The Sharing Economy Can Make You Money

Taxation of this Sharing Economy:

The Internet, along with its rising social media, has created some very new opportunities for people to earn extra cash. This ‘sharing economy’ theme is defined as this – Putting up some unused resource either for sale or for rent (like a skill, parked vehicle, or empty room). This might seem a bit minor at first, but according to one statistic, this sharing economy actually represents as much as a $110 Billion dollar market.

One community marketplace for finding or listing or booking lodging all over the world, is Airbnb. This is done on the Internet and by mobile phones. They carry more than 500,000 listings for 33,000 cities, in 192 countries worldwide.

The Benefits:

If a taxpayer rents out a property for less than 15 days a year, they don’t have to report that income or the expenses on their tax returns. This enables them to rent out property for short periods of time with NO TAX liabilities. In order to qualify for this exception, all you have to do is use your home personally for over 14 days, or for 10% of the overall number of days, that you rented it out to other people for a fair price.

Another Investment Possibility: Prosper and LendingClub

If you are not someone with a spare bedroom or car that you can share, but you have available cash sitting around, you can make some money this way. Peer to peer lending through sites like Prosper or LendingClub gives you the opportunity to earn some extra cash. They allow individuals to either lend or borrow money, with a certain degree of anonymity, using interest rates that are credit score based. Risk levels are also factored in. Both of these sites will allow investors to lend out their money in increments as low as $25.

Tax Carnival Ecstasy – July 30, 2013

Cover of Book, The Art of Investing in America.
Cover of Book, The Art of Investing in America. (Photo credit: Wikipedia)

Welcome to the July 30, 2013 edition of Tax Carnival Ecstasy. We start this edition with some short term financial goals by Viveka on the blog ‘My Journey to Millions’. John Schmoll takes a look at investing in the stock market and the level of difficulty that you face when you invest for retirement. And finally Bill Smith looks at annuities as investments and the tax implications of investing in them. Hope you like all the articles, bookmark our carnival, like on Facebook, tweet the link and come back real soon.

David presents Quick Way to Save Money on Booking a Hotel Reservation posted at Financial Nerd, saying, “Interesting Way I saved money by booking a hotel reservation”

viveka presents Top 15 Most Popular Coupon Websites posted at Top 15 Most Popular Music Websites, saying, “Here are the 15 Most Popular Coupon Websites ranked by a combination of constantly updated traffic statistics.”

deductions

viveka presents Short Term Financial Goals posted at My Journey to Millions, saying, “Short Term Financial Goals – My Journey to Millions”

filing

viveka presents The Detroit Bankruptcy Should Teach You that Nothing is Guaranteed with your Finances posted at My Journey to Millions, saying, “Detroit\’s recent bankruptcy should teach you something about risk and your personal finances and retirement. Real possibility of reduction in pension and trimming of bonds”

viveka presents Dividend Investment Portfolio Archives posted at My Journey to Millions, saying, “Dividend Investment Portfolio Archives – My Journey to Millions”

retirement

John Schmoll presents Is Investing in the Stock Market Really That Easy? posted at Frugal Rules, saying, “Many are overwhelmed when it comes to investing in the stock market. With a little homework and due diligence it can actually be simplified quite a bit and can lead to more efficient investing for long term needs like retirement.”

viveka presents Will I ever Lose my 401k? posted at My Journey to Millions.

tips

Bill Smith presents Are Annuities a Good Investment posted at 2011 Tax, saying, “There are two different types of annuities: deferred annuities and immediate annuities. The type of annuity you choose depends on how soon you expect to receive payments.”

That concludes this edition. Submit your blog article to the next edition of tax carnival ecstasy using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

Tips On Preventing Tax Refund Identity Theft

Tax Refund Identity Theft

Tax filing tips can help someone prevent tax refund identity theft, but there are tax filing tips that can keep someone from becoming a citric of this crime when he is filing his taxes 2011 or his taxes for any other year.  There is vital information a person must place on every return. The return needs his name and his social security number. He needs to be honest about his income, but if more than one social security return is filed for the same  number may or may not send up a red flag. The IRS cannot check everyone.  The checks or the debit cards need to be sent to their intended recipient.

Many people rely on their tax return to make large purchase. Some people use their taxes to buy new cars or to make other large purchases. If the IRS gets two different terms from the same social security number, it flags the return. IRS agents need to go over the return manually. The need to process a return manually can delay the return for weeks or months. The IRS needs to figure out which return is legitimate and which return needs to be processed.

A taxpayer who has followed the rules all of his life may wonder why  his tax return has undergone such scrutiny. It has to do with the way the organization processes returns. The return that gets handed in first is processed first. A later return coming in later causes an investigation to be launched. There may be times when the mistake comes about because of a transcription error. There are other times when it comes about because someone has stolen the original taxpayers social security number.

Lower Capital Gains Taxes Can Influence Voters

The current capital gains taxes on investment income are fifteen percent. While the taxes on the middle class wages are around thirty-five percent. Mitt Romney admitted recently that he pays only fifteen percent on his total yearly income. The Occupy Wall Street movement has not faded from voters’ memories or the specter of the wealthy one-percent. Romney found himself identified as a member of this affluent group.

There has been serious debate as to whether lower capital gains taxes will help the economy. Top economists do not agree on the effect of lower taxes investment income. Some contend that lower taxes on investment income will generate economic growth. Other studies do not confirm there is a correlation between lower taxes and increased investment activity. Over the years capital gains tax has fluctuated from almost forty percent during the mid-seventies to the present fifteen percent. It is noted that savvy investors will not be deterred from a good investment opportunity, even when there is a higher tax rate. There is no suggestion that a higher investment income tax reduces investment activity.

A down market can shape investment activity, when it comes to the buying and selling of stocks. A major concern of the average American is whether the Romney’s of the world, pay their share of the taxes. High unemployment and a poor economy have the non-investors questioning their higher tax rates and 2012 taxes. Lowering the capital gains tax may not alter the market, but it may influence how people vote.