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October 2012

The economy is a major presidential campaign theme, but one of the biggest economic threat -- the impending convergence of expiring tax laws and the debt reduction deal that imposes severe across-the-board budget cuts -- is still hanging out there. To a large degree, it's out of the president's hands. Congress must come up with a deal on taxes and spending cuts to keep the country from falling off the so-called fiscal cliff. And House and Senate lawmakers must do so in the few weeks that they will be in D.C. after the Nov. 6 election. Only then will the... Read more →

Most companies that offer worker benefits have open season in the fall. During this time, employees can choose from various types of workplace perks, such as health care coverage, that they want or need. Among the most popular benefits are flexible spending accounts, usually referred to as FSAs. These workplace accounts can help you pay for medical expenses that aren't covered by insurance, as well as for some child care costs. They also can save you a few tax dollars And they are this week's Weekly Tax Tip. Pre-tax contributions: Whether you have a child care or medical FSA, the... Read more →

The good news was that we finally got some tax talk last night during the second presidential debate between President Obama and Mitt Romney. The bad news was that we didn't get much more at the Hofstra University town hall session than what's already been offered, such as in this comparison of the Obama and Romney tax plans. But the two candidates did talk a bit of taxes. Here are some tax excerpts taken from the debate transcript. Obama threw the first substantive punch: "Governor Romney doesn't have a five-point plan. He has a one-point plan. And that plan is... Read more →

Will popular but costly tax breaks end?

Tonight President Obama and Mitt Romney face off in their second presidential debate. While Obama might be, as his campaign staff promises, more aggressive, I doubt we'll get any more specifics this time from Romney about his tax proposal(s). The Republican challenger and his vice presidential pick Paul Ryan have remained steadfastly vague about changes they would make to the tax code. The most we've gotten are three possible limits on itemized deductions: $17,000 mentioned by Romney before the first debate and $25,000 or $50,000 (make up a number, any number!) he threw out there during the event itself. Romney... Read more →

Welcome back to Tax Day 2012. As procrastinators know, this is the drop-dead, absolutely final deadline to finish and file tax returns that you just couldn't get to in April ... or May or June or ... No judging here. I've been in your position before. So let's not waste any more valuable time. First, take a quick look at the earlier Countdown to Oct. 15 tax tips. You also might want to breeze through this year's Weekly and Daily tax tips for a few more filing ideas and reminders. This handy tax preparation checklist also makes a good filing... Read more →

The head-to-head match-up last week of Vice President Joe Biden and Republican nominee Rep. Paul "Call me Mister" Ryan marked the halfway point of the 2012 campaign debates. It also gave the number two guys on their respective tickets a chance to talk taxes. Or rather, as Citizens for Tax Justice (CTJ) put it, have a spirited discussion over their competing visions for tax policy. CTJ, whose analyses were mentioned frequently by Biden, kept track of the tax encounters and came up with the veep debate's tax top 10. That number also is this week's By the Numbers figure. In... Read more →

You've gathered all your tax statements and you've discovered that you actually made more money than the Internal Revenue Service knows. Woo-hoo! Tax free income! Wrong. Sure, your neighbor paid you $400 for the weekend you spent making him a bookcase for his office. And you got $300 for the article you wrote about the project. Since both jobs paid less than $600, neither your neighbor nor the magazine had to issue you a 1099-MISC. That means the IRS didn't get a copy either. But technically, even if you don't get a tax statement the income is still taxable. This... Read more →

Would you be more inclined to pay your overdue tax bill if the Internal Revenue Service was able to report your tax delinquency to the national credit reporting agencies? That's one of the questions asked in a recent Government Accountability Office, or GAO, report about such a possibility. In its report to the chairman and ranking member of the Senate Finance Committee, the GAO noted that millions of people owe billions of dollars -- $258 billion in fiscal year 2011 alone -- and that the IRS spends substantial resources, both in dollars and personnel, trying to collect the overdue taxes.... Read more →

The hubby and I have an SUV. I remember when we first got it, I felt like I was 10 feet above the road. And for the first time, I started paying attention to clearance signs. Highway bridges obviously are not an issue. But when we park in garages, especially some older ones, I get a little nervous. Will we be able to squeeze in without scraping the roof? The hubby always says it's not a problem, but I still worry until we're safely parked. A similar consideration of tax clearance warnings is necessary in order to navigate several tax... Read more →

Do you sometimes feel left out when folks talk about tax breaks. Schedule A gets so much attention and you've never filed it. Don't despair. You are actually in the majority. Internal Revenue Service data reveals that around two-thirds of tax returns claim the standard deduction amount each year. And the tax code has something for all y'all standard deduction filers. They're known officially as adjustments to income. But they're popularly called above-the-line deductions because you claim them in the "Adjusted gross income" section found at the bottom of the first page of both Form 1040 and Form 1040A, just... Read more →

