capital gains – Eshcinsel http://eshcinsel.net/ Sun, 17 Apr 2022 16:06:40 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://eshcinsel.net/wp-content/uploads/2021/10/icon-41-120x120.png capital gains – Eshcinsel http://eshcinsel.net/ 32 32 I’m selling an apartment and buying another. Income tax rules explained https://eshcinsel.net/im-selling-an-apartment-and-buying-another-income-tax-rules-explained/ Sat, 19 Mar 2022 05:42:02 +0000 https://eshcinsel.net/im-selling-an-apartment-and-buying-another-income-tax-rules-explained/ I have two small residential apartments. One was bought in 2001 and we lived there until 2017, then we moved to a smaller apartment bought in 2016 by taking out a housing loan. Now we want to buy a bigger house for self use and therefore plan to sell our old flat from 2001 in […]]]>

I have two small residential apartments. One was bought in 2001 and we lived there until 2017, then we moved to a smaller apartment bought in 2016 by taking out a housing loan. Now we want to buy a bigger house for self use and therefore plan to sell our old flat from 2001 in March 2022. The provisional Long Term Capital Gains (LTCG) on our old flat is around 65 Lakh (after indexing) and the new flat will cost us 160 Lakh. Can you tell me if I can take advantage of this capital gain to buy a new house for personal use? Please note that I already own an apartment on the date of the sale of the old apartment. I am retired.

Since you sold the old apartment after more than 24 months of ownership, the profits from the sale of this apartment are taxable as a long-term capital gain. The tax laws contain provisions allowing exemption from long-term capital gains tax if the investment is made in certain specified assets. Pursuant to Section 54 of the Income Tax Act, an individual and a HUF may claim a long-term capital gains exemption resulting from the sale of a residential home by investing the indexed capital gains for the purchase of another residential home within a specified period. The exemption is available if the investment is made within two years for the purchase of a house. In case of self-construction of a house or reservation of a house under construction, a longer period of three years is available. Long-term capital gains not so invested by the filing due date of the income tax return (ITR), the unused amount must be deposited into an account under the Capital Gains Account Scheme and which can be used to make payment for the acquisition of the dwelling house within the time allowed. If the amount is not used within the prescribed period, it becomes taxable in the year in which the period has thus expired.

There is no restriction on the number of dwelling houses you can own on the date the property is sold to qualify for an exemption under Section 54.

Since you plan to invest more than indexed long-term capital gains, you won’t have to pay any tax. However, if the long-term capital gains are not fully invested, the exemption will be available to the extent of the investment and on the balance you will have to pay a 20% flat tax.

Thus, if you sell your apartment before March 31, 2022, you will have to buy the new apartment before July 31, 2022, which is your deadline for filing your ITR. If you are unable to do so, you will need to deposit the unused money into the capital gains account. If possible, I would advise you to execute the deal next year so that you have a longer period until July 31, 2023 to invest the LTCG.

Balwant Jain is a tax and investment expert and can be reached on jainbalwant@gmail.com and @jainbalwant on Twitter.

To subscribe to Mint Bulletins

* Enter a valid email address

* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our app now!!

]]>
Can I claim a long-term capital gains income tax exemption again? https://eshcinsel.net/can-i-claim-a-long-term-capital-gains-income-tax-exemption-again/ Sun, 13 Mar 2022 08:38:50 +0000 https://eshcinsel.net/can-i-claim-a-long-term-capital-gains-income-tax-exemption-again/ I had benefited from an exemption under articles 54 and 54EC for the long term capital gains on the sale of my dwelling house in 2010. Can I again apply for an exemption for the sale of the current dwelling house purchased in 2010 or the exemption is only available once in a lifetime. I […]]]>

I had benefited from an exemption under articles 54 and 54EC for the long term capital gains on the sale of my dwelling house in 2010. Can I again apply for an exemption for the sale of the current dwelling house purchased in 2010 or the exemption is only available once in a lifetime.

I think you’re talking about the provision in the Income Tax Act for a one-time exemption under section 54 for the investment of capital gains from the sale of a dwelling house in two dwelling houses provided that the amount of the long-term capital gain does not exceed 2 crores. Except for this benefit which is only available once in a lifetime, a taxpayer can claim exemption under Sections 54, 54F and 54EC a number of times as long as they meet the prescribed conditions.

