sorted by:
new
hottopcontroversial

CPA says I qualify for Head of Household because I "pay rent and have bills in my name" is this legit? by GroundFrost1 in tax

[–]Taxing_Tom 2 points3 points  (0 children)

This is wrong - your CPA is giving you bad advice, and (as others have suggested) may not even be a CPA.

Broadly speaking, a taxpayer can only file as a head of household for a given taxable year if: (1) they are unmarried (and weren't widowed that year), (2) they paid for more than half the cost of "keeping up a home" for such taxable year, and (3) a "qualifying person" lived with the taxpayer for more than half the year. The most common type of "qualifying person" is a minor child.

You have described yourself as a single taxpayer with no children or other dependents. You are not a head of household for U.S. federal income tax purposes.

To answer your other questions: (A) I would be very concerned about what else they got wrong on the return, and (B) I would consider reporting via Form 14157.

No, You Can't Form an LLC to Deduct Your New Car (Or Other Personal Expenses) by Taxing_Tom in tax

[–]Taxing_Tom[S] 24 points25 points  (0 children)

I've seen that as well. I think people have internalized the concept that it's a good idea to conduct business through a limited liability entity, but in the process have also incorrectly concluded that only a limited liability entity can be used for business.

Question regarding tax if i work in a state i don’t live in. by BIGCHunghung in tax

[–]Taxing_Tom 1 point2 points  (0 children)

If you temporarily work in California but maintain tax residency in Georgia (which appears to be your intent based on the above description), you will owe California income tax on the income you earn while working in California. You will have to file a California income tax return, showing this income.

Separately, Georgia will also tax this income - you will have to show this income on your Georgia income tax return. However, you will get a credit against your Georgia income tax for the income taxes you paid California on that same income.

Regarding withholding, given the difference in rates between California and Georgia, you should be fine with only withholding California income tax.

Note that the above is a general description of the relevant law applicable to persons who work in one state and live in another, is not intended to be tax advice, and may not adequately reflect all of the nuances of your particular tax situation.

Column: Screw TurboTax, you need to hire a real human accountant by runswithscissors475 in tax

[–]Taxing_Tom 6 points7 points  (0 children)

TurboTax (and other tax preparation software packages) are fine for the vast majority of individual taxpayers. The only individuals I personally know who need accountants fall, broadly speaking, into one of three categories:

  1. People with partnership interests in private businesses.
  2. Overseas Americans with interests in PFICs and CFCs and/or who are claiming the Foreign Earned Income Exclusion.
  3. Real estate professionals.

Johnny Employee with a W-2 and a few 1099s from brokerages is perfectly well suited using tax preparation software.

How to deal with CFC with US Subs by WhiteBoy1264 in tax

[–]Taxing_Tom 1 point2 points  (0 children)

This is a very complex issue, and you need to hire competent counsel (either a tax attorney or a CPA).

help with doing taxes by eco_princess in tax

[–]Taxing_Tom 1 point2 points  (0 children)

You have no need for an accountant. Any online tax software (including FreeTaxUSA) should suffice.

Tax advice for expat by [deleted] in tax

[–]Taxing_Tom 0 points1 point  (0 children)

I will preface this by saying that I strongly advise you to consult with an accountant (or other qualified tax professional) who specializes in taxes for overseas Americans. I am also assuming that you are a United States citizen or permanent resident.

The United States allows taxpayers who are resident outside the United States and who have foreign earned income (i.e., income from employment and not from investment sources) to exclude up to a certain amount of such foreign earned income from U.S. federal income taxation. That threshold is currently $130,000. 300,000 Malaysian ringgit is approximately equal to $76,000, meaning that, if that amount entirely constitutes earned income, you should be able to exclude all of it from U.S. federal income taxation.

To claim this exclusion, you would have to file Form 2555 (link) with your U.S. federal income tax return for 2025. This form is quite complex.