The scene is set. It’s the 2010-11 tax season and United States is hit by an outbreak of tax changes unlike the world has ever seen before. “This year has brought us some of the most interesting tax changes we’ve seen in years—at least interesting to us tax accountants,” says Vern Hoven, CPA, EA and CPE Link instructor, who specializes in demystifying tax legislation.
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In this episode of Tax Update Adventures, our hero, Super Tax Preparer rescues individuals from paying unnecessary taxes and being subjected to the terror of audits.
“Super” saves Joe and Mary Smith from the double whammy of having their home foreclosed or sold short and then, POW, having the amount of the cancelled debt counted as “income” on which they owe tax. “Super” shows them how to avoid the dreaded “cancellation of debt.”
“Super” helps Carlos, a factory worker who is retraining for a new job, to take advantage of extensions to the American Opportunity Tax Credit by deducting all qualified tuition costs, which now includes the cost of books. Joe breathes a sigh of relief because books have added $3,000 to the cost of his engineering degree.
Wealthy and philanthropic Mary, age 72, changes the world AND avoids paying income tax on the minimum IRA distribution she must take but doesn’t need by giving it directly to her favorite cause--thanks to the advice of “Super Tax Preparer,” her savvy accountant.
Registered domestic partners, parents of dependent children, investors, buyers of electric cars, and home remodelers are also among the countless individuals helped to pay their rightful tax and no more through in depth understanding of recent tax updates.
There are about 140 million tax filers in the United States and these are just a few of their stories.
In Episode II of The Tax Update Adventures, Super Tax Preparer tackles cases of real estate tax, passive loss, and Estate and Gift Taxation.