When you file your taxes, the IRS gives you two options for taking tax deductions. You can either take a standard or itemized deduction, but not both. A standard deduction is a set amount that’s determined by the IRS each year. If you choose the standard deduction, your deduction is predetermined and you can check […]
The standard deduction is a flat amount that you can subtract from your income, while itemized deductions are specific expenses that you can deduct, but you must keep track of your expenses and provide documentation. The choice between claiming the standard deduction and itemizing your deductions will depend on which method gives you the greatest […]
When you’re filing your taxes, you have two options for taking deductions: standard or itemized. Standard deductions are easier to take since you simply subtract a set amount from your taxable income. However, some people may benefit more from itemized deductions, which requires you to list (and provide proof of) all eligible expenses during the […]
Adjusted Gross Income (AGI) is a financial term used to describe a taxpayer’s total income minus specific deductions. AGI is calculated by taking your gross income (total income from all sources) and subtracting any allowable tax deductions. This number is then used to determine how much of your income is subject to tax, and which […]
A business tax deduction is an expense that a business can subtract from its taxable income when calculating its federal income tax liability. Deductions can reduce a business’ taxable income and lower the amount of taxes owed to the government each tax year. Here’s how it works: What counts as a business expense? To determine […]
What is a tax deduction? A tax deduction is a way to reduce the amount of money you have to pay in taxes. It’s like a special discount that the government gives you when you spend money on certain things. When you spend money on tax deductible expenses, you subtract that amount from your total […]
Capital gains are generally taxed as ordinary income by the IRS, although the tax rate on capital gains can be lower than the tax rate on ordinary income, depending on the circumstances and the jurisdiction. The holding time of a capital asset affects the tax rate applied to any capital gains realized from its sale. […]
