Internal Revenue Code (IRC) Section 121 "The Home Sale Gain Exclusion" Explained
When a person sells their principal residence, specific tax implications must be considered. Under Internal Revenue Code (IRC) Section 121, a taxpayer may exclude up to $250,000 ($500,000 for married…
IRS Form 1065 Schedule K-1 Explained
IRS Schedule K-1 is a tax form used to report a person's share of income, deductions, credits, and other items from a partnership, S corporation, trust, or estate. This form is used to report the…
IRS Schedule C "Report Profit of Loss" Explained
IRS Schedule C, or Form 1040, is a tax form self-employed individuals use to report their business income and expenses. It is used to calculate a person's net profit or loss from their business…
IRS Schedule A "Itemized Deductions" Explained
IRS Schedule A is a form that taxpayers can use to itemize their deductions if they choose not to take the standard deduction. The standard deduction is a fixed dollar amount that reduces the income…
IRS 1040 Schedule 1 Form "Additional Income and Adjustments to Income" Explained
IRS Form 1040 Schedule 1 reports additional income adjustments for individuals who are required to file a Form 1040 tax return. This form reports income not reported on the main Form 1040, such as…
7 Reasons Taxpayers Get An IRS Audit
Facing an IRS audit is a daunting experience. The idea of having your financial records scrutinized by the most feared collection agency, the IRS, can shake anyone to their core. The cost in both…
IRS Form 1040 Schedule R "Credit for the Elderly or the Disabled" Explained
IRS Schedule R (Form 1040) is a tax form used to claim the Credit for the Elderly or the Disabled. This credit is designed to provide financial assistance to taxpayers 65 years or older, or retired…
IRS Form 1040 Schedule J "Income Averaging for Farmers and Fishermen" Explained
IRS Schedule J (Form 1040) is a tax form farmers and fishermen use to calculate and report their income using the income averaging method. Income averaging is a method that allows these taxpayers to…
Lien vs. Levy: Deciphering Tax Terminology
Taxes can be complex and overwhelming. When back tax debt comes into the picture, things can get more complicated and stressful. If you fail to pay your back taxes, two terms often surface: "lien"…