The Small Business Tax Help Blog

Archive for March, 2010

Question: Capital Gain Taxes – Sell & Buy immediately – Impact ?

I am currently a Canadian Resident (fiscally) but I am working outside of Canada on an Engineering project. I qualify for the Overseas Employment Credit (T626), so my tax rate is currently excellent (no provincial tax paid, reduced Cdn rate). Because of this tax rate, I want to sell my current holdings (Cdn stocks) to create capital gains and immediately buy back the same stocks…
does the 30-day rule apply, or does it apply only in the case of capital losses ? Any other rules I need to be aware of in my case ? Thanks !

Answer: No, there is no reference in the ITA to specifically discuss what is essentially a superficial gain (unlike the superficial loss rules).

The only other rules you might consider are General Anti Avoidance Rules, under Section 245 of the Income Tax Act, since the only reason for this transaction is tax related. IC 88-2 has more information on that. I don't think you are really avoiding tax in this case, though, just taking advantage of the tax rates you are currently subject to, similar to if you moved to the lowest tax rate province (Alberta) and did some transactions there.

Are you sure you aren't subject to Provincial tax? Residents file using the tax return of the Province they have the most ties to (if they aren't actually living in a Province at December 31). Deemed residents actually have to pay an additional surtax to compensate for the fact they don't pay provincial tax.

Regulating Third-Party Election Ads in West Virginia

West Virginia's House of Delegates wants the Senate to consider regulating third-party election ads as well as political activity by in-state corporations.

New Investments in Jobs and Clean Energy

Question: How much will I get back on my income tax refund?

I live in Canada, Ontario and I need to know roughly how much I will be getting back. Your help is very much appreciated. Here is the following information…..

Marital status: Single
Employment Income: $37,459.14
Income Tax deducted: $5,769.91
CPP: $1,680.98
EI Premiums: $648.04
Charitable Donations: $260.00

Claims:

Rent: $10,500
Orthodontic bills: $3,97
RRSP contributions: $600

Answer: Buy a copy of one of the tax software programs and enter your data, it is the only way to be accurate, and since you have to do it anyway, why not start now?

Canada’s Opposition Says Airport Security Fee Hides Harper Tax

Feb. 26 (Bloomberg) -- Canadian Prime Minister Stephen Harper’s decision to raise airport fees to pay for security measures is a hidden tax that underscores the challenges for the government to erase a record deficit , opposition lawmakers said.

Jack Layton on Corporate tax cut and EI Payroll tax increase

Question: Can i still recieve a income tax check at the end of the year?

I live in Tennessee, and I haven’t had a regular steady job this year. I have worked for a licensed contractor who owns his own business. He has wrote me check(s) for the hours that i worked. So i guess i would be considered a temporary employee. He once told me he could pay me up to X amount of dollars a year as a outside contractor before he had to report my wages on his taxes for his business. I have filled out the proper paperwork that states that i have worked for him and everything is legit.

There were no taxes taken out on the checks that he gave me for the work. When I fill out my income tax forms this year, will i still receive a refund?? Will i have to pay in?? The money i have made is under 8 grand. I have no idea what to do. PLEASE HELP SERIOUS ANSWERS ONLY PLEASE!!!

Answer: If your income is less than $8,000, you will probably not have to pay "income" tax. However, I think you were an "independent contractor", not a "temporary employee", and independent contractors must pay a 15.3% self-employment tax. You will be entitled to a $400 making work pay credit and to an earned income credit. If these credits exceed your self-employment tax, you will receive a refund. If the tax exceeds the credit, you will have to pay.

Popular business directory searches

Volunteers are and have always been a vital part of Fair Park. Without their efforts, generosity and commitment, Fair Park would not be able to offer the classes and services that it does today.

Wacker Chemie in Tennessee part 2

Question: Can I write offs on tax for a failed business investment?

I invested 50K to a new start up company. I’m NOT part owner or anything, just an investor. The company failed and now my money is gone. Can I write this off. The company started two years ago and I invested the money 1 year ago when it was struggling.
Thanks

Answer: Hi Reality Check

Yes, you can but You’ll need to include extra paperwork. Good luck.

-- Eric

http://forexsoho.com/

11 tax deductions you can't actually write off

Although the tax code permits a wide range of deductions, thousands of filers routinely claim write-offs that are in fact non-deductible. These are some of the most common ones.

Tax Tips & Information : How Do Tax Write-Offs Work?

Question: guidelines to claim a HOME BUSINESS?

What are the guidelines to call what you are doing a “home business?” Is there an income minimum? An hour minimum?

I am in the midst of starting a home business. I started last year and it has been mainly development expenses so far…. advertising, materials, samples, business plan etc etc etc. I have not produced any income yet.

Can i claim the expenses i incurred during this time? can i claim a percentage of my house..since we do have a room dedicated as “our office?”

please help…
any extra info and tips would be greatly appreciated as well!!!

Answer: Yes, you can claim all of your expenses. Since you did not have any income, you would have a business loss which would offset your other earnings and would lower your tax liability.
You would need to do this on a Schedule C. You need to have a separate room dedicated as your office to be able to deduct the expense for the use of your home.

W.Va. State Budget Weakened in February

State officials say West Virginia's budget picture weakened by more than $31 million in February.

Business Plan-What is EBITDA?