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January 2013

In addition to the tax statements that are arriving this month, you'll need some other information to file your return. Today's Daily Tax Tip offers a checklist of what to round up, for either yourself if you plan to file on your own or for your tax professional. General information and documents that will be useful include: Social Security numbers for yourself, your spouse and all dependents. Last year's federal return. If you live in a state that collects taxes, dig out that old return, too. They can serve as guides to this year's filing. Records of estimated tax payments... Read more →


While we're waiting for the Internal Revenue Service to finish updating its forms, we filers can go ahead and get the other documents we need to file in order. Yep, I'm talking about gathering up all those tax-related statements that have been filtering into your snail mail or email boxes. Information on these exciting pieces of necessary filing paper is today's Daily Tax Tip. You'll need that documentation to fill out your Form 1040. Employers, clients, vendors and anyone else with whom you had a taxable transaction last year has until Jan. 31 to get the forms in the mail... Read more →


The 2013 driving season won't kick in until Memorial Day weekend. That's quickly followed by thousands of Americans hitting the road for summer vacations. But some folks are already worrying about the cost of those trips from a gas price standpoint as well as possible taxes. What's prompting the transportation tax concerns? The Government Accountability Office issued a new report in December 2012 that examines the financial advantages, for Uncle Sam, not drivers, of a mileage-based transportation tax system. Your highway tax dollars at work: Federal funding to build and maintain the nation's highways and bridges comes primarily from federal... Read more →


President Obama today formally proposed expansive federal gun-control measures, including 23 executive orders, in order to stem what he called "the epidemic of gun violence in this country." President Barack Obama, surrounded by Vice President Joe Biden and families from around the nation, signs 23 executive orders that are part of the Administration's new gun control proposals in response to the Newtown, Conn., elementary school shootings and other recent gun violence incidents. (Official White House Photo by Lawrence Jackson) Obama's proposals to institute universal background checks and ban military-style assault weapons and high-capacity ammunition magazines will get most of the... Read more →


Yeah, I'm feeling a bit like a tax geeky Paula Revere here, but the official update of Form 1040 is good news. We're all waiting for the Internal Revenue Service to get ready for us 140 million or so taxpayers to send in our 2012 returns. They're aiming to open their doors, both real and digital, on Jan. 30. The biggest tax task is, of course, transferring all the American Taxpayer Relief Act data into Uncle Sam's computers. But the IRS also has to do basic stuff, like getting the tax returns updated. If you've spent any time browsing the... Read more →


Did you get so caught up in the fiscal cliff fight and the subsequent tax rate changes for 2013 that you almost forgot that our first tax deadline of the new year is almost here? Me, too. But tax time marched on and tomorrow, Jan. 15, is the due date for the final estimated tax payment of 2012. Dealing with estimated taxes also is today's Daily Tax Tip. The good news is that when it comes to 1040-ES forms and payments, either by check or money order payable to the U.S. Treasury, the Internal Revenue Service uses the same "timely... Read more →


The continuing chaos and complexity of the tax code finally convinced you that this is the year you'll get some professional tax help. You investigated the types of tax pros and have determined which one best fits your needs. Now it's time to get specific and check out the guy or gal you want to hire to do your taxes. Today's Daily Tax Tip offers some suggestions on how to do just that. Make sure the pro is registered: Individuals who prepare 1040s for pay now must meet Internal Revenue Service requirements for federal tax return preparers. Once they pass... Read more →


President Obama is working on his annual budget, but we know one thing that he won't be asking Congress to approve: construction of a Death Star. Death Star by Krischan at Blitz Research Planet Creator forum The main reason is because building a "Star Wars" style space station/super weapon would cost an estimated $850,000,000,000,000,000. The Lehigh University students who arrived at that spectacular amount say it is roughly 13,000 times the world's gross domestic product and is for just the steel needed to complete the project. $850 quadrillion (yes, I looked up the name for 15 zeros) also is this... Read more →


Filing season 2013 is here, sort of. And while no tax season is easy, this year's has its own special complications that I examined last week at my other tax blog. Since Congress waited until Jan. 1, 2013, to approve a variety of tax laws that apply to the 2012 tax year, it was no big surprise that there would be a slight delay in filing federal tax returns. The question then became just when would taxpayers, especially those who are depending on refunds, be able to submit their 1040s? The IRS' answer: It would start accepting 2012 tax returns... Read more →


2012 and 2013 tax rates, income brackets

If you're a higher income earner, take a good long look at your 2012 return. It will be the last one for a while -- at least until 2017 and only then if a Republican moves into the White House -- where your top ordinary income tax rate will be 35 percent. This time next year, you'll face a top income tax rate of 39.6 percent. To acknowledge the changing tax rates, today's Daily Tax Tip presents the 2012 and 2013 income tax rates and income brackets. The table below shows the rates and income ranges that will be used... Read more →