Disasters happen every day. And in many instances, people's tax filings are affected. But here's one unforeseen circumstance that taxpayers can't prepare for: Your tax returns are burned in a mail truck fire. On Sept. 11, a delivery truck carrying mail addressed to the New Jersey Division of Taxation was involved in an accident on the New Jersey Turnpike. The truck caught fire and, according to New Jersey's Treasury Department, most of the correspondence in the vehicle burned. "The contents of the truck were destroyed beyond recognition, with the exception of a small number of certified mail pieces, some of... Read more →

If you believe the adage that art reflects life, then today's television programs are giving us a much more wide-ranging view of the American family. OK, maybe equating art and television is not exactly accurate, especially when we're talking about the families represented by Dance Moms and Honey Boo Boo and Duck Dynasty. Then we have the truly fictional families portrayed in Sons of Anarchy, The Middle, Modern Family, How I Met Your Mother (Lily, Marshall and Marvin), Don and Betty "Worst Mother Ever" Draper of Mad Men and my favorites, back soon via Netflix, the Bluths of Arrested Development.... Read more →

I do our taxes and the hubby cheers me on, usually by chanting "Deduct! Deduct!" After all these years I've finally convinced him that tax credits are better than tax deductions because they reduce your actual tax liability dollar for dollar. But he reminds me that it's still more fun to yell "deduct" than "claim a credit." So I humor and welcome his tax-time support and then round up tax-saving deductions and credits under the umbrella term of tax breaks. Over the years, I've run into some that folks tend to miss. Today's Countdown to Oct. 15 takes a look... Read more →

I appreciate lawmakers efforts to wring as much money as they can out of their jurisdictions. Times are tough for everyone, including governments at every level. I also appreciate efforts to reduce violence. Any area that wants to keep its residents and grow has to be a safe place to live. But even I, a fan of some firearm limits, knew the minute I saw the NBCNew headline about a proposed "violence tax" in the greater Chicago area that people would immediately take aim at the idea. Cook County President Toni Preckwinkle says a tax on guns and ammunition would... Read more →

OK, folks, pull out your Schedule A and let's look at what tax deductions we can eliminate. But note, you can't touch the mortgage interest deduction for a principal residence or the write-off for charitable gifts. No, that's not the eternal wishes of lobbyists for the housing and philanthropy sectors. That's the word straight from Mitt Romney. Tax plan in flux: The Republican presidential nominee is making the rounds, dropping hints about his tax plan. Although his campaign website still simply says the Republican presidential nominee would "make permanent, across-the-board 20 percent cut in [the existing six] marginal rates," he... Read more →

One of the main reason people put off doing their taxes is their fear of making mistakes. One error, whispers that voice as soon as you start working on your 1040, and the Internal Revenue Service will jump all over it, send you nasty letters, audit your return, make your life hell. Take a breath. Most of the time when the IRS finds an error on a tax return, especially a math mistake, it corrects it for you. Sure you'll get a notice of the change, but this correspondence tends to be more boring than totally terrifying. Still, you don't... Read more →

Hey there, you 11 million taxpayers who didn't file your return in April. Your time is almost up. OK, not all of you are procrastinating until the absolute final Oct. 15 due date. You, like Mitt Romney, didn't need the full six months to finish your Form 1040. But there still are plenty of you -- the Internal Revenue Service's official count is "many" -- are going down to the wire. Why wait? You didn't have all the forms you needed. You were worried about a particular tax claim. You just didn't want to mess with taxes back then. Well,... Read more →

I'm not a church-going gal, much to my mother's chagrin, but I know that a minister's (or priest's or rabbi's) job is not easy. Father Niles, the Episcopalian priest who officiated when the hubby and I got married, had to travel several hundred miles to make our union legal in the eyes of man and God. But he did so because his faithful congregant, my father-in-law, thought our private-residence rite needed a touch of spirituality. So even though I'm not in a church on Sundays, I know that many folks are at weekly (and more) services and that their preachers... Read more →

Thanks to a slow start, I've got a lot to do today and to post here, so I'm cutting right to the chase with this report of posts last week at my other tax blog. We've entered the fourth quarter of 2012 and we taxpayers still have no idea about some key tax moves we want to make because Congress has pushed off action until after the election. That also means we're getting closer each day to the fiscal cliff's costly prospects. That topic, however, didn't come up during the first presidential face-to-face between Barack Obama and Mitt Romney. In... Read more →

A lot of taxpayers depend on tax breaks that are no longer in the tax code. But they're hopeful that Congress will reinstate them soon after they get back to work in mid-November. These technically temporary tax provisions expire and then are renewed, or extended, for another year or two. Because Representatives and Senators often wait so late in the legislative year to take action, the tax breaks often are retroactive. This process has led to these tax laws being known as extenders, although some tax wags have dubbed them expirers because in recent years that's what happens before they... Read more →