This is the first issue of IICLE’s FlashPoints on income taxation. We titled this FlashPoints “Tax Law in Plain English” because it will be tailored to lawyers who do not consider taxation to be their primary area of practice. At the same time, even tax lawyers will find reasons to read this FlashPoints. Few people like payi...
What is income? More specifically, what is income according to the Federal Income Tax laws? The short answer is “Everything.” The slightly longer answer is: Everything that you ever get is considered to be income unless the income tax laws tell you otherwise. Internal Revenue Code Section 61 defines gross income as follo...
While the tax deduction for home mortgage interest is as American as apple pie, the recipe can be very complicated. The home mortgage interest deduction is an example of a simple general rule with extensive and complicated exceptions. In the good old days, people simply deducted interest that they paid. There was no distinctio...
Deferring the recognition of income taxes under IRC Section 1031 was the rage in the real estate boom years. While the real estate market has cooled it is still important to know about like kind exchanges (“1031 Exchange”). First, you or some of your Clients may own properties that were acquired in a 1031 Exchange. Second, de...
The general rules and guidelines of IRC Section 1031, Like-Kind Exchanges were presented in Part 1, in the August, 2009 edition of FlashPoints. This Part 2 follows the Section numbering and terminology from Part 1. Selected Issues: There are many detailed requirements to accomplish and then retain the benefits ...
You have status with the IRS….but don’t let it go to your head. They do not think that you are special. Rather, all individuals have a tax filing status as determined under the Federal Income Tax laws. The tax filing status of individuals is often taken for granted rather than thoughtfully considered. The wrong status co...
There is a well publicized $8,000 Federal Income Tax incentive available to first time home buyers. This incentive is designed to encourage people to purchase principal residences. It not only helps those who want to own their own home but also helps stimulate the residential real estate market overall. Th...
My oldest child is a freshman in the Business School at the University of Illinois at Champaign/Urbana. Many people have congratulated us, not because it is difficult to get in (it is difficult) but because they assume that it must not cost much for an Illinois resident to attend an in-state university. The U of I estimates that i...
Americans are charitable people. There are many different types of philanthropy. Some involve giving of one’s time, some involve giving of cash and some involve giving of property. Americans, by most forms of measurement are the most philanthropic of any country. Studies show that nearly 75% of charitable giving in the United Sta...
Over the past month or two, taxpayers have been receiving various tax documents in the mail. These include W-2’s from their employer and Form 1099’s from their banks and brokerage firms. There is also an increase in the publicized prosecution of “tax cheats” in the news (designed to remind us that while we have a “volunta...
