Who pays a gift tax?
The donor is generally responsible for paying any taxes associated with a gift. Under special arrangements, the donee may agree to pay the tax instead.
For a legal consultation with a personal injury lawyer, call 434-817-3100
What is considered a gift and subject to a gift tax?
According to the Internal Revenue Service, any transfer to an individual, whether directly or indirectly, where full consideration (measured in money or money’s worth) is not received in return is considered a gift. The general rule is that any gift is a taxable gift. However, there are exceptions to this rule, of course. Gifts that are not considered taxable include those that don’t meet the allowable annual exclusion, tuition or medical expenses you pay for someone, gifts to your spouse, or gifts to a political organization for its use. Additionally, there are special exceptions for gifts made to qualifying charities.
An experienced tax law attorney can examine your precise situation and advise you as to any tax consequences.
How is a corporation taxed?
Corporations are taxed differently than other business structures and are responsible for paying their own income taxes on profits. This is so because a corporation is considered a distinct legal entity apart from its owners and therefore is taxed on all its profits that cannot be classified as business expenses. Generally, taxable profits consist of money kept in the company to cover expenses or expansion and profits that are distributed to its shareholders as dividends.
If I sell my home and suffer a loss, is that loss deductible?
No. Only losses associated with property used in a trade or business and investment property such as stocks are deductible. A loss on the sale or exchange of personal use property, which includes a loss on the sale of your primary, personal residence, is not deductible.
Are the proceeds I received from a reverse mortgage taxable to me?
No. The amount received from a reverse mortgage is not taxable. A reverse mortgage is considered a loan and not income. The lender is paying you while you continue to live in your home. Likewise, any interest accrued on a reverse mortgage is not deductible until you actually pay it, which is usually when you pay off the loan in full.
A skilled tax attorney can help you determine whether a reverse mortgage is appropriate for your needs and, if you currently have a reverse mortgage, a Virginia tax attorney can advise you on its tax consequences and ensure you are fully complying and benefiting from the laws.
Click to contact our personal injury lawyers today
Does my partnership or corporation have to file a tax form even though it had no income for the year?
It depends. According to the Internal Revenue Service, a domestic partnership must file an income tax form unless it neither receives gross income nor pays or incurs any amount treated as a deduction or credit for federal tax purposes. A domestic corporation, however, must file an income tax form whether it has taxable income or not.
A Virginia tax attorney can examine your business and advise you as to its precise tax obligations.
Are child support payments considered taxable income?
No. Child support payments are neither deductible by the payer nor taxable to the payee. When calculating your income to determine whether you are required to file an income tax return, do not include any child support payments you have received.
Call 434-817-3100 or complete a Case Evaluation form
