A dependent with unearned income in 2025 may be required to file their own federal tax return and, if that income exceeds $2,700, must attach Form 8615 to calculate the "kiddie tax" — a rule that taxes the excess at the parent's marginal rate rather than the child's lower rate.

For most vehicles used in a small business, the MACRS recovery period is 5 years under the General Depreciation System (GDS).

Yes, but only for one of the two limitations. The carryforward under IRC §179(b)(3)(B) applies specifically to the taxable income limitation. Amounts that cannot be deducted because your active business taxable income was insufficient in the year of election are carried forward indefinitely.

The maximum contribution to a solo 401(k) for 2026 is $72,000 for participants under age 50. Participants aged 50–59 and 64+ can contribute up to $80,000, and participants aged 60–63 can reach $83,250 under the SECURE 2.0 super catch-up provision.

Yes. The IRS imposes three statutory limits on solo 401(k) contributions for 2026.

It depends on who the disability insurance covers and who pays the premiums.

An S corporation does not report the ERC as taxable income on Form 1120-S.

An S corporation cannot deduct charitable contributions at the corporate level. Contributions are passed through to shareholders, who claim the deduction on their individual returns.

Guaranteed payments are a common way for partnerships to compensate partners for services rendered or for the use of capital. Understanding the tax treatment of these payments is critical for both partnerships and partners to ensure proper reporting and compliance.

Form 1065 (U.S. Return of Partnership Income) is only for partnerships, that is, entities with two or more owners.

Gift cards can be tax deductible for a business, but only in limited situations and subject to strict IRS rules. Whether they’re deductible depends on who receives the gift and why it’s given.

Usually, no. If a trust or estate files Form 5227, it generally does not also file Form 1041 for the same tax year, unless there is unrelated business taxable income (UBTI).

Trust, not the individual beneficiaries, is responsible for paying property taxes, but who actually pays in practice depends on the type of trust, who controls the property, and state law.

The at-risk rules limit the amount of partnership losses a partner may deduct to the amount the partner is economically at risk for in the activity. Even if a partnership allocates a loss to you on Schedule K-1, you can deduct it only up to your at-risk amount for the year.

It depends on where the LLC is located and how the spouses choose to be treated for federal tax purposes.

Yes, sometimes. Two roommates living at the same address can both claim Head of Household (HOH) filing status only if each independently meets all HOH requirements. Merely sharing an address does not disqualify either taxpayer.

It depends on who pays the premiums and how much coverage you have. For tax year 2025, voluntary life insurance is often pre-tax for the employee up to certain limits, but not always.

A Specified Service Trade or Business (SSTB) is a category of business defined under IRC §199A(d)(2) that receives restricted treatment under the Qualified Business Income (QBI) deduction rules.

Federal bonus depreciation in 2025 is a split-year answer: the rate was 40% for qualified property placed in service between January 1 and January 19, 2025, and 100% for property acquired and placed in service on or after January 20, 2025.

The deductibility of business interest expense is governed by IRC §163(j), which imposes an annual cap on the amount a business may deduct.

Yes. If you paid your mother to babysit your children, the money is taxable income to her and generally must be reported on her tax return.

No. Immigrants do not receive special or automatic tax breaks because they are immigrants.

Yes, but only within strict IRS time limits. You can change from Married Filing Jointly (MFJ) to Married Filing Separately (MFS) only before the tax return due date (including extensions).

Form 709 is the U.S. federal gift tax return used to report taxable gifts you make to another person during the year. It is filed by the person giving the gift, not the recipient.

Car repair expenses are deductible only to the extent the vehicle is used for business or other deductible purposes. Personal-use car repairs are not deductible.

Yes, sometimes. Sales tax paid on a used car purchased in 2025 may be deductible only if you itemize deductions and elect to deduct state and local sales taxes instead of state and local income taxes. The deduction is subject to the $40,000 SALT cap ($20,000 if married filing separately).

The 'kiddie tax', formally called the tax on unearned income of certain children under IRC §1(g), applies to children and young adults who have more than $2,700 in unearned income in 2026 and meet specific age and dependency conditions. When it applies, the unearned income above the threshold is taxed at the parent's marginal tax rate rather than the child's typically lower rate. The tax is calculated on IRS Form 8615 and reported on the child's own return.

