Welcome to Part 4 of the ol' blog's 2019 series on tax inflation adjustments. We started on Nov. 15 with a look at next year's income tax brackets and rates. Today we look at changes to credit and deduction amounts. Note: The 2019 figures apply to 2019 returns to be filed in 2020. For comparison purposes, you'll also find 2018 amounts to be used in filing 2018 returns due April 15, 2019. Taxpayers depend each year on tax deductions and tax credits to cut their annual tax bills. The biggies are, of course, the use of standard or itemized deductions... Read more →
Family
Welcome to Part 2 of the ol' blog's 2019 series on tax inflation adjustments. We started on Nov. 15 with a look at next year's income tax brackets and rates. Today we look at standard and itemized deductions, personal exemptions and limitations on these tax situations that apply to some taxpayers. Note: The 2019 figures apply to 2019 returns to be filed in 2020. For comparison purposes, you'll also find 2018 amounts to be used in filing 2018 returns due April 15, 2019. Internal Revenue Service data show that year after year, around 70 percent of filers claim the standard... Read more →
UPDATE, Oct. 15: Additional areas in Florida, Georgia, North Carolina, South Carolina and Virginia now receive tax relief in connection with Hurricanes Florence and Michael. Details below. Monday, Oct. 15 is a big tax day for millions. The Internal Revenue Service says more than 14 million taxpayers requested added time to complete their 2017 tax returns. While not all of them put off that tax task until the very last minute, it's a safe bet that a lot did. If' you're among that group of uber-procrastinators, I wish you well in getting the job done by tomorrow. The tax and... Read more →
The Trump children gathered for this undated family photo. They are, from left, Robert Trump, Elizabeth Trump Grau, Fred Trump Jr., Donald Trump and Maryanne Trump Barry. A piece of information filed years ago during Barry's judicial confirmation hearing led to a New York Times' exposé on the family's wealth and tax tactics. (Donald J. Trump presidential campaign photo) Talk about an awkward Thanksgiving. It seems that Donald J. Trump's oldest sister is how The New York Times got the inside info on the Trump family fortune and taxes. You know of the story even if you haven't yet read... Read more →
My octogenarian mother does an amazing job of taking care of herself and her little dog, aka my furry younger brother. My mother and her pup come to our place, like the Thanksgiving visit pictured here, but usually it's me taking time from work to head her way. (Photo by Kay Bell) But since she no longer drives and hates to impose on friends and neighbors, I make regular trips to her place to help her run errands, take her to doctor appointments and just visit. It's not too much of a hassle because she lives relatively close and it's... Read more →
UPDATE , Oct. 1, 2018: The House has signed off on its three Tax Reform 2.0 bills to extend the individual provisions of 2017's Tax Cuts and Jobs Act. The Senate, however, is not so keen on the measures. Additional Senate tax action this year looks doubtful as the Upper Chamber focuses on other year-end priorities. The Tax Cuts and Jobs Act expanded the use of 529 education savings plans to cover elementary and secondary school costs. One of the House's Tax Reform 2.0 bills would also make 529 money available to pay some home-schooling expenses. (Photo by Chris Yarzab... Read more →
House Ways and Means Chairman Rep. Kevin Brady (R-Texas) was among GOP leaders who celebrated the six-month anniversary of the party's tax reform bill back in June. Now he and other Republicans want to expand that bill by the end of September. We're still waiting for clarification of many of the new tax laws in the Tax Cuts and Jobs Act (TCJA). In fact, some say we need clarification of clarifications; have you tried to decipher the new 199A business deduction even with the Internal Revenue Service guidance? But such lingering TCJA questions are not stopping Republican leaders from trying... Read more →
This time of year, my social media streams are full of photos of my friends' children as they head back to class. And it's not just the youngest students being celebrated. Yes, I'm old enough to have peers with kids in college. While all these students' parents are proud of their progeny's new educational milestone, there's also a bittersweet tinge to all those Facebook postings of surprisingly grown up kids. And, of course, there's the realization that this next phase of their youngsters' lives is going to cost them. In some cases, the costs will be a whoooooole lot. Ever... Read more →
Trees in September will see their first fall color. (Photo by Jonathan Bloy courtesy Bloy.net) Hello, September. It's nice to have you back. You are a month that offers mostly-welcome transitions. There are beginnings, as students start a new school year. Parents nationwide say "thank you!" There are endings, as summer gives way to fall's cooler temps and foliage changes. Those of us tired of heat waves want to know what took you so long!?! There are expectations, as the end of the year and its many holidays approach. It's never too early to start planning for these. My Christmas... Read more →
The Tax Cuts and Jobs Act (TCJA) did away with exemptions, a particularly concerning change for large families. Exemptions were a specific dollar amount, adjusted annually for inflation, that taxpayers could claim for themselves, their spouses if filing jointly and dependents. The exemptions total helped reduce the amount of filers' income subject to tax. TCJA supporters, however, say not to worry. They say the new law's lower income tax rates, wider income brackets, larger and more refundable child tax credit and $500 tax credit for other dependents will make up for the eliminated exemptions. Dependents guidance: The Internal Revenue Service... Read more →
