Personal Injury Proceeds-taxation

Personal Injury proceeds are NOT taxable

Personal injury proceeds are considered compensation of injuries and losses, it is not a "gain" or "windfall" under the tax codes.
Actually, whether personal injury damage awards are taxable depends on what the award is for. If it is to compensate for personal physical injuries or sickness, then it's not taxable (IRC Section 104(a)(2)). Emotional injury that is the result of of physical injury may not be taxable; however emotional injury that is the result of nonphysical injury (for instance, defamation or trespass) is generally taxable. Likewise, lost wages that are the result of physical injury may not be taxable. (See IRS Guidance: Lawsuit Awards and Settlements and Rev. Ruling 85-97.)

For further clarification, contact us.

charitable donation

IRS is tightening up the rules and monitoring of donation deductions. To be on the right side, be sure to donate to a qualified chariotable organization.  Proper documentation is premiere.  You should keep/get a receipt.  If you donate money get a receipt and/or give checks preferrably.  All donations should be done before end of calendar year-Dec 31st.

Thank you and

Happy Thanksgiving to you and loved ones.

Vijay Sammy

Estate planning for child with disability

What follows is very important concerning estate planning for the future protection of a son or dauther with a significant disability:

Things to consider:

1.Wills
2. Special needs trust
3. Durable power of attorney
4.  Medical directive or living will

look into as proper planning can handle reality better for all involved.
Sincerely Gratitutes.
Vijay

Tax update tips

Remember if you make any energy eifficient puchases/renovations please keep reciept. This is for year 2009 and 2010 tax year. Check with me for more details on this and many other updates.