Finances Feed

The Internal Revenue Service has delivered two rounds of COVID-19 economic impact payments (EIPs). The first was the $1,200 per person approved in late March 2020 under the Coronavirus Aid, Relief and Economic Security (CARES) Act. The second EIP for $600 per person was authorized at the end of last December as part of the Consolidated Appropriations Act (CAA), with payments distributed through the first two weeks of January 2021. By now, folks know that if they didn't get the full amounts, which included additional payments for eligible dependents, they need to claim the Recovery Rebate Credit (RRC). You'll do... Read more →


The tornado that struck Afton, Iowa, in Union County on April 26, 2024. That county is one of eight that have been declared major disaster areas, meaning residents are eligible for a variety of federal assistance, including tax relief. (Photo by Dean Baron via National Weather Service) Iowans in eight Hawkeye State counties that were struck by severe storms and tornadoes last month now have until Oct. 15 to file various federal individual and business tax returns and make tax payments. This latest Internal Revenue Service disaster relief applies to individuals and households that live or have a business in... Read more →


Photo by Keith Luke on Unsplash Congratulations to this year’s high school and college graduates. Walking across that stage and getting that diploma is a ceremony they and their families have long waited to experience. So what, besides sincere well wishes, do you give the graduates in your life for reaching this milestone? There are lots of gifts that can help young adults as they head off to college or into the work world. My personal favorite when I was that age was cash. (Truth be told, it still is my preferred present!) If your favorite graduate is like me,... Read more →


Our annual property tax protest has been filed. Not by us. We finally hired a company to take care of it. But the hubby and I and our neighbors are not the only ones concerned about property taxes. So are the government officials in charge of levying and collecting them, albeit for different reasons. Property tax problems: Real estate taxes are the primary financing source for city, county, and other local governments. Tax Foundation analysts found that in fiscal year 2020, property taxes comprised 32.2 percent of total state and local tax collections in the United States, more than any... Read more →


Photo by Amina Filkins If National Small Business Week has you thinking about starting your own company, congratulations. You’ll be joining a growing sector of the U.S. economy. The Small Business Administration (SBA) describes a small business as one with fewer than 500 employees. That covers enterprises from one-person shops to manufacturing facilities with hundreds of workers. The U.S. Census Bureau’s Business Dynamics Statistics indicate there were 5,358,600 firms that met that definition in 2021, the latest year for complete data. That was an increase from 5,322,155 in 2020. But small really is key here. County Business Patterns (CBP) data... Read more →


Photo by Joshua Rodriguez on Unsplash It’s National Small Business Week 2024! Technically, the U.S. Small Business Administration’s annual recognition event started yesterday, Sunday, April 28. The kick-off yesterday of this year's National Small Business Week (NSBW) included an awards ceremony where this year’s National Small Business Person of the Year and runner-up were named, along with the Small Business Persons of the Year from each state, the District of Columbia, Guam, and Puerto Rico. The event, with a theme this year of Building on America’s Small Business Boom, continues through Saturday, May 4. Your small business taxes: The full... Read more →


Photo by Leeloo The First You didn’t file a tax return on April 15 and you’re still avoiding the task because you owe more than you can pay. That’s a terrible reason. You actually are making things worse. Penalty and interest charges automatically started running as soon as your tax filing and nonpayment became delinquent on April 16. So you need to act now, first by filing a return, and then by exploring ways to eventually pay Uncle Sam what you owe. Failure to file and/or pay penalty costs: Even if you can't afford to immediately pay the full amount... Read more →


Getting a tax refund can feel like it's raining money. (Photo by Eugene Lisyuk) You filed your taxes, and now are awaiting a refund. The Internal Revenue Service's data shows the average it had issued as of April 5 was $3,011. That three grand average is a nice chunk of change. Even a smaller amount is welcome. So, what are you going to do with that money? Everyone's personal, financial, and yes, tax, needs are different. But here are some suggestions for all y'all getting a refund. 1. Open or add to a savings account or emergency fund. I know,... Read more →


Did you turn 73 last year? Belated happy birthday wishes. Now here's an important tax question about that septuagenarian celebration. Did you take your first required minimum distribution (RMD) from your tax-deferred retirement funds by the end of 2023? If the answer is no, then you've got to withdraw that mandated amount by next Monday, April 1. No fooling. Miss that RMD deadline date, and you'll owe Uncle Sam more money than just the tax due on your withdrawal amount. Ending tax deferral days: The Internal Revenue Code offers myriad tax benefits for retirement savers. Several of them provide tax-deferred... Read more →


The Employee Retention Credit (ERC) helped many companies keep workers during the difficult COVID-19 pandemic days. But some ERC claims wrong, and the IRS is successfully recouping some of those incorrectly claimed and/or issued funds. The Internal Revenue Service closed out its Employee Retention Credit (ERC) Voluntary Disclosure Program (VDP) on Friday, March 22, on a high note. Going into the day, the VDP, which allowed those who got improper ERC payments to pay back most of the money, had produced more than $225 million from 500+ taxpayers. Another 800 submissions were still being processed, and even more being filed... Read more →