Yes, many childbirth and pregnancy-related expenses are deductible as medical expenses under IRC §213, provided you itemize your deductions on Schedule A and your total unreimbursed qualifying medical expenses exceed 7.5% of your adjusted gross income (AGI) for the year. The deduction covers a wide range of prenatal, delivery, and postpartum costs, but several common pregnancy-related expenses are explicitly excluded.

Your nondeductible IRA contribution is simply the difference between what you contribute and what you're allowed to deduct. Whether your contribution is deductible depends on your income, filing status, and whether you (or your spouse) are covered by a retirement plan at work.

The IRS does not send you an RMD amount. While your financial institution (the custodian) will usually calculate it for you and may send a notice, you are legally responsible for the math. If you have multiple IRAs, the calculation gets more complex because of the Aggregation Rule.

Your tax refund may not increase after claiming charitable donations for several common (and perfectly normal) reasons under tax year 2025 rules. A charitable contribution only reduces your tax if it actually lowers your taxable income or tax liability, and often, it doesn’t.

It depends on the purpose of the loan and how the points are used. For tax year 2025, mortgage points may be deducted in the year paid or amortized over the life of the loan, depending on the facts below.

Yes, the portion of a Pell Grant (or any scholarship or fellowship) that exceeds qualified education expenses is taxable income for federal income tax purposes. The tax treatment is governed by IRC §117, which provides an exclusion from gross income for scholarship amounts, but only to the extent those amounts are used for qualifying expenses.

Pass-Through Entity (PTE) tax, also called an entity-level state income tax or SALT cap workaround, is a mechanism enacted by most U.S. states that allows partnerships, S corporations, and in some states LLCs taxed as pass-throughs, to elect to pay state income tax at the entity level rather than at the individual owner level.

Florida does not impose sales tax on most digital products and services under current state law. Florida's sales tax applies to sales of tangible personal property and certain specifically enumerated services — and digital goods, as intangible property, have not been broadly brought within the taxing statute by the Florida Legislature.

Patronage dividends are distributions paid by a cooperative organization to its members based on the volume of business each member conducted with the cooperative during the year. They are not dividends in the traditional corporate sense — they are a return of the overcharge or over-deduction on goods or services transacted through the cooperative, proportional to each member's patronage.

If your amended federal tax return (Form 1040-X) is rejected, it means the IRS did not accept it for processing. A rejection is different from a delay or adjustment. What you should do next depends on why it was rejected and how you filed it.

Yes, often. Medicare premiums are eligible for the self-employed health insurance (SEHI) deduction, and Medigap (Medicare supplemental) premiums are also eligible, if you otherwise qualify for the deduction. Certain other “supplemental” policies may not qualify.

When you surrender (cash out) a life insurance policy, any taxable amount is generally ordinary income, not capital gain. The taxable portion is the amount you receive above your investment in the contract (basis).

In most cases, renters insurance is not tax deductible for individual taxpayers. However, there are important exceptions where a portion (or all) of the cost may be deductible, depending on how the rented property is used. 

A GIIN is a unique 19-character identification number issued by the IRS to financial institutions and certain entities that register under FATCA (Foreign Account Tax Compliance Act).

Tax equity financing is a specialized project-finance structure in which an investor provides capital to a project, most commonly in renewable energy or other tax-credit-eligible developments, in exchange for the project’s federal tax benefits, rather than relying primarily on operating cash flow.

For U.S. federal tax purposes, computers used for business are depreciated under the Modified Accelerated Cost Recovery System (MACRS). The applicable recovery period and method depend on how the computer is classified and how it is used.

For federal tax purposes, a semi-truck is depreciated over 5 years under the IRS’s MACRS depreciation system.

Yes, ownership is not required, but your parents’ address can only be your tax home if it is where you regularly live and work. Simply using your parents’ address as a mailing address does not automatically make it your tax home.

Usually 4–8 weeks, but it can range from a few days to several months, depending on how you apply, the tax year, and whether additional review is required.

