Sentences with phrase «deduction against ordinary income»

If the loan that can't be repaid is a business loan, however, the lender receives a deduction against ordinary income and can take deductions even before the loan becomes totally worthless.

Not exact matches

The itemized deduction for state income tax can be used against ordinary income that's taxed at 39.6 %, which means the effective rate of tax on the capital gain under the regular income tax could be about 16 % versus 27 % in the AMT calculation, producing a difference of eleven percentage points.

To the extent there are any tax deductions, those deductions are applied to the ordinary income first, and only apply against long - term capital gains directly once ordinary income has been reduced to zero.

And notably, because deductions are applied against ordinary income first and capital gains second, someone with high total income due to capital gains could still be eligible for low tax rates on a partial Roth conversion (although this can still phase out the benefits of 0 % long - term capital gains tax rates), and / or have their deductions apply favorably to shelter further partial Roth conversions.

Depreciation is a deduction against passive income (Sch E), and it is never «written off against ordinary gains» (which is not a correct expression either way).