Maritime Tax Preparers and the Alternative Minimum Tax

6
by on January 8, 2011 at 2:40 pm

What they don’t want you to know…

This video points out the tremendous effect of the AMT on merchant mariners. Seamen taking business deductions and offsets may very well be realizing little to no benefit from these offsets. It also examines some alternatives that may or may not assist in alleviating the effect of the AMT. It’s important to examine the short term and long term benefits of tax strategies. Tell your tax planner your short and long term goals.

AMT Effect on mariners incidental per diems

These expenses, like all employee business expenses are subject to AMT limitations. When a mariners income gets to a certain point, these deductions have little to no effect.

Mariners in the situations outlined in the video should pursue long term tax planning strategies to address AMT. Bogus Sailor tax offsets will not be effective.

6 Comments

  • Dave S

    09/01/2011

    I remember the day this was explained to me. I had been paying 1k a year for deductions that weren’t helping me at all. I remember reading that the mariners who weren’t audited after the kapp lawsuit were so far in the AMT that they hadn’t benefitted from the bogus deductions…

    • Auth

      26/04/2012

      More than likely, you’ll be using the 1040-A, if not the 1040-EZ. There are more thgins to consider than just what you made. Whether or not you’re able to deduct any of you education expenses depends on what and how those expenses were paid. If you receive a 1098-T for your tuition expenses, at least part of that may be deductible. Other thgins to consider are: Were you completely self supporting, or did someone (parents, for example) pay most of your maintenance in 2008? Do you own your own home? Did you make any major purchases, such as a car? Did you have a lot of medical expenses (if you were self-supporting), or make a lot of contributions to charities (either money or personal items)? Did you have any unreimbursed business expenses for your job, or do you have a home-based business?I’ve never used the e-filing feature at irs.gov, but Turbo Tax does a pretty good job of covering all the bases. Or you could go to a business that specializes in doing taxes, such as Jackson Hewitt, and have them do it for you. Yes, you’ll have to pay to have it done, but what you pay to have your income taxes done this year is a deductible expense next year. Those places to a pretty good job on returns, just make sure you take ALL your information in when you go: driver’s license, social security card, proof of charitable contributions, all your W-2 s and any other tax documents you get from your school, banks or investment companies. If you go in before you’re ready to get your taxes done and ask, they’ll probably give you a list of thgins that might be deductible for you to gather documentation on. You can also get the information off the IRS site (www.irs.gov) although it might be difficult to find if you’ve never done your own taxes before.

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