Yes, your tax refund can be delayed or taken if you owe back child support. This happens through a federal program called the Treasury Offset Program (TOP).

The estimated tax safe harbor is a set of IRS rules that lets you avoid underpayment penalties even if you owe tax at filing, as long as you paid in enough during the year through withholding and/or estimated payments.

No, there is currently no federal income tax credit for purchasing an energy-efficient dishwasher for your home.

In Florida, property is reassessed every year, but significant increases in taxable value typically occur only when certain events happen. 

California imposes several potential taxes when you sell a house, though many homeowners may owe little or nothing depending on their circumstances.

Generally, yes. Travel nurses typically must file a tax return in every state where they earned income during the year, plus a resident return in their home state (tax home). However, exceptions apply for states without an income tax and states with reciprocity agreements.

What people call a “Florida tax ID” can mean different things, depending on your situation. Florida does not issue a single, universal tax ID. Instead, you may need one or more of the following.

Health FSAs are generally not subject to California income tax - California conforms to the federal IRC §125 cafeteria plan rules. However, there is a critical distinction between FSAs and HSAs that is frequently confused: HSAs are taxable in California even though they are federally tax-free.

For federal tax purposes and for tax year 2025, mortgage insurance premiums are not deductible on your individual income tax return. The deduction for qualified mortgage insurance premiums expired after tax year 2021 and has not been extended by Congress for tax years 2022 through 2025.

Form SSA-1099 is the Social Security Benefit Statement issued by the Social Security Administration each year. It reports the total amount of Social Security benefits received during the prior calendar year and is used to determine whether any portion of those benefits is taxable on your federal return.

As a U.S. citizen or resident alien, you are taxed on worldwide income. Rental income from properties located outside the United States must be reported on your federal return, and several additional reporting requirements apply.

Yes, property taxes paid through a mortgage escrow account are deductible, but only for the tax year in which your mortgage servicer actually remits the funds to the taxing authority, not when you deposit funds into escrow.

How you report income from telemedicine services depends on your employment classification. The IRS distinguishes between W-2 employees and independent contractors, and the difference has significant tax implications.

Yes. Photography is generally subject to Florida sales tax when it results in the sale of tangible photographs, such as prints, albums, canvases, or images on a disc or flash drive. Images transferred solely by electronic means, such as over the internet, are not tangible personal property and generally are not taxable.

When a person dies in California, there is no California estate tax or inheritance tax. However, several federal and state-level tax obligations may still apply, depending on the decedent’s income, assets, and estate size.

Nevada’s Modified Business Tax (MBT) is a state-level employer payroll tax imposed on businesses that have employees working in Nevada. The tax is based on gross wages paid, not on business profits, income, or revenue.

California S corporations must make estimated franchise tax payments during the year using Form 100S rules administered by the California Franchise Tax Board (FTB).

In Florida, there is no state income tax, so your paycheck withholdings generally include only federal taxes and payroll taxes, not state income tax.

No. Florida does not tax Social Security benefits.

Yes. Required Minimum Distributions (RMDs) are taxable in California if they come from a tax-deferred retirement account (such as a traditional IRA or pre-tax 401(k)). California generally taxes RMDs the same way the federal government does, as ordinary income.

In Arizona, property tax exemptions are administered at the county level, but eligibility and rules are set by state law. To apply, you must file the proper exemption form with your county assessor and meet the applicable eligibility requirements.

The NY PFL tax is the employee contribution that funds New York Paid Family Leave (PFL), a mandatory state program that provides paid, job-protected leave for eligible workers.

Yes. Tips are considered taxable wages in California and are subject to California Personal Income Tax (PIT), just like regular wages.

Form 540 2EZ is a simplified California state income tax return for residents with very simple tax situations.

Oklahoma offers an agricultural sales tax exemption permit (often called a farm exemption card) that allows farmers and ranchers to purchase qualifying farm inputs, such as feed, seed, fertilizer, tractors, and equipment, without paying state sales tax. The permit demonstrates you are engaged in farming or ranching for profit. 

A tax levy on your paycheck means the IRS is legally seizing a portion of your wages to pay an unpaid tax debt. This is one of the most serious collection actions the IRS can take, and it occurs only after the IRS has sent you multiple notices and you haven't responded or made arrangements to pay.

