If this is your first visit, be sure to check out the FAQ by clicking the link above. You may have to register before you can post: click the register link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. |
|
|
Thread Tools | Display Modes |
#1
|
|||
|
|||
[OT] US Tax help???
I know there are a few people on the group who do taxes for a living and I'm
scrounging for some free advice. I mentioned in another post that my ex has finally agreed to sign over his half of the house to my daughter, and I'm going to do the same. What I didn't consider, however, is that there may be a "gift tax" that I'll be liable for. I think that it's for anything donated that's worth over $11,000 the donor will be taxed. Would it be worthwhile for me to get an appraisal on the house in its current disaster state? Does the tax still apply if it's to my daughter - who's also a Katrina victim??? Last year we had to take out a two-year loan to pay our taxes because we mis-calculated how much to keep out in taxes when we had to take out our IRA funds. I don't want to be in the same boat this year so would appreciate any "heads up" anyone can give me. Hugs, CatNipped |
#2
|
|||
|
|||
[OT] US Tax help???
On Wed, 09 Nov 2005 17:50:07 +0100, Nomen Nescio wrote:
-----BEGIN PGP SIGNED MESSAGE----- From: "CatNipped" I know there are a few people on the group who do taxes for a living and I'm scrounging for some free advice. I mentioned in another post that my ex has finally agreed to sign over his half of the house to my daughter, and I'm going to do the same. What I didn't consider, however, is that there may be a "gift tax" that I'll be liable for. I think that it's for anything donated that's worth over $11,000 the donor will be taxed. Well, I'm not an accountant, but........... (sparing you a lame "Holiday Inn" joke) I did take a couple semesters of accounting. I believe you and your ex can each gift 11k for a total of 22k untaxed. Would it be worthwhile for me to get an appraisal on the house in its current disaster state? Yes. The gift value is the current value of the property. I believe you can itemize a deduction for a casualty loss (the IRS still allows that, don't they?) for 1/2 the property value before the damage less 1/2 the value after the damage (with certain income restrictions). Does the tax still apply if it's to my daughter - who's also a Katrina victim??? I think so. It would be worth your while to talk to an accountant since it can get kinda complex. Maybe instead of a gift, you can sell it to her for a buck. Best of luck. -----BEGIN PGP SIGNATURE----- Version: N/A iQCVAwUBQ3JOdZMoscYxZNI5AQGksQP/VHoyfhUHc2SJObiIGqR7ZRXwXznFH8uV d63Ai69ROFPCT8eDEQ/CdEUYB5QKNVQ3gFYh53haKKop6eXlha262bI8iK0XFGR2 /eoTfSe5TCc+XBrVgF0v8q7r94oe+Z+XMP1wWNrB0DtjLoGRsm2 yekhzWqWlcPHW LksC133vBNc= =IbOi -----END PGP SIGNATURE----- I don't understand the details, but there is a lifetime exemption in there somewhere. Talk to a certified accountant. MLB |
#3
|
|||
|
|||
[OT] US Tax help???
"CatNipped" wrote in message ... I know there are a few people on the group who do taxes for a living and I'm scrounging for some free advice. I mentioned in another post that my ex has finally agreed to sign over his half of the house to my daughter, and I'm going to do the same. What I didn't consider, however, is that there may be a "gift tax" that I'll be liable for. I think that it's for anything donated that's worth over $11,000 the donor will be taxed. Would it be worthwhile for me to get an appraisal on the house in its current disaster state? Does the tax still apply if it's to my daughter - who's also a Katrina victim??? Last year we had to take out a two-year loan to pay our taxes because we mis-calculated how much to keep out in taxes when we had to take out our IRA funds. I don't want to be in the same boat this year so would appreciate any "heads up" anyone can give me. Hugs, CatNipped I'm a CPA. A gift of less than $11,000 would not be taxed. Any amount over $11,000 would come out of your $1,000,000 lifetime exclusion before it would be taxed. I would still be a good idea to get an appraisal of the post Katrina, pre cleanup value of the property. Just because it is so much easier to do now rather than later. Then you get into the part where you and your spouse can make a joint gift to your daughter of $11,000 each and that boosts it to $22,000 before you are supposed to file a tax return. It you make the gift to her and to her husband then you are up to $44,000. Doesn't really matter that it all belongs to you and not your spouse. But for these scenarios you do need to file form 709. Just to put what you are doing on the record. You need to download form 709 and Publication 950 from the IRS website and try to wade through what applies to you. http://tinyurl.com/dxnhk http://tinyurl.com/9olsn Then for a little more light reading download http://tinyurl.com/bbz2v It tries to explain what you can deduct for your losses from Katrina. You might even be able to deduct the loss on your 2004 tax return. Disaster losses are outside my area of expertise, but I'm guessing plenty of accountants in your area are adding it to theirs right now. You would have a loss of 1/2 of the value of the home before Katrina less 1/2 of the value after. Your daughter's family will have a huge loss on personal property from the pictures I saw. Jo |
#4
|
|||
|
|||
[OT] US Tax help???
