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Etsy Tax

This is the final installment in my analysis of the rapidly growing shared economy. So far, we have outlined the popular transportation and home rental segments, which can be viewed here:

Air BnB – How Is It Taxed?

Tax Planning Of You Drive Uber or Lyft

Today, we will analyze the taxation for those who sell their talent online.

Etsy

How is Etsy.com Taxed?

Etsy tax? No, this is not a new tax the government has decided to implement. This has to deal with the taxation of those who sell on the popular website Etsy.com. Etsy is an online marketplace for the general public to buy and sell handcrafted items. Sellers on Etsy range from the casual crafter that wants to make some money off of their hobby, to the businesses that use Etsy as a supplement marketplace to their own website or storefront.

The main cogs of Etsy include jewelry, clothing, and accessories, most of which are handcrafted by the sellers. The sellers will receive a 1099 for their total amount of sales for the year. We help people in Milwaukee and Waukesha counties that sell on Etsy with tax preparation and tax planning.

What kind of expenses can you deduct?

The main expenses involved with selling on Etsy are the Cost of Goods Sold. The Cost of Goods Sold are going to be the materials purchased which are needed to produce the product. Also, equipment needed to produce your product can be deducted as well. Sewing machines, computer software, and other large machinery would be considered equipment.

Another expense to take into account is the Home Office Deduction. If you have a designated room in your home that is used exclusively for running your Etsy business, then you can deduct this as an expense. There are two ways you can do this. The first option is the Simplified Method, which gives you a $5 deduction per square foot of the room. The other option is the traditional method. With the traditional method, you compute the percentage of square feet the office is in comparison to the entire home. This percentage is used to deduct a portion of you real estate taxes, mortgage interest and utility bills.

Mileage: Any miles driven to gather supplies and materials can be deducted using the standard IRS mileage rate.

 

fiverr

What about Fiverr? … What is Fiverr?

Fiverr.com is a website that can help consumers pretty much with anything. It is a gold mine for business owners, and we have personally used services on Fiverr a few times. Services include: graphic design, writing, video editing, music & audio, programming. and advertising. The sellers on Fiverr utilize their talent in these categories to produce a product based on the buyer’s order. It is a pretty cool concept, and I suggest you check it out if you ever need help with anything you don’t want to waste your own time on.

The taxation of Fiver sellers is similar to those on Etsy. However, they may not incur as many direct expenses. Their main expenses are going to comprise of equipment and the home office. In most cases, there are not many supplies or materials needed because they are using their expertise to produce a final product.

Both Etsy and Fiverr members may incur processing fees from the website. These fees are also deductible as expenses.

What have we learned about the Shared Economy?

The shared economy is a highly successful business model that is being carried over into many different sectors and industries. The main concept is that the Business lets us, the general population, do their work for them. They benefit off of the processing fees and advertising space, but rely on the citizens of the world to produce for their business.

The important thing to remember for all of those that are “working” for these companies is that you are not their employee, you are your own business! It may be your full time gig, or just something you do to supplement your income, but you are a business owner. You are no longer treated by the IRS as an employee and you will be taxed differently. It is important for you to know how to keep records of your business and stay compliant with the IRS tax code.

If you are currently involved in the shared economy, or if you want to make some extra money and join the shared economy, please contact your tax consultant to learn more of what you need to do.

 

Have a great weekend!

 

Nicholas Hammernik, EA

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

Air BnB – How is it taxed?

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In my last post, I talked about the tax ramifications of the rapidly booming shared economy phenom, Uber. The IRS has taken notice and is beginning to crack down on those involved with making money from the shared economy. Today, we will move to the vacation rental sector of the shared economy. The biggest player here is Air BnB, followed by other services such as VRBO, Home Away, and FlipKey. So how does it work? Let’s say you want to take a trip to Florida for a week of vacation…If you either feel that hotels are too expensive, or you don’t like the overall feel of hotels, you would opt for the shared economy option. Hosts list their homes or apartments on the website with the price per day, location, # of rooms and pictures. If you think it looks like a place you would like to stay, you pay them via the website and receive instructions from there.

So, if you are a host receiving money for visitors to stay at your house…how are you taxed?

