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Wednesday, March 29, 2017

Happy Parallelogram Season!

At Gardner & Billing CPAs we can't promise how sharp our geometry skills are, but we DO know taxes!  Bring your tax information to the experts and let us take care of you this tax season!

Wednesday, March 22, 2017

10 Non-Deductible Expenses

Based on an article by Mark P. Cussen

Although the tax code permits a wide range of deductions for taxpayers in various situations, thousands of filers routinely claim deductions for various types of expenses that are in fact non-deductible. Here is a list of some of the more common non-deductible expenses that show up on tax returns each year. 

1) Spousal and Child Support
Many taxpayers try to deduct these two forms of familial support on their returns. However, alimony is the only type of income paid by one ex-spouse to another that can be deducted.

2) Unreimbursed Work Expenses
Although self-employed taxpayers can deduct every dollar of work-related expenses, W-2 employees are limited on the amount of unreimbursed work expenses they can deduct - and only those who are able to itemize their deductions can take advantage.

3) Above-the-Line Deduction for Roth IRA Contributions
Unlike traditional IRA contributions, there is no deduction for Roth IRA contributions because the income distributed from them is tax-free, whereas traditional IRA and retirement plan distributions are taxable as ordinary income.

4) Political Contributions
Cash or property donations to any qualified 501(c)(3) organization are deductible, but political parties do not fall into this category. So unfortunately, the money you sent in to your candidate or party of choice doesn't go anywhere on the 1040.

5) Homeowners' Insurance
The only time that this can be deducted is for those who either use part of their home for business or for those who own rental properties. Homeowners outside these categories cannot deduct their homeowners' or rental insurance under any circumstances.

6) Life Insurance Premiums
Except for a small amount that can be purchased inside a qualified plan, life insurance premiums are non-deductible for individuals. Group life insurance premiums can be deducted by employers within certain limits.

7) Dependents Whom You Cannot Claim
Many separated and divorced couples race to claim some or all of their dependents each year whether they can or not. The IRS has a fairly clear set of rules that determine who gets to claim which kids. However, both parents often try to claim the same dependent in the same year, thus causing the return of the one who files second to be rejected. Those in this category who are legitimately entitled to claim a dependent or dependents must take up their case with the IRS and furnish proof that establishes their eligibility.

8) Substantial Contributions of Tangible Property to Charities
Although the entire amount of any property that is donated to charity can be deducted eventually, the dollar limits for this type of contribution are lower than for cash. So make sure that your property does not exceed these income limits in the year that you give it to your charity.

9) Passive Losses
Tax losses that are generated from certain types of investments or activities, such as partnerships, can only be written off against passive income, which is defined as income for which the recipient had no material role in generating. Passive losses cannot be deducted against active income, such as earnings or investment income.

10) Capital Losses
Although capital losses can be used to offset any amount of capital gains, they can only be deducted against a portion of other income each year. If you flushed your $50,000 nest egg down the toilet last year in the stock market and had no gains to declare it against, then you will only be able to deduct some of that loss as a long or short-term loss each year.

If you try to write the entire balance off at once, the IRS will gently inform you that you will have to prorate the loss over the next few year. Unless, of course, you reap a large gain in the future, in which case you can write off as much of the remaining loss as there is against whatever amount of gain you have earned.

The Bottom Line
This is only a list of the more common deductions that taxpayers frequently attempt to claim. If you are unsure whether a specific expense that you incurred during the year is deductible, visit the IRS website at or consult your tax professional.

Tuesday, March 14, 2017

Tuesday, March 7, 2017

Montana Dept of Revenue - Where's My Refund FAQs

Check the status of your refund with TransAction Portal. Select Where's My Refund link under the 'Quick Links' section.  **Checking the status of your return does not require a TAP account.**

Where's My Refund Frequently Asked Questions

How long will it take to receive my refund?
Because of the ongoing nationwide increase in identity theft and filing of fraudulent returns, the department takes time to review returns to make sure they are valid. This means that the department cannot always give you a timeframe for how long it will take to issue your refund.

TAP will show you the status of your return and refund. The status of your refund depends on where your return is in the process.

How soon after filing can I check the status of my refund?
Wait at least

  • 4 weeks if you filed electronically
  • 8 weeks if you filed a paper return
What can slow down my refund?
Your refund could seem slow or be delayed because:

  • In response to security measures in place to protect you from identify theft, we may have sent you an identify verification letter. Your refund cannot be processed until the steps included in the letter are completed.
  • Your return has line item or calculation errors to be reviewed.
  • Your refund may have been offset to pay another state debt. You will receive a letter if this happens.
  • You are considered to be a first-time filer. A first-time filer is defined as a taxpayer who has not filed a Montana tax return as a primary or secondary taxpayer in previous years.
Tips for using Where's My Refund
Be sure to use the same information from your current year's tax return:

  • Social Security Number
  • Refund Amount
You can find your refund amount on:
  • Line 74 of Form 2
  • Line 21 of Form 2EZ
  • Line 13 of Form 2EC
Which returns are available in Where's My Refund?
You can only check on the current year individual income tax return in Where's My Refund.

Will I get more information if I call?
No, Where’s My Refund has up-to-date information available about your refund. The information you see in Where's My Refund is similar information available to our phone representatives when you call.

If it has been more than eight weeks, our representatives may have additional information. Call us toll free at (866) 859-2254 (in Helena (406) 444-6900) between the hours of 8 a.m. and 5 p.m., Monday through Friday.

When is the information updated?
Information is updated overnight, Monday through Friday, so you don't need to check more than once a day.

Wednesday, March 1, 2017

IRS Reminds Farmers & Fishermen about March 1 Tax Deadline

IRS Special Edition Tax Tip 2017-05, February 24, 2017

The Internal Revenue Service reminds farmers and fishermen about the March 1 deadline to take advantage of special rules that can allow them to forgo making quarterly estimated tax payments.

Taxpayers with income from farming or fishing have until March 1 to file their 2016 Form 1040 and pay the tax due to avoid making estimated tax payments. This rule generally applies if farming or fishing income was at least two-thirds of the total gross income in either the current or the preceding tax year.

Ways to Pay:
IRS Direct Pay – IRS Direct Pay offers individual taxpayers an easy way to quickly pay the tax amount due or make quarterly estimated tax payments directly from checking or savings accounts without any fees or pre-registration. Direct Pay is available 24 hours a day, seven days a week and taxpayers can schedule a payment up to 30 days in advance. Last year, IRS Direct Pay received more than nine million tax payments from individual taxpayers totaling more than $31.6 billion. When a taxpayer uses the tool they receive instant confirmation after they submit their payment. Direct Pay cannot be used to pay the federal highway use tax, payroll taxes or other business taxes.
EFTPS – The Electronic Federal Tax Payment System allows individual and business taxpayers to pay their federal taxes electronically. Taxpayers must enroll and receive a PIN in the mail to use EFTPS. Visit to check out other payment options.

Farmers and fishers choosing not to file by March 1 should have made an estimated tax payment by Jan. 17 to avoid a penalty.

Taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.

Additional IRS Resources:
Tax Topic 416, Farming and Fishing Income
Publication 5034 Need to Make a Tax Payment? (English and Spanish)
Fishing Tax Center
Agriculture Tax Center