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How to Pay Zero Taxes 2016: Your Guide to Every Tax Break the IRS Allows

How to Pay Zero Taxes 2016: Your Guide to Every Tax Break the IRS Allows


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About the Book

Updated for 2016—a new revised edition of the classic guide that shows you how to pay less to the IRS Easy to read, easy to use, and hard to beat, this comprehensive tax-saving guide has become the go-to resource for tax professionals and home filers alike. Unlike other brand-name guides, the book focuses on tax saving, not tax preparation—zeroing in on the one thing you really care about: paying less to the IRS. Tax expert Jeff Schnepper explains everything you need to know in simple, accessible terms, organizing important subjects like deductions, exemptions, and tax shelters into six simple sections. The book includes the most up-to-date information—and hundreds of insider tips—that can lower your tax bills, and save you a bundle, year after year. Jeff A. Schnepper, Esq. (Cherry Hill, NJ) is the author of multiple books on finance and taxation, including all previous editions of How to Pay Zero Taxes. He is a financial, tax, and legal advisor for Estate Planning of Delaware Valley and operates a tax, accounting, and legal practice in Cherry Hill, NJ. Mr. Schnepper is Microsoft’s MSN MONEY tax expert, economic editor for USA Today, and tax counsel for Haran, Watson & Company.

Table of Contents:
ACKNOWLEDGMENTS xvii CHAPTER 1: Tax Insanity 1 CHAPTER 2: Is It Legal? 35 CHAPTER 3: How Our Tax System Works 41 CHAPTER 4: Exclusions—Tax-Free Money 47 A Alternatives to “Earned Income” 49 1. Hospitalization Premiums 49 2. Group Life Insurance Premiums 50 3. Group Legal Services Plans 52 4. Accident and Health Plans 52 5. Employee Death Benefits 53 6. Merchandise Distributed to Employees on Holidays 53 7. “Expenses of Your Employer” 54 8. Meals and Lodgings 54 9. Employee Discounts 56 10. Workers’ Compensation 56 11. “Cafeteria” Plans and Flexible Spending Accounts 57 12. Dependent Care Assistance Program 57 13. Employer Educational Assistance 59 14. Employee Awards 60 15. Clergy Housing Allowance 62 16. Miscellaneous Fringe Benefits 62 B Donative Items 63 17. Gifts, Bequests, and Inheritances 63 18. Scholarships and Fellowships 64 19. Prizes and Awards 66 20. Qualified Charitable Distributions (QCDs) 68 C Investors 69 21. Interest on State and Municipal Obligations 69 D Benefits for the Elderly 70 22. Public Assistance Payments 70 23. Social Security and Other Retirement Benefits 70 24. Annuities 73 25. Sale of Your Home 76 E Miscellaneous Individual Exclusions 77 26. Carpool Receipts 77 27. Damages 78 28. Divorce and Separation Arrangements 86 29. Life Insurance 89 30. Qualified State Tuition (§529) Programs 91 31. Your Home—The Mother of All Tax Shelters! 100 32. Disabled Veteran Payments 104 33. Exclusion of Income for Volunteer Firefighters and Emergency Medical Responders 104 34. Unemployment Benefits 104 35. Homeowner Security 104 36. Reimbursed Costs to Parents of Children with Disabilities 105 37. Wrongful Conviction and Incarceration 105 38. Restitution Payments 105 39. Frequent Flier Miles 105 40. Hurricane Sandy 106 41. Cancellation of Indebtedness 106 42. Medicaid Payments for Foster Care of Related Individuals 106 F Schedule of Excludable Items 107 CHAPTER 5: Credits—Dollar-for-Dollar Tax Reductions 109 A Estimated Tax and Withholding Exemptions 110 B Credits 113 