"Jo Firey" wrote in message
... "CatNipped" wrote in message ... I know there are a few people on the group who do taxes for a living and I'm scrounging for some free advice. I mentioned in another post that my ex has finally agreed to sign over his half of the house to my daughter, and I'm going to do the same. What I didn't consider, however, is that there may be a "gift tax" that I'll be liable for. I think that it's for anything donated that's worth over $11,000 the donor will be taxed. Would it be worthwhile for me to get an appraisal on the house in its current disaster state? Does the tax still apply if it's to my daughter - who's also a Katrina victim??? Last year we had to take out a two-year loan to pay our taxes because we mis-calculated how much to keep out in taxes when we had to take out our IRA funds. I don't want to be in the same boat this year so would appreciate any "heads up" anyone can give me. Hugs, CatNipped I'm a CPA. A gift of less than $11,000 would not be taxed. Any amount over $11,000 would come out of your $1,000,000 lifetime exclusion before it would be taxed. I would still be a good idea to get an appraisal of the post Katrina, pre cleanup value of the property. Just because it is so much easier to do now rather than later. Then you get into the part where you and your spouse can make a joint gift to your daughter of $11,000 each and that boosts it to $22,000 before you are supposed to file a tax return. It you make the gift to her and to her husband then you are up to $44,000. Doesn't really matter that it all belongs to you and not your spouse. But for these scenarios you do need to file form 709. Just to put what you are doing on the record. You need to download form 709 and Publication 950 from the IRS website and try to wade through what applies to you. http://tinyurl.com/dxnhk http://tinyurl.com/9olsn Then for a little more light reading download http://tinyurl.com/bbz2v It tries to explain what you can deduct for your losses from Katrina. You might even be able to deduct the loss on your 2004 tax return. Disaster losses are outside my area of expertise, but I'm guessing plenty of accountants in your area are adding it to theirs right now. You would have a loss of 1/2 of the value of the home before Katrina less 1/2 of the value after. Your daughter's family will have a huge loss on personal property from the pictures I saw. Jo Thanks Jo! I had downloaded the form 709 before I found out about the $1,000,000 lifetime exemption and when I saw that it taxed the donation amount at 48% I almost had a heart attack!!! DH said that I will have to get my ex husband to sign the form 709???! Maybe that is only if we do the joint gift thing??? We signed and notarized the donation papers today (I was going to do it even if I had to pay the taxes), but we are still going to get the house appraised before it is repaired (we should have done it before they cleaned out the house and stripped off the moldy sheetrock - the appraiser would have gotten a different picture than the clean-looking result now!). Katrina victims are going to get back the last 3 years of income taxes that they'd paid (and I would think they wouldn't have to pay taxes for 2005 either, or else claim the losses for a bigger refund??). I also found out that people who are housing Katrina will get a $500 per person exemption, to a maximum of $2,000, off of their 2005 taxes. That will help me out a little (utility bills at my house have quadrupled in the last 2 months!!!). FEMA won't help out the "hosts" because they say that the monthly allowance they're giving Katrina victims should be spent on "ren t" to their hosts - but I won't take any money from them because my daughter will need every penny she can find to rebuild and to re-buy everything they owned. Hugs, CatNipped |
#5
|
|||
|
|||
[OT] US Tax help???
Cat you also need to check with your state they have disaster relief
exceptions My tax attorney did not even know about them till I asked each state is doing something different |
#6
|
|||
|
|||
[OT] US Tax help???
"CatNipped" wrote in message ... Thanks Jo! I had downloaded the form 709 before I found out about the $1,000,000 lifetime exemption and when I saw that it taxed the donation amount at 48% I almost had a heart attack!!! DH said that I will have to get my ex husband to sign the form 709???! Maybe that is only if we do the joint gift thing??? Nope. Your ex can take a flying whatever you like. DH is only signing to acknowledge that he is letting you use his $11,000 in regard to a possible gift to your daughter and won't be taking it himself. In effect the two of you could give $44,000 to your daughter and her DH with out it touching your lifetime exclusion. Jo |
#7
|
|||
|
|||
[OT] US Tax help???
"Jo Firey" wrote in message
... "CatNipped" wrote in message ... Thanks Jo! I had downloaded the form 709 before I found out about the $1,000,000 lifetime exemption and when I saw that it taxed the donation amount at 48% I almost had a heart attack!!! DH said that I will have to get my ex husband to sign the form 709???! Maybe that is only if we do the joint gift thing??? Nope. Your ex can take a flying whatever you like. DH is only signing to acknowledge that he is letting you use his $11,000 in regard to a possible gift to your daughter and won't be taking it himself. In effect the two of you could give $44,000 to your daughter and her DH with out it touching your lifetime exclusion. Jo AH! Kewl - *THANKS*, that's *very* helpful info! Hugs, CatNipped |
#8
|
|||
|
|||
[OT] US Tax help???
