How to Pay Zero Taxes, 2005

by Schnepper, Jeff A.

• ISBN13: 9780071441001
• ISBN10: 007144100X
• Edition: 22nd
• Format: Paperback
• Copyright: 2004-11-22
• Publisher: McGraw-Hill

Summary

How to Pay Zero Taxes for solid guidance on paying less to the IRS. This fully updated 22nd edition contains: The latest tax changes More tax-saving tips than any other guide Easy, practical strategies to lower taxes this year, next year, and beyond Hundreds of legal ways to preserve pretax income and profit.

Table of Contents

Preface	xv
Is It Legal?	1	(6)
How Our Tax System Works	7	(6)
Exclusions---Tax-Free Money	13	(56)
Alternatives to ``Earned Income''	15	(15)
Hospitalization Premiums	15	(1)
Group Life Insurance Premiums	16	(3)
Group Legal Services Plans	19	(1)
Accident and Health Plans	19	(1)
Employee Death Benefits	20	(1)
Merchandise Distributed to Employees on Holidays	20	(1)
``Expenses of Your Employer''	21	(1)
Meals and Lodgings	21	(2)
Employee Discounts	23	(1)
Workers' Compensation	23	(1)
``Cafeteria'' Plans	24	(1)
Dependent Care Assistance Program	24	(2)
Employer Educational Assistance	26	(1)
Employee Awards	26	(3)
Clergy Housing Allowance	29	(1)
Miscellaneous Fringe Benefits	29	(1)
Donative Items	30	(6)
Gifts, Bequests, and Inheritances	30	(1)
Scholarships and Fellowships	31	(3)
Prizes and Awards	34	(2)
Investors	36	(1)
Interest on State and Municipal Obligations	36	(1)
Benefits for the Elderly	37	(7)
Public Assistance Payments	37	(1)
Social Security and Other Retirement Benefits	37	(3)
Annuities	40	(3)
Sale of Your Home	43	(1)
Miscellaneous Individual Exclusions	44	(23)
Carpool Receipts	44	(1)
Damages	45	(2)
Divorce and Separation Arrangements	47	(4)
Life Insurance	51	(2)
Qualified State Tuition (§529) Programs	53	(12)
Your Home---The Mother of All Tax Shelters!	65	(2)
Schedule of Excludable Items	67	(2)
Credits---Dollar-for-Dollar Tax Reductions	69	(26)
Estimated Tax and Withholding Exemptions	70	(3)
Credits	73	(13)
The Earned Income Credit	73	(3)
Excess Social Security Tax	76	(1)
The Child and Dependent Care Credit	77	(1)
Child Care Credits for Children of Divorced or Separated Parents	78	(6)
Credit for the Elderly or Permanently and Totally Disabled	84	(2)
Special Credits	86	(9)
Work Opportunity Credit (Formerly Targeted Jobs Tax Credit)	86	(1)
Welfare to Work Credit	87	(1)
Research Tax Credit	87	(1)
Orphan Drug Tax Credit	87	(1)
Adoption Assistance	88	(2)
Hope Scholarship Credit	90	(1)
Lifetime Learning Credit	90	(1)
Child Tax Credit	90	(1)
Disability Credits	91	(1)
Health Insurance Credit	92	(1)
Saver's Credit	92	(1)
Small Employer Credit	93	(1)
Electric Vehicle Credit	94	(1)
``Above the Line'' Deductions	95	(74)
Deductions for Adjusted Gross Income	99	(70)
Trade and Business Deductions	99	(1)
Employee Business Expenses of Actors and Other Performing Artists	100	(1)
Employee Business Expenses	101	(1)
Alimony	101	(9)
Interest on Qualified Education Loans	110	(1)
Retirement Plan Payments	110	(49)
Self-Employment Tax	159	(1)
Health Insurance Deduction for Self-Employeds	159	(1)