43. The Earned Income Credit 113 44. Excess Social Security Tax 116 45. The Child and Dependent Care Credit 117 46. Credit for the Elderly or Permanently and Totally Disabled 123 C Special Credits 125 47. Work Opportunity Credit (Formerly Targeted Jobs Tax Credit) 125 48. Welfare to Work Credit 126 49. Research Tax Credit 126 50. Orphan Drug Tax Credit 127 51. Adoption Assistance 127 52. Hope Scholarship Credit 129 53. American Opportunity Tax Credit 130 54. Lifetime Learning Credit 131 55. Child Tax Credit 131 56. Disability Credits 132 57. Health Insurance Credit 133 58. Saver’s Credit 133 59. Small Employer Credit 134 60. Electric Vehicle Credit 135 61. Credit for Residential Energy Efficient Property 135 62. Energy Saving Home Improvement Credit 136 63. Hybrid Vehicles Credit 137 64. Telephone Tax Refund 139 65. First-Time Home Buyer Credit 139 66. “Making Work Pay” Tax Credit 140 67. Plug-in Electric Drive Vehicle Credit 141 68. Plug-in Electric Vehicle Credit 143 69. Conversion Kits 143 70. Treatment of Alternative Motor Vehicle Credit as a Personal Credit Allowed against AMT 144 71. Small Business Health Insurance Credit 144 72. Foreign Tax Credit 144 73. The Premium Tax Credit 145 CHAPTER 6: “Above the Line” Deductions 147 A Deductions for Adjusted Gross Income 151 74. Trade and Business Deductions 151 75. Employee Business Expenses of Actors and Other Performing Artists 152 76. Employee Business Expenses 153 77. Alimony 153 78. Interest on Qualified Education Loans 162 79. Retirement Plan Payments 162 80. Self-Employment Tax 219 81. Health Insurance Deduction for Self-Employeds 219 82. Moving Expenses 220 83. Clean Fuel Vehicles 227 84. Deduction for Qualified Higher Education Expenses—Tuition and Fees 228 85. Legal Fees 229 86. Classroom Materials 229 87. Medical Savings Accounts (Archer Medical Savings Accounts) 230 88. Health Savings Accounts 232 89. Sales Tax Deduction on Motor Vehicles 234 CHAPTER 7: “Below the Line” Deductions 237 A The Importance of Filing Status 238 B Tax Planning with Itemized Deductions 243 90. Medical Expenses 243 91. Income Taxes 258 92. Real Property Taxes 260 93. Personal Property Taxes 261 94. Interest 261 95. Mortgage Insurance 281 96. Charitable Contributions 281 97. Casualty Losses 305 98. Theft Losses 309 99. Miscellaneous Trade and Business Deductions of Employees 317 100. Job Loss Insurance 317 101. Travel Expenses 318 102. Transportation Expenses 323 103. Meals and Entertainment Expenses 327 104. Gifts 329 105. Reimbursable Employee Business Expenses 331 106. Educational Expenses 331 107. Limit on Itemized Deductions 332 C Schedules of Deductions 334 108. Medical Deductions 334 109. Deductible Taxes 335 110. Charitable Deductions 336 111. Casualty and Theft Loss Deductions 337 112. Miscellaneous Deductions 338 113. Employee Miscellaneous Deductions 338 114. Investor Deductions 339 CHAPTER 8: Traditional Tax Shelters 341 A Deferral and Leverage 356 115. Real Estate 357 116. Fees in Public Real Estate Partnerships 369 117. Oil and Gas 370 118. Equipment Leasing 379 119. Single-Premium Life Insurance 383 120. Cattle Feeding Programs 387 121. Cattle Breeding Programs 389 122. Tax Straddles 391 123. Art Reproduction 393 124. Noncash Gift Shelters 394 125. Municipal Bond Swaps 395 B How to Analyze a Tax Shelter 396 126. Getting Out of the Tax Shelter 398 127. Master Limited Partnerships 400 128. Abusive Shelters 402 CHAPTER 9: Super Tax Shelters 405 A Family Shifts 406 129. Unearned Income of