Some taxpayers awoke today to $600 (or more!) in their bank accounts. The money is the maximum per-person amount authorized by Congress and signed into law on Dec. 27 as part of the second COVID-19 economic relief measure. The Internal Revenue Service, which once again is in charge of distributing the economic impact payments (EIPs), says the electronic delivery will continue into next week. Some account holders may see the direct deposit payments as pending or as provisional payments in their accounts before the official payment date of Jan. 4, 2021. Sorry, but you'll just have to wait for the... Read more →
Healthcare Medical
My neighborhood optometrist is encouraging medical flexible spending account (FSA) owners to stop by and spend that money before the end of the year. (Photo by Kay Bell) You just discovered that you have money in your medical flexible spending account (FSA). For folks who don't have an FSA, this is a workplace benefit that allows you to put money into the account as an automatic withdrawal from your paychecks. In 2020, you could put up to $2,750 into your FSA. Since inflation has been low, that amount stays the same in 2021. You then use FSA funds to pay... Read more →
Welcome to Part 10 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. Today we wrap up the series (finally!) with standard optional mileage rate changes. 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, 2021. via GIPHY As... Read more →
Update, December 30, 2020: When the Consolidated Appropriations Act, 2021, finally was signed into law on Dec. 27, the new law OK'ed the $600 COVID-19 economic relief payments now going out and meant the federal government would stay open through Sept. 30, 2021. But it also included the No Surprises Act, a measure that should help end the unexpected medical bills many patients receive even though they have insurance. The new health care law will take effect in 2022. The only thing nearly as bad as dealing with a medical situation is getting a surprise bill after the treatment. (Photo... Read more →
Plain old tobacco cigarette smuggling is costing many states much-needed tax revenue. Yes, the House last week decided to decriminalize marijuana. The bill's bipartisan passage (really!) was the first ever Capitol Hill vote to legalize — and tax— cannabis. It's not going anywhere in the waning days of the 116th Congress. It might have a shot in the next one, which convenes in January 2021, depending on what happens with Georgia's runoffs for two Senate seats. The federal stance on weed is frustrating for the 36 states that have legalized the plant for medicinal purposes, along with the 15 jurisdictions... Read more →
It's no surprise that bad people take advantage of bad situations. That's why as we continue to cope with COVID-19, pandemic-related scams — tax and otherwise — proliferate. The latest coronavirus tax scam arrives via a text message. COVID-19 text scam warning: It was created by thieves who are trying to trick people into disclosing bank account information under the guise of receiving the $1,200 COVID-19 Economic Impact Payment (EIP), according to the Internal Revenue Service and its Security Summit partners. This scam's text message tells recipients: "You have received a direct deposit of $1,200 from COVID-19 TREAS FUND. Further... Read more →
Welcome to Part 5 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 changes to some popular tax-related medical matters. 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, 2021. Medical issues have... 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 →
Marco Verch via Flickr Halloween's tomorrow. Have your youngsters (and you!) picked out who or what they (and you!) want to be? When I was very young, I went trick-or-treating for several years as my favorite cartoon character, Bugs Bunny. Nowadays, though, kiddos tend to opt for other outfits. Over the years, the hubby and I have opened our front door on Oct. 31 to candy-craving athletes, superheroes and the occasional real-life occupation, such as a firefighter or astronaut or physician. With COVID-19 haunting this Halloween, we all might see more health care costumes sprinkled among the traditional goblins and... Read more →
For millions of U.S. workers, this month is the beginning of their benefits open enrollment period. This is your annual chance to switch, adjust or cancel usually tax-free company perks for you and your family. The biggest employer-provided benefit is medical insurance. Health coverage has taken on new importance during the coronavirus pandemic. But companies offer many more options that help make their workers' lives a bit easier and less costly. And many benefits experts expect COVID-19 considerations during this open season to alter the usual trend of workers simply letting existing coverages roll into the new year, which is... 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 →
