What is the new due date for our taxes this year?

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Because of the COVID-19 Virus disruption, the Government has extended the due date for paying taxes in 2020. The Federal due date to pay any tax due has been extended 3 months, to July 15. 

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Taxpayers are encouraged to file by April 15, because if they are due a refund, they can receive it during this economically challenged time. Taxpayers can still file a six-month Extension to file, but are still required to estimate and pay any taxes due by the due date.

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States are making their own decisions as to due dates. California has extended the date to June 15 for both filing and payment. 

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If I sell my house, by what date do I need to buy a new home?

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This is an old rule about real estate taxes. In order to avoid paying capital gains tax, sellers needed to purchase a new home within two years. There is no longer any rule about buying a new home.

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Instead, if you have lived in your home longer than two of the past three years, you are entitled to exclude $250,000 in gains, and only pay tax on any gain over that amount. That is $500,000 per couple. Remember that gain is calculated by subtracting your payments into the home.

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Also, Capital Gains tax for many people is one of the lowest rates available. Long Term Capital Gains is  0%, 15% or 20%, depending on your income and filing status.

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Can I write off the use of my vehicle if I have a sign on it?

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The business use of your vehicle for tax purposes has nothing to do with the sign on your vehicle. It is calculated by finding the ratio of business use to private use, by keeping track of the miles driven for business. The IRS wants to see this kept track of in writing. 

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Then this percentage is used to calculate standard mileage or actual expenses (gas, insurance, repairs).

 

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More questions? Contact me below, or by phone.  818-970-9491