However, opponents of the Internal Revenue Service's option that cuts out private tax software companies still aren't convinced of the program's value or security. UPDATE, Sept. 5, 2025: Has your state joined Direct File? Check out this special Direct File 2025 Participating States page. Two more states will be a part of the Internal Revenue Service’s Direct File program next year. When the 2025 filing season starts, more than 120,000 Maine and 600,000 Wisconsin taxpayers and will be eligible to file via the IRS created and managed free, online tax preparation and e-filing option. The potential Pine Tree State and... Read more →
Photo by Alesia Kozik The 2024 election features a lot of firsts. We’ve seen the first sitting president to withdraw from the race after securing enough delegates to win his party’s nomination. The first woman of color seeking the presidency. The first person convicted of (and facing more) felony charges running against her. It’s also the first presidential race in which crypto currency could play a major role. Blockchain companies have supplied 48 percent of the $248 million of corporate money donated to influence federal elections this cycle, according to research by the nonprofit watchdog group Public Citizen. To be... Read more →
Photo by Katt Yukawa on Unsplash Crowdfunding, a personal way of raising money that’s been supercharged by social media’s reach, has tax implications. Most of us are familiar with charitable crowdfunding. Expect to see a lot more of that in the wake of natural disasters, with solicitations by individuals and groups looking for help for themselves or others. In addition to charitable fundraising, there also are lots of online financial solicitations by and for businesses. Regardless of the crowdfunding reason, the Internal Revenue Service notes that distribution of the funds may be includible in the gross income of the person... Read more →
If you're the boss — lady, gentleman, or whatever title you choose, — one of your business' tax tasks is issuing W-2 forms to employees. SECURE 2.0 made some changes to this process. (Photo by Paymo on Unsplash) The second Setting Every Community Up for Retirement Enhancement Act, signed into law on Dec. 29, 2022, created a lot of changes for both workers and companies that offer retirement savings plans. That’s why the Internal Revenue Service is giving businesses an early reminder of their tax reporting responsibilities under SECURE 2.0, as the law is popularly known. One key area that... Read more →
Having trouble making your student loan repayment plan and your budget add up? A workplace benefit that helps cover college debt could help. (Photo by George Becker) School is, or soon will be, starting across the United States. That means students, parents, and teachers are hearing about the variety of educational tax breaks that could help them. But what about all the former students, especially those who took out loans to cover higher education costs? You and your lots of student loans are not forgotten. Almost 43 million U.S. borrowers have federal student loan debt, according to data collected by... Read more →
If you’ve glanced at the filing extension countdown in the ol’ tax blog’s right column, you know time is running out to file your extended tax return. The incessantly ticking clock isn’t a reason to panic. It is, however, a reminder that you don’t want to push that Oct. 15 deadline. The Internal Revenue Service doesn’t give you any more time to file your Form 1040. So, you should be thinking about finishing up that paperwork now. Here are some tips to help. Gather your filing documents. This shouldn’t be too much of a problem. You probably used the material... Read more →
“Oh, yeah. That’s the spot,” seems to be what this Chow Chow is thinking as he’s getting a neck rub from his owner. (Photo by Omid Armin on Unsplash) Happy National Dog Day! Or, for canine lovers, the 239th day of Dog Year 2024. Personally, I’m a cat fan. But many of my relatives are pooch parents. And let’s be honest, whatever creature you choose to welcome into your home, the animals are part of your family. So, we should be able to claim them as dependents, right? Sorry, but wrong. The Internal Revenue Service probably is full of pet... Read more →
When making retirement plans, be sure to include how taxes might affect your ability to spend your golden years the way you want. Taxation of Social Security is getting a closer look this year, mainly because the Republican presidential nominee has suggested ending the current federal tax paid by some retirees on up to 85 percent of their benefits. A handful of states also tax the federal retirement benefits that their residents receive. This is the case in Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah, Vermont, and West Virginia. Those nine Social Security taxing states are this weekend’s... Read more →
A few years ago, when housing prices here in Austin kept climbing, the hubby and I hired a company to protest our annual real estate appraisal. That assessment is used to calculate just how big our property tax bill will be. Other factors, such as local tax rates and certain exemptions, also come into play. But if your house is deemed to be worth a whole lot of money, and you’re not planning on selling it for or near that amount, then a generous appraisal will cost you property tax dollars. So, we hired a firm with time and experience... Read more →
UPDATE, Oct. 4, 2024: Parts of two more states, Illinois and Washington, are the latest to get a Feb. 3, 2025, tax deadline extension due to major disasters. Details in this post. UPDATE, Aug. 29, 2024: The U.S. collection of Caribbean islands joins its fellow territory Puerto Rico in getting tax relief due to Tropical Storm Ernesto effects. It also ups the count to 10 of disaster areas across the country that have the new extended, early 2025 tax return due date. The satellite view, courtesy National Oceanic and Atmospheric Administration's NESDIS/STAR GOES-East imagery, of Tropical Storm Ernesto as it... Read more →
