Deducting Ponzi losses Investors who lost money in Ponzi schemes are allowed a tax deduction, but many questions need to be answered prior to actually entering the deduction on a tax return. For example, since Ponzi-scheme victims have paid tax on fictitious income, how are they to get refunds of their overpaid taxes? Amended returns

Before you agree to act as a guarantor, endorser, or indemnitor of a debt obligation of your closely held corporation, you should be aware of the possible tax consequences if your corporation defaults on the loan and you are required to pay principal or interest under your guarantee agreement. If you are compelled to make

If you are a volunteer worker for a charity, you should be aware that your generosity may entitle you to some tax breaks. Although no tax deduction is allowed for the value of services you perform for a charitable organization, some deductions are permitted for out-of-pocket costs you incur while performing the services (subject to

Dividends are taxed at the same favorable 0%, 15%, or 20% rates that apply to long-term capital gain, for purposes of both the regular tax and the alternative minimum tax—but only if the dividends are “qualified dividend income.” Dividends that aren’t qualified are taxed as ordinary income, at rates as high as 39.6%. Starting in

School teachers such often pay for classroom materials out of their own pockets. If you qualify as an “eligible educator,” you will be allowed a “classroom expense deduction” of up to $250 for expenses you pay during the year in connection with books, certain supplies, computer equipment (including related software and services), other equipment, and

Dear Friend: As a teacher or professor, you’ve probably seen advertisements for job-related courses in exotic locales. You may have wondered whether such courses are tax-deductible. The answer depends on the specifics of the course and of your job situation. If the education comes from the travel itself, the expenses aren’t deductible. For example, a

Maybe you can deduct these losses and maybe they are suspended depending upon your circumstances. If you have a number of rental real estate properties that are throwing off losses that you’d like to deduct against your other income for tax purposes. As you may be aware, the passive activity loss (PAL) rules would normally

If you or someone in your family is looking for a new job, you should be aware of the income tax deduction that may be available with respect to job-search costs. Qualifying expenses are deductible even if they don’t result in a new position being offered or accepted. What are job hunting expenses. Expenses of seeking

Individuals must pay 25% of a “required annual payment” by Apr. 15, June 15, Sept. 15, and Jan. 15, to avoid an underpayment penalty. (When that date falls on a weekend or holiday, the payment is due on the next business day.) The required annual payment for most individuals is the lower of 90% of

 The “Nanny Tax” isn’t limited to a nanny. It also applies to a housekeeper, maid, baby-sitter, gardener or other household employee who isn’t an independent contractor. The tax doesn’t apply to a household employee who’s also a farm worker. If you employ someone who’s subject to the “Nanny Tax,” you aren’t required to withhold federal