figuring tax deductions?

Question

Hi
I just want to know how does one calculate deductions from money received from a not for profit organization?
1. I live in Illinois
2. For my service she is paying me 300 a month.
3. She told me I would have to have my own taxes deducted?
Help!!!!

Answer 1

It appears that the not for profit organization is considering you an independant contractor, and not an employee. I can't discuss the validity of that conclusion, since I don't know all the facts and circumstances.

Assuming you are in fact an independant contractor, you should complete a Schedule C as the previous posted indicated. On this form you will show your income (cash received for your services), and you will also get to deduct any expenses you incurred to earn that money. For example, if you are cleaning their offices, and you buy your own cleaning supplies, the cost of those cleaning supplies would be a deduction against your income.

The net profit (hopefully) from your Schedule C will go to page one of your Form 1040. It will also go Schedule SE, which you will need to complete to figure out how much social security and medicare tax you have to pay on your net profit. Assuming you have no expenses, and earned $3,600 for the year, this calculation is as follows:

$3,600 x .9245 x .153 = $509

You will show this tax on page two of your Form 1040. Half of this tax amount will be shown as a deduction from adjusted gross income on page one of your Form 1040.

Finally, if you pay your own health insurance premiums, you may be able to deduct some or all of the premium payments on page one of your Form 1040 as self-employed health insurance, instead of taking the deduction on Schedule A.

Being self employed is difficult from a tax perspective, so I'd suggest getting help from a qualified tax professional.

Answer 2

http://www.realestatedonation.org/ allows you to take a deduction equal to the appraised value of the donation. You may deduct up to 50% of your AGI for 5 years to claim the full amount.

Answer 3

This answer is only a basic one and I hope it helps some. I do not know how old you are but if you want you can do a schdule C for a business type and claim all your expenses. I help my family with their taxes every year and I have found that by down loading a program called Tax Act from the computer for $19.95 I can get all the information I need. I wish you luck and have have happy tax preparing.

Answer 4

Consider donating to charity. Check out http://www.charityboats.org/boat-taxdeduction.html. They accept more than just boats at their organization. It was very simple, and they pick up your donation for free. Besides the good deed of donating to charity, you also benefit from the tax deduction.