Have you ever received one of those love letters from the IRS that says you owe them more money? Occasionally a client calls me in a panic when they receive one. Most of the letters I have seen are due to the client or the tax preparer forgetting to include the sale of a stock
Taxes
If you are paying college expenses for yourself or for one of your dependents, you may be able to deduct the tuition and fees on your federal tax return. Qualified tuition and fee expenses may be partially deducted as long as the expenses are not paid by others through programs such as scholarships, grants, or
Caring for an elderly relative can be rewarding, but incredibly difficult – as well as expensive. However, it may be possible to recoup some of the costs through income tax savings.
There are three general approaches to tax savings on elder care costs – declaring your elderly relative as a dependent to receive an exemption,
Congratulations! You have just been handed your first little bundle of joy in the hospital and have embarked on the long journey of parenthood. It is a trip full of joyful experiences that make the corresponding aggravations worthwhile, and it comes with many benefits — some of which are tax-related. You can look forward to
Social Security is generally considered a tax-free benefit, but that is not always the case. Depending on the amount of alternate income that you have in retirement and your filing status, you could owe taxes on up to 85% of your Social Security benefits.
If you receive Social Security or Social Security Disability Insurance (SSDI)
It is easy to lump exemptions, deductions and credits into the same basket of tax-saving mechanisms, but they are distinctly different. Here are the simplified differences:
What They Reduce – Deductions and exemptions both reduce your taxable income, and credits reduce your overall tax bill. With reference to Form 1040, exemptions and deductions all take
Your home is your castle, and it is also a source of tax deductions. Yet, every year, Americans let these potential tax deductions pass by, not realizing how to take advantage of them.
IRS Publication 530, titled “Tax Information for Homeowners”, can fill you in on the deductions that are available to you for the
Congratulations! You have just been handed your first little bundle of joy in the hospital and have embarked on the long journey of parenthood. It is a trip full of joyful experiences that make the corresponding aggravations worthwhile, and it comes with many benefits — some of which are tax-related. You can look forward to
You want to be an energy saver, and are interested in going green as much as possible through new energy efficient appliances, home modifications, and perhaps even building a brand new energy-efficient home. Every level of the U.S. government also wants you to be an energy saver, and is willing to back it up with
Change is the word for 2017 in many respects. While the incoming Trump administration promises many changes related to taxes, there are already changes written into law that will affect your returns for the 2017 tax year (returns that you file in April 2018), and a few others affecting your 2016 taxes that take effect
529 plans are one of the best options available to save for your child’s college education. Named after a section of the tax code, 529 plans are state-operated savings plans that provide tax benefits as long as the money is used for qualified educational purposes.
State 529 plans operate in a similar fashion to 401(k)
Fall is here, which means that it is time for the annual running of the workplace benefits gantlet. In all the rush to pick healthcare plans and sort out this HMO from that HSA, do not let your FSA get lost in the alphabet soup of offerings. That is a Flexible Spending Account, and it
Senate Judiciary Committee Chair Bob Goodlatte has introduced a new draft of the Online Sales Simplification Act (OSSA) that, if passed, would create an online sales tax that is much less complicated than the current method for online retailers to collect taxes. The way internet sales taxes are currently collected depends on whether the retailer
When most of us think of mobile homes, we don’t think of high-end features, gazebos, and a deck featuring a stunning ocean view. We also don’t think of them being worth $5.3 million.
Welcome to Malibu, where upper-end mobile homes can be built out like luxury beachfront homes of traditional construction while offering the same
One of the tax deductions available to individuals and couples who own their home is the mortgage interest deduction. This deduction can save homeowners who owe taxes a substantial amount, especially if they have a mortgage with a high interest rate. An announcement by the IRS last week will provide some homeowners with even larger
Donald Trump’s taxes and his net worth are subjects of great mystery and speculation, so why should his income be any different? Again, The Donald does not disappoint when it comes to controversy.
In his financial disclosures with the FEC in 2015, Donald Trump listed $362 million in income for 2014. In a press release
Life insurance has grown in complexity over the years and, as a result, life insurance taxation issues have become equally complex. While you should consult with a tax professional to verify the tax status of any life insurance payout you receive, we can give you some general rules and guidelines to consider.
Pre-Tax or Post-Tax
How much will you be paying in federal income taxes this year? According to data from 2013, the average individual American tax bill was over $8,500 — yet there are large corporations making millions of dollars in profit and paying no income taxes. According to USA Today, 27 large corporations in the S&P 500 reported
Does your ability to pass on your wealth to your heirs depend on where you live … and die? Indeed it does. Federal estate taxes apply no matter where you live within the U.S., but eighteen states subject their citizens to estate taxes or inheritance taxes. The difference between the two is that estate taxes
When most homebuyers sit down to calculate whether they can afford a particular home, they often assume their monthly mortgage payment will include only the principal and the interest. Many forget to factor in property taxes and their monthly homeowner’s insurance premium. This often leads borrowers to experience sticker shock when they see what a
The Affordable Care Act (ACA, or Obamacare if you prefer) has probably had a significant impact on your health insurance. Did you realize that Obamacare has had an effect on your taxes as well? Here are a few of the tax ramifications of the ACA.
Individual Mandate – If you are aware of only one
If you ever wanted to achieve the level of wealth that allows you to hide a large amount of it within the iconic Swiss bank account, you are now officially out of luck. Feel free to target great wealth, but do not expect to be able to evade taxes by parking your assets offshore in
As the tax filing deadline looms, many Americans continue to prepare and file their annual income taxes. For the 86 million taxpayers who own their homes and have a mortgage, there are several different tax deductions they can take advantage of, including deducting their mortgage interest and the insurance premiums of any private mortgage insurance.
According to a report by the Institute on Taxation & Economic Policy, illegal immigrants in the United States pay in almost $12 billion dollars in taxes annually. This amount includes sales, property, income, and excise taxes that go to local and state budgets. The findings contradict the talking points of many politicians seeking support for
The U.S. economy has been slowly climbing out of the effects of the Great Recession, but new milestones suggest that we are finally turning the corner toward full recovery. A recent study by The Pew Charitable Trusts noted one such milestone. In a majority of states, inflation-adjusted state tax revenues have topped pre-recession levels.
Using
Ladies, how much are you paying in “pink tax”? That’s the amount of additional money you’re paying just for being female. We’re not just talking about clothing and haircuts… we mean, fashion and coifs. You’re even paying more for games and toys, according to a recent study by the New York City Department of Consumer
The U.S. has the highest corporate tax rate in the developed world with a 35% federal levy on profits. When various state taxes are included, the nominal rate is just over 39%. Is it time to consider lowering our corporate rates?
American corporations have argued for years that our tax rate should be lowered, because
You may have heard presidential candidates talk about repatriation and how different approaches to the subject should play a part in tax reform. What is repatriation and why does it matter with respect to US taxes?
To explain, it is important to look at one unique aspect of the US tax code: the US is
One great way to start a fight is to initiate a debate about what constitutes a fair share of taxes. Should they be progressive, regressive, or neutral? An even better way to phrase the question is: Should taxes be based on a proportionate share of income, consumption, or some other property?
Those are the basic
Every year, the Tax Foundation compares the total amount of taxes paid in America and the amount of spending on the necessities of food, clothing, and shelter. In most recent years, the Tax Foundation has concluded that Americans spend more on taxes than on necessities — and 2015 is no different.
The Tax Foundation projections