To benefit from the exemption under section 54 on the sale of a dwelling house, you must have held the house for a period of more than 24 months from its acquisition and the indexed capital gains are invested to acquire another dwelling house within the prescribed period. To benefit from the exemption under Section 54F when selling an asset other than a dwelling house, you are required to invest the net sale consideration for the acquisition of a house. dwelling within the prescribed period and you must not own more than one dwelling at the date of sale of the asset. To claim an exemption under 54EC for long-term capital gains resulting from the sale of land or building, you must invest the index-linked long-term capital gains in capital gains bonds of specified entities within six months of the date of sale. of the asset.

I have a feeling you want to sell your existing dwelling house for which you applied for a Section 54 exemption in 2010. Since you have owned the new house for over three years, which is the ne of the conditions for avoiding the cancellation of the exemption requested previously, the question of the cancellation of the exemption requested in 2010 no longer arises today. You can again buy another dwelling house and/or invest in capital gains bonds and again claim exemption under Sections 54 and 54EC if you sell the house now.

Balwant Jain is a tax and investment expert and can be reached on jainbalwant@gmail.com and @jainbalwant on Twitter.

To subscribe to Mint Bulletins

* Enter a valid email address

* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our app now!!

]]>
How to Make the Most of Capital Gains Tax Exemptions https://eshcinsel.net/how-to-make-the-most-of-capital-gains-tax-exemptions/ Sat, 12 Mar 2022 13:09:10 +0000 https://eshcinsel.net/how-to-make-the-most-of-capital-gains-tax-exemptions/ Whether you are saving or investing, tax efficiency is an important aspect to consider as it can make a significant difference to your overall wealth and minimize the tax burden. Capital Gains Tax (CGT) is levied on gains realized after the sale, transfer, gift or exchange of certain assets. CGT is the amount, which is […]]]>

Whether you are saving or investing, tax efficiency is an important aspect to consider as it can make a significant difference to your overall wealth and minimize the tax burden. Capital Gains Tax (CGT) is levied on gains realized after the sale, transfer, gift or exchange of certain assets. CGT is the amount, which is the difference between the selling price and the buying price of any asset.

The tax generally applies to stocks, investment funds, secondary properties, sale of a business, inherited properties, valuable assets, assets transferred below market value and cryptocurrencies .

CGT in the UK depends on two things: whether the taxpayer is a base rate, top rate or additional rate taxpayer, and the type of asset being sold. If you are a higher or additional rate taxpayer, you must pay 28% on the gain from residential property and 20% on other taxable assets, and base rate taxpayers must pay 18% on residential property and 10% on other assets.

© 2022 Kalkine Media®

Tax experts are urging Britons to make the most of the capital gains tax relief before the April 5 deadline as CGT bills are set to rise. Savers can choose to hold their stock market-linked investments in an Individual Savings Account (ISA) or in tax-exempt retirement accounts. For the 2021/22 tax year the capital gain deduction is £12,300 meaning that if your gain is less than this amount in that tax year no capital tax must be paid.

Here are five ways to make the most of capital gains tax exemptions.

  1. Compensated losses

You can minimize your CGT liability by using losses to offset your gains in the same tax year. As CGT is calculated on the gains you make from selling assets, you can deduct your gain from the losses you incurred from selling other assets that have depreciated in value.

Additionally, you can carry forward unused losses from previous tax years to bring your gains back under the exemption limit, provided they are reported to HM Revenue & Customs (HMRC) within four years of the end of the tax year. tax year in which the assets were sold. When calculating CGT liability, you can also offset certain transaction costs such as attorney fees or realtor fees.

  1. Transfer of assets

If you are married or in a civil partnership you can use two sets of allowances totaling £24,600 as it is exempt from CGT meaning you can transfer assets to your partner, known as transfer between spouses to take advantage of the CGT exemption. .

There are often no transfer fees. You can contact your broker, platform or advisor to facilitate the transfer.

Read also : What are the best lifetime ISAs right now?

Use annual allowances

If you invest in assets beyond the ISA or retirement packages and hold the asset long-term without selling it, you can accumulate a huge CGT liability that will be taxed when you sell all of your holdings. This is also known as pregnancy gain.

To avoid this, try to use your allocation each year by giving away a portion of the asset to reduce the risk of incurring a large CGT liability in the future. The CGT allowance cannot be carried over to the following tax year.

The CGT allowance cannot be carried over to the following tax year.

© 2022 Kalkine Media®

  1. Using the ISA and Retirement Allowances

Profits made on assets held in ISA and retirement accounts are exempt from CGT, so it makes sense to use tax-advantaged retirement allowances and ISAs, especially for a higher-rate taxpayer. For the 2021/22 tax year the ISA allowance is £20,000 and for married couples and civil partners it is £40,000.

