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Tax Help and Optimization
Types of tax shelters
Some tax shelters are questionable or even illegal:
- Offshore companies. By transferring funds to a company in another country, one may claim the transfer as an expense, and thus lowering the taxable income. Difficulties in international tax treaties often make the income not legally taxable.
- Financing arrangements. By paying an unreasonably high interest rates to a related party, one may severely reduce the income of an investment (or even create a loss), but creates a massive capital gain when they wish to withdraw the investment. The tax benefit derives from the fact that capital gains are taxed at a lower rate than the normal investment income such as interest or dividend.
The flaws of these questionable tax shelters are usually that transactions were not reported at fair market value or the interest rate was too high or too low. In general, if the purpose of a transaction is to lower tax liabilities but otherwise have no economic value, and especially when arraged between related parties, such transaction is often viewed as unethical. In the case of the clothing, the tax agency may claim that the shirts are not worth $5, since the importing company were unable to sell them at that price. The agency may re-evaluate the price, and will quickly neutralize any over tax benefits. However, in reality, such cases were rarely won. A soft drink from a vending machine can cost $1.00, but may also be bought in bulk for $0.25. To prove that the price is in fact unreasonable may turn out to be unreasonably difficult itself.
Tax & Accounting Software Solutions
Latest Tax Articles
The Dreaded Letter From the IRS Posted By : Rich Chappo..Sun, 06 May 2007 00:00:00 -0500
It is a part of just about all of our daily habits. We stroll out the mailbox to see what interesting bit of mail we got. As you dig through the junk mail, you see a few bills and an ominous looking letter. Egad, it is from the IRS. A dear john letter of a different sort.
Tax Refund When Is It Coming? Posted By : Rich Chappo..
Sun, 06 May 2007 00:00:00 -0500
Tax season can make you manic-depressive. Nothing is more depressing than preparing your taxes. Nothing is more manic than planning how to spend your tax refund. Ah, but when is it going to show up is the biggest question most have.
Top 7 Ways To Minimize Your Income Taxes Posted By : Kristine McKinley
Fri, 28 Jul 2006 00:00:00 -0500
Are you paying too much in income taxes? Are you getting all the credits and deductions you are entitled to? Here are 7 tips to help you minimize taxes and keep more in your pocket: 1. Participate in company retirement plans. Every dollar you contribute will reduce your taxable income and thus your income taxes. Similarly, enroll in your companys flexible spending account. You can set aside money for medical expenses and day care expenses. This money is use it or lose it...
Types Of Tax Exchanges Posted By : Nationwide1031
Sat, 24 Jun 2006 00:00:00 -0500
Although the vast majority of exchanges occurring presently are delayed exchanges, let us briefly explain a few other exchanging alternatives. Simultaneous Exchange As mentioned previously, prior to Congress modifying the Internal Revenue Code as to exchanges and formally approving the concept of delayed exchanging, virtually all exchanges were of the simultaneous type. To qualify as a simultaneous exchange, both the relinquished property and the replacement property must...
Managing Freelance Tax Posted By : Pat Murphy
Sat, 10 Jun 2006 00:00:00 -0500
According to business analysts, the home-based business trend is on the rise and a lot of people are jumping onto self-employment. The news is not surprising since there are many advantages in being self-employed and owning your own business. Aside from the fact that you can actually call something your own, there is also the sense of achievement brought by personal success. On the practical side, you get to be your own boss, which means that you decide your hours and how muc...
Tax Help and Optimization FreshNews:
Some tax rebate checks run into obstacles (USA Today)
Fri, 16 May 2008 13:25:48 GMT
To help boost the economy, the Bush administration has tried to put tax rebates in consumers' hands as fast as possible. Yet, hundreds of thousands of taxpayers who thought they would have their checks by now are still waiting for their money.
Some tax rebates run in to obstacles (The News-Press)
Fri, 16 May 2008 12:15:42 GMT
To help boost the economy, the Bush administration has tried to put tax rebates in consumers' hands as fast as possible.
Data Scribe launches new entity to help Income Tax payers (New Kerala)
Wed, 14 May 2008 16:55:00 GMT
Bangalore, May 14: Data Scribe Infotech Pvt Ltd, a 100 per cent EOU, registered with STPI, Bangalore has opened DS Consulting Service to help Income Tax payers in filing of Tax returns.
Help available for tax/rent rebates (Public Opinion)
Fri, 16 May 2008 02:16:01 GMT
The Chambersburg TaxAide program will continue to assist people with filing for the federal stimulus payment and the Pennsylvania property tax/rent rebate program.
Darling says tax cuts will help in slowdown (Reuters via Yahoo! UK & Ireland News)
Wed, 14 May 2008 07:29:00 GMT
Chancellor Alistair Darling said on Wednesday that the global credit crunch was slowing down the economy but income tax cuts announced this week would help many Britons weather the storm.
Sales tax for roads (The Union)
Fri, 16 May 2008 07:24:04 GMT
A broad group of community leaders today is expected to introduce a sales-tax initiative to help fund street repair and an interchange at Dorsey Drive and the Golden Center Freeway in Grass Valley, The Union has learned.
Gordon Brown: tax move a necessity, not a political ploy (Belfast Telegraph)
Fri, 16 May 2008 08:56:03 GMT
Gordon Brown was accused yesterday of being "in denial" after claiming the £2.7bn package to compensate losers from the abolition of the 10p tax rate was designed to help Britain survive the global economic storm.