July 1: Today is the beginning the new fiscal year for many states, meaning some
new tax laws take effect today across the country. They include a new tax on sports betting in Louisiana, rate changes in Idaho and Iowa, and tobacco-related taxes in Utah and Virginia. Your
state tax department's website should have details.
July 4: Happy 245th Birthday, America!
Although the official federal holiday is Monday, July 5, most jurisdictions across the United States are holding festivities today and, for fireworks viewing, tonight. Enjoy your celebrations safely, from both coronavirus health and pyrotechnic perspectives.
Most of us will never be totally independent of taxes, but we can celebrate fewer tax hassles by paying attention to what we might owe and how we can reduce that amount throughout the year. Such attention to tax details is especially important given the changes and tax breaks created in response to the
COVID-19 pandemic and its economic effects. One of those kicks in this month, with the Internal Revenue Service beginning delivery of
advance payments of the Child Tax Credit (AdvCTC) to eligible families.
July 9 & 10: If you qualify for the AdvCTC but want or need help in filing a 2020 tax return to ensure you get the payments, the IRS is ready to help these two days. It and community groups in 12 metro areas are holding
AdvCTC Free Tax Prep Days.
July 12: It's looking like it's going to be a more normal — remember what that was like? — summer, thanks to more of us being vaccinated against the coronavirus. That means more restaurants will resume table service. Be sure to share your happiness about being served in person again with your waiters. If you're still a bit hesitant about going to a packed eatery, also tip the food delivery folks still bringing meals to your door.
If a tip isn't included in your restaurant check or food delivery charge, click the image above to calculate how much to tip.
Those of you getting the tips, remember that your
tips are taxable income. If you got such added financial thanks that came to a total of at least $20 last month, whether as a waiter/waitress or hair stylist or valet or whatever job where gratuities are common, you need to account for them today. Report them to your employer on
Form 4070.
July 15: This is the day the AdvCTC should start showing up if you provided a bank account for direct deposit. While the payments aren't taxable income, if your family situation has changed in 2021 from the 2020 tax data used to calculate it, you might have to
repay some of the early credit amounts when you file next year.
July 19: Speaking of life and family changes, if you've had any since last tax year, it's time for a
paycheck checkup. This will help determine whether you need to
adjust your payroll withholding. Even if things haven't changed, a withholding review is warranted if you were
surprised by the refund you did (or didn't) get last year.
July 23: Potentially destructive weather is one area where you definitely don't want surprises. We're well into the Atlantic/Gulf of Mexico hurricane season. There were three named storms in June, but so far the United States has been lucky. No major storm has hit, as least not as I type this on July 1.
The longer it takes for storms to form, the longer we have to
prepare for what the National Oceanic and Atmospheric Administration (NOAA) expects to be an
active 2021 tropical storm season. Even if we don't get the predicted 20 named storms, with possibly 3 to 5 reaching major status, it only takes one to wreak havoc. The countdown clock below can help you keep track of how many more days you have to worry about tracking any size or type of tropical storms.
You also might want to check out the ol' blog's special
Storm Warnings.
These multi-page collections of posts offer tax advice on preparing for, recovering from and helping those who sustain damages from the many ways that that weather goes wild. That includes
claiming uninsured losses from a major natural disaster as on itemized tax deduction.
July 28: Speaking of filing, if you got an
extension back in May, giving you until Oct. 15 to finish your 2020 tax return, you don't have to wait until then. You can get to work on that now. And whenever you do get around to finishing your taxes, the IRS recommends you do so electronically. You can do that
and possibly save some money by using Free File, the online no-cost tax preparation and e-filing partnership between the IRS and Free File Alliance.
The official
Free File site at IRS.gov this season offers
nine participating tax software options if your adjusted gross income is $72,000 or less, regardless of filing status. If you make too much to use the online software, look into using Free File's fillable forms. Both the online Free File and fillable forms are available through October's extension due date.
July 30: Wow, the end of the month is already here! That means the new school year is just around the corner. So are the usual back-to-school sales tax holidays. Although Alabama kicked off the tax-free events on July 16, most are in August. But four more state sales tax holidays begin this final July weekend. You'll find details on the ol' blog as the details are firmed up and near this and next month. Until then, you can get an idea of shoppers' potential tax savings by reviewing
2020's sales tax holidays.
Small Business Tax Calendar: Important
filing, deposit and record keeping dates throughout the year that your company needs to know. You can get more tax calendar information at the IRS'
online calendar page and view the full year's important business and individual tax dates in
IRS Publication 509.
Everyone should know that if you receive rental income from renting a dwelling unit, such as a house or an apartment, you may deduct certain expenses. Basically, the amount of time you personally spend at your second home determines how much tax you might owe on rent, as well as deductions you can claim against the property. Lots of second-home buyers rent their property part of the year to get others to help pay the bills. Very different tax rules apply depending on the breakdown between personal and rental use. The best tax deal is for short-term rentals. If you rent the place out for 14 or fewer days during the year, you can pocket the cash tax-free.
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