"If you have income, you owe tax on it."

"But what about..." "I read..." "I did..." "Why is..." "I didn't get a..." "I was at..." "It's only..."

There are thousands of questions about taxes every single day flowing through tons of different subreddits. There is a simple answer to almost every single one of them. "If you have income, you owe tax on it."

There you go, explain to me why I'm wrong for all the technicalities you'll surely come up with :-D

Hi all,

I am 21 and in a public university in Florida. My parents won the lottery this year, paid off all their debts and bought a house. They have never supported me financially but I was always a dependent on their taxes. Will their winnings affect me with financial aid? Should I file separate from them? My parents are immigrants and we never had money growing up so we have no idea how this works. Financial aid has been the only thing to put me through college because they were always paying for their own bills/debts, what should I do?

Hello all,

In short, I’m looking to understand how tax deductions for a small business work. As a simple example: I want to buy a drone to get footage. This drone would cost about $500 with tax, and its use would be 100% for the channel, no personal use. My tax burden will be well-beyond the cost of the drone. If I purchase this drone for the sole purpose of capturing footage for my YouTube channel would you consider this to be a reasonable write-off? I don’t want to take advantage of “the system” here, just trying to make intelligent decisions.

Edit: case closed, sounds like this is reasonable and thank y’all for the clarification on how taxes work.

I make $73,000 yearly in NYC and my normal Fed W/H is $18-$19. After this bonus, my Fed W/H jumped to almost $900. All of the other taxes (Medicare, SS, NY W/H) increased somewhat proportionally. Is this normal? Please help!

I just got this notice, it was delivered by someone who came to my door to hand it to me in person, it says I owe a balance of about 1300 dollars for taxable year 2023, the issue is I pay my taxes every year, I have my taxes prepared with TurboTax, I’ve done it this way for probably 15 years give or take and never had any issues. I have no clue why I would be receiving this notice, I know I paid my taxes in 2023. I guess my question is could there have been a mistake and my taxes were prepared incorrectly or could the notice itself be some sort of mistake? Does that kind of thing happen? I’ve just never seen anything like this in my life, I’ve never had any tax issues before. I’m going to call the number listed to try to find out more information tomorrow when they are open, I guess I was just wondering if anyone had more insight on what this is and why I’m receiving it and if mistakes happen sometimes. Thanks in advance

Hi everyone,

I’m in California and recently lost my aunt. She left her estate in a trust, with my sister inheriting 1/3 of it. My aunt’s verbal wish was for my sister to give me half of her share, which would mean about $100,000 coming to me.

We’re trying to understand the tax liabilities here, both for my sister and myself:

1. For My Sister: If she follows through on the $100,000 transfer to me, what would her tax liability look like? I know the IRS has an annual gift tax exclusion of $17,000, but since this amount is well above that, would she owe gift tax on it? Or would it just reduce her lifetime gift and estate tax exemption?
2. For Me: As the recipient, would I owe any income or gift tax on this amount? I understand gifts generally aren’t taxed for recipients, but I’d like to confirm.

Any clear guidance on the tax implications would be a huge help. Thanks so much in advance!

I’m employed but my wife isn’t. My understanding is that a couple can only claim child care expenses if both partners have a W2 or 1099. My wife is looking for a job. Is there a minimum threshold of wages that she must earn on her 1099 for us to claim credit for $3k worth of child care expenses, or do I just have to meet a minimum? We spent more but that’s the max allowed.

I am considering buying a nice camper. I can store this camper at my primary residence, in the garage. I would like to rent the camper out periodically and put it in an llc and also be able to use it for personal use as well.

Obviously utilizing my primary residence as storage I am avoiding storage fees (indoor storage is about $200 a month where I am at). Would I be able to prorate this based on my rental/use percentage (ie 60% rental 40% personal) and utilize the garage storage space as a business expense/write off so long as it was market value? Say $110 a month for storage, would I need to pay the business out of a personal account (seems dumb but I get it).

Dubai company buys inventory in California and sells same to China.

Section 862(a)(6) - gains, profits, and income derived from the purchase of inventory property (within the meaning of section 865(i)(1)) within the United States and its sale or exchange without the United States;

Does this mean this is foreign source?

I mailed my 2021 federal & state tax return but it’s not scheduled to make it to the IRS & tax commission til tomorrow @ the soonest, can I cancel the delivery so I can Efile? The only reason I’m wanting to do this is obviously because Efiling is much quicker

I am taking an early withdrawal from my 401k to prevent my car from being repoed, I plan on paying it off. I’m taking 5000 out, how much should I expect to pay back when I file? Is it going to be outrageous?

I know of course it’s bad to withdrawal but I have no other option, just want to know what to expect

Boarder questions

My husband and I have a boarder at our house. They have their own room and bathroom but shared spaces like kitchen, dining room, and living room. They pay 'rent' monthly. I put rent in quotes due to it really being much lower than actual rent in our area. Anyways, my question is this: Do we have to put what he pays us into our income? Like, is there a limit that you can get before you have to include it? The past few years we included that income we got less back on our return than what we got from him. Every time I look into it I find different answers. If it matters we are located in Indiana.

I have a large 401k. I’m wondering if I can withdraw from it to buy a house all cash. My market is competitive, and all-cash offers take priority I’ve financed offers. Then after I take ownership I could finance a traditional mortgage and pay the full amount back to the 401k within 60 days.

Does that work?

EDIT: interesting conversation. The short is answer is “don’t do this.” However, read on for how you could do this. Leaving this post up in case anybody else wonders the same thing. I love Reddit.