  • The most important factor to consider is the 14 day rule. If you rent the property out for 14 days or less, the income you receive is not taxable. Money that isn’t taxed?! I’m not crazy, this is a thing. I actually had a friend/client avoid having to pay tax on the money he earned through Air BnB by having him stop renting the place out at 14 days. You will still receive a 1099 from Air BnB showing the income that they paid you for the year. You DO need to report this on your tax return. You are able to post an adjustment on your tax return stating that you qualify for the 14 day rule to cancel out this income. It is important that you keep diligent records of the number of days that your place is rented out by visitors in case it is ever put in question. Air BnB usually does a good job of doing this for you, but keep your own records as well to be safe.
  • What happens if you rent out your home for more than 14 days? Now you will need to pay taxes on the income that you have brought in. This income will be reported on the Schedule C, NOT the Schedule E. The IRS considers this income to be a self employed business and not a rental property. The fact that you are providing bookings, amenities and other hospitality services makes you a business owner and not a landlord.
  • So, now that you are running a business, what can you deduct? In order to reduce your tax liability, you need to track possible deductions to offset some of your income. First, keep track of any amenities that you provide visitors. If you purchase new bed sheets, towels, linens etc. for new visitors, these costs can be deducted. Also, if you are a gracious host and provide your visitors with food and beverages, these can be deducted as well. Next, you will be able to use a portion of your real estate taxes, mortgage interest, and utility bills. Take the total number of days your place was rented and divide that by 365 days. Whatever percentage you come out with, that is the percentage of your taxes, interest and utilities that you can deduct from your business income on the Schedule C. The remaining amount of the real estate taxes and mortgage interest will be part of your itemized deductions on your Schedule A. It is important to know that you can not take the full amount on Schedule A and still use your percentage on Schedule C. Also, if you only rent out a single room in your house, then you will need to use the percentage of the total square footage of that room compared to the total area of the house. Any service fees that Air BnB assesses to you can also be deducted.
  • Occupancy Tax may be coming… Many hotel and lodging operators have put in complaints that they have to pay occupancy taxes when they have visitors, but Air BnB hosts do not pay these taxes. Many states are in the process of enforcing occupancy tax on the shared economy hosts. If this goes into effect in your state, you will need to charge your visitor an occupancy tax and then pay that amount to the government.

Like Uber drivers, many times Air BnB hosts do not realize that they may have become a business owner overnight. It is important to educate yourself on how you will now be treated under the tax code. I was able to save my friend a couple hundred dollars in taxes by making him aware of the 14 day rule. If you currently rent out your place through the shared economy, or are considering doing so for a big upcoming event, please consult with a tax professional to keep yourself educated and compliant. We can help with the tax preparation and tax planning of taxpayers involved in the shared economy.

The Milwaukee and Waukesha County areas are in high demand during events such as Summerfest, State Fair, and various sporting events. It is a good opportunity to put some extra cash in your pocket, but be aware of how it could affect you at tax time. Plan now before it is too late! Hammernik and Associates specializes in helping Milwaukee, Waukesha, Brookfield, New Berlin, Wauwatosa with Air BnB tax preparation and tax planning.

Next week, the final segment of the shared economy industry will focus on the online retail sector.

 

Until then,

Nicholas Hammernik, EA

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

Tax Planning If You Drive Uber Or Lyft

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The IRS will begin to take a closer look at examining the rapidly growing “sharing economy”. The sharing economy are activities which people get paid for through an online platform. The most popular companies of the sharing economy include Uber, Lyft, Air BnB, Etsy, Fiverr and TaskRabbit.  Over the next few weeks I will be focusing on these different activities to raise public awareness regarding the tax consequences involved with the sharing economy.

To begin, I will focus on the transportation sector of the shared economy. This is by far the most booming sector. In fact, it has surpassed taxis/cabs in corporate spending reports. There are two main players in the transportation shared economy game, Uber and Lyft. I personally use Uber almost every weekend and any time I am on vacation. It is easy to use, convenient and cost effective. It is focused on providing the millennial market an easy way to get from point A to point B. Uber and Lyft’s business plans are centered around having “employees” (the drivers) work for them using their personal automobiles. However, in reality, the drivers are not employees of said companies, they are sole proprietors.

What does this mean if you are a driver for Uber or Lyft?

The answer….Congratulations you now own your own business! We help Milwaukee and Waukesha Uber and Lyft drivers with tax preparation and tax planning.