You may consider disposing of all of your assets to use the CGT exemption and then immediately redeeming the same assets inside the ISA account. This strategy is known as Bed and ISA or Bed and Pension.

Also read: 5 stock investing tips for female investors

  1. Invest in an Enterprise Investment Program (EIS)

You can consider reinvesting your capital gain in Enterprise Investment Scheme (EIS) companies which are exempt from CGT. EIS companies are small, unlisted and start-up companies and are therefore very risky and illiquid. In addition, investing in these companies comes with a 30% income tax credit. A CGT liability is only deferred when investing in EIS and recrystallizes when the ESI shares are sold, but it may be possible to continue to defer the liability.

]]>
Liberty Lake Says No to Local Income Tax | Washington https://eshcinsel.net/liberty-lake-says-no-to-local-income-tax-washington/ Wed, 02 Mar 2022 18:57:29 +0000 https://eshcinsel.net/liberty-lake-says-no-to-local-income-tax-washington/ (The Center Square) – Liberty Lake is the latest municipality to ban a local income tax, joining 11 other counties and 15 cities in Washington state. This brings to 27 the total number of municipalities that have rejected a local income tax. “City Council hereby declares that the imposition of a local income tax on […]]]>

(The Center Square) – Liberty Lake is the latest municipality to ban a local income tax, joining 11 other counties and 15 cities in Washington state. This brings to 27 the total number of municipalities that have rejected a local income tax.

“City Council hereby declares that the imposition of a local income tax on residents and businesses of the Town of Liberty Lake would be in direct conflict with the high value the town places on the promotion of economic development through the attraction and expansion of financially sound people, employers who pay the family wage”, Resolution No. 22-296approved by the board on Tuesday, reads in part.

“Small businesses are the backbone of our local, regional, state and national economy and it is imperative that the city does not put unnecessary obstacles in the way of their success. As such, the Liberty Lake City Council prohibits the imposition of a local income tax in the event that a local income tax is deemed lawful and authorized by the Supreme Court of the State of Washington or the Washington State Legislature.

Cowlitz, Lincoln, Kittitas, Asotin, Benton, Chelan, Douglas, Franklin, Grant, Spokane, and Yakima counties passed measures prohibiting local income taxes.

Liberty Lake – a city in Spokane County in eastern Washington – joins the cities of DuPont, Battle Ground, Benton, Granger, Grand Coulee, Longview, Kennewick, Moses Lake, Pasco, Richland, West Richland, Spokane, Spokane Valley , Union Gap, and Yakima by prohibiting local income taxes.

“I believe it is my duty to support the Washington State Constitution which clearly outlines revenue and taxation in Article VII,” said Liberty Lake Councilwoman Jamie Baird. Recount Jason Mercier, director of the Center for Government Reform at the Washington Policy Center. “As politicians and the courts redefine what constitutes an income tax, it is important that local jurisdictions uphold the will of those who overwhelmingly oppose any type of income tax.”

She defended the board’s decision.

“Some have accused those of us who support a local income tax ban of inventing a problem that doesn’t exist,” she said. “However, I firmly believe that good leadership is visionary and not reactionary. Our taxpayers and businesses cannot afford to wait and see what happens in Olympia; let’s be clear that we oppose local income taxes. This insurance will attract and retain good business, and it will reassure thousands of taxpayers that the City of Liberty Lake does not support the taxation of their income.

All but one of the municipalities that passed an income tax ban did so by elected vote. In 2021, 78% of Yakima City voters approved Proposition 3, a charter amendment prohibiting city officials from imposing a local income tax.

Meanwhile, a bill that would allow local governments to impose a graduated income tax has stalled in the state legislature. State law prohibits income tax, but Senate Bill 5554 would allow local governments, after reducing sales or property taxes, to create income taxes to fill the funding gap.

Several court cases contribute to this growing anti-tax movement.

In April 2020, the Washington State Supreme Court overturned Seattle’s attempt to impose an income tax on affluent households. In 2017, the city council approved a 2.25% tax on individuals earning over $250,000 and couples earning over $500,000.

Estimates showed that the tax would bring in about $40 million a year.

The King County Superior Court and State Court of Appeals ruled against the tax, and the Supreme Court denied the city’s request for review. The tax was rescinded on the grounds that income is considered property and the state constitution stipulates that property should be taxed evenly.

The Supreme Court, however, rested an appeals court ruling last year that struck down a 1984 law banning net income taxes. This decision allowed cities to impose a flat tax of 1% on net income.

