Who pays the deceased’s taxes?

When a person dies, you might be wondering who is responsible for paying his or her taxes. Generally, the person’s estate or trust is responsible for those liabilities and pays them before making distributions to the beneficiaries. In situations where the liabilities exceed the assets (i.e. insolvent), state law governs which creditors get paid first. …

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The new form 1099-NEC

Another new change is coming for the 2020 tax season. Nearly 70% of filers in 2019 who reported income in Box 7 (nonemployee compensation) of Form 1099-MISC will now be using the new Form 1099-NEC to report nonemployee compensation! Don’t miss: Closing down a sole proprietorship The IRS decided to make this change effective for …

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Closing down a sole proprietorship

Unfortunately, due to Covid-19, a lot of individuals have had to make the difficult decision to close their businesses. Closing a sole proprietorship legally has several steps and boxes to check to make sure the business is permanently closed. Here are the steps the IRS has laid out to help you close your sole proprietorship. …

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Best practices for protecting your data

As the amount of available data stored by businesses and individuals continues to grow so does the risk that the data can be accessed by unauthorized individuals. Below is a list of tips to help a business or individual keep their data secure. Don’t miss: IRS transcripts masked for identity protection Antivirus Software – Antivirus …

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More clarity for partnership international reporting

Are you invested in a partnership that provides you with an enormous number of documents attached to the K-1? Well the recent form changes are meant to extract some of the long narratives to describe the type of foreign income items being allocated to you and streamline such disclosures to specific Schedules on the K-1. …

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FAQs for filing an amended tax return

If you have ever filed an amended tax return in the past, you know a paper tax return was required since amended tax returns could not be filed electronically. Good News! If you need to amend your 2019 Form 1040 and 1040-SR, the IRS says you can file your amended tax return (1040-X) electronically at …

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IRS gives retirees a longer life in 2022

In early 2020, the CARES Act dropped the required minimum distribution (RMD) requirement for year 2020. However, if you received a RMD from your retirement account in prior years, you may realize that life expectancy tables are used to calculate your annual RMD amount. Don’t miss: IRS transcripts masked for identity protection To calculate an …

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IRS transcripts masked for identity protection

Identity theft has long been a serious issue for taxpayers in the United States, with thousands of taxpayers each year having their personal information fall into the wrong hands. Fortunately the IRS has taken yet another step to combat this growing trend – since December 13, sensitive information has been masked on taxpayer transcripts. Don’t …

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Estate and tax planning for your home

There are numerous ways to own real estate and these ownership arrangements have significant legal and tax ramifications. Let’s take a look at some of the most popular arrangements and what might happen after death. First, let’s assume that John and Jane Smith are married, and that Joe Nelson is John’s business partner. John died …

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