4Thought Blog

4thought graphic - blog 2020

The Tax Benefits of Putting Your Vacation Home into an LLC

Posted by Concannon Miller on Tue, Mar 29, 2022

If you're lucky enough to own a vacation home, you might wonder about the optimal ownership structure for the property.

For rental real estate properties and real estate held for investment, such as raw land, good choices are single-member and multi-member limited liability companies (LLCs). But the LLC option isn't always right for vacation homeowners.

Here's important information to help you decide what's best for your situation.

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Topics: Individual tax planning

Warning: Working from Home May Complicate Your Income Taxes

Posted by Concannon Miller on Thu, Mar 24, 2022

Remote work has become more common in recent years, and the COVID-19 pandemic has resulted in employers realizing that many jobs can be done from home.

Some remote workers even work in a different state than where their employers are based. These employees may have opted to move to states with lower or no income taxes, but they — and other remote employees now working across state lines — may find themselves shouldering unexpected state income tax liabilities.

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Topics: Individual tax planning

Federal Government Warns of Tax Return, Refund Delays for 2022

Posted by Concannon Miller on Tue, Jan 18, 2022

U.S. Treasury officials last week warned of expected significant delays in processing tax returns and refunds for the 2022 season.

The IRS is still dealing with backups in processing returns from the past two filing seasons and the continuing pandemic is causing staff shortages, officials said. Normally at the start of tax season the IRS has about 1 million items in its backlog but the current backlog totals more than 6 million items, officials said.

The IRS is urging taxpayers to file electronically and request direct deposit – instead of a mailed check – for quicker turnaround.

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Topics: Business tax planning, Individual tax planning

The Top 7 Personal Financial Resolutions for 2022

Posted by Concannon Miller on Tue, Dec 28, 2021

It's almost time to ring in the New Year — and many people are looking forward to putting 2021 in the rearview mirror.

While New Year's resolutions often focus on eating less and exercising more, you should also give some thought to your financial fitness.

Here are seven ways to introduce more discipline and vigor into your financial regime.

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Topics: Individual tax planning

Tips to Avoid Costly Tax Penalties on Your RMDs

Posted by Concannon Miller on Mon, Dec 13, 2021

After a one-year hiatus due to the COVID-19 pandemic, owners of qualified retirement plans and IRAs must adhere to the rules for required minimum distributions (RMDs). The RMD rules are tricky and could result in a substantial tax penalty if you're not careful.

For starters, an RMD is the amount you must withdraw from a qualified retirement plan account or traditional IRA to avoid an expensive tax penalty after reaching the "magic" age. Here are the answers to 20 frequently asked questions about RMDs under current law.

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Topics: Individual tax planning

4 Big Charitable Tax Breaks for Businesses, Individuals to use in 2021

Posted by Concannon Miller on Tue, Nov 23, 2021

Are you feeling generous? Qualified charitable contributions can be rewarded with sizeable tax breaks during the second calendar year of the COVID-19 pandemic.

Recent legislation includes the following four temporary tax law changes that are designed to help individuals and businesses that donate to charities through the end of 2021.

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Topics: Business tax planning, Individual tax planning

9 Tax-Saving Moves for Individuals in 2021

Posted by Concannon Miller on Thu, Oct 28, 2021

With year end rapidly approaching, it's time to consider making some moves that will lower your 2021 federal income tax bill — and potentially position you for future tax savings. Unfortunately, tax planning is particularly challenging this year, because the tax rules for 2022 aren't yet certain. In fact, they may not even be certain for 2021.

Here are nine planning tips for you to consider making before year end. But you also may want to be ready to take last-minute corrective actions if Congress works out a deal on the Build Back Better Act and the Bipartisan Infrastructure Bill before year end.

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Topics: Individual tax planning

Hurricane or Tornado Victim? How to Salvage a Casualty Loss Deduction

Posted by Concannon Miller on Tue, Sep 28, 2021

So far, 2021 has been a rough year for casualty losses. Hurricane Ida wreaked havoc in the south and east. Wildfires have destroyed millions of acres in the west. Catastrophes in other parts of the country this year — including tornadoes, earthquakes and floods — have caused significant damage to personal property.

But there may be a silver lining to these dark storm clouds: Casualty victims who have suffered economic loss may be eligible for tax deductions on their 2021 return. In fact, some victims may even benefit from special expedited tax relief measures, if certain requirements are met.

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Topics: Individual tax planning

The Home-Sale Gain Exclusion Tax Break: Cashing in on the Sellers’ Market

Posted by Concannon Miller on Tue, Sep 21, 2021

In many areas, residential real estate markets have surged, and some are still surging. In these sellers' markets, big home-sale gains are likely. That's great news if you're a seller — but will you owe taxes on the profit?

If you sell your principal residence for a large profit, you can potentially exclude tax (pay no federal income tax) on a certain amount of profit. Here are the basics of how to take advantage of this tax-saving opportunity.

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Topics: Individual tax planning

Hold or Sell Stocks: Tricks to Avoid Unfavorable Tax Consequences

Posted by Concannon Miller on Tue, Jul 20, 2021

With autumn coming up in a couple months, it's time to think about "harvesting" capital gains or losses from sales of securities.

In addition, unfavorable tax law changes proposed in President Biden's American Families Plan may create an added sense of urgency for some taxpayers.

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Topics: Individual tax planning

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