Real tax questions from real readers, answered. Got a question of your own? This is where Taxgirl answers them.
Taxpayer asks: I heard on the radio that we will have to pay taxes on the money from the Cars for Clunkers. If so, I am really mad because nobody said we had to pay taxes on it. Is this true? Taxgirl says: A number of web sites and um, what’s the word, liars opportunists…
Taxpayer asks: I have what may be a stupid question. I read your answer about FBAR and I was wondering whether you have to report bank accounts in Canada or does this just apply overseas? Taxgirl says: Oh, Canada. Land of moose, maple syrup, and an occasionally decent hockey team… Actually, Canada has a pretty…
Taxpayer asks: I was just reading about the rules for FBAR, and noticed that the IRS says that people who have Power of Attorney (POA) for elderly relatives with foreign bank accounts must submit FBAR reports if those accounts total over $10,000 at any point during the year. As it happens, I have a POA…
Taxpayer asks: Hi Kelly, With all the publicity about UBS and foreign bank accounts, I have some concerns that a lot of parents may be sharing… I know you’re a mom too (though your kids are too young for you to have to worry about this right now!) But, if you were in my shoes,…
Taxpayer asks: A friend of mine asked me to buy an ad in a book for her daughter’s beauty pageant. She claims that it is tax-deductible. I didn’t think that beauty pageants were charities, so how is this true? Taxgirl says: This question turned out to be far more complicated than I thought – even…
Taxpayer asks: My wife is a Girl Scouts Leader. Is all of her time and contributions to the troop tax deductible? If so, how? Taxgirl says: Okay, the bad news first: the value of your time spent volunteering for charitable organizations is never deductible. Ever. But there is good news! Out of pocket expenses relating…
Taxpayer asks: Hi, I heard a car dealer on a radio talk show say that if the consumer owes any federal or state taxes when they buy a C4C car, the dealer is on the hook to get reimbursed by the consumer or eat the difference, because the federal payment will take out the arrearrage…
Taxpayer asks: Do you have any advice for how SELLERS should best take advantage of the credit? Should we advertise about the credit with our real estate listings? Taxgirl says: That’s a great question! I think the credit is a real selling point (though I’m not a fan of the concept). It definitely makes sense…
Taxpayer asks: I moved 3 years ago and am renting a house that I own. I’m not able to file single head of household because I don’t live in the only home I own. Would I qualify for the tax credit?Thanks Taxgirl says: As I understand your question, you are wondering if you would qualify…
Taxpayer asks: Hi Taxgirl, [I emailed you last week when we received the refund to our amended return for 2008 because we claimed the new homebuyers $8000 credit. I was perplexed that it was for $7978 instead of for $8000. The following info explains why, and continues my question.] We just received a letter from…