National Guard troops have been deployed to help states meet COVID-19 needs, ranging from personal protective equipment training, support of medical testing facilities and healthcare professionals and assisting with disinfecting and cleaning common public spaces. (Photo courtesy U.S. Department of Defense) Taxes have been in the public spotlight this week, not because right about now we normally would be nearing the annual filing deadline, but because of how the coronavirus pandemic has thrown normal, including our tax obligations, out the window. By now you know that April 15 is not Tax Day this year. Instead, it's been pushed to July... Read more →
Shout Out
States also are coping with COVID-19 and tax return timing, with a handful already delaying some returns. UPDATE, March 21, 2020: Tax Day 2020 has changed again. Now taxpayers have until July 15 to file their 2019 returns and pay any due tax. This latest change was announced March 20 and the IRS issued some guidance on the changes on March 21. This window's timely admonition usually is good advice as April 15 nears. This year, however, Tax Day may be pushed back due to the spreading coronavirus. (Painted window in Harlingen, Texas, 1939, by Lee Russell; New York Public... Read more →
Image: Mark Knoller, CBS correspondent, via Twitter Donald Trump visited tornado-ravaged areas of Tennessee on March 6. While such visits and shows of support are important, the White House's major disaster declaration the day before was critical. It allowed the federal agencies to start helping Volunteer State residents who sustained losses with their physical recovery efforts. That started with the Federal Emergency Management Agency (FEMA) listing the areas that are eligible for help. Right now, that's three counties — Davidson, Putnam and Wilson. But damage assessments are continuing. Don't be surprised to see more counties and additional types of FEMA... Read more →
Happy Feb. 29! Here's to a great extra day in 2020. I know I've joked (sort of) about how nice it is to have another day to work on your taxes, but there really is a Leap Year potential tax connection. SentricHR, a cloud-based payroll and human resources software company, points out in this weekend's Saturday Shout Out item that while an extra pay period can show up any year depending on a business' pay system, a leap year increases the chance that workers can collect extra pay. Generally, an extra pay period affects salaried employees paid weekly or biweekly,... Read more →
Texas doesn't have a personal income tax, but there are plenty of other levies we Lone Star State residents must pay. Most U.S. taxpayers also must file a state return every spring. Only those of us who live in one of the seven states — Alaska, Florida, Nevada, South Dakota, Washington, Wyoming and my home Texas — don't have to mess with state income tax forms. Some more local jurisdictions, generally large cities, also levy income taxes. And most of those other 43 states (and cities et al) plus the District of Columbia also follow the federal April 15 deadline.... Read more →
The Setting Up Every Community for Retirement Enhancement Act, or SECURE Act as it's popularly known, was attached to the omnibus spending legislation enacted in late 2019. Taxpayers, lawmakers and investment advisers generally supported most of the measure's changes to how we stash and ultimately access our retirement funds. One SECURE provision, however, is causing some concerns, especially among those who have accumulated large IRA holdings and who had planned to leave the bulk of that money to heirs. They and, more importantly, their heirs no longer have access to what used to be known as a stretch IRA. Ending... Read more →
I finally got the final 1099 I was waiting for yesterday. Yay! Now I can file my return. The 1099 situation for a retired Southern California dentist, however, didn't go so smoothly. David Powell, got a 1099 from MetLife insurance showing he was paid $1,500 for dental work he says he never performed. Since MetLife also sent that 1099 to the Internal Revenue Service, this meant Powell was on the hook for taxes on money he never earned. Double check documents immediately: Powell's case is why you always need to look at every tax statement — 1099s, W-2s, bank, brokerage... Read more →
Are you having some trouble getting fired up for Super Bowl LIV? I feel ya. It's hard when your team isn't one of the competitors. But as a lifelong Dallas Cowboys fan, I've learned over the last 24 years — yes, that's how long it's been since Them Cowboys were in the National Football League championship game — creative ways to pique my interest in the annual match-up. This year, for example, it's pretty easy to find a reason to watch. Kansas City Chief's star quarterback Patrick Mahomes is not only a native Texan like the hubby and me, but... 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 →
Detroit police inspecting illegal alcohol distilling equipment found in a clandestine underground brewery during Prohibition. (Photo: National Archives and Records Administration via Wikipedia Commons) Last week was the 100th anniversary of a momentous, and eventually failed, effort by U.S. lawmakers to control public actions. Following ratification of the 18th Amendment in 1919, Congress followed up with the National Prohibition Act, commonly referred to as the Volstead Act. It outlawed the production, distribution and transportation of alcohol. The United States officially went dry on Jan. 17, 1920. Not only did Prohibition, authorized by the 18th Amendment, fail to stop Americans from... Read more →
