How to Pay Zero Taxes, 2003

by Schnepper, Jeff A.

• ISBN13: 9780071407366
• ISBN10: 0071407367
• Edition: 20th
• Format: Paperback
• Copyright: 2002-12-01
• Publisher: McGraw-Hill

Summary

Includes all the latest updates and changes to the 2002 tax code

""Might very well be the IRS's worst nightmare. . . . If there's a tax break allowed out there, it's in here."--"New York Daily News

"Publishers Weekly called it "a can't-miss title." The "New York Daily News praised it for "pushing the envelope" and taking "a consumerist approach that's helpful during all the other months before next April." Best of all, more than half a million people have consulted "How to Pay Zero Taxes for solid guidance on paying less to the IRS.

This fully updated 20th edition contains all the latest tax changes and delivers more tax-saving tips than any other guide. It outlines the easiest, most practical strategies consumers can use to lower their taxes this year, next year, and beyond--by focusing on hundreds of legal ways to preserve pretax income and profit.

Author Biography

Jeff A. Schnepper is the author of several books on finance and taxation, He is a financial, tax, and legal advisor and runs a full-time accounting and legal practice in Cherry Hill, New Jersey. Mr. Schnepper also writes a column for Microsoft's online personal finance website, MSN MONEY, and is tax counsel

