

Of course, this only makes sense in cases where you were planning to give 10,000 to charity regardless. Otherwise you’re spending $1 to save $0.37. Don’t do it!

(The number of people that don’t seem to get this is staggering. Never spend on crap you don’t need just to save on taxes! Congrats, You’re now poorer but at least you didn’t pay taxes 🙄)
And of course, always speak to your tax pro before the fact, not after. Tax advice is never one size fit all. There are too many variables.

Wait, did I just give one size fit all advice?? 🤔
« Last Edit: April 16, 2024, 09:02:38 AM by Help »

Offline Izzzy

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Re: any accountants out there that i can ask a question?
« Reply #2525 on: April 17, 2024, 11:59:14 AM »
Maybe forget again. One CPA advised me against it but I don't remember the scenario. Forgetting these things is common.
By forgetting again, I am risking having to pay penalties and interest when they eventually get around to figuring out on their own that I didn't report that 1099 INT.

Offline herb

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Re: any accountants out there that i can ask a question?
« Reply #2526 on: April 18, 2024, 02:26:51 PM »
When reconciling excess APTC, someone told me that there is a cap on what you need to pay back to the marketplace if you underestimated your income. Anyone familiar with that?
to be more specific, it's hard to get exact number in beginning of year, taking in salary raise, investment income, and other miscellaneous 1099s etc. as well as any deductions and other factors.
That being said, trying to avoid any tax penalties, I would have thought to overestimate, but if they won't take back all the money I owe necessarily, I'd rather underestimate.
Not specifically trying to be dishonest, as the official policy is that they do take back the excess PTC, just they are "mochel" part of it. Unlike Medicaid for example where if I would underestimate, I am legitimately taking money that I'm not entitled to. Unless I make no sense and I'm just trying to justify it in my head and it is regular tax fraud....
« Last Edit: April 18, 2024, 02:47:45 PM by herb »

Offline av83

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Re: any accountants out there that i can ask a question?
« Reply #2527 on: June 25, 2024, 11:05:02 AM »
Asking for older couple looking to sell home and relocate:
for simplicity:
Basis in house (purchase price+cap impr) 800,000
Current owe on the house 1,000,000
Will sell for 2,000,000

Are there any methods to avoid tax on the 700K  (1.2M gain minus 500K 121 home sale exclusion)


Offline Help

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Re: any accountants out there that i can ask a question?
« Reply #2528 on: July 05, 2024, 04:26:59 PM »
Asking for older couple looking to sell home and relocate:
for simplicity:
Basis in house (purchase price+cap impr) 800,000
Current owe on the house 1,000,000
Will sell for 2,000,000

Are there any methods to avoid tax on the 700K  (1.2M gain minus 500K 121 home sale exclusion)


Perhaps it's worth considering not selling, but instead tapping into the existing equity?

Keep in mind that inherited property benefits from a step-up in basis...

Online Alexsei

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Re: any accountants out there that i can ask a question?
« Reply #2529 on: September 03, 2024, 04:51:46 PM »
Looking for a responsive NYS based accountant to analyze, solve and settle NYS tax and Labor dept liabilities.
We have been unburdened by what has been.

Offline Help

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Re: any accountants out there that i can ask a question?
« Reply #2530 on: September 03, 2024, 05:31:16 PM »
Looking for a responsive NYS based accountant to analyze, solve and settle NYS tax and Labor dept liabilities.
It sounds like what you need is an attorney specializing in tax controversy.

These guys are top of line, but expensive.
https://www.hodgsonruss.com/people/Mark-Klein

Tax accountants are good at keeping you compliant and working on strategy to reduce taxes. They generally don’t specialize in tax controversy.
« Last Edit: September 03, 2024, 05:35:20 PM by Help »

Online 4yourinfo

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Re: any accountants out there that i can ask a question?
« Reply #2531 on: September 16, 2024, 08:34:43 PM »
Will investment income on an LLC count for the EIC limit? If yes, is there some kind of low risk investing that you can do to avoid the eic limit?

Offline Help

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Re: any accountants out there that i can ask a question?
« Reply #2532 on: September 17, 2024, 01:33:02 PM »
Will investment income on an LLC count for the EIC limit? If yes, is there some kind of low risk investing that you can do to avoid the eic limit?
For tax year 2024 the limit is $11,600 of investment income. If you earn 11,600 or more you’re ineligible for the EITC.

Online 4yourinfo

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Re: any accountants out there that i can ask a question?
« Reply #2533 on: September 17, 2024, 04:19:26 PM »
For tax year 2024 the limit is $11,600 of investment income. If you earn 11,600 or more you’re ineligible for the EITC.
Let me rephrase - Does investment income from an LLC count towards the 11,600 limit? If so anyone have any ideas on some kind of low risk  investment that will realize gains yearly that wont effect the eic? No, an Ira is too limited

Offline gozalim

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Re: any accountants out there that i can ask a question?
« Reply #2534 on: September 17, 2024, 04:22:33 PM »
No, an Ira is too limited
how about roth ira? also too limited?
(still doesn't 'report')

Online ckmk47

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Re: any accountants out there that i can ask a question?
« Reply #2535 on: September 17, 2024, 05:44:35 PM »
Will investment income on an LLC count for the EIC limit? If yes, is there some kind of low risk investing that you can do to avoid the eic limit?
Education savings accounts (529) has some of the limitations of an IRA.
In NY there are limited investment choices.
It can be used for many education expenses including elementary, HS, many yeshivas and expenses like books and equipment.
And I think the principal can eventually come out with no penalty. 
My favorite cause: cssy.org

Online 4yourinfo

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Re: any accountants out there that i can ask a question?
« Reply #2536 on: September 17, 2024, 07:01:36 PM »
how about roth ira? also too limited?
(still doesn't 'report')
what i mean by limited - I need to invest more than 7k
besides don't want restrictions on the $..

Offline Help

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Re: any accountants out there that i can ask a question?
« Reply #2537 on: September 17, 2024, 11:05:40 PM »
Let me rephrase - Does investment income from an LLC count towards the 11,600 limit?
yes.
Perhaps hold your investment in a C-corp....

Offline Help

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Re: any accountants out there that i can ask a question?
« Reply #2538 on: September 17, 2024, 11:09:18 PM »
Education savings accounts (529) has some of the limitations of an IRA.
In NY there are limited investment choices.
It can be used for many education expenses including elementary, HS, many yeshivas and expenses like books and equipment.
And I think the principal can eventually come out with no penalty. 
Beware, NY does not conform to this change; K-12 is a non qualified distributions for NYS taxation.

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Re: any accountants out there that i can ask a question?
« Reply #2539 on: September 17, 2024, 11:12:51 PM »
Beware, NY does not conform to this change; K-12 is a non qualified distributions for NYS taxation.
I forgot that.
Thanks.
My favorite cause: cssy.org