"CatNipped" wrote in message ... We signed and notarized the donation papers today (I was going to do it even if I had to pay the taxes), but we are still going to get the house appraised before it is repaired (we should have done it before they cleaned out the house and stripped off the moldy sheetrock - the appraiser would have gotten a different picture than the clean-looking result now!). You need to establish what it was worth right before Katrina, and right after. Picture should be a big help. But get a valid appraisal. Katrina victims are going to get back the last 3 years of income taxes that they'd paid (and I would think they wouldn't have to pay taxes for 2005 either, or else claim the losses for a bigger refund??). Not saying this isn't true, but it doesn't sound like income taxes as I know them. At least not federal. Maybe Louisiana, but then I can't see how they could afford it. Probably the potential for a disaster loss being large enough to general a Net Operating Loss Carryback that could wipe out prior years taxes is being reported to sound this way. I also found out that people who are housing Katrina will get a $500 per person exemption, to a maximum of $2,000, off of their 2005 taxes. That will help me out a little (utility bills at my house have quadrupled in the last 2 months!!!). FEMA won't help out the "hosts" because they say that the monthly allowance they're giving Katrina victims should be spent on "ren t" to their hosts - but I won't take any money from them because my daughter will need every penny she can find to rebuild and to re-buy everything they owned. Sort of true. You would likely get a $500 per person exemption for your daughter and her kids, but that would only translate to that amount times your marginal tax rate off your taxes. $2000 time 15% or maybe 28%. For really fun light reading http://tinyurl.com/ahhef Great as a cure for insomnia if nothing else. Jo |
#9
|
|||
|
|||
[OT] US Tax help???
CatNipped wrote: I know there are a few people on the group who do taxes for a living and I'm scrounging for some free advice. I work for a CPA firm, although I know nothing about the tax consequences of a situation such as you describe. I really think you should consult a CPA or attorney, just to be sure. (Not all of them charge an arm and a leg for simple advice, and in the long run it's less expensive than finding out the hard way that you've made a costly mistake.) |
#10
|
|||
|
|||
[OT] US Tax help???
On Wed, 09 Nov 2005 17:34:35 +0000, mlbriggs wrote:
On Wed, 09 Nov 2005 17:50:07 +0100, Nomen Nescio wrote: -----BEGIN PGP SIGNED MESSAGE----- From: "CatNipped" I know there are a few people on the group who do taxes for a living and I'm scrounging for some free advice. I mentioned in another post that my ex has finally agreed to sign over his half of the house to my daughter, and I'm going to do the same. What I didn't consider, however, is that there may be a "gift tax" that I'll be liable for. I think that it's for anything donated that's worth over $11,000 the donor will be taxed. Well, I'm not an accountant, but........... (sparing you a lame "Holiday Inn" joke) I did take a couple semesters of accounting. I believe you and your ex can each gift 11k for a total of 22k untaxed. Would it be worthwhile for me to get an appraisal on the house in its current disaster state? Yes. The gift value is the current value of the property. I believe you can itemize a deduction for a casualty loss (the IRS still allows that, don't they?) for 1/2 the property value before the damage less 1/2 the value after the damage (with certain income restrictions). Does the tax still apply if it's to my daughter - who's also a Katrina victim??? I think so. It would be worth your while to talk to an accountant since it can get kinda complex. Maybe instead of a gift, you can sell it to her for a buck. Best of luck. -----BEGIN PGP SIGNATURE----- Version: N/A iQCVAwUBQ3JOdZMoscYxZNI5AQGksQP/VHoyfhUHc2SJObiIGqR7ZRXwXznFH8uV d63Ai69ROFPCT8eDEQ/CdEUYB5QKNVQ3gFYh53haKKop6eXlha262bI8iK0XFGR2 /eoTfSe5TCc+XBrVgF0v8q7r94oe+Z+XMP1wWNrB0DtjLoGRsm2 yekhzWqWlcPHW LksC133vBNc= =IbOi -----END PGP SIGNATURE----- I don't understand the details, but there is a lifetime exemption in there somewhere. Talk to a certified accountant. MLB Sorry folks. I was trying to eliminate the "stored" messages. MLB |
Thread Tools | |
Display Modes | |
|
|
Similar Threads | ||||
Thread | Thread Starter | Forum | Replies | Last Post |
[OT] Broadband! | Yowie | Cat anecdotes | 53 | May 22nd 05 01:27 AM |
[OT] Follow-up To Posts | Peacemaker | Cat anecdotes | 9 | May 4th 05 04:50 PM |
[OT] Follow-up To Posts | Catnipped | Cat health & behaviour | 62 | May 1st 05 01:28 AM |
[OT] I *LOVE* my DH | CatNipped | Cat anecdotes | 10 | April 29th 05 05:50 PM |
[OT] Rant | CatNipped | Cat anecdotes | 30 | April 28th 05 05:45 AM |