Last year, the Democratic-controlled Legislature passed — and Gov. Jay Inslee signed into law — a capital gains tax aimed at the state’s wealthiest residents. The measure adds a 7% tax on capital gains over $250,000 a year, such as profits from stocks or business sales. Exceptions include the sale of real estate, livestock and small family businesses.

This law is currently being challenged, with Douglas County Superior Court Judge Brian Huber decision Tuesday afternoon, Washington State’s capital gains tax is unconstitutional.

That decision is expected to be appealed, with the state Supreme Court having the final say in the matter.


Spokane County Sheriff wants to raise some hiring bonuses to $25,000

]]>
Do your clients need an IFA to reduce inheritance tax? https://eshcinsel.net/do-your-clients-need-an-ifa-to-reduce-inheritance-tax/ Mon, 14 Feb 2022 15:24:38 +0000 https://eshcinsel.net/do-your-clients-need-an-ifa-to-reduce-inheritance-tax/ As Benjamin Franklin once said, “Nothing in this world is certain except death and taxes.”2 And for many Canadian business owners, that’s exactly what comes to mind. They have worked hard, built a thriving business, and hope to pass on the wealth to their children. But how do they do it in a tax efficient […]]]>

As Benjamin Franklin once said, “Nothing in this world is certain except death and taxes.”2 And for many Canadian business owners, that’s exactly what comes to mind.

They have worked hard, built a thriving business, and hope to pass on the wealth to their children. But how do they do it in a tax efficient way?

Step 1: Secure a whole life insurance policy

Whole life insurance policies have emerged as a powerful solution to this problem. After the death of the client, his assets are generally transferred to the heir, along with inheritance rights.

However, if a client owns a whole life policy, the impact of potential capital gains may be minimized by the death benefit and cash value. This gives beneficiaries a way to inherit while keeping most of the funds intact.

There’s only one catch: expensive bonuses.

Policies used for estate planning for high net worth individuals are often expensive. And even if clients can afford the policy, the cash flow drain may prevent an advisor from suggesting the strategy. Enter, the Immediate Financing Arrangement (IFA).

Step 2: Apply for an Immediate Funding Agreement (IFA)

An IFA is the missing piece of the puzzle. It allows the insured to borrow up to 100% of the premium as soon as the contract is set up.3 They can effectively add insurance to cover them – and optimize the estate plan – without negatively impacting their liquidity.

Let’s take a real-world example: Richard is a 75-year-old business owner with a wife and two adult children. He wants to pass the business on to his sons when he dies, but worries about the large capital gains that would be triggered when he dies. Moreover, he is reluctant to withdraw any capital from the company at this time.

To mitigate the potential tax bill, Richard purchases a company-owned whole life insurance policy with a premium of $500,000. He is then eligible to re-borrow the funds through an IFA – thereby structuring his estate and ensuring the business has enough capital to continue.

Step 3: Borrow 100% of the premium

After a quick underwriting process, Richard qualifies for an IFA of $500,000. There are no restrictions on the use of the funds, and apart from paying outstanding interest on the loan, the borrower must maintain the policy in good standing at all times. He can also ask to borrow additional premiums on an annual basis, if the need for capital persists.

The Fair Advantage

While IFAs are offered by several lenders, Equitable has gone further. We allow policyholders to access up to 100% of the premium, with no excess coverage! even if the cash value (CSV) of the policy is lagging. For example, the CSV might only be worth $350,000, but Steve would still qualify for $500,000 (the full bounty amount).3

Other benefits include:

  • Low minimum – only $50,000 annual premium required
  • A hassle-free process for additional credit limit increases
  • Easy to navigate underwriting and auction process – limited back and forth
  • Competitive rates and fees keep your costs low4
  • No capital due until the death of the insured5

Most importantly, we respect the advisor-client relationship. Our involvement is solely as a lender and our goal is to help advisors and clients achieve their financial goals.

Ready to refer? Provide your details and an expert will contact you shortly. Contact our team at wealthsolutions@eqbank.ca.

DOWNLOAD BROCHURE >

ACCESS THE NEWS RELEASE >


1 Equitable Bank does not provide tax or financial advice. Advisors should consult with their clients to discuss their unique tax situation and the tax-free benefits of a CDI.
2 NCC Staff, “Benjamin Franklin’s Last Great Quote and the Constitution,” National Constitution Center, November 13, 2021.
3 Subject to internal underwriting and discretion, the expected year-end cash value must equal at least 70% of the premium amount.
4 Rates are subject to change at any time.
5 Equitable Bank RV Line of Credit offers are demand credit facilities, which means that Equitable Bank may demand payment of all or part of the outstanding balance at any time.