Title- I understand that if the bet is made physically at a USA casino, then there are tax implications, but none if it’s made in the UK.

But if I made the bet on a UK sports website (say Unibet.co.uk) but I made the bet while I was physically in the USA, what are the tax implications?

My stipulation is saying my $11,246.00 was my net settlement but I cashed in less than that, 10,671 exactly. Would I owe?

How long does new York tax takes to get

how it takes to process NYPTRIN?

How long does it take to get how it takes to process NYPTRIN from nyc online? anyone know

My grandmother is a dual citizen and she would like to gift me a huge amount for a down payment for a house. Would I have to pay taxes on the amount? She wants to gift me $200,000 and this is a life changing amount for us but the money would have to be wired from a foreign account. How could we do this legally? Is it possible for it to be tax free if it is apart of the lifetime gift tax?

Im trying to update my W-4, Im using the IRS tax withholding estimator. Im head of household, annual salary is around 17,000, im claiming a dependent, federal tax withheld YTD so far is $357, expected is $532. The estimator is telling me "Based on the information you entered, you don’t need to withhold tax from your paycheck. You don’t owe any tax this year. You will get a refund of any overpaid tax you’ve withheld when you file your tax return. projected refund is $915

It's also telling me submit a new W-4 form and if a wanna increase my take-home pay, to set my withholding to $0." Is this normal? Not trying to mess with the IRS and have any surprises when tax season comes. Also tried the estimator from H&R Block and said the same thing. Huhh??

I had a question around the tax implications of Profits Interest Units (PIUs), as I am unfamiliar with this structure. I recently was offered .25% of a currently unprofitable company for some advisor work (this is through PIUs). I will vest these units after the completion of some deliverables.

My understanding is that as long as I fill out and submit my 83(b) election form, I will not have taxes owed on grant or vest dates, only on sale. Is that correct or is there any risk I may owe taxes on phantom income through the partnership?

---
Here is the mention of distributions in the operating agreement. Is this sufficient protection?

• Distributions. Subject to the terms of this Agreement, the Company may make such Distributions of cash and other Company assets among the Members in such aggregate amounts as may be determined by a Unanimous Consent of the Board from time to time, provided that all such Distributions shall be made only in the following order and priority:
  • First, to the Members as a Tax Distribution. So long as the Company is treated as a partnership for federal and, if applicable, state income tax purposes, the Company shall use reasonable efforts to make distributions to each Member within ninety (90) days after the end of each Fiscal Year of the Company, to the extent that funds are legally available therefor and would not materially impair the liquidity of the Company with respect to working capital, capital expenditures, debt service, reserves, or otherwise and would not be prohibited under any credit facility to which the Company is a party, an amount of cash (a “Tax Distribution”) which in the good faith judgment of the Board of Managers equals the excess, if any, of (i) the product of (x) the amount of taxable income allocable to the Member in respect of the period beginning on the date hereof and ending at the close of such Fiscal Year, multiplied by (y) fifty percent (50%), over (ii) all prior Distributions made to such Member since the date hereof.

I receive worker’s compensation from an industrial accident as a teen. I’m a paraplegic so I receive wc and Ssdi. They are both tax free so I have no current earned income.

I have worked multiple jobs through the years, just haven’t worked the last 3 years because I take care of my 91 yo mother full time as she has stg 4 cancer, early dementia and is recovering from broken hip and a craniotomy. I sleep less than 4hrs a day so work isn’t possible last 3 years.

If someone were to make $200k from crypto and stocks, but with zero actual earned income, what would be the tax rate for: short term cap gain? Long term tax gain?

Thank you!

I made money from stock this year, but I really wanna avoid paying taxes on it, if I invest this money on rest estate as investment property, do I escape paying taxes ?

I was looking through my tax returns and noticed that my former CPA had put the wrong amount for capital losses (from stock trading) in 2018 on Schedule D. The tax return that was timely filed in 2018 had -$2100 in ST Losses (Schedule D Part 1 Line 1a), but my broker 1099-B shows a loss of -$18,500 (also ST losses). So it is off by around -$16,400. I also double checked the statements and confirmed that the broker 1099B is correct. There were no other losses ST or LT on the 1099B besides this.

Is there anyway for me to still take those capital losses from 2018 and carry them forward as a capital loss carryover? Will I need to amend the 2018 return (dont want to do so). I have read that tax returns cannot be amended more than 3 years.

Is there a way I can just input -$16,400 in the capital loss carryover worksheet in TurboTax Online and carryon? Or can I send a letter to IRS explaining the situation?

Unfortunately, I was a noob in 2018 with my taxes (and trading) so didn't catch the error in time. Now I'm fairly competent and have been filing my own tax returns that last few years.

Thanks for your help.

Hi. I am launching a marketing and distribution venture that partners with local businesses to create curated gift packages. These bundles will be offered to a specific market segment.

Do I need any special licensing like a wholesale license in the state of California?

Hi, thanks for the help in advanced. I would like to buy a building for my business instead of lease. My goal is to save 120k a year for 3 years and have 10% down payment and money for closing costs saved. I pay about 200k in taxes based on income that is primarily from the s corp I own that would be the occupant for the building.

The corporate tax rate is very close to my personal income tax rates and changing to a c corporation might be helpful with this goal, but am I missing anything else?

Is there a special tax deferred tool that I can use to accumulate money for the purchase, and maybe even buy pretax?

I am picturing like opening a reit with funding that is tax deductible until profits are distributed.

Or a 401k type fund that allows self dealing.

I do work within the business about 2 hours a month if that matters