| Capitalization of Motion Picture, Master Recording, and Video Expenses |
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| If you are the producer of a movie or sound recording, you already know that you spend a lot of money before your creation is ready to earn some money. The question is how you handle all of those incurred expenses for federal income tax purposes. More... |
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| Education Credit |
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| Congress has created two federal income tax credits for qualifying higher education expenses: the Hope credit and the lifetime learning credit. Both credits reduce regular income tax liability, but if the amount of the credit exceeds the tax liability for the year, the taxpayer is not entitled to a refund. More... |
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| Workers' Compensation Benefits |
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| If you are an employee who receives benefits under a workers' compensation act for personal injuries or sickness incurred in the course of employment, you do not have to include those benefits in your gross income for federal income tax purposes. In addition, if you are the survivor of an employee who died of injuries sustained during the course of employment, you are not required to add the benefits paid to you under a workers' compensation act to your gross income. Benefits are excludable even if the injury to an employee is not permanent and the employee is not totally disabled. More... |
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| Business Bad Debts |
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| A business bad debt is defined as a loss from an obligation that was either created or acquired in your trade or business or closely related to your trade or business when it became worthless. Whether or not a business bad debt is deductible depends on whether the amount owed was previously included in the taxpayer's gross income. More... |
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| Community Property Rules |
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| The issue of community property rights is usually only relevant when a married couple decides to file separate income tax returns. Joint filers have no need to distinguish between community and separate income because all income is reported on a single tax return. There are currently nine community property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. Under the laws of these states, one half of the income and property earned and acquired by spouses during their marriage is generally deemed to belong to each spouse, no matter in whose name the legal title is held. More... |
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