The reason why the IRS is trying to raise public awareness among the shared economy community is because that these drivers don’t realize that they are their own business and not employees. This can result in major tax problems when it comes time to file your tax return. When it comes to tax preparation, there are some important things you need to know when you own your own business.

Here are five things that all Uber and Lyft drivers should be aware of:

  1. The income checks that you receive are not all yours to keep. When you are an employee, your medicare and social security tax are paid half by you and half by your employer. Guess what? You have to cover the employer and employee portion of this as a business owner. This is known as self employment tax. On top of this tax, you are also responsible for paying federal and state income tax on your net business income. It is important to make quarterly estimated tax payments to the IRS and State to stay compliant and avoid penalties. Hammernik & Associates works with business owners by tax planning throughout the year to stay compliant.
  2. All income you receive is to be reported to the IRS, this includes cash tips. The third party network will send you a tax form at the end of the year showing the total amount of income that they paid you. This will be reported on Form 1099-MISC if they paid you over $600 or on Form 1099-K if they paid you over $20,000 or there were over 200 transactions. The IRS also received this tax form, so it is  important to keep track of the income that you receive throughout the year for year-end reporting. I would suggest that you create a bank account separate from your personal account to keep track of business activity only. Do not co-mingle funds between your personal account and your business account.
  3. Create an LLC. A LLC is a cost effective way to protect your personal assets. LLC stands for Limited Liability Company. The reason to create an LLC is to protect your personal assets in the event that something goes wrong with your Uber or Lyft business. If somebody decides they want to sue you, they can only go after any assets that are in the LLC. They can not go after your personal items, such as: your house, your savings account, your IRA or 401(k), etc. As I mentioned before, it is important to keep your business activity in a separate bank account. Any activity between your personal account and the business account can put the LLC protection into question.
  4. Keep track of your mileage. Not all the income you receive is going to be taxable. The way that we reduce the taxable income is by deducting business expenses. The main deduction that an Uber or Lyft driver is going to have is mileage. In 2016, the IRS mileage deduction rate is $.54/mile. It is important that you keep a log of the miles that you drive for business purposes. Make sure that you keep this log separate from the miles that you drive for personal use. There are mobile apps available which make it easy to log your miles, otherwise an Excel sheet works fine as well. You can only choose to deduct mileage OR actual expenses (gas, oil changes, repairs, etc.). More often than not, mileage is the most effective way to go.
  5. Other ways to reduce taxable income. What other things can you deduct as business expenses? A lot of the Uber drivers I have received rides from have water or candy available to their passengers to improve their experience. If you are one of those drivers, keep your receipts, this is deductible. It is important for Uber drivers to keep their cars clean to provide a nice environment for their passengers, therefore, any car washes, detailing, or interior cleaning expenses are all deductible. Lastly, in order to be an Uber driver you need to use a smart phone. If you are using your personal phone, you are able to deduct a portion of your phone bills. You will need to determine the percentage of use that your business takes up of the overall use of your phone, and that percentage of your bill will be deductible.

The IRS knows that the shared economy is here to stay and is growing every year. They will begin putting more focus on patrolling the tax returns of taxpayers that participate in these activities. Hammernik & Associates is here to make sure that you stay complaint, tax plan to save money, and know what you can and cannot deduct. Also, as a business owner, you now have additional tax savings opportunities available to you. If you are an Uber or Lyft driver or if you frequently use the service, let it be known that Hammernik & Associates knows how to deal with the tax implications involved with being an Uber or Lyft driver.

Hammernik & Associates helps business owners and individual taxpayers save on taxes by proactive planning.

The next blog post will discuss the home rental sector of the shared economy. Stay tuned.

 

Have a great weekend,

Nicholas Hammernik, EA

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

 

Make a Difference Today…

The last few months have been a rough time for the state of humanity. I will not get into any political views or issues regarding events that have taken place. However, it does shine a light on how valuable your life is.

A main pillar of Hammernik & Associates is helping the community. Our charity of choice over the years has been the Muscular Dystrophy. We collect donations throughout the year by selling shamrocks and we also donate $1 for every tax return that we prepare. MDA has created a campaign that makes it so easy for you to help find a cure. All you have to do is upload a picture of yourself and $5 will be donated to the MDA. Here is the picture that I uploaded.

