FAQ | Carroll Tax Firm

COMMON QUESTIONS

Oct 20, 2020
1 min

How can my non-working spouse save for retirement?

As long as 1 spouse has earned (non-passive) income, then the working spouse can contribute to an IRA in the name of the non-working spou...

Do I have to report money I inherited on my income tax return?

Dennis Carroll

Feb 13, 2020
1 min

Do I have to report money I inherited on my income tax return?

No, but if you put that money into a bank account that earns interest then you'll report the interest income. If you stuff that money in yo

How does the IRS catch your cash-only side business?

Dennis Carroll

Feb 10, 2020
1 min

How does the IRS catch your cash-only side business?

If a client pays you more than $600, they are supposed to file a 1099-MISC with the IRS. Now maybe that 1099-MISC never made it to you bec

Can I deduct fees paid for my kid's sports team?

Dennis Carroll

Feb 4, 2020
1 min

Can I deduct fees paid for my kid's sports team?

Maybe. If your kid is under age 13 and his participation during team practices/games is meant to allow you to work, then you could deduct u

Can I deduct the new roof I put on my house?

Dennis Carroll

Jan 28, 2020
1 min

Can I deduct the new roof I put on my house?

"Can I deduct the new roof I put on my house?" Yes, this credit ("deduction") was reinstated recently for 2019 and 2018 after not being all

"I raided my retirement account to buy a house, what does this do to my taxes?"

Dennis Carroll

Jan 21, 2020
1 min

"I raided my retirement account to buy a house, what does this do to my taxes?"

Depends on the type of retirement account, how much you took out, and if you're considered a first-time homebuyer. A 401K withdrawal will

"I bought my first house; how does this change my taxes?"

Dennis Carroll

Jan 17, 2020
1 min

"I bought my first house; how does this change my taxes?"

Depends on whether you're married or sharing the house expenses or buying alone. If you bought the house alone, and the local property taxe

Did the required minimum distribution [RMD] age for retirement accounts change?

Dennis Carroll

Jan 14, 2020
1 min

Did the required minimum distribution [RMD] age for retirement accounts change?

Yes, if you turn age 70.5 in 2020 or later, then your RMD age is now 72. You can also contribute to your traditional IRA now, if you're sti

Why do I have to pay income taxes but Amazon doesn't?

Dennis Carroll

Dec 27, 2019
1 min

Why do I have to pay income taxes but Amazon doesn't?

Income tax is owed on net profit; which is sale proceeds minus expenses. Amazon had a few expense categories that were very large.

How many personal days can I use in my rental property before it affects my tax return?

Dennis Carroll

Dec 26, 2019
1 min

How many personal days can I use in my rental property before it affects my tax return?

A personal use day is any day that you're using the property or anyone else is using the property for less than a fair rental price. (Or yo

How much does the government really need my income taxes?

Dennis Carroll

Dec 20, 2019
1 min

How much does the government really need my income taxes?

For fiscal year 2018, the federal government relied on federal income taxes as 51% of its total revenue of $3.3T. Payroll taxes, which are

Does my child need to file an income tax return if they only had a summer job?

Dennis Carroll

Dec 12, 2019
1 min

Does my child need to file an income tax return if they only had a summer job?

Does my child need to file an income tax return if they only had a summer job? Your child will need to file a federal income tax return (10

Will my retirement payments be taxed in my employer's state if I move to another state?

Dennis Carroll

Dec 12, 2019
1 min

Will my retirement payments be taxed in my employer's state if I move to another state?

Will my retirement payments be taxed in my employer's state if I move to another state? No, retirement plan payments will be taxed in the s

Do I get a tax credit for putting energy efficient products on my house?

Dennis Carroll

Dec 10, 2019
1 min

Do I get a tax credit for putting energy efficient products on my house?

Yes, but only the following products: solar electric property, solar water heaters, geothermal heat pumps, and small wind turbines.

When does the IRS consider a business activity a hobby?

Dennis Carroll

Dec 9, 2019
1 min

When does the IRS consider a business activity a hobby?

Generally, a business activity will be considered a hobby when it doesn't look like you intend to make a profit. The IRS will look at the "

Can I claim my parent or adult child as a dependent?

Dennis Carroll

Dec 6, 2019
1 min

Can I claim my parent or adult child as a dependent?

Yes, but their taxable income must be less than $4,200 in 2019 and you must pay for more than 50% of their total support. In this test, "

How do I file taxes for a deceased family member?

Dennis Carroll

Dec 4, 2019
2 min

How do I file taxes for a deceased family member?

Income earned by a deceased family member from January 1st through the day of their death will be reported on their final individual income

Should I take the standard mileage deduction or actual expenses for the business use of my car?

Dennis Carroll

Dec 2, 2019
1 min

Should I take the standard mileage deduction or actual expenses for the business use of my car?

The easy answer is "it depends". And you won't know until December 31st when you've tallied a year's worth of expenses and mileage. An older

Can I deduct the part of my house where I work (my home office)?

Dennis Carroll

Nov 27, 2019
1 min

Can I deduct the part of my house where I work (my home office)?

Yes, but that part of your house must be used exclusively & regularly for your own business. You can either deduct $5 per square foot of you

Can I contribute to my retirement account after age 70.5?

Dennis Carroll

Nov 26, 2019
1 min

Can I contribute to my retirement account after age 70.5?

Not to a traditional IRA unless you're rolling over from another retirement account into the traditional IRA. You can contribute to a Roth

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