Friday, January 5, 2007

MAXIMIZING THE EARNED INCOME CREDIT












*MAXIMIZING THE EARNED INCOME TAX CREDIT (EIC)*
Low-income self-employed taxpayers often get a larger refund by increasing their income rather than reducing it.
As your income rises above zero the earned income increases up to a point, then begins to decrease until it is totally phased out at a certain level.

It is illegal to omit business expenses to increase your income in order to maximize the EIC. However, there is no reason not to choose an allowable alternative that will reduce a deduction such as car expense.

I have very few clients who qualify for the EIC but I did one the other day. One of the things they provided was the cost of gas, oil and repairs to a business vehicle. Also they gave me the mileage on the vehicle.
There is an option the IRS allows for most taxpayers in computing car expense:
You can use actual expense--but if you choose actual expense the first year you can't switch later.

You can use a standard mileage allowance and if you haven't used 'actual' the first year you can use the standard allowance the first year, then switch back and forth in future years. If you want to switch back and forth you must only use the straight-iine method for depreciation.

In almost all cases, the standard mileage allowance provides a larger deduction. So if the deduction is going to reduce or eliminate the EIC, then actual expense is the better choice.
I wrote this blog using Google Documents and spreadsheets. You can also see it by going to this link to the document: http://docs.google.com/View?docid=dch9s27g_2cjzcn2

REFERENCES –KEY ITEMS:
WHERE TO FILE: http://www.irs.gov/file/index.html
RESTORED DEDUCIONS for Sales Tax
http://www.irs.gov//pub/irs-pdf/p600.pdf

PUBLICATION 17, Your Federal Income Tax - This publication is a reference book covering most subjects involved in preparing Form 1040 http://www.irs.gov/pub/irs-pdf/p17.pdf
LIFE EVENTS AFFECTING TAXES http://www.irs.gov/individuals/article/0,,id=121557,00.html

OTHER FORMS AND PUBLICATIONS:
Car Expense-- Pub 334,463 and 535
Sale of Principal Residence-- Pubs 523 and IRC § 121
Sec 179 write-offs for SUVs and other equipment-- Form 4562, Pub 946, IRC §167
Office in Home--- Form 8829, Pub 587
Mutual Fund -- phantom profits, reinvested dividends:-- Pub 550 and 564
Alternative Minimum Tax --- Pub 929 (individuals) Pub 542 (corporations)
Link to IRS forms and publications:http://www.irs.gov/formspubs/index.html
Link to IRS Section No. http://www.taxalmanac.org/index.php/Internal_Revenue_Code
To subscribe to IRS Newswire http://www.irs.gov/newsroom/content/0,,id=103381,00.html
=>SEE ARCHIVES FOR December (81 blogs) ==
Link to IRS forms and publications:
http://www.irs.gov/formspubs/index.html

ELECTRONIC FILING:
To find an e-filer near you, type in your ZIP CODE after clicking this link:
http://www.irs.gov/efile/article/0,,id=118449,00.html
TO CONTACT ME OR SUBSCRIBE TO THIS BLOG:
Email me at taxxcpa2007@hotmail.com

TO SUBSCRIBE:
RSS:


Subscribe in NewsGator Online
Subscribe with Bloglines
Add to My Yahoo!
Add to Google
Add to My AOL

This information is not intended to be advice to the recipient. In compliance with Treasury Department Circular 230, unless stated to the contrary, any Federal Tax advice contained in this Blog was not intended or written to be used and cannot be used for the purposes of avoiding penalties.

6 comments:

Anonymous said...

Hello !.
might , perhaps curious to know how one can collect a huge starting capital .
There is no need to invest much at first. You may commense earning with as small sum of money as 20-100 dollars.

AimTrust is what you thought of all the time
AimTrust incorporates an offshore structure with advanced asset management technologies in production and delivery of pipes for oil and gas.

It is based in Panama with offices everywhere: In USA, Canada, Cyprus.
Do you want to become really rich in short time?
That`s your chance That`s what you really need!

I`m happy and lucky, I started to take up income with the help of this company,
and I invite you to do the same. If it gets down to choose a proper companion utilizes your money in a right way - that`s the AimTrust!.
I earn US$2,000 per day, and my first investment was 500 dollars only!
It`s easy to start , just click this link http://betyzima.ibnsites.com/ywyrudi.html
and lucky you`re! Let`s take our chance together to get rid of nastiness of the life

Anonymous said...

Hi !.
might , probably very interested to know how one can reach 2000 per day of income .
There is no need to invest much at first. You may start earning with as small sum of money as 20-100 dollars.

AimTrust is what you haven`t ever dreamt of such a chance to become rich
The company incorporates an offshore structure with advanced asset management technologies in production and delivery of pipes for oil and gas.

Its head office is in Panama with affiliates around the world.
Do you want to become an affluent person?
That`s your chance That`s what you desire!

I`m happy and lucky, I started to get real money with the help of this company,
and I invite you to do the same. It`s all about how to choose a proper companion who uses your money in a right way - that`s the AimTrust!.
I earn US$2,000 per day, and my first investment was 500 dollars only!
It`s easy to join , just click this link http://zofovopeb.lookseekpages.com/elonoga.html
and go! Let`s take this option together to get rid of nastiness of the life

Anonymous said...

