The Tax Questions Blog

Archive for the ‘Non-Taxable Items’ Category

IRS Ruling 2009-14

Revenue Ruling 2009-14 (which is specifically limited to term policies) found that death benefit proceeds payable by a US insurance company to a non-US investor not engaged in a US trade or business, upon the death of an insured who is a US citizen residing in the US would be US-source income.

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Question: What is Nontaxable combat pay election?

I received an economic stimulus package from social security and do not have to file taxes but i am filing this and donot know if i have any nontaxable combat pay election

Answer: The purpose of the nontaxable combat pay election is to have your non-taxable combat pay considered in determining your eligibility for the stimulus rebates.

If you were stationed in a hostile-fire pay zone all year and are either enlisted or a commissioned office below about the paygrade of O-4, all of your base pay and allowances are non-taxable. That would result in a tax liability of $0 and would unfortunately exclude you from the stimulus plan rebates. If you show your non-taxable combat pay on the special Form 1040-A return then it will be used to determine if you earned at least $3,000 and would therefore make you eligible for the rebate.

Here's an IRS link that will explain it all: http://www.irs.gov/newsroom/article/0,,id=180339,00.html

Please note that claiming this will NOT cause you to pay taxes on your excluded combat pay! It will ONLY allow you to report it so that you will qualify for the rebate!

EITC – Don’t Overlook It

The Earned Income Tax Credit is a financial boost for workers earning $48,362 or less a year. Four of five eligible taxpayers filed for and received their EITC last year. The IRS wants you to get what you earned also, if you are eligible.

Addie Jenne re-election announcement 5.24.7

Question: Help with Fixed Deposits?

I have about 80,000 Rs in my savings account which have accumulated over the years. My yearly income is not taxable. I want to invest this money in FDs for about 2 to 5 years but I do not want to go through the hassle of submitting forms for non-TDS deduction. How can I avoid TDS deduction? What should I do?

Answer: better u invest in post office MONTHLY INCOME SCHEME .
and also open arecurring account also & in MIS account you mention it that intrest will be transfered automaticaly in recurring account. & maturity of recurring you will got maximum rate of interest of about 11.5% per annum . there is no TDS DEDUCTION.

Research and Markets: Brazil Insurance Report Q2 2010

DUBLIN----Research and Markets has announced the addition of the "Brazil Insurance Report Q2 2010" report to their offering.

Question: The Question about personal profits being non taxable?

Do you have information that would support, From our Constitution or any Judgment that this idea has any merit? I collect taxes from individuals when I do business and have no compensation for collecting and paying them is there a ruling that would give me compensation for my collection efforts, even postage is coming out of my income. The same for workers taxes and insurance, which I feel is good thing, but why increase the cost to my customers?

Answer: There is the matter of cost of doing business but you are taxed on your NET income, not your GROSS!

My business (corporation) makes ZERO profits each year so we pay no federal tax. We still have to pay the annual $800 state tax for the "privilege of doing business in the state of CA."

Shaw Announces Second Quarter Financial and Operating Results

CALGARY, ALBERTA--(Marketwire - April 9, 2010) - Shaw Communications Inc. (TSX:SJR.B)(NYSE:SJR) announced results for the second quarter ended February 28, 2010. Consolidated service revenue for the quarter and year-to-date periods of $929 million and $1.84 billion, respectively, was up 11% over the same periods last year. Total service operating income before amortization 1 of $425 million and ...

Question: Terminal Illness and Debt?

My father (53) has a terminal illness (he's almost a year into a 3 months to a year prognosis). While he thinks he still has years, the reality is that it's more likely less than a year.

Over the years, he has manage to get himself into at least $75K of consumer debt and $9K of CRA debt. He is single and rents. The only assets he has is approximately $55K in lock-in RSPs. His income is approx. $5K/month (Disability CPP and non-taxable disability insurance). The debt is really weighing him down, and he has been paying approx. $3K/month towards it (well over minimum payments). However, he also wants to be able to live the best life he can. He's thinking of bankruptcy and wanted to find out what other options he has. Any suggestions?

Answer: Rebecca...talk to him about seeing a Debt Councellor...they can help him restructure his debt, and possibly even have his debtors forgive some of the debt. Even if it is only the accumulated interest on the original debt(s), that can be a significant chunk out of the debt. They can also help to see if bankruptcy is a valid option for him ... although, at this stage, the 7 year black mark on his Credit Rating is a moot point. But, if he's looking to leave you and your siblings (if any) an inheritance, clearing his debts is the only way to do so.

As someone else pointed out...your Father's debts die with him. If there is still money owing after the estate is cleaned out, they can NOT come after you unless you co-signed on the debt.

Incidentally...there are many Debt Councilors that work for free. You can look them up in the Yellow Pages.

Good Luck!

VA to automate Agent Orange claims process

WASHINGTON — The Veterans Affairs Department plans to announce Tuesday that it will fully automate how it pays claims for illnesses related to exposure to the chemical Agent Orange to keep an overburdened system from collapse. It is the VA’s first effort at automating claims processing in its 80-year history, VA chief technology officer Peter Levin said. It comes as the agency struggles to cut a ...