Table of Contents

Preface	p. xv
Is It Legal?	p. 1
How Our Tax System Works	p. 11
Exclusions--Tax-Free Money	p. 17
Alternatives to "Earned Income"	p. 19
Hospitalization Premiums	p. 19
Group Life Insurance Premiums	p. 20
Group Legal Services Plans	p. 23
Accident and Health Plans	p. 23
Employee Death Benefits	p. 24
Merchandise Distributed to Employees on Holidays	p. 24
"Expenses of Your Employer"	p. 25
Meals and Lodgings	p. 25
Employee Discounts	p. 27
Workers' Compensation	p. 27
"Cafeteria" Plans	p. 28
Dependent Care Assistance Program	p. 28
Employer Educational Assistance	p. 30
Employee Awards	p. 30
Clergy Housing Allowance	p. 33
Miscellaneous Fringe Benefits	p. 33
Donative Items	p. 34
Gifts, Bequests, and Inheritances	p. 34
Scholarships and Fellowships	p. 35
Prizes and Awards	p. 38
Investors	p. 39
Interest on State and Municipal Obligations	p. 39
Benefits for the Elderly	p. 40
Public Assistance Payments	p. 40
Social Security and Other Retirement Benefits	p. 40
Annuities	p. 43
Sale of Your Home	p. 46
Buying Your Own Home--Twice!--The Schnepper Bootstrap	p. 49
Miscellaneous Individual Exclusions	p. 50
Carpool Receipts	p. 50
Damages	p. 50
Divorce and Separation Arrangements	p. 53
Life Insurance	p. 56
Qualified State Tuition ([section]529) Programs	p. 58
Schedule of Excludable Items	p. 68
Credits--Dollar-for-Dollar Tax Reductions	p. 71
Estimated Tax and Withholding Exemptions	p. 72
Credits	p. 76
The Earned Income Credit	p. 76
Excess Social Security Tax	p. 79
The Child and Dependent Care Credit	p. 79
Child Care Credits for Children of Divorced or Separated Parents	p. 81
Credit for the Elderly or Permanently and Totally Disabled	p. 86
Credit for Interest Paid on Mortgage Credit Certificates	p. 88
Special Credits	p. 89
Work Opportunity Credit (Formerly Targeted Jobs Tax Credit)	p. 89
Welfare to Work Credit	p. 90
Research Tax Credit	p. 90
Orphan Drug Tax Credit	p. 91
Adoption Assistance	p. 91
Hope Scholarship Credit	p. 93
Lifetime Learning Credit	p. 93
Child Tax Credit	p. 93
District of Columbia--First Time Homebuyer	p. 94
Disability Credits	p. 95
Health Insurance Credit	p. 95
Saver's Credit	p. 96
Small Employer Credit	p. 97
"Above the Line" Deductions	p. 99
Deductions for Adjusted Gross Income	p. 103
Trade and Business Deductions	p. 103
Employee Business Expenses of Actors and Other Performing Artists	p. 104
Employee Business Expenses	p. 104
Alimony	p. 105
Interest on Qualified Education Loans	p. 113
Retirement Plan Payments	p. 114
Self-Employment Tax	p. 157
Health Insurance Deduction for Self-Employeds	p. 157
Moving Expenses	p. 158
Clean Fuel Vehicles	p. 166
Deduction for Qualified Higher Education Expenses	p. 166
"Below the Line" Deductions	p. 167
The Importance of Filing Status	p. 168
Tax Planning with Itemized Deductions	p. 173
Medical Expenses	p. 173
Income Taxes	p. 190
Real Property Taxes	p. 191
Personal Property Taxes	p. 193
Interest	p. 193
Charitable Contributions	p. 217
Casualty Losses	p. 239
Theft Losses	p. 244
Miscellaneous Trade and Business Deductions of Employees	p. 252
Travel Expenses	p. 252
Transportation Expenses	p. 258
Meals and Entertainment Expenses	p. 262
Gifts	p. 263
Reimbursable Employee Business Expenses	p. 265
Educational Expenses	p. 266
Limit on Itemized Deductions	p. 266
Schedules of Deductions	p. 267
Medical Deductions	p. 267
Deductible Taxes	p. 268
Charitable Deductions	p. 269
Casualty and Theft Loss Deductions	p. 270
Miscellaneous Deductions	p. 271
Employee Miscellaneous Deductions	p. 271
Investor Deductions	p. 272
Traditional Tax Shelters	p. 275
Deferral and Leverage	p. 292
Real Estate	p. 292
Fees in Public Real Estate Partnerships	p. 305
Oil and Gas	p. 305
Equipment Leasing	p. 315
Single-Premium Life Insurance	p. 319
Cattle Feeding Programs	p. 323
Cattle Breeding Programs	p. 325
Tax Straddles	p. 327
Art Reproduction	p. 329
Noncash Gift Shelters	p. 330
Municipal Bond Swaps	p. 331
How to Analyze a Tax Shelter	p. 332
Getting Out of the Tax Shelter	p. 334
Master Limited Partnerships	p. 335
Super Tax Shelters	p. 339
Family Shifts	p. 340
Unearned Income of Minor Children	p. 343
Outright Gifts	p. 347
Clifford Trusts	p. 351
Interest-Free Loans	p. 352
The Schnepper Shelter: Gift Leasebacks	p. 352
The Schnepper Deep Shelter	p. 358
Family Partnerships	p. 359
Family Trusts	p. 359
Employing Members of the Family	p. 360
Author's Delight	p. 362
Running Your Own Business	p. 363
Your Home	p. 366
Your Car	p. 378
Meals and Entertainment	p. 381
Travel and Vacation	p. 385
Gifts	p. 391
Advertising	p. 392
Deductible Clothes	p. 392
Creative Deductions--Busting the IRS	p. 392
Medical Premiums	p. 393
Borrowing from Your Company	p. 393
Lending to Your Company	p. 396
Miscellaneous Corporate Advantages	p. 397
Investment Planning to Save Taxes	p. 401
Short Sales	p. 406
Broad-Based Index Options and Regulated Futures Contracts (RFCs)	p. 407
Wash Sales	p. 407
Premiums on Taxable and Tax-Exempt Bonds	p. 408
Original Issue Discount (OID)--Taxable Bonds	p. 408
Original Issue Discount (OID)--Tax-Exempt Bonds	p. 408
Market Discount	p. 409
Municipal Bond Swaps	p. 409
Employee Options--Non-Qualified	p. 410
Incentive Stock Options	p. 411
Year-End Stock Sales	p. 416
Fund Strategies	p. 416
Tax-Exempt Income	p. 417
Special Report	p. 419
Old Prices	p. 420
Alternative Minimum Tax for Individuals	p. 420
U.S. Savings Bond Exclusion	p. 432
Last-Minute Tax Planning	p. 437
Defer Taxes	p. 438
Accelerate Expenses	p. 440
Accelerate Special Deductions	p. 441
Dependents and Personal Exemptions	p. 441
Phaseout of Exemptions	p. 445
Timing Strategies	p. 445
Retirement Plans	p. 446
Individual Retirement Plans (IRAs)	p. 446
H.R. 10 or Keogh Plans	p. 447
Marital Status	p. 448
The Goldinger Deferral	p. 449
The Attorneys' and Accountants' Relief Act of 1993	p. 451
Training and Investment Provisions	p. 453
Investment Incentives	p. 454
Expansion and Simplification of Earned Income Tax Credit	p. 455
Real Estate Provisions	p. 455
Miscellaneous Provisions	p. 457
Revenue-Raising Provisions	p. 458
Business Provisions	p. 464
Stealth Tax Reform	p. 467
The New Taxpayer Bill of Rights	p. 468
Personal Responsibility and Work Opportunity Reconciliation Act of 1996, HR 3734	p. 472
The Health Insurance Portability and Accountability Act of 1996, HR 3103	p. 473
The Small Business Job Protection Act of 1996, HR 3448	p. 477
Tax Relief for Bosnian Effort	p. 489
Tax Reform--Again!	p. 491
The Mind-Numbing Complexity of the Tax Reconciliation Act of 1997, Also Known as the Taxpayer Relief Act of 1997	p. 492
The Internal Revenue Service Restructuring and Reform Act of 1998	p. 503
IRS Reorganization	p. 504
IRS Governance and Oversight Changes	p. 504
Extension of Attorney-Client Privilege to Tax Advice	p. 506
Burden of Proof Shifted to IRS in Certain Civil Tax Cases	p. 507
Taxpayer Rights	p. 507
Roth IRA Conversion/Loophole	p. 509
Capital Gains	p. 509
Venture Capital	p. 510
Home Sales Clarification	p. 510
Conclusion	p. 511
The Economic Growth and Tax Relief Reconciliation Act of 2001	p. 513
Marginal Rate Reductions	p. 514
Tax Benefits Relating to Children	p. 519
Marriage Penalty Relief Provisions	p. 520
Education Incentives	p. 523
Pension and Individual Retirement Arrangement Provisions	p. 527
AMT Relief	p. 535
Health Insurance for Self-Employed	p. 535
Income Tax Treatment for Certain Restitution Payments to Holocaust Victims	p. 535
Estate, Gift, and Generation-Skipping Transfer Tax Provisions	p. 536
Sunset	p. 541
The Job Creation and Worker Assistance Act of 2002	p. 545
Bonus Depreciation	p. 546
Net Operating Losses	p. 546
Classroom Materials	p. 546
Electric Vehicle Credit	p. 546
Work Opportunity Tax Credit	p. 547
Welfare to Work Tax Credit	p. 547
Archer Medical Savings Allowance	p. 547
Liberty Zone Benefits	p. 547
How to Avoid/Survive an IRS Audit	p. 549
Cost Recovery/Depreciation	p. 649
Law Prior to the Tax Reform Act of 1986	p. 663
Law After March 14, 1984 (Real Estate)	p. 667
Business Use of "Listed Property"	p. 679
Auto Leases	p. 687
Index	p. 737
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