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Want to upload your own picture and donate $5? Click Here

This is an easy way to make a difference, it will only take a couple minuted of your day.

Take advantage of this simple way to make a difference in someone’s life. You have the ability to help send some kids to summer camp and put a smile on their faces. That is a great feeling!

Thanks in advance,

Nick Hammernik, EA

Don’t Tell Bobby Bonilla Pensions Are Dead

Today, July 1st, is unofficially named “Bobby Bonilla Day”.

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Today is the day that Bobby Bonilla gets his annual check for $1,193,248.20 from the New York Mets baseball team, just as he will every single year through 2035.

To catch everyone up:

The deal was signed by the Florida Marlins in 1996, but Bonilla was traded to the LA Dodgers in the 1998 blockbuster that involved Gary Sheffield and Mike Piazza. Bonilla was later flipped to the Mets. He then only played 60 games in 1999, hitting a dismal .160 batting average, so the Mets decided to release him before the 2000 season instead of paying him $5.9 million that year.

In buying out Bonilla before 2000, the Mets triggered a deferral that paid Bonilla the above figure annually from 2010-2035.

Call it one of the more fun pensions you’ll ever see.

Pensions are a close to extinct financial animal, but if you can find an employer that offers one, you should jump on the opportunity.

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What is a ‘Pension Plan’

A pension plan is a type of retirement plan, usually tax exempt, wherein an employer makes contributions toward a pool of funds set aside for an employee’s future benefit. The pool of funds is then invested on the employee’s behalf, allowing the employee to receive benefits upon retirement.

Why are Pensions dead?

Retirement has taken a back seat to corporate profitability for more than 40 years as the United States has embraced the reduction of pensions, and now the U.S. economy is paying the price with lowered productivity.

Without pensions, older workers are being forced to work longer hours and stay in the workforce longer, and that means they’re squeezing out some of the most productive workers of all, known as core workers (ages 25-54).

Employers have now opted for retirement plans such as 401K’s, 403(b)’s and Simple IRA. In these plans, employers still contribute to their employee’s retirement, it is just not as much as they would contribute to a pension.

Salary Deferral

“Bobby Bonilla Day” is a joke that is discussed every July 1st on sports talk shows and all over the Internet. It is looked at as a joke because the Mets are still paying a guy on their payroll over $1 million a year…and he hasn’t played a game in 16 years.

My question is, why don’t more athletes defer salary. There are a few other notable players such as Ken Griffey, Jr that are also being paid after their playing days. Griffey is actually even receiving 4% interest on his money…what a great retirement plan.

A Sports Illustrated story ran last year and stated this:

“Reports from a host of sources (athletes, players’ associations, agents and financial advisers) indicate that: By the time they have been retired for two years, 78 percent of former NFL players have gone bankrupt or are under financial stress because of joblessness or divorce.”

In an industry that sees former athletes trying to scrape together autograph signings and speaking engagements just to make a living after retirement, I ask this: Why not make salary deferral a priority for agents during negotiating contracts?

A glorified pension in an age where pensions are dead.

Figure out a way that you can support the lifestyle you want to live after you are done receiving a paycheck. This may no longer be through a pensions, but there are other ways to secure financial independence during retirement.

If you do not have a retirement game plan in place, or you think it can be improved, contact our office at 414-545-1890. Our Wealth Management division will review your current financial game plan and come up with a strategy to make your future retirement a success.

Have a safe and happy 4th of July weekend!

 

Nicholas Hammernik, EA

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

 

How State Tax Impacts Salary

The NBA draft went down last night, and some of these kid’s lives are forever changed. The amount of money they will make on their first contract is more than most Americans will make in their lifetime. While I am a huge sports fan and enjoy the draft for what it is, I also like to look at the tax implications involved. When you dissect everything, it is eye opening to see how State tax rates can have a larger effect on the amount of money that they make than the slot that they are drafted.

Let’s take a deeper look into the draft so I can show you what I am talking about. I am a Marquette basketball fan, so we will begin with analyzing the local kid, Henry Ellenson.

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Henry was picked with the 18th overall pick by the Detroit Pistons. Michigan has a top state tax rate of 4.25%. A native of Rice Lake, WI, Henry escapes the WI top tax rate of 7.65 to the friendlier Michigan rate. However, let us take a look at the financial impact of Henry being drafted at #18 instead of one pick earlier at #17.

