For example, if I used a cash advance to
1. buy stocks,
2. invest in bonds/fixed income assets
3. "refi" my personal mortgage
4. buy investment property
or any other situations where credit card interest is tax deductible?
Is credit card interest tax deductible if you put the money on the credit card towards investments?
No. Only those loans that are secured by your real property unless business activity is involved.
Reply:Can i ask for what reason you would want to do this? even if your rate of intrest on credit card is 8% and u make 10% a year on investments it is not worth it after taxes and certainly is not worth the risk.
Reply:The $20 gain on the sale of the stock would be taxed as a capital gain. The $10 in credit card interest would be deductible on schedule A as "investment interest expense". You must itemize to take advantage of the "investment interest expense" deduction. If you don't sell the stock, you can still take the $10 deduction. However, you must have investment income from other sources of at least $10 or the deduction will be limited and carried forward until you have investment income (investment interest is only deductible to the extent of investment income earned).
Please note that investment income does NOT include qualified dividends or capital gains (i.e. gains taxed at 15%). However, you can elect to treat dividends and capital gains as investment income (which allows you to take the investment interest expense deduction now). However, if you do so, you lose the benefits of the 15% rates and that income is taxed at ordinary rates.
Please let me know if you need any clarification.
Reply:spicertax is correct about the 'tracing rule'. As others have said, if you use the same card for ANY other purpose, you may have trouble tracing the interest to the investments. Personally, I recommend NOT using a credit card to finance investments, but that is a separate issue.
Reply:Yes and No. If you do that, you will end up in a very messy situation.
1. You have to have a separate credit card, just for that purpose, in your business name if you have one.
2. Never co mingle your business and personal charges.
3. Some you can not deduct until a profit is realized.
Reply:Yes for all investments except your mortgage. To deduct mortgage interest the house has to be the collateral. For other investments a tracing rule applies. If you can prove that the loan proceeds was put into just taxable investments you can deduct the interest up to the amount of investment income earned.
Reply:no...if you re financed your home with a home equity loan and paid all of those credit cards off with it...the interest you pay on your home equity loan would be tax deductible.
fruit gift baskets
Friday, November 6, 2009
Can I write-off or get tax credit for my trip to South America to learn Spanish?
You could probably write it off if you have a company that is paying for it. But that company would have to generate income to write the trip off against, and the trip would have to be company related.
Can I write-off or get tax credit for my trip to South America to learn Spanish?
Um...no. Unless you enrolled and paid tuition while you were there.
Reply:First of all you would need an income that relates to the need to speak Spanish. If you have a business that does work in South American countries that would be a good example. You should think about the question of why you could not do the same thing here without the travel. The IRS will be looking to verify that this is not just a pleasure trip with a Spanish lesson. If you do take this deduction you should plan on a visit from the IRS and have a prepared explanation.
Reply:Maybe, if you're already a Spanish teacher and were trying to improve your Spanish, or chaperoning a group of students.
Reply:No, sorry.
Reply:NOPE!
Can I write-off or get tax credit for my trip to South America to learn Spanish?
Um...no. Unless you enrolled and paid tuition while you were there.
Reply:First of all you would need an income that relates to the need to speak Spanish. If you have a business that does work in South American countries that would be a good example. You should think about the question of why you could not do the same thing here without the travel. The IRS will be looking to verify that this is not just a pleasure trip with a Spanish lesson. If you do take this deduction you should plan on a visit from the IRS and have a prepared explanation.
Reply:Maybe, if you're already a Spanish teacher and were trying to improve your Spanish, or chaperoning a group of students.
Reply:No, sorry.
Reply:NOPE!
Does having savings effect the amount of child tax credit you get?
I currently receive CTC but will be receiving some monies due to a death of a family member.
Will this effect the amount I receive in CTC
Thank you
Does having savings effect the amount of child tax credit you get?
I don't believe its means tested it is to do with the amount of hours you work.
Reply:About 5 years ago I had savings over £6,000 because I had sold my house and was living with a relative at the time, they said I was not eligible, until that April (2003) when they were changing the system. I have since built my own home, however, on each annual renewal, I do include the amount of interest my remaining savings have earned.
Reply:Savings over £8500 are considered for this.
Reply:No your savings won't effect it, it is worked out on your wage
Will this effect the amount I receive in CTC
Thank you
Does having savings effect the amount of child tax credit you get?
I don't believe its means tested it is to do with the amount of hours you work.
Reply:About 5 years ago I had savings over £6,000 because I had sold my house and was living with a relative at the time, they said I was not eligible, until that April (2003) when they were changing the system. I have since built my own home, however, on each annual renewal, I do include the amount of interest my remaining savings have earned.
Reply:Savings over £8500 are considered for this.
Reply:No your savings won't effect it, it is worked out on your wage
Is there a limit to the number of children you can claim for the Child tax credit?
In theory there is no limit.
Large families regularly claim 5, 6, 7 and more children. (They attach extra paper to the tax return to list them.)
At some point the extra children do not change the refeund anymore.
First, the child tax credit is used to reduce your income tax.
Second, if there is credit left over, there is additional child tax credit. It's from a formula using your income, so if the income is low, it might limit the additional credit.
Is there a limit to the number of children you can claim for the Child tax credit?
No, for the Child Tax Credit you claim as many eligible children as you have. For EIC, you don't get extra money for more than two kids.