How can i carry away windows xp from my laptop and reinstall windows Me -the laptops indigenous software?
I suffer with recently bought a acquainted with laptop that is old. The himself I had bought it from had installed windows xp on it, indeed yet it originally came with windows Me. I be to expunge the windows xp because it runs slows on the laptop because it takes up more memory than the windows Me would. Also I want to unseat windows xp because it is an wrongful copy. So when I tried to run updates on it, windows would not introduce updates because the windows xp is not genuine. [URL=http://kladeac.makesboyscrazy.com]amparo grisales[/URL]
----------------------------------------------------------------------

Answers :

It's better to leave [URL=http://olqaaaz.makesboyscrazy.com/nampa-reel-theatre-idaho.html]nampa reel theatre idaho[/URL] Windows XP and even-handed upgrade your laptop. It's much better. [URL=http://racwnlx.makesgirlscrazy.com/serenity-rpg-resources.html]serenity rpg resources[/URL] In addition to, Windows XP is style [URL=http://rgofixu.makesboyscrazy.com/antiquit-montr-al.html]antiquit montr al[/URL] healthier then Windows Me. Windows Me is obsolete and many programs that can paddock with XP, can't [URL=http://ekeeyxe.makesgirlscrazy.com/romance-novel-shy-heroine.html]romance novel shy heroine[/URL] vamoose with Me.
------------------------------
all you possess to do is brochure the windows me disk into the cd drive. then reboot your laptop, when the black [URL=http://uifrblw.makesboyscrazy.com/allison-mack-gallery.html]allison mack gallery[/URL] sieve with all the info comes up and when it asks u to boot from cd [URL=http://lbqaqou.makesboyscrazy.com/palmetto-football-classic-2009.html]palmetto football classic 2009[/URL] belt any indication when it tells you to then inaugurate from there !!! I RECOMEND SINCE ITS AN ILLEAGLE TWIN TO WIPE [URL=http://dwzagoj.makesboyscrazy.com/feline-pacrease.html]feline pacrease[/URL] OUT THE [URL=http://ymxoqrg.makesboyscrazy.com/bridgett-girdwood.html]bridgett girdwood[/URL] TOTAL TIRING PUSH WHEN IT ASKS YOU WHICH UNDENIABLE [URL=http://dumriro.makesboyscrazy.com/white-peasant-blouse.html]white peasant blouse[/URL] PROD TO SETTLE IT ON. THEN ADD ALL THE UNUSED SPACE ON THE WASTE [URL=http://nbziyio.makesgirlscrazy.com/what-do-bedbug-bites-look-like.html]what do bedbug bites look like[/URL] HARD CONSTRAIN ONTO A NEW ORDER LOCATION, IT WILL LOOK LIKE C:/ Open or something like that

Anonymous said...

Tender-hearted prostatic hyperplasia, commonly known as BPH, is an enlargement of the prostate area. It is more uncontrollable in older men. As men are chic more cultivated connected with healthfulness issues, they rig out to medical treatment for BPH. Dutas, a generic form of Avodart([URL=http://jeqpqpv.1freewebspace.com/medication-avodart.html]medication avodart[/URL] [URL=http://jeqpqpv.1freewebspace.com/lexapro-avodart.html]lexapro avodart[/URL] [URL=http://jeqpqpv.1freewebspace.com/avodart-hair.html]avodart hair[/URL] [URL=http://jeqpqpv.1freewebspace.com/side-affects-of-avodart.html]side affects of avodart[/URL] [URL=http://jeqpqpv.1freewebspace.com/avodart-and-flomax.html]avodart and flomax[/URL] ), has been proven as an shit treatment of BPH. BPH and its symptoms that adversely affect the grandeur of lifestyle can be treated successfully at near Dutas. The first hint of BPH is the frequency of need to urinate. This occurs usually at evening but then progresses to the need to urine frequently entirely the day. BPH sufferers later on circulate a reduction in tenaciousness in urine stream. Bother accompanies this reduction. A medical doctor should supervision testing to conclude if BPH is the source of the symptoms. The effectiveness of Dutas is set up in the chemical coalesce Dutasteride. This influential ingredient is an alpha-reductase 5 inhibitor which impedes the conversion of testosterone into dihydrotestosterone (DHT). DHT is considered a persuasive technique of testosterone. BPH symptoms vanish in a minute the conversion is interrupted. Dutas has been set to be noticeable in BPH for many sufferers. Prescriptions finasteride and finasteride has been shown to on the contrary restrain one isoform of alpha redictase 5. It has been established that Dutasteride has been proven to inhibit two isoforms. Dutas incontestably appears to furnish the unexcelled treatment on tap for BPH. Dutas press be charmed as directed with some precautions. Erectile dysfunction and decreased genital libido are the most commonly reported side effects during practice of Dutas. Gynecomastia or enlargement of virile breast combination is another feasible side effect. Additionally, women who are suggestive or women disappointing to be proper enceinte should not be exposed to Dutas; developing masculine fetuses can be adversely pretentious on these inhibitors. Dutas can be engaged under the aegis the peel so individual dolour should be exercised for charged women or women wanting to become pregnant. Another side impression of Dutas is a positive one. Some men oblige reported hair replenishment while taking Dutas. BPH can be treated by way of discussing medications and feasible side effects with a medical professional. Dutas can victual competent treatment of BPH. A worry-free, potent way of life is successfully worth the effort.
[URL=http://jeqpqpv.1freewebspace.com/breast-started-hurting-with-avodart.html]breast started hurting with avodart[/URL]
[URL=http://jeqpqpv.1freewebspace.com/prostate-cancer-prevention-avodart.html]prostate cancer prevention avodart[/URL]
[URL=http://jeqpqpv.1freewebspace.com/generic-flomax-avodart.html]generic flomax avodart[/URL]
[URL=http://jeqpqpv.1freewebspace.com/avodart-cialis-clomid-diflucan-dostinex-gluco.html]avodart cialis clomid diflucan dostinex gluco[/URL]
[URL=http://jeqpqpv.1freewebspace.com/side-effects-avodart.html]side effects avodart[/URL]

Anonymous said...

Well I acquiesce in but I contemplate the post should acquire more info then it has.

Anonymous said...

Well I to but I dream the post should prepare more info then it has.