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Above are the projected guaranteed 2 year contracts that each slot in the draft will receive. The difference between being selected #17 and #18 is only $183,240…which isn’t monumental when you are talking about millions of dollars. However, Memphis is in the state of Tennessee, which is NO STATE TAX. Taking the 4.25% Michigan state tax off of Henry’s contract with the Pistons results in a total tax of $148,109. So that difference of $183,240 suddenly becomes a difference in salary of $331,349.

Now, let’s take a look at how getting drafted  5 picks later actually benefited one of the draftees from a financial standpoint. We will focus on the 25th pick by the LA Clippers and the 29th pick of the San Antonio Spurs. The Clippers took Brice Johnson from the University of North Carolina and he is projected to make $2,605,080 in guaranteed salary. The Spurs took Dejounte Murray from the University of Washington with the 29th pick and he is projected to make $2,413,320 in guaranteed salary.

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The simple math here tells us the Johnson will make $191,760 more than Murray. However, San Antonio is in Texas which also has NO STATE TAX. Whereas, Brice Johnson will become a California resident which has the highest state tax in America with a top rate of 13.3%. This state tax will result in a cut off Johnson’s salary of $346,475, thus, Dejounte Murray will actually make $154,715 more than Johnson as he resides in the state of Texas.

It is important to remember that all athletes are subject to the “jock tax”. This means that they are taxed by each state for the number of days that they are working (playing) in each individual state. Therefore, none of the athletes are completely free from paying state taxes. However, the majority of their income is taxed in their state of residency.

All in all, the major hype around drafts is usually about how high an individual is drafted, but there is more to the financial story when you dig deeper into the numbers. All of these athletes have reached their childhood goal and are now in position to be financially secure for life if they manage their money in the proper way. Unfortunately, a large percentage of athletes eventually go broke due to mismanagement or bad advice with their finances. I just find it fascinating how the state tax rates can have a large effect on total take home pay for each individual.

If you are a sports fan or not, I hope that you enjoyed digging into the impact of state tax. There is a reason that many retirees move to Florida, and it is not just because of the great weather!

*All figures are based on NBA slotted projections. Calculations do not take into account federal taxes and other income and deductions that these individuals may have.

Our summer newsletter is now out, check it out! Summer 2016 Newsletter

P.S. Inside the newsletter you will find out about our contest that we are running through 7/1/16. Let us know what you think about Hammernik & Associates. Post a review on  Google or Yelp and be entered into our contest to win a $100 VISA gift card. Your opinion matters to us, don’t keep us a secret!

 

Nicholas Hammernik, EA

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

Nick is Talking Tax To Milwaukee. Combing the boring topic of tax with the latest news in pop culture and sports.

 

What To Do When You Receive An IRS Phone Call

One of the most common phone calls that we get at our office is clients calling to say that the IRS called them and told them that they need to pay them immediately. These are IRS scam phone calls that have been going on for almost two years. Want to know what to do if you receive one of these call or an email from the IRS?

Watch Nick Hammernik and Lori Beck tell you what to do:

What To Do If The IRS Calls You

If you have any questions or concerns about identity theft our financial scams, please call our office at 414-545-1890

 

How To Avoid IRS Interest

The IRS has decided they want more of your money! As of the second quarter of 2016, they have raised their interest rate from 3% to 4%.

Do you want to know how to avoid paying the IRS that interest? We help Milwaukee and Waukesha with tax issues.

Watch This Video

Blog Special: Schedule a tax planning session with your Hammernik & Associates adviser by 6/17/16 for only $59. Our normal tax planning rate is $175/hr, so don’t miss out!

If you need a Tax Cleanse with some IRS debt, schedule a complimentary consultation to see how we can help you out.

We will be trying to do video blogs every other week. Please let us know if there is a certain topic you would like to see discussed!

