When more of the people's sustenance is exacted through the form of taxation than is necessary to meet the just obligations of government and expenses of its economical administration, such exaction becomes ruthless extortion and a violation of the fundamental principles of free government.
~ GROVER CLEVELAND, attributed, Treasury of Presidential Quotations
Over the years the courts have allowed taxpayers to deduct some crazy things that most of us wouldn't even dream of claiming, ranging from pet food to free beer.
On December 18, 2015, the President signed into law the tax extenders bill, entitled the Protecting Americans from Tax Hikes (PATH) Act of 2015. The new law makes more than 20 tax breaks permanent and retroactively extends others for two or more years.
Here's a rundown of key business, individual, and miscellaneous provisions:
Generally, the cost of meals are considered a personal expense and are not deductible, unless they meet certain IRS rules.
For example, if you go out to lunch yourself during the course of your work day or with a business associate, and there is no business purpose other than to simply get a bite to eat, the cost of your lunch is a personal expense and is not deductible.
You can deduct meal and entertainment expenses only if they are both ordinary and necessary (not lavish or extravagant) and meet either one of the following two tests (discussed below).
Self-employed persons deduct business-related travel expenses while away from home as a business expense.
Offshore accounts have been used to lure taxpayers into scams and schemes. According to the IRS, hiding money or assets in unreported offshore accounts remains on its annual list of tax scams known as the “Dirty Dozen” for the 2015 filing season.
Over the years, a number of individuals have been identified as evading U.S. taxes by hiding income in offshore banks, brokerage accounts or nominee entities and then using debit cards, credit cards or wire transfers to access the funds.
For any month during the year that you or any of your family members don’t have minimum essential coverage and don’t qualify for a coverage exemption, you are required to make an individual shared responsibility payment (a euphemism for penalty) when you file your tax return.
Here are six things to know about the penalty payment:
The Affordable Care Act (ACA) will affect your federal income tax return.
Five things you should know about exemptions from the ACA coverage requirement and the individual shared responsibility payment that will help you get ready to file your tax return:
The IRS announced that Missouri storm victims will have until May 16, 2016 to file their returns and pay any taxes due. All workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization also qualify for relief.
Last tax season, 2015, some crooked tax preparers around the country victimized a number of uninformed taxpayers in connection with the penalty requirement for taxpayers without health insurance.
Starting January 2014, you and your family were required to either have health insurance coverage throughout the year, qualify for an exemption from coverage, or if you had no health insurance coverage, pay a penalty with your 2014 federal income tax return filed in 2015. The penalty is euphemistically called, The Individual Shared Responsibility Payment.
Many people already had qualifying health insurance coverage and did not need to do anything more than maintain their coverage.