]]>
What to choose in 2022? https://eshcinsel.net/what-to-choose-in-2022/ Sun, 13 Feb 2022 01:38:42 +0000 https://eshcinsel.net/what-to-choose-in-2022/ How to choose between the new and the old tax system? The new tax system differs from the old one in two respects. First, it has more slabs with lower tax rates. And second, all major exemptions and deductions available to taxpayers under the existing old tax system are disallowed if the new tax system […]]]>

How to choose between the new and the old tax system?

The new tax system differs from the old one in two respects. First, it has more slabs with lower tax rates. And second, all major exemptions and deductions available to taxpayers under the existing old tax system are disallowed if the new tax system is elected. “Therefore, if the benefit of lower rates in the new tax regime exceeds the benefit of exemptions and deductions available under the old tax regime, then the taxpayer can choose the new tax regime,” said Archit Gupta, Founder and CEO of Clear.

The main difference between the old and the new tax regime is the difference in slab rates. Taxpayers in India have to pay income tax based on the slab system under which they fall. The tax slab is designed by considering the average income of individuals. Thus, taxpayers with higher incomes will be likely to pay more taxes.

The possibility of reducing the tax is also an important difference between the old and the new tax system. No deductions are allowed under the new tax system, but a taxpayer has many options under the old tax system.

“While the new tax system provides the taxpayer with zero deduction or exemption options, the old tax system provides about 70 deductions and exemptions to reduce their taxable income. The deductions allow taxpayers to reduce the amount of tax by saving, investing or spending on specific items,” said Amit Gupta, MD, SAG Infotech.

Which tax regime is the best?

Archit Gupta, Founder and CEO – Clear said that in order to know which tax regime is best, the taxpayer must calculate the income tax to be paid at the applicable normal tax rates, i.e. at the old rates tax slab, after taking advantage of all eligible exemptions and deductions from their income. For example, salaried persons can claim exemption for LTA, HRA, standard deduction of 50,000. In addition, individuals are permitted to claim a deduction under Section 80C up to 1.5 lakh, home loan interest deduction, NPS contribution, etc.

In addition, the taxpayer must calculate the income tax to be paid according to the rates of the tax slab of the new tax regime. Now they can compare and choose the tax regime that suits them best, he added.

Choosing an old or new tax regime is entirely up to you and will depend on your income structure, available deductions and circumstances.

“If you want to choose the new tax system, you will have to forget all the tax deductions and exemptions that the old tax system provides,” said Amit Gupta,

Who should opt for the new and who should opt for the old?

The choice between tax regimes may depend on various factors such as current income level, income composition i.e. sources of income, investment appetite and savings habits, among other factors. Individuals will need to determine their tax liability under the old and new tax regimes before deciding which is more advantageous.

“The Income Tax Department has also developed an easy-to-use calculator that shows which scheme would benefit based on tax output. While deciding to choose between the old and the new tax regime, one should consider the pros and cons of both regimes in order to make a wise decision,” said Akash Kumar, Director and Co-founder of Fincorpit Consulting Private limited.

The decision to opt for a new tax regime or an old tax regime depends on the taxpayer.

“We have observed that most taxpayers benefit from the old regime when they maximize Section 80C and opt for the tax deductions and benefits available in their salary structure, such as applying for HRA, receiving part from the CTC in the form of reimbursement, etc. Only 10% of the total of the filers on Cleartax benefited from the old regime and opted for this one,” said Archit Gupta.

We also observe that the younger population, which has few tax investments, opts for the new tax system.

“Many taxpayers are opting for the new regime because they want to avoid locking in funds under Section 80C investments, which has a lock-in period. These taxpayers are choosing to invest in FDs rather than locking their assets into tax-saving options for 3-5 years,” said Amit Gupta.

Is it allowed to switch several times between the old and the new tax regime?

If you are an individual employee, you can make this choice each year. “People with income under ‘Salary’, ‘Home ownership’, ‘Capital gains’ and ‘Other sources’ can choose each year to switch between the old or the new tax regime. But people who have business or professional income have only one chance to return to the old regime after opting for the new tax regime. They can only choose the new tax regime once in their lifetime,” explained Archit Gupta.

To subscribe to Mint Bulletins

* Enter a valid email address

* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our app now!!

