Unsplash+ in collaboration with Charlie Harris Financial gifts arrive this month for many mutual fund investors. Most funds make annual distributions in December, based on their results at the October end of their fiscal year. The money paid to fund owners also presents the Internal Revenue Service with a present. The distributions are taxable. The fund owner owes tax on the amounts regardless of whether the money is reinvested or paid directly to the investor. Such distributions typically are only a small portion of a fund's returns. However, sometimes the December amounts are big enough to pose a serious tax... Read more →
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Unsplash+ in collaboration with Getty Images The Internal Revenue Service and its Security Summit partners today wrapped up the eighth annual National Tax Security Awareness Week with a warning for everyone, individual taxpayers and tax pros, to stay alert to emerging tax scams. It's a message the group issues regularly throughout the year because con artists work year-round to steal our money and, in many cases, our identities. Once they get that personal data, they can file fake tax returns to try to collect fraudulent refunds. By now, most of us are well aware of the warning signs of scams... Read more →
Photo by Anne Nygård on Unsplash Most taxpayers get federal tax refunds. Internal Revenue Service data complete through Oct. 27 shows that the agency received 160.5 million returns and issued nearly 105 million refunds that totaled more than $319 billion. Not surprisingly, taxpayers who are getting cash back from Uncle Sam are among the first to file every tax season. That's also a good security move. By getting their 1040 forms to the IRS early, they beat the criminals who might try to file fake returns under their names to claim their or even bigger fraudulent refunds. But some folks... Read more →
IRS also ups payment threshold trigger to $5,000 for the 2024 tax year. Thanksgiving is this week, but the Internal Revenue Service today skipped all the way to Christmas, giving an estimated 44 million taxpayers an early gift. Most of these individuals won't have to deal with 1099-K forms in 2024. They now have another year before they'll get this tax statement detailing their self-employment income. They also can make much more next year — up to $5,000 instead of $600 — before this third-party reporting document must be issued in January 2025. This latest delay decision, detailed in IRS... Read more →
Photo by DocuSign on Unsplash Many of the accommodations we made for the COVID-19 pandemic were burdensome. Just ask parents who were forced into dual work-from-home and school teacher duties. But two tax-related changes were more well-received, so much so that the Internal Revenue Service is extending them. The agency extended indefinitely the option to use electronic or digital signatures on tax documents. The IRS says digital/e-signatures will be acceptable "until more robust technical solutions are deployed." In addition, encrypted emails still can be used until Oct. 31, 2025, to communicate directly with IRS personnel with whom the taxpayers or... Read more →
Small businesses' many challenges were multiplied during the COVID-19 pandemic. The Employee Retention Credit (ERC) helped many companies and their workers make it through that lean time. But recently, unscrupulous promoters have pushed some owners to improperly claim the ERC, creating new problems. Now the IRS is offering a way to correct those bad filings. (Image via Unsplash+ in collaboration with Getty Images) The Employee Retention Credit (ERC) helped lots of small businesses and their staff make it through the COVID-19 pandemic. When properly claimed, the ERC is a refundable tax credit designed for businesses that continued paying employees while... Read more →
You have a lot of responsibilities when you're self-employed. One includes making contributions to your retirement plan, which in some cases can be done as late as your filing extension deadline. (Unsplash+ in collaboration with Getty Images) Most IRA contributions must be made by Tax Day. For the majority of taxpayers this year, that deadline was April 18. But if you're self-employed and got an extension to file your 2022 tax return, you also got an extension to contribute to your entrepreneurial endeavor's retirement plan. That deadline, in case the days have slipped by you, is this coming Monday, Oct.... Read more →
Piles of illicit cash were a plot feature in the AMC show "Breaking Bad." Since meth-making kingpin Walter White couldn't bank it without raising suspicions, he kept his drug money under his floorboards and, finally, in a storage unit, where two underlings once used it to nap sans mattress. Anyone who watches crime programs (guilty!) knows one piece of tax law. Television, streaming, and movie crooks are always careful to avoid five-figure financial transactions. When these on-screen crooks deposit or withdraw more than $10,000 of their ill-gotten funds, the bank must report the large amounts to the Internal Revenue Service.... Read more →
A few years ago, tugboats pushing barges down the Mississippi River, like this one going under the Vicksburg Bridge, was not a problem. Extreme drought, however, has lowered the river's levels, allowing salty water from the Gulf of Mexico to creep upstream below a layer of freshwater. (Photo by Justin Wilkens on Unsplash) Salt water is creeping up the mouth of the Mississippi River and threatening the drinking supply of several parishes in Southeast Louisiana, including the city and suburbs of New Orleans. The prospects are so severe, the Federal Emergency Management Agency (FEMA) declared major disasters in Jefferson, Orleans,... Read more →
Unsplash+ in collaboration with Philip Oroni Get ready fellow taxpayers. Our robot tax overlords are here. Or rather, getting more here. The Internal Revenue Service began using artificial intelligence (AI) bots last year to help taxpayers complete some tax tasks, such as setting up a payment plan. Today, the agency announced that it is expanding its use of chatbots to help answer some tax notice questions. Specifically, the technology should help quickly answer basic questions for people who get notices about possibly underreporting their taxes. Those are CP2000, CP2501, and CP3219A mailings that tell taxpayers the information the IRS received... Read more →
