Most of us are cheering the rapidly approaching end of tumultuous 2020. I definitely am right there with you with some pre-New Year's Eve joyfulness. But take a little time off from your anticipatory year-end celebrations to check out these tax moves. These final three tax tasks for the final three days of the year could pay off at filing time in 2021. 1. Know the value of donating items instead of cash. You have until Dec. 31 to donate to an IRS-qualified charity so you can claim the gift as a deduction on your 2020 tax return. If you... Read more →
Investing Capital Gains
To spend your retirement the way you want, you need to build your nest egg. The IRS has made changes to required withdrawal amounts that should help those Golden Years funds grow more and for longer. If you've been saving for retirement, then you likely are as jazzed as I am about a provision of the Setting Every Community Up for Retirement Enhancement Act of 2019, or SECURE Act. This law, which took effect this year, gives all us owners of tax-deferred retirement savings accounts an extra year and a half before we must start taking out some of the... Read more →
Welcome to Part 6 of the ol' blog's series on 2021 tax inflation adjustments. We started with a look at next year's income tax brackets and rates. That first item also has a directory, at the end of the post, of all of next year's tax-related inflation updates. In today's post, we look at how the annual changes help investors, high-earners and, eventually, estate heirs. Note: The 2021 figures in this post apply to that tax year's returns to be filed in 2022. For comparison purposes, you'll also find 2020 amounts that apply to this year's taxes, due April 15,... Read more →
Whether you'll be on the road this holiday season or staying home, you still need to map out some year-end tax moves. (Photo by Mohan Reddy Atalu via Pexels.com) It's November, a month most of us welcome because of its cooler temperatures and annual holiday festivities. However, there's even more to think about in November 2020. The presidential election is just a few days away. Then there's the coronavirus pandemic, which means Thanksgiving plans for most of us are modified if not scrapped. If you find you're staying home this year as a health precaution, don't despair. Remember that it's... Read more →
Plus, tips on maximizing yard sales and holding safe events during a pandemic. When I went out to get the paper from our driveway this morning, I was puzzled by the amount of traffic on our usually quiet neighborhood street. Especially since it's Saturday. Then I remembered that it was our annual fall community garage sale day. Actually, it's our only community garage sale day this year. The spring 2020 event was canceled due to COVID-19 concerns. And while my immediate neighbors aren't big sellers of their old items, a few tend to participate. This year, though, the cars were... Read more →
Hello, October! You're always welcome at my house. I love your cooler temperatures that let me open windows and doors and put an end to exorbitant air conditioning costs. I love the color changes of trees and shrubs. And I love the candy that I accidentally (really!) over-buy in preparation for the young ghouls and goblins that knock on our front door each Oct. 31. I suspect I'm not alone in appreciating the arrival of autumn. But amid all these annual fall festivities, we need to make at least a few tax moves that could help out our upcoming tax... Read more →
These West Texas cattle don't appear worried about much. Their owners, however, have a lot of concerns, including severe weather that could hurt their ranches' profitability. If drought has caused problems, the IRS is offering them some tax relief. (Photo by Kay Bell) When we city folks think of disaster preparation and animals, we're worrying about how to keep our pets safe during and after a major Mother Nature event. It's a bit more complicated when the animals are part of your livelihood. That's why farmers and ranchers in the path of potential disasters, like the flooding that now's across... Read more →
Photo by Pixabay via Pexels.com Ah, election years. They're always, uh, fun. Yeah, let's go with fun. Competing candidates with usually diametrically opposed policy positions go at each other, trying to convince voters that their proposals will better benefit them. That's why we tend to see, even in more usual presidential campaigns, a lot of ideas tossed out, including tax proposals. That's the case in the Trump Administration's suggestion this week to lower capital gains tax rates. Taxing investment timing payoffs: Capital gains are the profits made when you sell assets. We generally think of them in terms of financial... Read more →
GivingTuesday.org Hello Giving Tuesday. No, the world has not gone so thoroughly whack that we've jumped to the Tuesday after Thanksgiving. Rather, because of the unprecedented, and unexpected, need caused by the coronavirus pandemic, the creators of Giving Tuesday are encouraging those who can afford to give to participate in Giving Tuesday Now. As in today. This new global day of giving is in addition to the fall event, which has been around since 2012 and is scheduled this year for Dec 1. Potential charities, philanthropic activities:"We believe that generosity has the power to unite and heal communities in good... Read more →
Are you freaking out because you have to take a tax-mandated withdrawal from a retirement account on April 1? The Coronavirus Aid, Relief and Economic Security (CARES) Act has some good news for you. The new law that's gotten a lot of attention for the pandemic related stimulus checks that should be going out soon also offers a break to seniors who must take required minimum distributions, or RMDs. RMDs are waived for 2020 under the CARES Act. That means you can leave your money in your tax-deferred account this year or at least not take as much out as... Read more →
