Free File is finally getting a lot of attention. Unfortunately for companies involved in the Internal Revenue Service/tax software partnership, it's not the kind of attention they want. The IRS now is following state officials in California and New York in looking into whether potential Free File users were intentionally directed away from the program. Free but not that popular: Free File, as the name indicates, was designed to allow most taxpayers access to no-cost online tax return completion and electronic filing. The 2019 filing season is its 17th. It's still available to taxpayers through the Oct. 15 extended filing... Read more →
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Around two dozen tax breaks are now in a legislative zombie state, much like these creatures in George Romero's classic zombie film "Night of the Living Dead." The tax versions are waiting for federal lawmakers to bring them back to life or finally and completely put an end to them. (Photo via Wikimedia Commons) A dozen groups spanning the political spectrum are urging Congress to let zombie tax extenders remain dead. Are you still waiting on expired tax provisions to be resurrected? If a motley crew of public policy, tax and advocacy groups get its way, you'll be waiting forever.... Read more →
Photo by Ken Hawkins via Flickr CC Free. It's the most magical word in the world. Everyone is always looking to get something for nothing. That includes tax filing. A couple of weeks ago, the tax and consumer protection worlds were abuzz over a provision in the Taxpayer First Act of 2019 that cleared the U.S. House with a provision that keeps the Internal Revenue Service from developing its own no-cost tax filing program. Such total IRS ownership of the form filling and electronic filing is the unicorn of the tax world for many. They oppose Uncle Sam acting as... Read more →
Children celebrate May Day by dancing around a maypole on the Village Green in Tewin, near Welwyn Garden City, Hertfordshire, England. (Photo by Paul Barnett via Wikimedia Commons) Happy May Day! It's the annual May 1 global holiday celebrating the contributions of workers. But the other mayday often comes to mind when taxes are involved. If it's a tax distress signal you're sending out as the merry month of May begins, here are some moves that could help ease your tax trepidations. 1. File your 2018 return. If last month you didn't file your 2018 tax return, either because you... Read more →
Michael Cohen (left) and Tom Arnold run into each other in New York City in June 2018. (Photo via Tom Arnold on Twitter) Michael Cohen, Donald J. Trump's former attorney and previously self-described fixer, is heading to federal prison in a couple weeks. But in a recent conversation with actor Tom Arnold, Cohen said he didn't commit all of the crimes for which he will do time. Specifically, according to the story on the telephone discussion that the Wall Street Journal broke, Cohen says he's not guilty of tax evasion, one of the charges for which he's going to jail.... Read more →
Tax season is over for another year. Now all that's left cleaning up after the filing crunch. I know many of y'all are tempted to simply toss everything in the trash. Don't. You don't have to the tax version of television's Hoarders, but there are some tax-related documents you need to hang onto, at least for a while. These 7 frequently asked questions and answers can help you get a better handle on your tax record keeping. 1. Why should I keep records? Well-organized records make it easier to prepare your tax return. Documentation, both the amount and in good... Read more →
High tax filing season is over and the numbers have been tallied. Unfortunately for Republicans who still are fighting the public relations war over their major tax reform law, the figures aren't good. Yes, fractionally more money has been delivered to taxpayers through April 21, almost a week after the filing deadline for most U.S taxpayers. But the average refund check remains smaller than it was last year. In 2018, the average refund was $2,780. This year, it came to $2,725. In case you're not good at math in your head (I'm not) and don't have a calculator handy, that's... Read more →
Social Security might be in trouble, but as long as it's around in some form, Uncle Sam will keep collecting taxes related to it. That includes not only the payroll taxes from workers that go toward funding the federal retirement benefits, but also in some cases on the benefits themselves. If you have enough money when you're older to enjoy time the way you want with your grandchildren, you might face taxes on your Social Security benefits. Stop me if you've heard this before. Social Security is running out of money. That's the latest word from the trustees of the... Read more →
How accommodating is your state's tax system? Kiplinger lists the top 10 most tax-friendly states. Most U.S. taxpayers are breathing a sigh of relief as this week winds down. They made it through Tax Day 2019, getting their annual federal return to Uncle Sam. Millions also filed their state returns at the same time. They live in the 43 states and District of Columbia that collect some sort of personal income tax. The majority of those state tax departments follow the Internal Revenue Service's filing time frame. But not all. Five states have return due dates that are a tad... Read more →
We made it! Tax Days 2019 — and yes, Days is correct, since there were two April deadlines this year — are done! OK, maybe we made it because we filed for an extension. That's OK. We got something in to the Internal Revenue Service on time. Now we can relax. But not too much. In addition to meeting that Oct. 15 due date, all of us need to be proactive with tax moves over the next few months to ensure that our 2020 bill is as small as possible when we file next year. That's what the Weekly Tax... Read more →
