Tax

Question 1

Above the line deductions (get to AGI)

Answer 1

“Retired Students Have Alimony Insurance”

Retirement & HSA
Student loan interest $2500 max
Half SE tax (half .1413)
Alimony paid pre 2019
SE Health Insurance

Question 2

Itemized Deductions (to get to taxable income)

Answer 2

“My Tax Is Calculated Correctly”

Medical ins OOP cost is greater than 7.5% AGi

Taxes Paid (SALT)

Investment Interest (mortgage up to $750 for home improvement and margin interest)

Charity

Casualty claims (must be a federally declared disaster)

If less than std deduction, use std

Question 3

Personal Service Corporation (PSC)

Answer 3

C corp

Income retained taxed at flat 21%

HALE

health
Accounting
Lawyer
Engineer

Question 4

Gross Income

Answer 4

“Wacky Dogs Always Underestimate Tiny Cats)

-wages
-distributions/pensions
- alimony pre 2019
- unemployment
-taxable SS
- c income (sched c biz)

“Only Interesting Cats really pounce”

Ordinary dividends
Interest (taxable)
Cap gains
Real estate
Punitive damages (no wrongful death)

Question 5

Social security tax

Answer 5

6.2% bc earliest you can take SS is 62.

FICA is 7.65% (6.2 SS and 1.45 Medicare)

Question 6

What does self employment income include?

Answer 6

One Goal: Be Cool

1099 earnings
General partnership income
Board of director fees
C (sched c)

Question 7

LIFO/FIFO

Answer 7

Low tax= LIFO
flourishing income=FIFO

Question 8

AMT Preference Items (add cement to rock)

Answer 8

IPOD

• IDC, excess intangible drilling cost
• private activity mini bond
• oil and gas percentage depletion
• depreciation (ACRS /MACRS)

Question 9

AMT add back items

Answer 9

It’s “BS”

• Bargain element of exercises ISO
• SALT