Photo by Andrea Piacquadio Forgiveness of debt piled up by college students has been a campaign mainstay in recent elections. It finally became a reality in August 2022. Sorta. On Aug. 24, 2022, President Joe Biden directed the Department of Education to forgive up to $10,000 per borrower of federally-held student loan debt, $20,000 for those who went to school on Pell grants. The next month, six Republican state attorneys general filed a lawsuit to stop the Biden move. In October 2022, a federal appeals court ordered the loan forgiveness plan put on hold while the case is considered. Now,... Read more →
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Photo by Army SPC Sara Wakai In addition to their duties as members of the armed forces, U.S. service members also have to answer to the Internal Revenue Service. When it comes to those taxes, many military men and women must deal with situations vastly different from civilian taxpayers. They also get some special tax considerations. Here are some resources to help members of the military community navigate their sometimes complex tax situations. Official IRS guide: The IRS' Armed Forces' Tax Guide is a good place to start. The 39-page PDF document, officially known as IRS Publication 3, covers the... Read more →
Photo by Tim Mossholder If you need some help with a tax that's NOT filing your annual return, Internal Revenue Service staff might be able to provide some in-person help this weekend. The second round of the agency's Saturday walk-in hours at certain Taxpayer Assistance Centers (TACs) nationwide will take place on March 11. IRS TACs normally are open on weekdays only, and taxpayers must make appointments to receive services. TAC help options: But during these special Saturday hours, walk-ins are welcome to get the help that the centers usually provide, except for making cash tax payments. If you need... Read more →
Photo by Kelly Sikkema on Unsplash Enough already, Mother Nature! We're not even through two full months of 2023, and you have been in a particularly foul mood too much of this time. The latest disastrous outbursts are leaving thousands across the country dealing with blizzards, high winds, and tornadoes. And the devastating weather system is still moving east. Meantime, folks who endured major disasters in January — which now cover most of California and parts of Alabama and Georgia — are still pare still picking up the pieces. That's why the Internal Revenue Service has decided to give these... Read more →
One thing that's missing in Texas is a personal income tax. But residents in most of the rest of the country have to file a state return at the same time their federal paperwork is due. We're roughly at about the midpoint of the official tax filing season, based on the Jan. 23 date when the Internal Revenue Service began processing individual tax returns. For many, this means they need to get serious about filing their taxes, which are due this year on April 18. The filing focus is especially true for folks who also must submit returns to their... Read more →
It's National Margarita Day! Each Feb. 22, the focus is on appreciating this popular tequila-based cocktail. Or as we call it here in Texas, every day. FX/FXX TV's spy-turned-private detective Sterling Archer offers his margarita recipe. If, however, you're looking for a drink that's a bit more elaborate that the basic one preferred by the animated (in so, so many ways!) and self-absorbed bon vivant, check out the Cooking Channel's top 28 margarita recipes. Personally, I prefer beer. But if a margarita is your drink, here's to an enjoyable happy hour with your fellow fans of this azul agave beverage.... Read more →
… and yes, there is a tax connection beyond winning wagers being taxable income. Photo by Scott Webb As is usual each Super Bowl Sunday, bets are getting a lot of attention. There are the big-dollar wagers on the game. Two seven-figure bets were placed last week on the Philadelphia Eagles to defeat the Kansas City Chiefs in today's Super Bowl LVII championship game. Then there are the prop bets, many of which have nothing to do with National Football League plays on the field. For any of those bets that pay off, the winners will owe taxes to the... Read more →
Image via California Franchise Tax Board Individuals who got special tax or inflation relief payments from their states last year won't have to worry about handing over a portion to the U.S. Treasury. The Internal Revenue Service announced late Friday, Feb. 10, afternoon, that, "in the interest of sound tax administration and other factors," recipients of the payments won't have to report the amounts on their 2022 tax returns that are now being filed. Disaster and general welfare exemptions: The IRS said that it will not challenge the taxability of payments related to general welfare and disaster relief. This means... Read more →
Free File 2023 has been open for almost a month. Have you tried it out yet? This partnership between Uncle Sam and the private tax software industry has been around since 2003. Free File's original mandate was to make electronic tax help available to taxpayers who might not be able to pay a tax professional or even afford tax software. However, the program hasn't really caught on as much as the Internal Revenue Service had hoped. Some of the lack of Free File enthusiasm might be attributed to roadblocks the program has encountered in recent years. Free File problems: Some... Read more →
UPDATE, February 10, 2023: There's good federal tax news for residents in 21 states who last year got some financial relief from their states. The Internal Revenue Service has determined that the stimulus/tax refund payment amounts are not subject to federal tax. Remember back in January when I listed 6 reasons why you should wait to file your federal tax return? The Internal Revenue Service has come up with a new one for taxpayers in several states. Specifically, the IRS is telling individuals who last year received special state-issued payments to help offset higher inflation costs to wait before submitting... Read more →