]]>
Your questions: Income tax | House held for more than two years classified as long-term fixed asset https://eshcinsel.net/your-questions-income-tax-house-held-for-more-than-two-years-classified-as-long-term-fixed-asset/ Tue, 08 Feb 2022 20:00:00 +0000 https://eshcinsel.net/your-questions-income-tax-house-held-for-more-than-two-years-classified-as-long-term-fixed-asset/ The cost of acquisition and improvement is indexed in the case of long-term fixed assets to take into account inflation over the years. By Chirag Nangia I had bought a property jointly with my father in 1987. We then invested Rs 1.6 lakh each. My father’s will gave his 50% share to my mother. My […]]]>

The cost of acquisition and improvement is indexed in the case of long-term fixed assets to take into account inflation over the years.

By Chirag Nangia

I had bought a property jointly with my father in 1987. We then invested Rs 1.6 lakh each. My father’s will gave his 50% share to my mother. My mother sold her 50% share to me in October last year for Rs 25 lakh. I had another property which was sold in 2021 and I used the capital gains to buy the 50% share of the property my mother sold to me. I now intend to sell the apartment at Rs 90 lakh and purchase a new property with the proceeds. How to avoid capital gains tax?
—C Srinivas

For tax purposes, real estate is classified as a long-term capital asset if it is held for a period longer than 24 months, otherwise it is considered a short-term capital asset. In order to calculate the capital gains, the cost of acquisition, the cost of improvement and the expenses (incurred entirely and exclusively in connection with the transfer) must be deducted from the sale price. The cost of acquisition and improvement is indexed in the case of long-term fixed assets to take into account inflation over the years. The Long Term Capital Gains Tax (LTCG) is 20% (including surcharge and disposal, if applicable). Short-term capital gains will be taxed at the applicable slab rates.

In addition, LTCG’s tax exemption on the transfer of residential property is permitted if you invest the capital gains either for the purchase of another residential property within one year before or two years after the date of transfer, or in the construction of another residential property. within three years from the date of transfer.

My mother, aged 75, took out a health card with the DGHS and paid Rs 78,000 this year. Is this amount eligible for an exemption under Section 80D?
—Girish Keswani

Section 80D provides for the deduction of the amount paid as a health insurance premium or any contribution made to the CGHS scheme or any other scheme notified by the central government in respect thereof or any payment made under a preventive health check. In addition, the elderly can claim a deduction of up to Rs 50,000 paid on the medical expenses they have incurred, if no amount has been paid as health insurance premium. Since the payment made by your mother does not fall into any of the above categories, the expenses cannot be deducted under section 80D.

The screenwriter is the director, Nangia Andersen India. Send your questions to fepersonalfinance@expressindia.com.

Financial Express is now on Telegram. Click here to join our channel and stay up to date with the latest Biz news and updates.

]]>
Capital Gains Tax Court hearing this Friday (2/4) » Publications » Washington Policy Center https://eshcinsel.net/capital-gains-tax-court-hearing-this-friday-2-4-publications-washington-policy-center/ Mon, 31 Jan 2022 15:22:28 +0000 https://eshcinsel.net/capital-gains-tax-court-hearing-this-friday-2-4-publications-washington-policy-center/ This Friday (2/4) at 10 a.m., Douglas County Superior Court will hold a summary judgment hearing on the capital gains tax passed last year. The State Supreme Court has consistently ruled that income is property and that a graduated/non-flat income tax is unconstitutional. Washington voters have rejected 10 consecutive income tax ballot measures (11 including […]]]>

This Friday (2/4) at 10 a.m., Douglas County Superior Court will hold a summary judgment hearing on the capital gains tax passed last year. The State Supreme Court has consistently ruled that income is property and that a graduated/non-flat income tax is unconstitutional.

Washington voters have rejected 10 consecutive income tax ballot measures (11 including non-binding advisory vote last year on SB 5096). These votes include Washingtonians who overwhelmingly reject six proposed constitutional amendments to allow for a progressive/non-informative income tax.

The attorney general asked the court to ignore and expunge from the record public records from the IRS and all state tax departments across the country depicting a capital gains tax as an income tax. . I understand that these public capital gains income tax records may be an inconvenient truth to the Attorney General, but the facts are the facts, even if the state wants to hide them from the court record.

TVW plans to Live Stream Friday’s Capital Gains Income Tax Court Hearing.