Topher Grace is known by millions of fans as television's Eric Forman. But when he's not acting, he also has a side gig. Side hustles aren't just for struggling wage slaves. From the "what I learned today" files, I literally learned today that actor Topher Grace has a side gig doing projects for Disney. Yes, the man who was Eric Forman in That '70s Show, and a buddy put together, as a lark, a consolidated trailer of all the Star Wars movies. Their unsanctioned YouTube post got a gazillion hits. OK, around 2 million from all the various postings. But... Read more →
Supporters of a minimum wage increase at rally in Chicago last year. (Photo: Charles Edward Miller licensed under CC by SA 2.0; cover of the National Employment Law Project 2020 report) New tax laws aren't the only ones that went into effect on New Year's Day across the United States. A record number of states, cities and counties have or will boost their minimum wages in 2020. On or around this Jan. 1st, the minimum wage increased in 21 states. Another 26 cities and counties also hiked their baseline pay at the start of this year. In the coming months,... 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 →
Christmas is next week! So of course you're thinking about filing your 2019 tax return. Maybe not this coming week. But you will soon. And when you do think about it, if you're like most U.S. taxpayers, you'll use tax software. E-filing encouraged: The Internal Revenue Service encourages us — and in the case of most paid tax preparers, requires — to use the tax preparation programs and accompanying electronic filing option. We follow those prompts and pushes. This year, more than 138 million returns were e-filed. That was almost 89 percent of all the 1040s and other annual returns... Read more →
Quick email question for you. Are you getting more online sale announcements or more requests to donate to good causes? It's close in my inbox, but charitable solicitations seem to be winning. That's not really a surprise. I'm not much of a shopper, in real life or online, so I don't generate enough of a cookie trail for e-tailers to follow. Plus, in the wake of the Tax Cuts and Jobs Act (TCJA) changes, charities are making concerted efforts to encourage donors. That means every nonprofit to which I've given over the years, as well as the groups they sold... Read more →
The days left in 2019 are dwindling. Quickly. Don't just take my work for it. Check out the countdown clock over in the right column of the ol' blog literally clicking away the seconds left in this year. That means it's time to act to cut your taxes. You can check out my monthly tax moves (thank you!) for November and December for some possibilities. While I did mention in those earlier posts (the November one specifically) the Tax Cuts and Jobs Act's 20 percent tax break for small businesses that operate as passthrough entities, most of those earlier tips... Read more →
Some food delivery apps apparently are shorting states when it comes to sales tax on the delivery fees. The 2019 holiday shopping season is officially underway. The kickoff remains Black Friday, the day after Thanksgiving, as many shoppers remain committed to post-Turkey Day sales. Early data from Adobe Analytics shows in-store sales were up 4 percent from last year. But consumer patterns are changing. The store of choice for more and more of us is the internet, which is open 24/7 365 days a year. Online Black Friday sales were up early in the day by more than 19 percent... Read more →
The men and women hoping to win the Democratic presidential nomination have gotten a lot of attention for their proposals to tax the wealthy. That's obviously an area to watch, as the money could help pay for some other tax and public policy pitches. But most of us aren't wealthy. So what is really important to us is how much of a tax bite the Internal Revenue Service would take out of our average Jane and Joe Taxpayer income under Democratic plans. The Tax Foundation has looked at the tax proposals from the four Democratic White House wannabes who, at... Read more →
Photo by Chris/spike55151 via Flickr There's a saying that any tax law bill should be subtitled the Perpetual Employment for Accountants Act. The thinking, in both the financial and political worlds, is that no matter what Congress does to the Internal Revenue Code, we'll need tax professionals to decipher at least some of it. Or to help guide you, if you can afford it, through the legislative and legal maze that will allow you to avoid or at least reduce the effects of some of the tax laws. That's the point of Paul Sullivan's analysis of proposed wealth taxes. "Name... Read more →
Welcome to Part 4 of the ol' blog's 2020 series on tax inflation adjustments. We started on Nov. 6 with a look at next year's income tax brackets and rates. Today we look at changes to tax credit, deduction and income exclusion amounts. Note: The 2020 figures in this post apply to 2020 returns to be filed in 2021. For comparison purposes, you'll also find 2019 amounts to be used in filing 2019 returns due April 15, 2020. The hubby has a chant he breaks into every year when I start working on our annual tax return: "Deduct! Deduct! Deduct!"... Read more →