Simplification Creates Complexity Do you love getting a big tax refund? You shouldn’t. You paid more than you owed and gave the government an interest-free loan when you could have been putting that money to better use. Believe it or not, the government agrees. The IRS prefers that you pay the exact amount of taxes
Procrastinator alert: your taxes are due! If you are nowhere near ready as the scary deadline approaches, you may file an extension with the IRS that gives you up to six more months to file your taxes. Filing an extension will spare you from late filing penalties — 5% of the amount of tax you
How many people like the IRS? According to Facebook, it’s almost 110,000! Does it bother you that the Internal Revenue Service is more popular than you are? If you regularly use social media outlets to stay in touch with friends and follow people or businesses that you find interesting and relevant, consider adding the Internal
Wouldn’t it be nice if you could deduct your credit card debt from your taxes? For most Americans, that’s just a dream that will never come true. However, some circumstances allow you to deduct some credit card debt – all related to using your card for business purposes. The 2017 Tax Cuts and Jobs Act
You’ve completed your 2018 tax return, and you don’t like the results. How did you end up owing so much money? There’s nothing you can do about it now … or is there? While the 2017 Tax Cuts and Jobs Act (TCJA) made sweeping changes to the tax laws, it didn’t offer any retroactive means
The Internal Revenue Service has plenty of ways to penalize you for mistakes on your tax return. Some of these potential penalties are so convoluted and complex that there may well be disagreement within the IRS on when they apply. However, most people accrue tax penalties for very simple mistakes. Below are some of the
What two words cause the most panic to Americans? There are probably a hundred funny responses running through your mind right now, but we were thinking of a less humorous response: “IRS audit.” Your odds of avoiding an audit are usually pretty good. The IRS reviewed less than 1.1 million tax returns in fiscal year
MoneyTips The last few years have been difficult ones for the IRS with respect to security issues, and the agency is determined to improve security during this year’s filing. Electronic filing is particularly vulnerable because of the speed of the process — it is a favorite method among thieves who steal information from taxpayers and
Chances are that if you have student loans, you need every bit of extra cash that you can get. Did you realize that your student loans might be able to generate some cash for you? Under certain circumstances, you may be able to save on your tax bill by deducting the interest that you pay
The Premium Tax Credit (PTC) may sound like it is a credit only available to top-tier incomes, but it is actually quite the opposite. “Premium” in this case refers to health care premiums, and the PTC is a way to help those with relatively low incomes to afford health insurance premiums and avoid the potential
On June 26, 2015, the Supreme Court settled the issue of same-sex marriage in the U.S. with the landmark decision in Obergefell v. Hodges. This decision requires states to issue marriage licenses to same-sex couples and for states to recognize such marriages that were performed in other states. Gay marriage became legal in all 50
The Tax Cuts and Jobs Act of 2017 cut taxes for many Americans and changed the tax bracket structure. Did you check your withholding and adjust to take any likely tax bill changes into account? According to a study from tax preparer H&R Block, you probably didn’t – and there’s a good chance you don’t
If you are over age 65 or are retired due to a disability, you may be eligible for a separate tax credit designed to help the nation’s seniors and disabled. Even better than a deduction, the Senior Tax Credit for the Elderly and Disabled could take up to $7,500 directly off of your tax bill.
What will you do with your tax refund? We hope you have something fun in mind, but a new survey suggests that you might use it to pay bills instead. The Center for Financial Services Innovation (CFSI) recently released baseline survey results for their U.S. Financial Health Pulse, a study designed to assess and track
Married couples have the choice of filing their taxes jointly or separately. What is the best option for you and your spouse? Generally, it is to file jointly – but there are several factors to consider before making your choice. Obviously, the first hurdle is that you have to be married. For tax purposes, you
If you’re a traditional employee, every year you receive a W-2 form from your employer that records your earnings for the year and the amount of taxes withheld from those earnings. IRS 1099 forms are complements to the W-2 form for non-traditional employee relationships. They are generally designed to record sources of income that have
To paraphrase the old adage, there are only three absolutes in life: death, taxes, and the rise of scams during tax season. A major tax scam since 2013 involves phone calls by fictional IRS agents that demand immediate payment for alleged tax debts, threatening lawsuits or even jail time to those who refused to comply.
Tax filing season is upon us. Soon you will be filing your paperwork and perhaps receiving a nice check — unless thieves file a return in your name first and falsely claim your refund. Unfortunately, if a thief has your Social Security number and other relevant information, tax identity theft is very hard to prevent.
The Earned Income Tax Credit (EITC) is a program designed to provide tax relief for American workers with low-paying jobs. Could you qualify for this tax credit? If you have a relatively low income, take some time to find out. Earned Income Tax Credit Qualification Some eligible taxpayers miss out on EITC savings because they
One of the most controversial provisions of the 2017 Tax Cuts and Jobs Act (TCJA) was the limit it placed on state and local tax (SALT) deductions. The TCJA capped the deduction on combined payments for state and local property, sales, and income taxes at $10,000 beginning in the 2018 tax year. According to the
Identity thieves have many ways to steal your money – including fraudulent tax returns. They file a return in your name as early as possible to beat your legitimate return, with fake financial data designed to claim a large refund. You won’t realize this until your tax return is denied because there’s already been a
Did you have a happy New Year? We certainly hope so. Now it’s time to get back to regular routines and take care of January chores, including gathering your tax information. The 2019 Tax Season Begins on January 28 Despite the partial government shutdown, the IRS announced that the 2019 tax season will begin on
Tax preparers such as Certified Public Accountants (CPAs) and Enrolled Agents are incredibly busy during tax season. Their time is precious, even more so this year with many of the changes introduced by the Tax Cuts and Jobs Act taking effect for the first time. That makes it even more important for you to prepare
The holiday season is full of plans and activities that make December incredibly hectic. If you are the average American, tax considerations and financial adjustments are pretty low on your holiday to-do list. However, you are not the average American — you enjoy saving money, are diligent in seeking ways to save, and excellent at
Uh-oh. You didn’t pay your taxes by the deadline. You’re facing late payment penalties – but, believe it or not, you may be able to convince the IRS to waive those penalties. It’s not well publicized, but the IRS does have a First Time Penalty Abatement (FTA) Policy. The FTA only applies for a single
Did you miss the April 17 tax deadline for 2018? If so, you probably filed for and received a six-month extension from the IRS. Don’t relax too much, because October will be here before you know it. The IRS offers a series of tips to help taxpayers avoid common errors when filing their taxes, whether
The term “administrative offset” brings to mind meaningless governmental jargon. It is governmental jargon – but if you are affected, it’s not meaningless at all. In layman’s terms, administrative offset is the government’s way of applying money that would normally be owed to you (such as tax refunds and certain Social Security benefits) to outstanding
Who wants simpler taxes? Most of us do, assuming we also keep more money in the process. Starting in 2018, homeowners are more likely to have simpler tax returns – but they may need to make similar tax calculations to ensure a lower tax bill. Tax simplification was part of the pitch to sell the
Retirement has finally arrived. You’re ready to start drawing on your retirement income sources. Enjoy this new phase of your life. Unfortunately, you haven’t been able to retire from taxes – and your taxes will enter a new phase as well. You don’t have an employer to hold out taxes on your salary anymore. You’re
A summer job is a great way for students to earn some extra money while building a resume for the future and learning new things about the working world. Typically, one of the hardest lessons for students to deal with is income tax. Working students may say, “Why is so much of my paycheck withheld?