Minor Children 409 130. Outright Gifts 413 131. Clifford Trusts 418 132. Interest-Free Loans 418 133. The Schnepper Shelter: Gift Leasebacks 418 134. The Schnepper Deep Shelter 424 135. Family Partnerships 424 136. Family Trusts 425 137. The Schnepper Malagoli Super Shelter 426 138. Employing Members of the Family 428 139. Author’s Delight 431 B Running Your Own Business 432 140. Your Home 435 141. Your Car 448 142. Meals and Entertainment 450 143. Travel and Vacation 454 144. Gifts 460 145. Advertising 461 146. Deductible Clothes 461 147. Creative Deductions—Busting the IRS 461 148. Medical Premiums 462 149. Borrowing from Your Company 462 150. Miscellaneous Corporate Advantages 465 CHAPTER 10: Investment Planning to Save Taxes 469 151. Short Sales 475 152. Broad-Based Index Options and Regulated Futures Contracts (RFCs) 476 153. Wash Sales 476 154. Premiums on Taxable and Tax-Exempt Bonds 477 155. Original Issue Discount (OID)—Taxable Bonds 477 156. Original Issue Discount (OID)—Tax-Exempt Bonds 477 157. Market Discount 478 158. Municipal Bond Swaps 478 159. Employee Options—Nonqualified 479 160. Incentive Stock Options 480 161. Year-End Stock Sales 484 162. Fund Strategies 485 163. Dividends 485 164. Tax-Exempt Income 490 165. Old Prices 492 166. Alternative Minimum Tax for Individuals 492 167. U.S. Savings Bond Exclusion 506 168. Madoff Losses 509 169. Collars—Tax Free Lock in Your Gain 509 CHAPTER 11: Last-Minute Tax Planning 511 170. Defer Taxes 512 171. Accelerate Expenses 514 172. Accelerate Special Deductions 515 173. Dependents and Personal Exemptions 515 174. Phase-out of Exemptions 520 175. Timing Strategies 521 176. Retirement Plans 521 177. Individual Retirement Plans (IRAs) 522 178. H.R. 10 or Keogh Plans 522 179. Marital Status 523 180. The Goldinger Deferral 524 CHAPTER 12: The Economic Growth and Tax Relief Reconciliation Act of 2001 525 181. Marginal Rate Reductions 526 A Individual Income Tax Rate Structure 526 B Phase-out of Restrictions on Personal Exemptions 528 C Phase-out of Itemized Deductions 529 182. Tax Benefits Relating to Children 531 A Increase and Expand the Child Tax Credit 531 B Extension and Expansion of Adoption Tax Benefits 532 C Child Care Credit 532 183. Marriage Penalty Relief Provisions 532 A Standard Deduction Marriage Penalty Relief 532 B Expansion of the 15 Percent Rate Bracket for Married Couples Filing Joint Returns 533 C Marriage Penalty Relief and Simplification Relating to the Earned Income Credit 535 184. Education Incentives 535 A Modifications to Education IRAs 535 B Private Prepaid Tuition Programs; Exclusion from Gross Income of Education Distributions from Qualified Tuition Programs 536 C Exclusion for Employer-Provided Educational Assistance 537 D Modifications to Student Loan Interest Deduction 537 E Eliminate Tax on Awards Under the National Health Service Corps Scholarship Program and the F. Edward Hebert Armed Forces Health Professions Scholarship and Financial Assistance Program 538 F Deduction for Qualified Higher Education Expenses 538 185. Pension and Individual Retirement Arrangement Provisions 539 186. AMT Relief 547 187. Health Insurance for Self-Employed 547 188. Income Tax Treatment of Certain Restitution Payments to Holocaust Victims 547 189. Estate, Gift, and Generation-Skipping Transfer Tax Provisions 548 A Phase-out and Repeal of Estate and Generation-Skipping Transfer Taxes; Increase in Gift Tax Unified Credit Effective Exemption 548 B Expand Estate Tax Rule for