A federal tax refund can legally be higher than the federal income tax withheld on your W-2 when refundable credits or certain payments exceed your total tax liability. This is common and fully allowed under U.S. tax law.

You can confirm whether the IRS received and applied your tax payment using one or more of the official methods below. The best method depends on how you paid (Direct Pay, EFTPS, check, or third-party processor).

Yes, a U.S. citizen can legally remain on a U.S. payroll while living abroad, but both the employee and employer have specific U.S. tax and compliance obligations.

Yes. If the IRS has issued an Identity Protection PIN (IP PIN) to your dependent, you must include that IP PIN on your federal tax return when you claim the dependent.

Usually, no. Paying child support by itself does not give you the right to claim a child as a dependent if the child does not live with you. In most cases, the custodial parent (the one the child lives with most of the year) is entitled to the dependency claim.

Yes, often you can. A dependent’s receipt of government assistance or income does not automatically disqualify them. Eligibility depends on whether the person meets the IRS tests for either a Qualifying Child or a Qualifying Relative.

Yes, you may be able to claim the Child and Dependent Care Credit even if you paid your provider in cash, but only if you meet all IRS reporting requirements.

Yes. You can still claim your child as a dependent for the year they passed away, as long as they met the IRS dependency requirements before their death.

Qualified Business Income (QBI) deduction, also called the Section 199A deduction, allows eligible taxpayers to deduct up to 20% of their qualified business income from pass-through entities, plus 20% of qualified REIT dividends and publicly traded partnership (PTP) income.

Professional licenses and regulatory fees are generally deductible business expenses if they are ordinary, necessary, and directly related to carrying on your trade or business.

You may be able to deduct medical expenses you paid for your child even if the child is not your dependent, as long as the child meets the IRS’s “would-have-been-a-dependent” test, with limited exceptions.

Yes, sometimes, but only in specific situations.

You generally cannot completely avoid taxes on severance pay, because the IRS treats severance as regular wages.

Qualified Improvement Property (QIP) is certain interior, non-structural improvements made to nonresidential (commercial) real property after the building is first placed in service.

Tax treatment of digital assets like websites, domain names, and computer software depends on how the asset is acquired, what type of asset it is, and how it's used in your business. Generally, these costs must be capitalized and recovered through amortization or depreciation rather than deducted immediately.

Usually, no. If your only income for the year was Social Security benefits, you generally cannot claim the Child Tax Credit (CTC) or the Additional Child Tax Credit (ACTC).

An “IRS TREAS 310” deposit means you received money directly from the U.S. Treasury, usually related to your federal tax account. 

In California, any withdrawal from a traditional 401(k) (whether periodic retirement distribution or lump-sum) is generally included in state taxable income and taxed at your regular California income tax rates.

Yes, health insurance premiums can be tax-deductible for retirees, but only under specific conditions. The rules differ depending on whether the retiree itemizes deductions, receives Social Security, or has self-employment or retirement plan income.

Land held for investment is a capital asset. It is not depreciable, gains are generally capital gains, and expenses are treated differently than operating real estate.

You report Airbnb income based on how often the property is rented and how it’s used. Most hosts report it on Schedule E or Schedule C, and in limited cases it may be partially or fully excluded.

MUD tax is a local property tax levied by a Municipal Utility District (MUD), most commonly in Texas, to fund infrastructure and ongoing services for a specific development area.

Yes. You must report all rental income you receive, even if it does not cover your mortgage payments or results in an overall loss.

Yes, in most cases. If you own a rental property in a state where you do not live, you usually must file a nonresident state income tax return in the state where the property is located.

Yes. but you can’t just start taking it going forward.

Timeshare income is reported based on how the income is earned and how the property is used. There is no single line for “timeshare income” on a tax return.

A check-the-box transaction for a foreign entity refers to a tax election made under the IRS check-the-box regulations that allows certain foreign business entities to choose how they will be classified for U.S. federal tax purposes.

A CP2000 notice (proposed underreporter adjustment) does allow you to ask for more time, and the IRS is usually reasonable if you do it correctly and promptly.