Are you having second thoughts about an ERC claim your company made? It so, it's time to review your records, and if you find you received an incorrect tax credit amount, let the IRS know by this Friday, March 22. (Photo by Henri Mathieu-Saint-Laurent) With the deadline to let the Internal Revenue Service know you got an improper Employee Retention Credit (ERC) fast approaching — it's this Friday, March 22 — business owners who are concerned need to act fast. Recipients of wrong payments can apply for the IRS' ERC Voluntary Disclosure Program by that deadline. If accepted, the businesses... Read more →


Did you discover you got an improper Employee Retention Credit (ERC) payment? You still have time to get out of the tax jam by applying for the ERC voluntary disclosure program. (Photo by Unsplash+ in collaboration with Getty Images) ERC voluntary disclosure deadline is March 22 Last December, the Internal Revenue Service announced that businesses that received improper Employee Retention Credit (ERC) amounts could let the agency know about the error. In these cases, many of which were created when companies got bad tax advice from aggressive ERC promoters, the companies would have to repay only 80 percent of the... Read more →


President Joe Biden has targeted capital gains tax laws in his fiscal year 2025 budget. But don't freak out if you have some money in the markets. For the most part, Biden's looking to get more from really wealthy market mavens who typically pay lower capital gains tax rates on the long-term assets they sell. Collecting billionaires' unrealized capital gains: When you sell an asset for more than your paid for it, that profit is a capital gain. The tax rate for these gains typically is less than ordinary tax rates that apply to earnings like wages. In most cases,... Read more →


Herbal supplements might make you feel better, but such products typically don't qualify as medical treatments that are eligible for tax-favored treatment. (Photo by Photo by Priscilla Du Preez 🇨🇦 on Unsplash) Health savings accounts, or HSAs, can offer some taxpayers triple tax savings. Holders of HSAs also have a longer window to contribute to these tax-advantaged plans. As noted in my March tax moves post, you can contribute to your HSA by Tax Day (that's April 15 this year), and have it count as money put into the account for the prior tax year. In addition to being a... Read more →


The Recovery Rebate Credit also is available until April 15, 2025, for unclaimed 2021 tax year amounts. Economic impact payments, or EIPs, issued in 2020 and 2021 helped millions deal with the financial damage caused by the COVID-19 pandemic. However, some people didn't get the coronavirus stimulus money to which they were entitled. These eligible individuals still have a chance to collect the cash by claiming the Recovery Rebate Credit. But time is running out. The Internal Revenue Service is alerting those who didn't file a 2020 tax return need to complete that form and claim the COVID funds by... Read more →


Image from IRS Publication/Poster 5731-B Tax law changes often cause filing problems for taxpayers when they try to determine how they are affected. Things can get even more complicated when the Internal Revenue Service steps in with its take on a confusing law. That's exactly what's happened and still happening with Form 1099-K, Payment Card and Third Party Network Transactions. This tax form is supposed to be issued to individuals who get money via a third party processor for goods or services the taxpayers provided customers. 1099-K history: For more than a decade, online apps and marketplaces (think PayPal, Venmo,... Read more →


Photo by Elissa Garcia on Unsplash If you're ever tempted to utter "these kids today" with a sigh and head shake, then take a few minutes to read about some California teenagers who are making a big tax difference in their community. The Rancho Cucamonga high school students come back to campus every Saturday during tax filing season to run a Volunteer Income Tax Assistance (VITA) clinic. The students, many of whom are planning on financial careers once they graduate high school and college, filled out 250+/- Internal Revenue Service returns last year for taxpayers in the city just east... Read more →


Consistent contributions to tax-advantaged retirement accounts can help them grow from seedlings to a solid and sizeable amount of money for your post-work years. (Photo by micheile henderson on Unsplash) The stock market has been on a roll, rather than a roller coaster, of late. On Friday, March 1, The Nasdaq recorded its first record close in more than two years. The Dow and S&P 500 are off to their best start to a year since 2019. That's more good news for investors, particularly those whose holdings are in retirement accounts. These savers already saw their retirement vehicles achieve their... Read more →


Photo by Anastase Maragos on Unsplash The Internal Revenue Service has been making the news (and blogs) recently for its efforts to get more money from wealthy taxpayers. The new IRS revenue collection initiatives — new audits of business aircraft use and collection notices to wealthy non-filers — piqued my curiosity about other tax matters that focus on the rich. I found a few — seven actually — and am sharing them in this weekend's Saturday Shout Outs. Let's start with the man who heads the IRS. After the aircraft audit announcement, CNBC Wealth Editor (what a cool job title!)... Read more →


Photo by Ozan Safak on Unsplash Higher income taxpayers tend to take the most advantage of tax breaks. That's no surprise. They can afford to hire tax professionals, who keep track of all the benefits they qualify for and claim them on the well-to-do taxpayers' returns. But there are some valuable tax breaks for the rest of us who are far from wealthy. And while higher-income households do enjoy greater per dollar benefits tax benefits, the breaks available to us tax plebeian are more beneficial when they are measured as a share of our income. Tax credits provide the most... Read more →


Tax laws are full of unintended consequences. That became painfully clear during the COVID-19 pandemic, when a variety of tax relief provisions were created to help individuals and businesses deal with the virus' economic effects. Such was the case with the Employee Retention Credit, or ERC. "The ERC provided a financial lifeline to millions of businesses and exempt organizations during the pandemic," said IRS Commissioner Danny Werfel in his prepared testimony for the Feb. 15 hearing before the House Ways and Means Committee. "The IRS has worked hard to implement this credit, and we have processed about 3.6 million ERC... Read more →