General case information
Final Briefs Filed in Capital Gains Income Tax Lawsuit – Hearing Date February 4
Attorney General Can’t Handle The Truth About Capital Gains Taxes
First Amicus Brief Filed in Capital Gains Income Tax Case
Capital Gains Tax Quotes – Who Said It?
Capital Gains Income Tax Interview with University of Washington Tax Expert Professor Schumacher
Tax Foundation: Why Washington State Can’t Declare Its Capital Gains Tax Excise Tax

A Capital Gains Tax IS an Income Tax: Irrefutable Proof in About Two Minutes (video)


Join the WPC Newsletter









]]>
Gee & Ursula: Is it time to impose an income tax in Washington State? https://eshcinsel.net/gee-ursula-is-it-time-to-impose-an-income-tax-in-washington-state/ Sat, 22 Jan 2022 16:05:45 +0000 https://eshcinsel.net/gee-ursula-is-it-time-to-impose-an-income-tax-in-washington-state/ Is it time to impose income tax in Washington State? State Senator Bob Hasegawa wants to do it. Capital gains tax, minimum wage increase among new laws coming into force in 2022 A concern many people have had about an income tax in Washington is that there is already a sales tax in the state […]]]>

Is it time to impose income tax in Washington State? State Senator Bob Hasegawa wants to do it.

Capital gains tax, minimum wage increase among new laws coming into force in 2022

A concern many people have had about an income tax in Washington is that there is already a sales tax in the state and people don’t want to pay “double taxes”. But Senator Hasegawa’s proposal would require a minimum 75% cut on all sales, utilities or property and B&O taxes at the same time.

“When it comes to income tax, I’ve always said I’d rather do income tax than all these other dink and dunk taxes that we do – really extremely high sales tax, all that “said host Gee Scott. “But for some reason there seems to be this fight to get away from that, and I just don’t understand why. I think so much would be done in this state if we only had a simple income tax.

“Now I know that’s not a popular opinion,” he added. “I’m from the state of Illinois, and so being here, being in a place where there’s no state income tax — but I still feel like we end up by paying more in other ways.”

State House passes 18-month deadline for long-term care tax

Guest host Aaron Mason says the tax argument is tricky.

“People seem to be very passionate, on the opposite side in particular, and part of me understands that,” he said. “They don’t want their money taken and thrown away, misused, spent lightly, and I don’t disagree with that. The problem is, from where I stand, I think taxes are a necessity.

“We all live in a community,” he continued. “Whether we like it or not, we’re all part of a bigger group. And this group needs certain basic necessities to function, and I believe it’s the role of the government to take care of those things, to manage those things – the way you pay for that is through taxes.

He says we all contribute a little based on what we have and it pays for the things we all use.

“I pay taxes for schools,” he said as an example. “I vote to approve like any school budget. I don’t go to school, I don’t have children, but for me it’s a good investment in my community because education is a good investment.

Aaron also acknowledged that there is an argument that an income tax is unconstitutional in Washington state.

“I’m not a constitutional lawyer, I can’t talk about that,” he said. “But for me, that’s no reason not to do something or at least look into it and maybe fix it. Just because it’s always been the case doesn’t necessarily mean it’s the best thing to do.

Producer Andrew Lanier is in favor of an income tax and thinks this Hasegawa proposal is unique, but cannot support it as is.

“I have to dig a little deeper into the details, but as I read, as long as you reduce a sales tax, utility tax, property tax, or B&O tax by at least 75%, then your city could start implementing an income tax,” he said. “Unless it’s statewide, and unless you say remove the sales tax period, here’s what’s going to happen: you’ll have an exodus of people from cities with taxes on the high income to areas without income tax. Then you’re stuck with no tax base and those people, who by the way are supposed to benefit from it, you’re still going to pay 3 to 5 cents, depending on where you live, on your sales tax.

“I don’t want two taxes, period. It has to be sales or revenue,” he added. “This state would repeal the state law that constitutionally prohibits income taxes, and I think that needs to be done. But I think the devil is in the details with this one.

Listen to the Gee and Ursula Show weekday mornings from 9 a.m. to 12 p.m. on KIRO Radio, 97.3 FM. Subscribe to the podcast here.

]]>
How much can you earn before paying federal income tax? https://eshcinsel.net/how-much-can-you-earn-before-paying-federal-income-tax/ Thu, 20 Jan 2022 21:27:00 +0000 https://eshcinsel.net/how-much-can-you-earn-before-paying-federal-income-tax/ MOST Americans earn the first part of their money entirely tax free through a standard deduction. This ensures that taxpayers have at least some income that is not subject to federal income tax. 1 Whether you should file depends on your age, filing status, income level and source of income The amount you can get […]]]>

MOST Americans earn the first part of their money entirely tax free through a standard deduction.

This ensures that taxpayers have at least some income that is not subject to federal income tax.