Moving Expenses	160	(7)
Clean Fuel Vehicles	167	(1)
Deduction for Qualified Higher Education Expenses	168	(1)
Legal Fees	168	(1)
Classroom Materials	168	(1)
``Below the Line'' Deductions	169	(106)
The Importance of Filing Status	170	(5)
Tax Planning with Itemized Deductions	175	(92)
Medical Expenses	175	(20)
Income Taxes	195	(1)
Real Property Taxes	196	(2)
Personal Property Taxes	198	(1)
Sales Taxes	198	(1)
Interest	198	(20)
Charitable Contributions	218	(22)
Casualty Losses	240	(4)
Theft Losses	244	(8)
Miscellaneous Trade and Business Deductions of Employees	252	(1)
Travel Expenses	253	(5)
Transportation Expenses	258	(4)
Meals and Entertainment Expenses	262	(2)
Gifts	264	(1)
Reimbursable Employee Business Expenses	265	(1)
Educational Expenses	266	(1)
Limit on Itemized Deductions	266	(1)
Schedules of Deductions	267	(8)
Medical Deductions	267	(1)
Deductible Taxes	268	(1)
Charitable Deductions	269	(1)
Casualty and Theft Loss Deductions	270	(1)
Miscellaneous Deductions	271	(1)
Employee Miscellaneous Deductions	271	(1)
Investor Deductions	272	(3)
Traditional Tax Shelters	275	(64)
Deferral and Leverage	292	(40)
Real Estate	292	(13)
Fees in Public Real Estate Partnerships	305	(1)
Oil and Gas	305	(10)
Equipment Leasing	315	(4)
Single-Premium Life Insurance	319	(4)
Cattle Feeding Programs	323	(2)
Cattle Breeding Programs	325	(2)
Tax Straddles	327	(2)
Art Reproduction	329	(1)
Noncash Gift Shelters	330	(1)
Municipal Bond Swaps	331	(1)
How to Analyze a Tax Shelter	332	(7)
Getting Out of the Tax Shelter	334	(1)
Master Limited Partnerships	335	(3)
Abusive Shelters	338	(1)
Super Tax Shelters	339	(64)
Family Shifts	340	(25)
Unearned Income of Minor Children	343	(4)
Outright Gifts	347	(4)
Clifford Trusts	351	(1)
Interest-Free Loans	352	(1)
The Schnepper Shelter: Gift Leasebacks	352	(6)
The Schnepper Deep Shelter	358	(1)
Family Partnerships	358	(1)
Family Trusts	359	(1)
The Schnepper Malagoli Super Shelter	360	(2)
Employing Members of the Family	362	(3)
Author's Delight	365	(1)
Running Your Own Business	365	(38)
Your Home	369	(12)
Your Car	381	(2)
Meals and Entertainment	383	(4)
Travel and Vacation	387	(6)
Gifts	393	(1)
Advertising	394	(1)
Deductible Clothes	394	(1)
Creative Deductions---Busting the IRS	394	(1)
Medical Premiums	395	(1)
Borrowing from Your Company	395	(3)
Miscellaneous Corporate Advantages	398	(5)
Investment Planning to Save Taxes	403	(36)
Short Sales	408	(1)
Broad-Based Index Options and Regulated Futures Contracts (FRCs)	409	(1)
Wash Sales	410	(1)
Premiums on Taxable and Tax-Exempt Bonds	410	(1)
Original Issue Discount (OID)---Taxable Bonds	411	(1)
Original Issue Discount (OID)---Tax-Exempt Bonds	411	(1)
Market Discount	411	(1)
Municipal Bond Swaps	412	(1)
Employee Options---Non-Qualified	413	(1)
Incentive Stock Options	414	(4)
Year-End Stock Sales	418	(1)
Fund Strategies	418	(1)
Dividends	419	(2)
Tax-Exempt Income	421	(2)
Special Report	423	(1)
Old Prices	424	(1)
Alternative Minimum Tax for Individuals	424	(12)
U.S. Savings Bond Exclusion	436	(3)