Photo by RODNAE Productions Last year, as the country started emerging from COVID-19 closures, the Internal Revenue Service joined the resocialization. It opened some of its Taxpayer Assistance Centers (TACs) across the country so individuals could get some face-to-face tax help, no appointments needed. That resumption of more-normal taxpayer interaction was such a success, the agency is doing it again this 2023 filing season. For one Saturday a month, beginning in February and continuing through May, TACs in 46 states, the District of Columbia, and Puerto Rico will be open on four upcoming Saturdays, from 9 a.m. to 4 p.m.... Read more →
The Internal Revenue Service has its own Groundhog Day, but it's not limited to just one specific 24-hour period. Most often, this re-do of a tax return is when you find you made a mistake on your original Form 1040. The do-over is accomplished by filing Form 1040-X, an excerpt of which is shown below. See more tax forms and more about them at 2022's Talking Tax Forms and Tax Forms 2023. Fix errors: Nobody's perfect, and the annual filing season underscores that for many of us. When we do make a mistake on our taxes, filing an amended return... Read more →
The first week of the 2023 tax filing season is in the books. But there are lots of other tax dates to look forward to, or at least be aware of, this year. As happens every year, there are the normal conflicts that delay some of them a bit. They are the traditional deadline shift the Internal Revenue Service institutes when tax due dates fall on weekends or federal holidays. The original date gets bumped to the next business day. The legal holidays in 2023 that could affect tax deadlines are — January 2, New Year's Day (observed) January 16,... Read more →
Photo by Dewang Gupta on Unsplash In 2019, the Internal Revenue Service received nearly 156 million tax returns. Then came the COVID-19 pandemic. In 2022, the number of 1040s filed hit 169.7 million. The increase continued in 2021 with the IRS receiving 169.1 million returns, and into 2022, when 164.3 returns were sent to the tax agency. The main reason for the 2020-2022 filing spikes was the coronavirus-related financial help — economic impact payments and increased advance Child Tax Credit amounts — that the IRS was tasked with delivering. Many, OK most, of those millions who hadn't filed before 2020... Read more →
UPDATE, Feb. 27, 2023: Since damages are so severe, and additional areas subsequently were designated by FEMA, the IRS has decided to further extend the tax deadline for victims of Alabama's and Georgia's major disasters first declared in January. Affected Yellowhammer and Peach state taxpayers now have until Oct. 16 to take care of multiple tax responsibilities. Details in this post. National Weather Service radar of a quasi-linear convective system (QLCS) and supercells, along with severe warnings in the southeastern United States during the afternoon of Jan. 12, 2023. The Autauga County, Alabama, EF3 tornado was on the ground at... Read more →
Being a bit pokey can sometimes pay off at tax filing time. (Photo by Kay Bell) My husband and I have a lot in common. We also are a lot different. I tend to obsessiveness, wanting to take care of things as soon as I can. The hubby, on the other hand, is more deliberative. Unless it absolutely has to be done immediately, he's OK with waiting. And waiting and waiting. We've managed to make out differing approaches work. And I must admit that sometimes, he's right to put off projects. Not always, but sometimes. Situations change, making moot what... Read more →
Photo by Kay Bell The Internal Revenue Service won't start processing 2022 tax year returns until Jan. 23, but you can file before then. A lot of folks are doing just that. The most common and obvious motive for filing early is to get the refund you're expecting. But there are some other reasons you might want to get your return to the IRS as soon as possible. 1. To beat tax ID thieves to the punch. The IRS and its Security Summit partners have made good progress in recent years in reducing tax identity theft and refund fraud. One... Read more →
Every filing season, eager taxpayers, most of them expecting a refund, send their returns to the Internal Revenue Service as soon as they can. For most it works out OK. Others, however, discover on their own, or learn from the IRS, something just not quite right, and costly, on their Form 1040. It works the other way, too. In some instances, folks submit a return without claiming a tax break that would have saved them dollars. The IRS isn't going to tell you about that! The best way to make sure you enter all the data that the IRS wants,... Read more →
The Rev. Dr. Martin Luther King in Washington, D.C., in 1963 where he delivered his "I Have A Dream" speech. (Photo via Wikimedia) On this Martin Luther King, Jr. Day federal holiday, the focus once again is on public service. It's a way to honor The Rev. Dr. King's commitment to helping those who need it the most. It's also a time when we rightfully recall the civil rights leader's most famous speech, his delivery of his "I have a dream" vision of equality in Washington, D.C., on Aug. 28, 1963. But King also knew that hard, practical work was... Read more →
The Internal Revenue Service won't start processing 2022 tax returns until Jan. 23, but you still can file before then. And if your adjusted gross income last year was $73,000 or less you can file for free at Free File. If you use a search engine to find free tax filing, you'll likely discover other options. You'll also probably get such offers in your email box. But the only official, IRS-sanctioned Free File option is the one on its website. To get there, type Free File in the search box at the upper right of IRS.gov. That search result will... Read more →