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Ha ha, did you see my post in the Cali thread.Yeah, we pay... have ever since the business partnership K1 started to really complicate matters.
Tax law is so complicated that even my friend Jimmy, who is an accountant, hires it done. Needless to say, we do, too.. although Dorcia does most of the grunt work after our yearly tax meeting in December. She's just finishing up, and mumbling something about not being able to do this much longer..
I'm a believer in turbo tax also, and my tax situation is ..uh..complicated!mike
On the other hand, if your world is more complicated than that, calling in a pro is probably a good idea ....
I think under current tax laws, the first $250k captial gain from a house sale is exempt.
That isn't true anymore. All gains from the sale of a primary residence are exempt from all capital gains taxes. You are confusing it with a new ACA law that adds a different tax (and much smaller than the capital gains tax) on home sales with a PROFIT of $250K or more for people making above a certain amount (ie, rich people selling big houses for big profit). I doubt many of us here have sold a house and PROFITed more than $250K. If you have, you are good investor or have struck oil on your property. health.burgess.house.gov/uploadedfiles/one_page_on_unearned_medicare_tax.pdfI also have a K-1 from a LLC with my sister. We have an accountant to do the business returns and give us K-1s. TurboTax handles that K-1 just fine for our personal return.
rodekyll, thanks for the heads up. I meant their software. Know a couple of the locals that actually work there. Not the sharpest knives in the drawer.
Brian; don't be so cheap. Pay a professional. Or, at least get Turbo Tax. Anyone who admits to drilling the wrong idle jet plugs on a Triumph T'Bird is not to be trusted with complex regulations. Just sayin'. Ralph
LowRyter has repaired a misconception re capital gains tax exclusion on the sale of a principal residence, having stated that it is $250K for a single homeowner, $500K for a couple. Note: The term primary residence carries certain IRS code requirements that must be met. The residence must be your homesteaded property (if your state has this deduction from property taxes, as many, including California, do). You must vote from that residence. Your drivers license must indicate that address. Your IRS forms 1040 should have that address, too. The period of principal residence to qualify a property for the exemption is "24 of the 60 months prior to sale". When I sold my first house qualifying for this exemption, I had, as I do now, two homes. To prove the 24 months of residence, I saved my credit card receipts for more than that many months. These showed purchases all made in the immediate area of the home claimed as a "principal residence.Next year, I plan to do the same tax exempt sale and am already assembling the data to support the legitimacy of our principal residence, tax exempt claim. The IRS may or may not chose to contest the validity of your principal residence claim. Careful documentation, with iron clad records, is the key to a "clean audit". Been there, done that.Brian; don't be so cheap. Pay a professional. Or, at least get Turbo Tax. Anyone who admits to drilling the wrong idle jet plugs on a Triumph T'Bird is not to be trusted with complex regulations. Just sayin'. Ralph