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To: FWS who wrote (41732)	4/12/2001 8:50:20 PM
From: Boa Babe	Respond to of 54805

and tekboy thanks too.. ROFL! ....oh, sorry, tb....but it WAS funny...maybe it was the way he/she delivered the line.

To: FWS who wrote (41732)	4/12/2001 11:24:54 PM
From: BirdDog	Respond to of 54805

Actually, our kinder, nicer, new, humanitarian IRS has issued IRS ruling number 159732346683792, which addresses your inquiry. It states that you can actually write off just about anything you want. Provided, during the tax year in question, you were abducted by Aliens wearing thongs in a Pink Cadillac. Pictures are considered acceptable proof of the abduction, and may be obtained through a UFo post. Otherwise, our kinder gentler IRS is satisfied if the aliens dropped you off at Fairhaven Sanatorium. BirdDog

To: FWS who wrote (41732)	4/13/2001 4:08:08 AM
From: Bruce Brown	Respond to of 54805

Chris wrote: I didn't realize I filled out a form 4952 last year. I sort of get it. Now because I didn't have much interest of div income and didn't take any gains last year, I have even more "disallowed investment interest expense to carry forward! thanks again. Right, you can carry the disallowed investment interest over to the next year. It looks like you've figured it out. Run the 'investment interest expense' through on form 4952 to see if it qualifies on line 8 as a deduction when computing the gross income from property held for investment, net gain from the disposition of property held for investment and net capital gain from the disposition of property held for investment to come up with your 'investment income'. As you mentioned - if disallowed, it may be carried forward to the next year to 'try again'. After running the calculation, you can see which is better for your individual case - the standard single deduction of $4XXX or the investment interest expense deduction. And as always - consult your CPA and make sure everything is post marked by midnight on Monday, April 16. BB

To: FWS who wrote (41732)	4/13/2001 7:41:50 AM
From: Brian K Crawford	Read Replies (1) \| Respond to of 54805

This probably won't be your favorite link, but it is authoritative: irs.gov Answers to your questions, clipped from the IRS FAQ's: Investment Interest If you borrow money and use it to buy property you hold for investment, the interest you pay is investment interest. You can deduct investment interest subject to the limit discussed later. Investment property. Property held for investment includes property that produces interest, dividends, annuities, or royalties not derived in the ordinary course of a trade or business. Interest on margin accounts. If you are a cash method taxpayer, you can deduct interest on margin accounts to buy taxable securities as investment interest in the year you paid it. You are considered to have paid interest on these accounts only when you actually pay the broker or when payment becomes available to the broker through your account. You cannot deduct any interest on money borrowed for personal reasons. Disallowed interest expense. In the year you dispose of the obligation, or if you choose, in another year in which you have net interest income from the obligation, you can deduct the amount of any interest expense you were not allowed to deduct for an earlier year. Follow the same rules provided in the earlier discussion under Deferral of interest deduction for market discount bonds. Limit on Deduction Generally, your deduction for investment interest expense is limited to the amount of your net investment income. You can carry over the amount of investment interest that you could not deduct because of this limit to the next tax year. The interest carried over is treated as investment interest paid or accrued in that next year. Net Investment Income Determine the amount of your net investment income by subtracting your investment expenses (other than interest expense) from your investment income. Investment income. This generally includes your gross income from property held for investment (such as interest, dividends, annuities, and royalties. Choosing to include net capital gain. Investment income generally does not include net capital gain from disposing of investment property (including capital gain distributions from mutual funds). However, you can choose to include all or part of your net capital gain in investment income. You make this choice by completing line 4e of Form 4952 according to its instructions. If you choose to include any amount of your net capital gain in investment income, you must reduce your net capital gain that is eligible for the lower capital gains tax rates by the same amount. For more information about the capital gains rates, see Capital Gain Tax Rates in chapter 4. Before making this choice, consider the overall effect on your tax liability. Compare your tax if you make this choice with your tax if you do not. END of IRS FAQ's I should note that it appears that, once again, Mr. Buckley got it exactly right in his answer to you. Brian