Income Averaging

[gman]

Next year, I am going to have a return that will probably do require income averaging.
My experience is low in this area. I have a few questions . In 05, they are showing
an NOL. So I can elect to cf that. It may wipe out all the income, but will not
affect Social security (se tax)owed. Will the Income averaging affect Social security
se tax- owed.

What are some of your thoughts in this area??

Thanks

[jainen]

None of us

>>My experience is low in this area<<

None of us have much experience in this area, since it was eliminated 20 years ago.

[BOB W]

Nol...

.. can be carried forward or back, Carrying forward of an NOL requires an election that must be attached to a timely filed tax return.

Income averaging is only available for farmers and fisherman. Is this for a Farmer?

NOL have no effect on SE taxes.

Income averaging only effect income taxes not SE.

[Bees Knees]

TTB, page 5-29 provides a couple examples to illustrate how it works and how much farm income to elect to get the best benefit. As the examples illustrate, you don't necessarily want to elect to income average all of the income.

[gman]

not eliminated--still available

read the rest of the posts. It was not eliminated 20 yrs ago..

[Bird Legs]

Income Averaging

Where can you show that Income Averaging is still available, except for farmers & fishermen?

[veritas]

I miss Shedule G.

[S T]

Income Averaging

Income Averaging , how I miss that form. It was such great fun and a way to help a tax client. So Income Averaging was eliminated and we got AMT. Not so much fun!

Sandy

[Jiggers]

Income Averaging Still Here

My self-employed Schedule F and C clients do their own form of income averaging, I suspect. They hold calves over some years from a December selling date to January selling date, depending on their current year profits. They double up on paying property taxes, January and December. They won't open mail the last week of December, and receive all their mail and open it and get their payments the first work day of January. They pay all of their bills on December 31st by writing a ton of checks that take one to two weeks to clear the bank.

Before I started requiring clients to bring in their livestock sales slips instead of relying on they properly allocating calves versus breeding stock, they used to deposit a lot of December dated sales in January. Now they can't do that. I found one client doing approximately $50,000 of December sales in January deposits.

[Ken]

income averaging

Gman
I read the rest of the posts and income averaging went out many years ago just like they said unless you are a farmer or fisherman.
I started doing taxes in 1982 and income averaging went out just a few years after that,.....Thank God!

[gman]

Yes, It Is A Farmer--of Course

Thanks For All Your Help

[Snaggletooth]

Income Averaging

In those days inflation was so high (late 70s early 80s) that I had some customers who income averaged every year. Clearly not the intent of government, and I think they were so embarrased by govt failure to control inflation that they did away with the old Schedule G.
Also failure to control medical costs did not mean they were going to suffer their fair share. The schedule A floor went from 3% to 5% to 7.5%.

It's like Lake Woebegone where "all the children are above average."

I see in the thread above where everyone's favorite friend (Jainen) could not resist throwing an insult at the original post. What a dork.