Reply:You can claim any number of children for child tax credit, but it only reduces your tax liability up to $1000. There is the additional child tax credit. This can give you up to a $1000 per child up til 5.
Large families regularly claim 5, 6, 7 and more children. (They attach extra paper to the tax return to list them.)
At some point the extra children do not change the refeund anymore.
First, the child tax credit is used to reduce your income tax.
Second, if there is credit left over, there is additional child tax credit. It's from a formula using your income, so if the income is low, it might limit the additional credit.
Is there a limit to the number of children you can claim for the Child tax credit?
No, for the Child Tax Credit you claim as many eligible children as you have. For EIC, you don't get extra money for more than two kids.
Reply:You can claim any number of children for child tax credit, but it only reduces your tax liability up to $1000. There is the additional child tax credit. This can give you up to a $1000 per child up til 5.
How do I get hold of Tax Credit Award NotiCE (TC602) for 2006-2007?
Need Help
How do I get hold of Tax Credit Award NotiCE (TC602) for 2006-2007?
phone them up and they can mail it out to you with the click of a button
Reply:Ring the tax credits helpline and they will tell you if you are eligible for tax credits - if you aren't they won't send you the forms
Reply:You would have recieved it from HRMC when you were awarded your tax credits. If you dont get tax credits you dont get one.
If its for your EMA, ask your parents for a copy, and they will also have to sign the EMA form as well.
Reply:ring up the tax credits helpline and ask for a copy
Reply:This TC602 is the confirmation of the actual award and is a breakdown of how (if applicable) any monies will be paid to you when (dates and amounts) These can change some are every Friday some are monthly. You will have been sent these forms once you completed a Tax Credit Renewal notice or applied for the first time. They do ask you to keep these safe (a bit like P45) I'm sure they will send another one to you. Call 118247 to get number. Unless you forgot they are in Newcastle. You will also need yr National Insurance number too. You can get this from payslips.
ginkgo
How do I get hold of Tax Credit Award NotiCE (TC602) for 2006-2007?
phone them up and they can mail it out to you with the click of a button
Reply:Ring the tax credits helpline and they will tell you if you are eligible for tax credits - if you aren't they won't send you the forms
Reply:You would have recieved it from HRMC when you were awarded your tax credits. If you dont get tax credits you dont get one.
If its for your EMA, ask your parents for a copy, and they will also have to sign the EMA form as well.
Reply:ring up the tax credits helpline and ask for a copy
Reply:This TC602 is the confirmation of the actual award and is a breakdown of how (if applicable) any monies will be paid to you when (dates and amounts) These can change some are every Friday some are monthly. You will have been sent these forms once you completed a Tax Credit Renewal notice or applied for the first time. They do ask you to keep these safe (a bit like P45) I'm sure they will send another one to you. Call 118247 to get number. Unless you forgot they are in Newcastle. You will also need yr National Insurance number too. You can get this from payslips.
ginkgo
If my wife and I are both recieving SSI and we have a 8 month yr old kid will we still get a child tax credit?
Are boy will be 8 months about next april.. And we both get ssi.
Will we still get a child credit??(Think there $1500 right?)
If my wife and I are both recieving SSI and we have a 8 month yr old kid will we still get a child tax credit?
No, SSI isn't eligible income, and if that's your only income, you aren't eligible for a stimulus payment. If you aren't eligible, you don't get the additional child amount either - parents must be eligible in order to get the child extra amount.
Reply:Child credit reduces the income tax you owe. If you owe zero there is nothing to reduce.
Reply:$0.
SSI isn't qualifying income for the rebate. So you get nothing for you, nothing for your wife and nothing for your child.
Will we still get a child credit??(Think there $1500 right?)
If my wife and I are both recieving SSI and we have a 8 month yr old kid will we still get a child tax credit?
No, SSI isn't eligible income, and if that's your only income, you aren't eligible for a stimulus payment. If you aren't eligible, you don't get the additional child amount either - parents must be eligible in order to get the child extra amount.
Reply:Child credit reduces the income tax you owe. If you owe zero there is nothing to reduce.
Reply:$0.
SSI isn't qualifying income for the rebate. So you get nothing for you, nothing for your wife and nothing for your child.
Can both parents claim the child care tax credit if the parents are both single?
No, only the parent the child lives with can get the child care tax credit, even if the other parent is allowed to claim the child as a dependent and get the child tax credit.
Can both parents claim the child care tax credit if the parents are both single?
The parent that the child lives with gets the credit regardless of which one the child lives with. If the parents live together with the child, the one who claims the child as their dependent gets the credit.
Reply:No.. only the parent whom the child lives with can receive the credit. If they all happen to live in the same home, then only one can take the credit.
Reply:Depends on who has physical custody, some states say 6 or 8 months out of the year. If both file their will be an audit, and the one in the wrong will pay a penalty.
Can both parents claim the child care tax credit if the parents are both single?
The parent that the child lives with gets the credit regardless of which one the child lives with. If the parents live together with the child, the one who claims the child as their dependent gets the credit.
Reply:No.. only the parent whom the child lives with can receive the credit. If they all happen to live in the same home, then only one can take the credit.
Reply:Depends on who has physical custody, some states say 6 or 8 months out of the year. If both file their will be an audit, and the one in the wrong will pay a penalty.
Subscribe to:
Posts (Atom)