The Tax Professionals Blog

Are Specialty Medical Devices and Supplies Deductible?

Posted by Lee Reams Sr. on

Medical expenses are defined as the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatments affecting any part or function of the body including dental expenses (Sec 213(d)(1)).

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Itemizing Deductions: Capitalizing Property Taxes

Posted by Lee Reams Sr. on

When itemizing deductions, a taxpayer is allowed to deduct a variety of taxes, including real or personal property taxes and state income or sales taxes. However, for alternative minimum tax (AMT) purposes, none of these itemized taxes is deductible. For most taxpayers, taxes represents one of the largest tax deductions, and it frequently triggers the AMT.

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Waiving the Required Retirement Minimum Distribution Penalty

Posted by Lee Reams Sr. on

The penalty, called the excess accumulation penalty, for failing to take the required minimum distribution from IRAs and qualified plans is 50% of the amount that should have been withdrawn but wasn’t. Not all trustees (financial institutions) remind their clients to take the distribution, and it is quite easy for elderly individuals to overlook or not understand the distribution rules, resulting in a potentially severe penalty. However, the IRS does have a liberal policy for having the penalty waived.

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Loss on the Sale of an Inherited Home

Posted by Lee Reams Sr. on

A beneficiary who inherits the residence of a decedent generally acquires it with a basis equal to the fair market value at the decedent’s date of death, and since it is inherited property, it is treated as held for long-term. Generally, a beneficiary will sell the residence through a broker and will have substantial sales costs. A frequent question is whether or not a loss is allowed on the sale. The answer to that question depends upon the beneficiary’s use of the property after inheriting it.

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How Married People Filing Separately Can Qualify for the Premium Tax Credit

Posted by Lee Reams Sr. on

Generally, a married taxpayer filing separately (MFS) who does not qualify as a victim of domestic abuse or spousal abandonment cannot take the premium tax credit (PTC) and thus must repay all advance premium tax credit (APTC) received (Sec 36B(c)(1)(C)).

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