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Author: karenlj Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121095  
Subject: Re: Capital gains tax for an estate? Date: 7/9/2012 10:48 AM
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I'm self-employed. Is it legal for me to have my agent hold back payments until next year?
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Of course it is. Income is still taxable in the year you had constructive control of it, though.

Phil
Rule Your Retirement Home Fool
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Phil's right. But it's also true that tax rates will go up next year for a lot of people, if the "Bush era tax cuts" expire, as they are scheduled to do, in the absence of congressional action.

So think carefully about the ramifications of deferring income to next year. It might not be a good year to do it.

Bill


I'm a little confused by the answers.

My reason for concern: if I earn enough to bump me above the 15% tax bracket, the 15% tax on the house profit will almost certainly wipe out the extra money and then some. I doubt the Bush tax cuts did much for me, so I'm not worried about the effect of their expiration.

If I earn it this year, but have payment deferred until next year, does that mean I have constructive control of it? If that's true, then I wouldn't have the option of deferring it anyway?

Karen
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