The Child Tax Credit (CTC) has been one of the most popular since its creation as part of the 1997 Taxpayer Relief Act. Since its $400 per child origin, the credit has increased notably. During the COVID-19 pandemic, the American Rescue Act bumped up the CTC in 2021 to a potential maximum of $3,600 per each child younger than age 6, and $3,000 per child up to age 17. The Internal Revenue Service also sent the credit amounts to qualifying amounts directly to eligible families so they didn’t have to wait until tax filing season to claim the funds. The... Read more →
Election results, however, could change that. Here's how to claim the alternative fuel vehicle tax credit now, just in case things change after the Nov. 5 results. Republican presidential nominee Donald J. Trump has softened his stance on electric vehicles, likely because of his burgeoning personal relationship with Tesla CEO Elon Musk. But even though Trump says he’s now “totally for” EVs, he also says he would consider eliminating a $7,500 tax credit for some of the vehicles. “Tax credits and tax incentives are not generally a very good thing,” Trump told Reuters after a campaign event Monday, Aug. 19,... Read more →
The Internal Revenue Service continues its efforts to get more taxpayers interacting with the agency electronically. The latest move is enhancing business taxpayer accounts. Upgrades for business filers: The business tax account, or BTA, was launched last fall as a way for certain business taxpayers to view and make balance-due payments online. With the latest expansion, an eligible business taxpayer can use a BTA to pay Federal Tax Deposits (FTDs), and see and make a payment on their full balance due. The account is also now accessible in Spanish with more translations planned. Entities that can open a BTA: You... Read more →
If you bought your youngsters new back-to-school clothes, you’re probably looking for ways to dispose of the older outfits. Many parents take advantage of hand-me-downs, either within their own immediate family or sharing with other relatives or friends. Others donate the old, outgrown clothes. Giving them to a charity could be a win-win. The nonprofits' recycling not only helps those looking for bargain priced apparel, but in some cases it provides a tax break to filers who itemize. 2017 tax rule changes: That donation deduction, however, hasn’t been claimed as much since enactment of the Tax Cuts and Jobs Act.... Read more →
UPDATE, Sept. 5, 2025: Has your state joined Direct File? Check out this special Direct File 2025 Participating States page. State participation in the Internal Revenue Service’s Direct File slowly keeps growing. Connecticut and North Carolina are the latest states that will allow some of their taxpayers to use the IRS’ direct tax preparation and e-filing online program next year. They join New Mexico, New Jersey, Oregon, and Pennsylvania as new participants during the 2025 tax filing season. Twelve states — Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington, and Wyoming. — were part... Read more →
Vice President Kamala Harris, Democratic presidential nominee, revealed some of her economic plans in a speech Friday, Aug. 16, in Raleigh, North Carolina. (Screenshot of X-Twitter video) Vice President Kamala Harris rolled out her presidential campaign’s economic proposals Friday in a roughly half-hour speech in Raleigh, North Carolina. They included a federal ban on alleged corporate price gouging on food products, ways to help people buy their first home, and financial help for families. Much of Harris’ assistance would come from tax breaks, some of them familiar fiscal tools, both enacted or previously proposed by the Biden Administration. New tax... Read more →
Yes, alligators, like this one enjoying an open water area of the everglades, are as much a cliché as Florida man escapades. But a gator seemed a good emblem for the IRS' persistence in going after a Florida man who evaded millions in taxes for around two decades. (Photo by Kay Bell) This Florida man story is much more serious that the Sunshine State memes you tend to see online. Aug. 13, Roger Whitman pleaded guilty to evading more than $2.4 million in taxes on income he earned from his business. The 76-year-old Ormond Beach, Florida, man’s business was manufacturing... Read more →
The Internal Revenue Service is giving businesses that discover they’ve benefited from an incorrect Employee Retention Credit (ERC) claim a chance to correct that error. The tax agency announced today that a it is reopening for a limited time its ERC Voluntary Disclosure Program (VDP). This second ERC disclosure period, which will be open through Nov. 22, will be similar to the original one that ended this spring. In addition to relying on taxpayers to voluntarily correct their wrong ERC claims, the IRS says it also will mail up to 30,000 new letters to reverse or recapture potentially more than... Read more →
Keeping track of your finances when you're older can alert you to the possibility that you might owe tax on some of your Social Security benefits. Most of us look forward to retirement. Some of us also get a tax shock once we start collecting Social Security. Some of our federal retirement benefits, in some cases as much as 85 percent of our annual payout, could be subject to federal taxation. Not only is that tax an unwelcome surprise to older taxpayers, it also has become part of the current presidential campaign “Seniors should not pay tax on Social Security,”... Read more →
Both taxpayers and the Internal Revenue Service depend on tax professionals doing their jobs in, well, a professional manner. A crucial part of the job is ensuring the security of clients’ tax information. Security measures are particularly important as everyone — tax pros, taxpayers, and the IRS — increasingly rely on electronic methods to complete tax tasks. In fact, tax professionals are legally required to secure their clients’ data. The Financial Services Modernization Act of 1999, also known as the Gramm-Leach-Bliley Act after the names of its primary Congressional sponsors, mandates that financial institution companies ensure the security and confidentiality... Read more →