Has the coronavirus pandemic got you stressing? Some ways to relief your COVID-19 anxiety might be covered by health insurance or associated medical savings accounts. (Photo by Gustavo Fring via Pexels) Life is stressful in the best of times. We definitely are not in the best of times. We're dealing with a contentious presidential election during a deadly pandemic. Plus, flu season is almost here. Mother Nature keeps whacking us with disasters. Kids are going back to school or not, both prospects producing parental problems. And way too many folks are unemployed or are worrying about losing their jobs. Whew!... Read more →
OK, this is a bit of tax inside baseball, but I couldn't resist. There are The New Yorker tax cartoon face masks! The Condé Nast publication is selling 17 different tax-related versions of COVID-19 personal protective equipment (PPE). A few are New Yorker cover images, but most are cartoons. My favorite, even though I am more of a feline fan, is the dog accountant one by M.E. McNair. Close behind on my list is Roz Chast's 1040-FI, the form for the financially incompetent, and Bernard Schoenbaum's fatherly tax advice. I can't vouch for their coronavirus pandemic precaution effectiveness. And no,... Read more →
Couple waiting to get married at San Francisco City Hall. (Photo by Brian Kusler via Flickr) One good thing has come of my self-imposed pandemic lock down. Seeking a distraction from the news channels I usually watch, I'm finally getting more of my money's worth from our cable account. I've been exploring the many channels the hubby and I typically tend to click right past. For the last week or so, I've tuned in to WEtv because of its run of CSI: Miami episodes. No judging, please! Actually, the TV is more like a talking lamp (really!). The dramatic intonations... Read more →
When you hit birthday milestones, like the one my Mom, the lovely lady in red, and her fellow Senior Center pals did a few years ago, you might qualify for some special tax benefits afforded older filers. (Photo by Kay Bell) Aging is not for sissies. I definitely can attest to that since, as the saying goes, I'm now a woman of a certain age. But with age also comes wisdom (or so I've been promised!). And getting older also provides some tax benefits. On this National Senior Citizens Day 2020 — yes, it was made official by President Ronald... Read more →
Rapper Cardi B quizzes Democratic presidential candidate Joe Biden on taxes (and more) in Elle magazine video chat. The 2020 Democratic Convention kicks off today, but former Vice President Joe Biden, who later this week will be formally nominated by his party to take on Donald J. Trump, got a media head start. Biden's recorded video chat with music superstar Cardi B was posted this morning. No, the nearly 17-minute video wasn't put out by the Joe Biden/Kamala Harris campaign. The conversation was sponsored by Elle, where Cardi's visage graces the fashion/lifestyle magazine's September cover. And no, Cardi's not coming... Read more →
The days of real toasts are on hold for the most part due to the coronavirus. But alcohol sales and the tax revenue they produce remain a bright spot in an otherwise dim outlook for state treasuries hit hard by the pandemic. (Photo by burst via Pexels.com). Many states have been facing budget issues for a while. Those financial problems have been exacerbated by the coronavirus pandemic. As businesses closed down, some temporarily and some forever, states saw the associated corporate tax revenue drop. Those closed companies meant its employees no longer had income on which they paid taxes. And... Read more →
Hello August! These annual hot and, here in Central Texas, sticky days of late summer usually are a transitional time. Families take one last summer vacation. Parents and kiddos (but mostly parents) get ready for the return of school. Not so in 2020. The coronavirus pandemic continues to keep much of our lives on hold, like those final holiday trips and school openings. Taxes, though, are more persistent. Yes, COVID-19 did delay Tax Day until last month. But as far as the rest of the tax realm is concerned, there still are some matters that must be considered. That means... Read more →
Hello July, which according to this year's goofy tax calendar is April. That means instead of heading to the beach, which is closed anyway due to COVID-19, or taking a longer trip to Europe, which isn't letting U.S. residents in, again due to COVID-19, we're spending mid-summer focusing on taxes. The main one, of course, is filing 2019 returns by the new Tax Day 2020: July 15. That date also is key for several other tax tasks to take care of in July. Here are six that you need to deal with in these two weeks before the 2020 tax... Read more →
Internal Revenue Service has offices nationwide, like this one in New York City. They were closed, at least partially, earlier this year as the agency took steps to slow the spread of the coronavirus. Now the IRS is calling back more of its workers to deal with the impending July 15 Tax Day. (Photo by Matthew Bisanz via Wikipedia Commons) As Tax Day 2020 nears, the Internal Revenue Service is bringing back more staff — thousands are expected back at their desks on Monday, June 29 — to deal with the added tasks that have been given the agency in... Read more →