You didn't file your taxes by the April deadline but you had a really good reason. Or did you? Excuses people make for not filing their taxes are right up there with rationalizations for claiming weird deductions. Both are creative exercises par excellence. And both will get you in bit trouble with the Internal Revenue Service. What won't fly: The Internal Revenue Code as we know it has been around since 1913. That means that for more than a century, Uncle Sam has heard just about every excuse for not getting a Form 1040 in on time or at all.... Read more →
Most U.S. taxpayers filed their annual tax returns or got extension on Monday, April 15. But what about folks who missed the Tax Day deadline? Don't panic, but don't procrastinate any longer. The IRS is serious about hearing from you each April. It imposes three main filing-related penalties, the harshest of which is for not filing. Here are four things late-filing steps you need to take ASAP. 1. File a return. Yes, the filing deadline is over. But still get the IRS a return. Now. You need to get something into the IRS system that will show the tax man... Read more →
Two tornadoes struck the small East Texas town of Alto on Saturday, April 13. The National Weather Service confirmed on Sunday that the first was an EF-2 tornado and the second was an EF-3. Click image to see video from Disaster Compilations on YouTube. There are some things more important than taxes on April 15, 2019. Too many folks in the southern half of the United States are dealing with the loss of family and friends after a deadly weather system moved across that region over the weekend. At least eight people were killed by the storms, which in addition... Read more →
Giphy It's finally here! Tax Day 2019. Congratulations to all y'all who survived this first filing season under the new Tax Cuts and Jobs Act (TCJA) provisions. We all deserve a hearty pat on the back. A hug. A drink, potent as the Jeopardy category goes, or not. Some freebies. I'll take one of the massages, thank you. A Major League Baseball break. Patriots Day and celebrants in Maine and Massachusetts get more tax-filing time so they can, among other things, enjoy today's Jackie Robinson Day Red Sox-Orioles game. Some sleep. And some tax talk. Radio tax ruminations: Wait, isn't... Read more →
Photo by Coolcaesar via Wikipedia Commons Two American institutions that regularly catch a lot of flak find that they are good partners each April. I'm talking, of course, about the Internal Revenue Service and U.S. Postal Service. True, software-assisted return prep and e-filing by individual taxpayers or the tax preparers they hire now is the dominant way we get our 1040s to the IRS every year. Most of the 50 million yet-to-file taxpayers, who are this week's By the Numbers honorees, will use these electronic methods by the end of tomorrow. But until Uncle Sam forces all of us to... Read more →
This wading bird doesn't mind being knee-deep, but it's not a good position if you're trying to dig through your taxes on this last weekend of the filing season. (Photo by I Am birdsaspoetry.com via Flickr CC) We're knee- or in some cases neck-deep into the final days of Tax Season 2019. How's it going for you? If you're among the more than 103 million U.S. taxpayers who have already filed their returns, you're probably feeling pretty good about things. So is Charles Rettig, who's overseeing his first federal filing season as commissioner of the Internal Revenue Service. "The filing... Read more →
The time left until Tax Day is tick, tick, ticking away. If you're feeling like silent movie legend Harold Lloyd (pictured above), hanging on by your fingernails as you try to get your tax filing act together, I have some good news and some bad news. The bad news is that there's no way to stop the tax deadline clock. The good news is you can get an extension to file your 1040. By filing for an extension, the Internal Revenue Service will give you six more months, up to Oct. 15, to submit your return. You still have to... Read more →
Federal and most state, tax returns are due in few days. Don't panic! You still have time to finish your return (or get an extension). If you do decide to just be done with your Form 1040 — new, but not necessarily improved this year under Tax Cuts and Jobs Act (TCJA) changes — make sure you don't make any of these common filing errors in your rush to finish. For the most part, tax software has helped eliminate a lot of mistakes. Still, we're not yet at the total tax automation point yet. And that old garbage in, garbage... Read more →
Thanks to much larger standard deduction amounts under the Tax Cuts and Jobs Act (TCJA), fewer filers are itemizing deductions. But that doesn't mean they aren't still writing off some tax-deductible expenses. During this first filing season after the many changes wrought by the latest tax reform law, taxpayers are still claiming what used to be called above-the-line deductions. Technically, they are and always have been adjustments to income. They got the above-the-line moniker because they previously appeared in the last section of the old long Form 1040, just above the last line of that form's first page where your... Read more →
Tax Day every April is the biggie for individual taxpayers. That's when our annual Form 1040 is due. And yes, I know this year there are two Tax Days, since Patriot Day celebrants in Maine and Massachusetts get until April 17 to send in their federal returns. But most of us must meet the April 15 deadline, so that's what I focus on in this post. Completing a 1040, however, is not the only mid-April tax deadline. It's just one of the 10 tax tasks listed below that many taxpayers also must make by next Monday, April 15. 1. File... Read more →