Last-Minute Tax Planning	439	(14)
Defer Taxes	440	(2)
Accelerate Expenses	442	(1)
Accelerate Special Deductions	443	(1)
Dependents and Personal Exemptions	443	(4)
Phaseout of Exemptions	447	(1)
Timing Strategies	447	(1)
Retirement Plans	448	(1)
Individual Retirement Plans (IRAs)	448	(1)
H.R. 10 or Keogh Plans	449	(1)
Marital Status	450	(1)
The Goldinger Deferral	451	(2)
The Attorneys' and Accountants' Relief Act of 1993	453	(16)
Training and Investment Provisions	455	(1)
Investment Incentives	456	(1)
Expansion and Simplification of Earned Income Tax Credit	457	(1)
Real Estate Provisions	457	(2)
Miscellaneous Provisions	459	(1)
Revenue-Raising Provisions	460	(6)
Business Provisions	466	(3)
Stealth Tax Reform	469	(24)
The New Taxpayer Bill of Rights	470	(4)
Personal Responsibility and Work Opportunity Reconciliation Act of 1996, HR 3734	474	(1)
The Health Insurance Portability and Accountability Act of 1996, HR 3103	475	(4)
The Small Business Job Protection Act of 1996, HR 3448	479	(12)
Tax Relief for Bosnian Effort	491	(2)
Tax Reform---Again!	493	(12)
The Mind-Numbing Complexity of the Tax Reconciliation Act of 1997, Also Known as the Taxpayer Relief Act of 1997	494	(11)
The Internal Revenue Service Restructuring and Reform Act of 1998	505	(10)
IRS Reorganization	506	(1)
IRS Governance and Oversight Changes	506	(2)
Extension of Attorney-Client Privilege to Tax Advice	508	(1)
Burden of Proof Shifted to IRS in Certain Civil Tax Cases	509	(1)
Taxpayer Rights	509	(2)
Roth IRA Conversion/Loophole	511	(1)
Capital Gains	511	(1)
Venture Capital	512	(1)
Home Sales Clarification	512	(1)
Conclusion	513	(2)
The Economic Growth and Tax Relief Reconciliation Act of 2001	515	(32)
Marginal Rate Reductions	516	(5)
Tax Benefits Relating to Children	521	(1)
Marriage Penalty Relief Provisions	522	(3)
Education Incentives	525	(4)
Pension and Individual Retirement Arrangement Provisions	529	(8)
AMT Relief	537	(1)
Health Insurance for Self-Employed	537	(1)
Income Tax Treatment for Certain Restitution Payments to Holocaust Victims	537	(1)
Estate, Gift, and Generation-Skipping Transfer Tax Provisions	538	(5)
Sunset	543	(4)
The Job Creation and Worker Assistance Act of 2002	547	(4)
Bonus Depreciation	548	(1)
Net Operating Losses	548	(1)
Classroom Materials	548	(1)
Electric Vehicle Credit	548	(1)
Work Opportunity Tax Credit	549	(1)
Welfare to Work Tax Credit	549	(1)
Archer Medical Savings Account	549	(1)
Liberty Zone Benefits	549	(2)
The Tax Relief Reconciliation Act of 2003	551	(10)
Rate Reductions	552	(1)
The Marriage Penalty	553	(1)
The Alternative Minimum Tax	553	(1)
Child Tax Credit	554	(1)
Dividends/Capital Gains	554	(2)
Deduct Your SUV---Election to Expense	556	(5)
How to Avoid/Survive an IRS Audit	561	(102)
Appendix A Cost Recovery/Depreciation	663	(14)
Appendix B Law Prior to the Tax Reform Act of 1986	677	(4)
Appendix C Law After March 14, 1984 [Real Estate]	681	(12)
Appendix D Business Use of ``Listed Property''	693	(8)
Appendix E Auto Leases	701	(68)
Index	769