1

Whether you should file depends on your age, filing status, income level and source of income

The amount you can get depends on filing status and age, and blind people also get an additional amount.

Below we explain what you need to know.

What are standard deductions?

Standard deductions generally change each year as wages increase with inflation.

The amounts below are for 2021 tax returns due April 18, 2022.

Single filing status

  • $12,550 if under 65
  • $14,250 if age 65 or over

Married filing jointly

  • $25,100 if both spouses are under age 65
  • $26,450 if one spouse under age 65 and one age 65 or over
  • $27,800 if both spouses are 65 or older

Groom filing separately

  • $12,550 if under 65
  • $14,250 if age 65 or over

head of household

  • $18,800 if under 65
  • $20,500 if age 65 or older

Eligible widow(ers) with dependent children

  • $25,100 if under 65
  • $26,450 if age 65 or older

For the 2022 tax year, the standard deduction for most couples will increase to $25,900, up $800 from this year.

And for most single filers, the threshold will jump to $12,950, an increase of $400.

Who does not benefit from a standard deduction?

It is important to note that some taxpayers are not entitled to the standard deduction.

This includes a married single filing as a separately married filing whose spouse details deductions.

It also includes an individual who was a nonresident alien or dual status alien during the year.

People filing for less than 12 months due to a change in their annual accounting period also do not receive one.

Also, an estate or trust, mutual trust fund or partnership will not get one either.

Who must file a tax return?

Whether you need to file a tax return depends on your age, filing status, income level, and source of income.

If your 2021 gross income exceeds the standard deduction, you must file a federal income tax return.

You will also need to know your gross income.

The IRS defines gross income as all income you receive in the form of money, property, goods, and services.

This includes income from outside the United States, the sale of stock, a business, and the sale of your home.

Deposit requirements for dependents

Even if a person is declared as a dependent on another person’s tax return, the person will generally have to file their own tax return if the person’s total income is more than the standard deduction.

In the following, earned income includes salaries, wages, tips, professional fees, and taxable scholarships and fellowships.

While unearned income includes taxable interest, ordinary dividends, capital gains distributions, unemployment benefits, taxable social security benefits, pensions, annuities, and distributions from a trust.

Single dependents under the age of 65 and who are not blind must file a declaration if any of the following apply.

  1. Your unearned income was more than $2,800 ($4,500 if you are 65 or older) and blind).
  2. Your earned income was more than $14,250 ($15,950 if you are 65 or older) and blind).
  3. Your gross income was greater than the greater of—
    1. $2,800 ($4,500 if age 65 or older) and blind), or
    2. Your earned income (up to $12,200) plus $2,050 ($3,750 if you’re 65 or older) and blind).

Married dependents under the age of 65 and who are not blind must file a declaration if any of the following apply.

  1. Your gross income was at least $5 and your spouse files a separate return and details the deductions.
  2. Your unearned income was more than $2,450 ($3,800 if you are 65 or older) and blind).
  3. Your earned income was more than $13,900 ($15,250 if you are 65 or older) and blind).
  4. Your gross income was greater than the greater of—
    1. $2,450 ($3,800 if age 65 or older) and blind), or
    2. Your earned income (up to $12,200) plus $1,700 ($3,050 if 65 or older and blind).

You can find full details of income requirements on the IRS website.

What if you received social security benefits?

Whether you receive Social Security benefits will depend on a few factors to determine whether you need to file a tax return.

For the 2021 tax year, unmarried seniors will generally need to file a return if the person is at least 65 years old and their gross income is $14,250 or more.

If the person is married and wants to file a joint return with a spouse who is also 65 or older, they must file a return if their combined gross income is $27,800 or more.

In most cases, if a person only receives Social Security benefits, they will have no taxable income and will not need to file a tax return.

You may want to submit a tax return to claim a tax refund

Even if you are not required to file a tax return, you may still be eligible for a refund.

So it is something to consider before deciding whether or not you will file this year.

Refunds are available for W-2 employees, who are usually salaried workers, and others who had tax deducted from their pay during the year.

The government also offers a few tax credits for low-income and senior citizens that can earn you money at tax time.

It is important to know that the IRS does not automatically issue refunds without a tax return.

Therefore, if you wish to claim a refund of tax owed to you, you must file one.

The Sun also explains when tax refunds will be released in 2022 and key tax changes for 2022.

Plus, here are five ways to increase your tax refund.

How the Child Tax Credit Boost Could Happen to Parents in 2022

We pay for your stories!

Do you have a story for The US Sun team?

]]>