With the latest stock market dive, investors feel like the frontiersman confronting a bear in this "rough and tumble with a grizzley" illustration by H. Bullock Webster. (Image via Wikipedia Commons) Investors are in the third week of watching in horror as their nest eggs crack. The fiscal horror show began with the realization on Feb. 24 that the coronavirus was a global health risk. It got worse on Black Monday March 9 in the wake of the Russia-Saudi oil price war. Today, stocks are plunging again at rates not seen in more than a decade when were mired in... Read more →
This is what I paid for a gallon of gas four years ago. It's not quite that cheap right now, but fuel prices here and nationwide are heading down again. Life is full of trade-offs. That includes our tax lives. If you have money in the stock market, the continued declines of asset values are, at best, disconcerting. Uncertainty about the coronavirus, both how quickly it's spreading and questions on how to contain it, have been a major factor in the market's losses. But another factor came into play with today's dive. The biggest oil price crash in decades sent... Read more →
For folks with money in the stock market, the coronavirus' effect on their holdings is more terrifying than Michael Myers, the persistent slasher of "Halloween" horror movie fame. I confess. I've been glued to cable TV financial channels this week. They're showing, for owners of stocks, a real-life horror movie. The evil and infectious COVID-19 monster is maniacally slashing investment gains. Who or what can show up (soon, please!) to stop this crazed killer of our planned comfortable retirement? OK, I might be taking this sequel — and that's what it is; market corrections and recessions have happened before —... Read more →
Thanks to a 2018 Supreme Court ruling, many other states have joined Nevada in accepting bets on sporting events. But casino operations like this one in Las Vegas still get plenty of action on days like Super Bowl Sunday. Happy Tuesday to everyone who skipped work yesterday. I hope you've fully recovered from your Super Bowl hangover. I also hope that at least some of your prop bets on the NFL championship game also paid off. So does the Internal Revenue Service. All your Super Bowl LIV winnings, as well as any other gambling proceeds are taxable income. Yes, even... Read more →
This cat apparently is expecting something to be delivered by his postal carrier. Many taxpayers share this feline's anticipation this time of year, when annual tax forms are on their way. The hubby and I have some investments in addition to our retirement accounts. We're hoping these assets will be a nice bonus to the funds dedicated totally to paying for our retirement years. That means we're among those folks who are waiting on some tax documents so we can file our 2019 tax return. And we're also among those folks who'll be waiting a bit longer. Mutual funds vs.... Read more →
If past years are any indication, when the 2020 tax filing season officially opens on Monday, Jan. 27, millions of taxpayers will hit the send button to electronically deliver their annual returns to the Internal Revenue Service. But millions more of us have to wait to file. We're still waiting on at least one tax statement that has information we need to finish filling out our Form 1040. Form deadline is Jan. 31: Technically, most of these tax documents aren't even required to be on their way to us until Jan. 31. Employers and other businesses that issue wage and/or... Read more →
One of the hallmarks of the Trump Administration is tariffs, either put in place or threatened, on a variety of imported goods. If you have money in the stock market, you're probably pretty happy with 2019. Despite some blips, the market this year maintained its continued upward march. The positive news for investors, however, goes against conventional wisdom that tariffs are bad for the economy. Wall Street bulls say that tariffs eventually will take their toll. And others, including a pair of Federal Reserve economists, cite evidence that tariffs already are costing jobs and hiking prices. No tariff trouble for... Read more →
I don't know who came up with all these holidays in quick succession at the end of each year, but that person needs to be fired. We, and by we I mean U.S. residents since Canadians are smarter about Thanksgiving's timing, have a lot of special days in the last calendar quarter. Holiday avalanche: It starts in mid-October with Columbus Day, still one of 10 federal holidays recognized by Uncle Sam, although many areas now celebrate that Monday as Indigenous Peoples' Day. At the end of the month, we have Halloween and, depending on your heritage or geography, Dia de... Read more →
Congress played Santa this week, averting a government shutdown and approving a wide variety of anticipated tax breaks. Merry Christmas U.S. taxpayers. H.R. 1865, the Further Consolidated Appropriations Act, 2020, is now law. In a surprise move earlier this month, House and Senate negotiators cobbled together a massive bill that not only, as the name indicates, assures that the federal government stays open, but which also included some long-awaited (at least by those who will benefit) expired tax provisions. In addition, lawmakers corrected — and by corrected, I mean repealed — some obvious — and by obvious, I mean universally... Read more →
Yes, I know I'm a nag when it comes to year-end tax moves. I've posted about individual steps to take by Dec. 31 both at the beginnings of November and December, as well as looked at business tax moves to make now. But as happens all the time in life and taxes, I've come up with a few more year-end tax moves that didn't make the earlier lists, or at least were mentioned just in passing. So here goes with five more tax moves to make by Dec. 31 1. Don't miss the RMD deadline. You followed all the financial... Read more →