Hurricane Lee in the Atlantic on Sept. 11, 2023, before heading north. Hurricane Lee was a strange, scary storm. It formed off the coast of Africa and rapidly intensified into a large category 5 hurricane. But instead of heading for the lower U.S. east coast as is typical this time of year, it turned northward. That track sent Lee toward New England, where rotated offshore before making official landfall Sept. 17 in Nova Scotia, Canada, as a strong extratropical cyclone. Don't be deceived by meteorologists' extratropical classification. Lee still did damage to the already water-logged region. That's why the Federal... Read more →
Beyoncé on the Renaissance World Tour at Tottenham Hotspur Stadium in London on June 1, 2023, (Photo by Raph_PH - BeyonceSpurs010623) I love music. I just ordered two CDs last week. That last retail admission should tip you off that my prime concert-going days are behind me. In one way, I'm glad. The cost to see my favorite musicians perform back in my day was reasonable, even then. Today's more youthful fans, however, are shelling out big bucks to attend concerts. Marketplace economics are part of the calculation. And emotion is part of the market. So scalpers, whose targets are... Read more →
Photo by Jakob Owens on Unsplash After two years of decline, thanks in part to the coronavirus pandemic, marriages in the United States have returned to pre-COVID levels, according to the U.S. Census Bureau's recently released 2022 American Community Survey (ACS). Even better for romantics, a major jewelry company is predicting a spike in engagements as more of us return to pre-pandemic lifestyles, including dating…and more. If you're planning nuptials, or already have said, "I do," congratulations. Now here are eight tax tasks you need to take care of, after the honeymoon, of course. 1. Make sure everyone knows your... Read more →
The scheme involved false W-9 information, which meant the payor wasn't able to provide the owner of the artificial turf company, or the Internal Revenue Service, with the proper third-party report, allowing the man to evade nearly a million in federal tax. Until tax investigators caught up to him. Artificial grass has been dividing sports fans and players since its installation in Houston's iconic Astrodome in 1966. But fake grass is gaining ground among residential and smaller commercial customers. The market is forecast to reach $7 billion by 2025, as we deal with hotter temperatures, drought, and water sources literally... Read more →
Screenshot from Atlanta's 11Alive report via YouTube on Tropical Storm Idalia's impact on Southeast Georgia. It took a while longer than expected, but southeast Georgia residents who were in the path of Hurricane-turned-Tropical-Storm Idalia finally get the same relief as their neighbors. The Internal Revenue Service announced today that individuals and businesses in 28 of the Peach State's counties qualify for special tax consideration, including a new Feb. 15, 2024, deadline for filing and paying certain taxes. The delayed tax due date, which matches the one granted Florida and South Carolina taxpayers, applies to deadlines that occurred from Aug. 30,... Read more →
The Sept. 15 deadline for paying the third installment of 2023's estimated taxes is just days away. Make sure you meet it. Also make sure you pay the correct amount. If when all is said and filed at tax time, you owe the U.S. Treasury $1,000 or more, you could face a penalty for underpaying your taxes. And where that taxable money was from sources not subject to withholding, you also could face late-payment fines for not remitting it during the proper estimated tax quarters. Estimated tax safe harbors: Most of us who must pay estimated taxes calculate that expected... Read more →
National Weather Service satellite image of Hurricane Idalia moving across South Carolina. Tax and weather watchers knew this was coming. Today, the Internal Revenue Service made it official. The tax agency announced that all individual and business taxpayers in South Carolina are eligible for tax relief in connection with damages from Hurricane Idalia, which started its journey across the Palmetto State as a tropical storm on Aug. 29. The SC trek was after Idalia made landfall in Florida's Big Bend region two days earlier as a category 3 hurricane, prompting the IRS to grant most of the Sunshine State tax... Read more →
Unsplash+ in collaboration with Martin Sanchez I hope you enjoyed your Labor Day break. Now that summer is effectively and officially coming to an end this month, it's also a good time to look at some tax tasks. Taking care of tax business in September can help you avoid a costly tax fall as autumn arrives. OK, bad seasonal quasi-pun. Sorry. Accept my apology and these four September 2023 tax moves. 1. Pay your third quarter 2023 estimated tax. Many who've already filed their annual tax return still have other taxes to take care of this month. Yes, I'm talking... Read more →
Labor Day isn't a holiday for all workers. (Photo by frank mckenna on Unsplash) Labor Day is a day off for many workers. But entrepreneurs probably put in regular shifts this first Monday in September. When your small business depends primarily on you, you tend to work even on holidays. Since you're busy being the boss, I won't take up too much of your time. But whether you're a new business owner or have been the boss for years, it's always good to stay on top of your tax responsibilities. Here are some tax basics for all of us self-employed... Read more →
Spc. LeAnn White, 2nd Scout Battalion, 49th Brigade, Alaska State Defense Force, assists with recovery operations in Crooked Creek, Alaska, following May floods. Ice dams caused riverbanks to overflow, severely damaging many homes in the area. (Photo courtesy Alaska National Guard via Defense Visual Information Distribution Service) All weather eyes recently, and understandably, have been on Florida, where on Aug. 30 Hurricane Idalia made landfall in the state's Big Bend area as a category 3 storm. Idalia's winds damaged buildings and roads in Keaton Beach and other Gulf Coast enclaves near where the hurricane came ashore. Flooding was more widespread,... Read more →