Conservation Easements 551 C Modify Generation-Skipping Transfer Tax Rules 551 D Availability of Installment Payment Relief 551 190. Sunset 553 CHAPTER 13: The Job Creation and Worker Assistance Act of 2002 557 191. Bonus Depreciation 558 192. Net Operating Losses 558 193. Classroom Materials 558 194. Electric Vehicle Credit 558 195. Work Opportunity Tax Credit 559 196. Welfare to Work Tax Credit 559 197. Archer Medical Savings Account 559 198. Liberty Zone Benefits 559 CHAPTER 14: The Tax Relief Reconciliation Act of 2003 561 A Rate Reductions 562 B The Marriage Penalty 563 C The Alternative Minimum Tax 563 D Child Tax Credit 564 E Dividends/Capital Gains 564 F Deduct Your SUV—Election to Expense 566 CHAPTER 15: Income Averaging and Hurricane Tax Breaks 571 CHAPTER 16: 2006 Tax Reform 577 A The Tax Increase Prevention and Reconciliation Act of 2005 578 B The Pension Protection Act of 2006 580 C Tax Relief and Health Care Act of 2006 583 CHAPTER 17: Tax Reform, 2007–2008 587 A The Mortgage Forgiveness Debt Relief Act of 2007 588 B The New Debt Relief Act 588 C The Economic Stimulus Act of 2008 590 D The Heroes Earnings Assistance and Relief Act of 2008 594 E The Housing and Economic Recovery Act of 2008 595 CHAPTER 18: 2009 Tax Changes 599 199. “Making Work Pay” Tax Credit 600 200. Reducing the COBRA Bite 601 201. First-Time Home Buyer Credit Expanded 602 202. American Opportunity Tax Credit 603 203. Energy Credits 604 204. Plug-in Electric Drive Vehicle Credit 604 205. Plug-in Electric Vehicle Credit 605 206. Conversion Kits 605 207. Treatment of Alternative Motor Vehicle Credit as a Personal Credit Allowed against AMT 605 208. AMT Patch 606 209. Earned Income Credit 606 210. Child Tax Credit 606 211. Section 529 Plans 606 212. Unemployment Benefits 607 213. Qualified Transportation Benefits 607 214. Estimated Taxes 607 215. Motor Vehicle Sales Tax 607 216. Business Depreciation 608 217. NOL Carrybacks 608 CHAPTER 19: More Tax Changes 609 A The Hiring Incentives to Restore Employment (HIRE) Act of 2010 610 B The Patient Protection and Affordable Care Act 611 C Small Business Jobs Act of 2010 614 D The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 616 E American Tax Relief Act of 2012 622 F Tax Increase Prevention Act of 2014 625 G The Able Act 627 H More Changes 628 CHAPTER 20: How to Avoid/Survive an IRS Audit 629 APPENDIX A Cost Recovery/Depreciation 747 APPENDIX B Business Use of “Listed Property” 761 APPENDIX C Auto Leases 775 INDEX 845

About the Author :
Jeff A. Schnepper, Esq. is the author of multiple books on finance and taxation, including all previous editions of How to Pay Zero Taxes. He is a financial, tax, and legal advisor for Estate Planning of Delaware Valley and operates a tax, accounting, and legal practice in Cherry Hill, NJ. Mr. Schnepper is Microsoft’s MSN MONEY tax expert, economic editor for USA Today, and tax counsel for Haran, Watson & Company.


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Product Details
  • ISBN-13: 9780071836647
  • Publisher: McGraw-Hill Education - Europe
  • Publisher Imprint: McGraw-Hill Inc.,US
  • Height: 234 mm
  • Returnable: N
  • Weight: 1322 gr
  • ISBN-10: 0071836640
  • Publisher Date: 26 Nov 2015
  • Binding: Paperback
  • Language: English
  • Spine Width: 46 mm
  • Width: 188 mm


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How to Pay Zero Taxes 2016: Your Guide to Every Tax Break the IRS Allows
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