One, in addition to being the loneliest number, also soon could cost some Chinese taxpayers when it comes to their family size. Three years ago, China abandoned its policy, which had been in place since 1979, of fining people for having more than one child. Now Chinese leaders want to encourage people to have more kids. The reason for wanting more babies is that China's previously restrictive family planning policy has produced a growing aging society and a shrinking young population. That's not healthy for any economy. To remedy that situation, China is exploring a variety of proposals, including a... Read more →
School's starting, meaning parents and students need to study up on how the new tax laws do and don't affect the many tax-favored ways to pay for classes. We're all still learning about the Tax Cuts and Jobs Act (TCJA) that was passed late last year and took effect, for the most part, at the beginning of 2018. One area where we all need some tax lessons, especially with the start of the first school year under the new tax law's provisions, is how it affects educational tax breaks. It does make some key changes to some of the tax... Read more →
Classes, from Kindergarten to high school to college, are or about to be in session across much of the United States. That means parents can breathe a sigh of relief now that schools and teachers will once again add structure to their children's lives. But the beginning of the school year also prompts a new parental concern: their youngsters' privacy. No age limit for ID theft: Identity thieves don't set age limits on the people whose lives they try to steal. When a young person's identity is stolen, it sometimes takes longer to discover since most kids aren't involved in... Read more →
Sunsets like this one at Zuma Beach in Malibu, California, make many Golden State coastal properties prime rental investments. But Golden State limits on property taxes on inherited homes cost cities and other jurisdictions billions of dollars. (Photo by Alex Beattie via Flickr CC) Californians love Proposition 13, the grandfather of tax-limiting ballot initiatives. Since its passage in 1978, it has kept a tight cap on property tax increases. But an expansion of the original Prop 13, enacted eight years later, and its unforeseen consequences have cost Golden State school districts, cities and counties of billions of dollars in revenue,... Read more →
This family, with four generations shown here, likely will feel the effects of the new tax law. (Photo by Azoreg via Wikimedia Commons) Things get complicated when you have kids. Those complications are, well, even more complicated when it comes to tax filing. The Tax Cuts and Jobs Act (TCJA) made a variety of changes, in effect at least for tax years 2018 through 2025, that will affect millions of parents. Here's a quick look at key tax changes for dependents. Exemptions are eliminated: Under prior law, personal and dependent exemptions were excellent. These tax breaks helped filers reduce income,... Read more →
Photo by Chris Potter via ccPixs.com School is about to start, so all the students who contributed to the just-released July jobs report are wrapping up those seasonal gigs. Many of these young workers plan to use the money they earned to pay some of their college costs. Kudos for them for contributing to their educations. But it's also a great idea for young people to start thinking about the day when they can quit working for good. The problem is that too many young people, like a lot of us, don't think that far ahead. Plus, a young person's... Read more →
Republicans unveiled their outline for additional tax changes on July 24 and it's just that. A bare bones framework. House Ways and Means Committee Chairman Kevin Brady (R-Texas) acknowledged the skimpy structure. That was by design, he said, with the outline to serve as a starting point for his GOP colleagues to offer feedback. Yes, he said Republican feedback. As with the original Tax Cuts and Jobs Act (TCJA) that was enacted last December, Democrats were excluded from the legislative writing process. Once things are fleshed out, Brady said he expects a Tax Reform 2.0 bill to go before the... Read more →
It's hot. Not just here in Texas, but across the United States. In fact, around the world. That means we all need to be careful. More careful than the hubby, who decided to mow our yard yesterday. And not during the relative cooler morning when temperatures were in the 80s, but in the afternoon when the thermometer nudged 100 and it felt even hotter. It wiped him out for the rest of the day and evening. I love my man, but I guess it's true that the heat does make us do dumb things. Deadly heat: Excessive heat also tends... Read more →
Couples by Michael Lehet/Flickr CC The hubby and I basically have a pretty equal, albeit traditional gender swapped, marriage. He's more persnickety when it comes to cleaning. So he does much of those household duties, including bathrooms and whole-house vacuuming. I hate that noise, so he vacuums when I'm out; that's one of the reasons I love him! We split kitchen duties, with the person who doesn't cook dinner doing the cleanup. We collaborate on investments, deciding how much and where our money goes. As for the day-to-day expenses, I take care of making sure the bills are paid on... Read more →
One of those hammocks has my name on it, after I finish a few July tax tasks. (Photo by Roberto La Forgia via Flickr CC) School is out. The fireworks have been shot (except for the stashes of my neighborhood's teens, which based on prior post-July 4 experiences, probably will last another week). And the heat is definitely on. That means it's finally, fully summer. And that means that it's time to get down to some serious summertime tax moves. Yes, I know you want to head to the pool or beach or catch up on neglected novels or just... Read more →