 

Until next time,

 

Nicholas Hammernik, EA

Sweet Tooth Taxes

A couple of recent topics have given me a tax sweet tooth. The Soda Tax and National Doughnut Day.
I am not huge on sweets, but I know a lot of you out there are! Grab a free doughnut today and enjoy that soda while it is still tax-free 😉
REMINDER: Our educational event ” The Future Looks Bright” is coming up on JUne 9th. Please contact Lori at lbeck@hammernikassoc.com to reserve your spot ASAP. Spots are filling up. This event will educate you on the current financial status of the market and what the future of the market looks like.
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Today, June 3rd, is National Doughnut Day. It seems like everyday is National “something” Day…Anyways, Krispy Kreme is giving away FREE doughnuts and also trying to raise money for the Salvation Army in the process. Check out the details and the tax implications of donating to a charity here:
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The easiest way for a city or a state to make money is to TAX it’s residents. We here in Milwaukee know that all too well with the Miller Park stadium tax that we pay.
Well, the Mayor of Philadalephia has proposed to put a tax on soda ( or “pop” as some regions of the country call it). Now, this tax is a two-fold agenda. Soda is one of the most popular refreshments…it is also pretty bad for your health. Try pouring a can on something rusty and see what happens.
There is a large volume of soda purchased in the United States, therefore a tax would produce a large revenue stream for the City of Philadelphia. Also,this increase in price may drive residents of Philly to consume less soda. Thus, making Philadelphia a healthier city in that regards.
Do I think this will pass? No. However, if it works in Philadelphia, don’t be surprised for it to spread to other cities.
Read the full article here:
Milwaukee, Waukesha, Brookfield, New Berlin, Wauwatosa tax preparation and tax planning

Tax Breaks For The Troops

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As Memorial Day weekend approaches, it is time to pay our respects to those that lost their lived serving for our country. However, it is also a good time to celebrate those that have served, or are currently serving our country.

I have massive respect for our service members. I have a few friends and a few clients that have served our country. I’m not sure I could physically or mentally do what they do/did. However, I can help them with some tax advice….


Talking Tax to Milwaukee’s Military:

For Business Owners: Milwaukee business owners have the opportunity to employ veterans and get a credit for it. Not only are you helping out a veteran, but you are also helping your business.

  • Short-term Unemployed: A credit of 40% of the first $6,000 of wages (up to $2,400) for employers who hire veterans who have been in receipt of unemployment insurance or compensation for at least 4 weeks or who have received assistance from a supplemental nutrition assistance program under the Food and Nutrition Act of 2008 for at least a three month period during the 15-month period ending on the hiring date
  • Long-term Unemployed: A credit of 40% of the first $14,000 of wages (up to $5,600) for employers who hire veterans who have been in receipt of unemployment insurance or compensation for longer than 6 months (whether or not consecutive) in the one-year period ending on the hiring date.

For Military Spouses: Military spouses are strong individuals. They are responsible for taking care of a lot different things. Moving around from different bases is very common, and the IRS recognizes this.

  • Prior to 2009 there wasn’t much relief for military spouses. They generally had to pay income taxes to the states where their spouses were stationed. Under the Military Spouses Residency Relief Act signed into law on November 11, 2009, military spouses who earn income in the state where their spouse is stationed may be able to claim either the state they are located in or their spouse’s legal residence (if they have established residence there as well) for tax purposes. This only matters if the spouse has income of their own. That could generate big savings if their spouse’s legal residence has lower tax rates — or no income tax at all.

For Veterans or Surviving Spouses: This credit is specific to the State of Wisconsin.

Veterans and Surviving Spouses property tax credit?

The veterans and surviving spouses property tax credit is a credit equal to the amount of property taxes paid during the year on an eligible veteran’s or surviving spouse’s principal dwelling. The credit is claimed on the Wisconsin income tax return. Before claiming the credit, the veteran or surviving spouse must obtain verification of his or her eligibility for the credit from the Wisconsin Department of Veterans Affairs (WDVA). A copy of this verification must be attached to the Wisconsin income tax return for the first year that the credit is claimed.

 

These are just a few of the tax breaks that I have come across while serving some of my clients. There are also a variety of other tax deductions, credits, and breaks that are available to current or former military members. If you know of someone that may be able to take advantage of these deductions, please have them contact our office. We help Milwaukee, Waukesha, New Berlin, Brookfield, Wauwatosa with all tax preparation needs.

While you are out enjoying this weekend with friends and family, remember the reason you are able to enjoy the (hopefully) beautiful Milwaukee weather… The Troops!

 

 

Happy Memorial Day!

 

Nicholas Hammernik, EA