Jacob Joseph "Jack" Lew, the current White House Chief of Staff, is getting as much attention for his signature as he is for President Obama's decision to name Lew as successor to Timothy Geithner as Secretary of the Treasury. By now, you've seen Lew's John Hancock, which is no John Hancock at all, but rather a string of circles that has become known as the Loopy Lew. The idea of that scrawl appearing on U.S. currency immediately captured the fancy of America. OK, maybe it just caught the attention of bored journalists. But you've got to admit that Lew's signature... Read more →


OK, we all agree with National Taxpayer Advocate Nina Olson that a bloated, confusing tax code is the biggest problem we taxpayers all face when we try to meet our annual filing obligations. But wait, as the saying goes, there's more. Much, much more. Olson's list this year contains 23 trouble spots. You can read all about all of them in her just-issued 2012 Annual Report to Congress. But if you just want an idea of what she sees as the major taxpayer challenges, here's the list. The Complexity of the Tax Code The Alternative Minimum Tax Corrodes Both the... Read more →


How long does it take you to file your tax return? The Form 1040 instructions book estimates that a taxpayer needs on average around 18 hours to complete a tax return. An analysis of IRS data by the Office of the Taxpayer Advocate extrapolates those figures even further. It found that it takes all U.S. taxpayers more than 6.1 billion hours to complete their annual tax filing tasks. The reason? The same one that National Taxpayer Advocate Nina E. Olson has cited year after year after year: our convoluted tax code. Tax complexity is again atop Olson's list of the... Read more →


Yesterday I asked when will the Internal Revenue Service be ready for our tax returns? The qualified answer is Monday, Jan. 30. Good job, IRS, good job. The tax agency didn't get the final word on 2012 tax year changes that are part of fiscal cliff tax bill (American Taxpayer Relief Act, or ATRA) until New Year's Day. And it expects to incorporate most of that info and be ready to handle taxpayer filings only eight days later than the originally planned tax season 2013 opening day of Jan. 22. The Jan. 30 date will apply to folks who might... Read more →


How the heck did it get to be January 2013, and into the second week of the month at that? Oh yeah, we all were preoccupied by the Congressional fiscal cliff near debacle. OK. Some folks think the deal that was struck, the American Taxpayer Relief Act of 2012, is itself a fiasco. We shall see. That may well be the theme of a future Tax Carnival. But now we're ringing in, albeit a bit belatedly, Happy Tax New Year 2013 in the 110th Tax Carnival. And what better way to get it started than with some contributor examinations of... Read more →


Taxpayers are once again paying the price for Congressional procrastination. By putting off the fiscal cliff bill until Jan. 1, our Senators and Representatives have probably forced us taxpayers to wait to file our 2012 returns. That measure, the American Taxpayer Relief Act, included provisions, notably the Alternative Minimum Tax (AMT) and numerous extenders, that affect 2012 tax returns. And although Representatives and Senators were warned repeatedly that their bad work habits would create problems for the Internal Revenue Service and taxpayers, they apparently didn't care. So now the IRS is working, feverishly we hope, to update tax forms, worksheets,... Read more →


The 2013 tax season certainly will be a bit more challenging since Congress took so long to finalize the 2012 tax laws. But not to worry. To help make your tax tasks easier, you'll find a Daily Tax Tip over there in the ol' blog's right column each day, weekends and federal holidays included, through the April 15 filing deadline. And if you miss a day, check out the full 2013 daily tips list. Read more →


Happy New Tax Year! Yes, I realize that it's Jan. 7 not Jan. 1. But six days ago we all were preoccupied with the fiscal cliff that we fell off of for about 10 hours between the final Senate and House approval of the American Taxpayer Relief Act (ATRA) of 2012. The new 2013 individual income tax rates got most of the fiscal cliff attention. But ATRA also included the Senate Finance Committee version of tax extenders that had expired more than a year ago. The resurrected tax breaks were made retroactive to Jan. 1, 2012, meaning we can use... Read more →


The latest session of Congress convened on Jan. 3, 2013. We're all familiar with the quote that "No man's life, liberty or fortune is safe while our legislature is in session," but this year poses added problems for folks with triskaidekaphobia. That tongue twister of dread is the fear of the number 13. This year, 2013, brings us the 113th Congress. And the shared final two digits of those reference points -- 13 -- represent this week's By the Numbers figure. This new group of legislators enters inauspiciously. The Republicans who hold the majority of the U.S. House seats are... Read more →


The end of 2012 and the beginning of 2013 all came together in a blur, thanks in large part to Congressional procrastination that led to a mad rush to pass fiscal cliff legislation. So it's no surprise that what is and isn't in the eventual fiscal cliff tax bill dominated 2013's debut discussion last week at my other tax blog. The first Bankrate Taxes Blog post of 2013 arrived with an unwanted welcome: Happy higher new year payroll tax. The 6.2 percent payroll tax amount was not part of fiscal cliff talks and quietly returned on Jan. 1. That means... Read more →