Photo by Kay Bell All things considered, we got through last week's Central Texas ice storm pretty well. Yes, I whined about no power, hence no heat for 3½ days, but we piled on enough clothes to mimic the Michelin Man, and used our grill to cook previously frozen food before it spoiled. As for our property, our oldest and biggest tree, a live oak, lost just three limbs. Two, shown above, fell in our backyard; the other snapped on the other side of the fence and fell into our neighbor's yard. The neighbor had a clean-up crew over at... Read more →
Shout Out
If you dabbled, or more, in innovative financial assets like crypto in 2022, then one of the most important lines on your 2022 tax return shows up early. The section just below where you enter your (and, if married filing jointly, your spouse's) name, the Internal Revenue Service asks: At any time during 2022, did you: (a) receive (as a reward, award, or payment for property or services); or (b) sell, exchange, gift, or otherwise dispose of a digital asset (or a financial interest in a digital asset)? (See instructions.) See more tax forms and more about them at 2022's... Read more →
Photo by Nataliya Vaitkevich One of the reasons to file early is to beat tax identity thieves to the punch. Even though the Internal Revenue Service has slowed such tax crimes a bit in recent years, they're still out there. In fact, I've been getting a lot of scam span in recent weeks, both texts and email, like the one below I got this morning. While this poorly faked attempt — a Gmail address for the U.S. Agency for International Development's grant office; really? — isn't a specific tax hack attempt, some of the information the crooks want from me... Read more →
One of the forms in the long list of tax documents you need to file your 2022 return is the 1099-K. This form has been used for years for third-party payment processors — for example, PayPal, Amazon, eBay, Facebook Marketplace, rideshare companies, and many more — to report to fund recipients the money they got during the year. The Internal Revenue Service also gets a copy so it can check the amounts that the earners report on their tax returns. Taxpayers have been getting 1099-K forms since 2012, with this initial reporting coving third-party amounts in 2011. The factors that... Read more →
Image by Gerd Altmann from Pixabay Most states operate on a fiscal year that runs from July 1 to June 30. That's why we see some new laws take effect each summer across the United States. However, those states also make the effective date for other changes the first of the year. It's easier for us residents, who operate on a January to December calendar, to accept that timetable. That's especially true of tax laws, since most states also tend to follow the Internal Revenue Service calendar. New tax laws effective New Year's Day: This Jan. 1, notes the Tax... Read more →
Before the House Ways and Means Committee released six years of Donald J. Trump's federal filings, the last time was got an ostensible glimpse of the former president's Form 1040 was back in October 2015. That's when he shared this photo on his Twitter account of him signing what he said was his federal tax return for that year. With just a few hours left in 2022, some of us are doing some last-minute tax accounting. OK, maybe that's just me and a handful of others who've already planned our annual living room countdown to 2023. I know that one... Read more →
Kris Kringle, portrayed by Edmund Gwenn in the 1947 classic movie "Miracle on 34th Street." (via Giphy) I'm a Christmas traditionalist. OK, so I expand the traditional holiday season. We, at my urging, put up holiday decorations right after Halloween. We have a lot of them, so it takes time. Plus, I'm a fan and nonresident celebrant of Canada's Thanksgiving. Our neighbors to the north's celebration of the harvest and other blessings of the past year falls on the second Monday of October, following a more North American seasonal shift. Even better, it provides a welcome space between Turkey Day... Read more →
Photo by Pixabay Health and retirement are inextricably linked, and not just when we talk about staying in good shape in order to enjoy post-work years more fully. The link also is evident in the tax code, notably with the tax benefits of health savings accounts, or HSAs, that I blogged about last week. An HSA starts as a way for high deductible health plan enrollees to save tax-free for medical expenses, and then can morph into retirement funds when the account owner is older. In doing research for that HSA post, I ran across another retirement connection to the... Read more →
Everyone who helps fellow taxpayers, regardless of language, makes a real-life difference. So here's also a look at some of those who do that as VITA and TCE volunteers. Photo by Dakota Corbin on Unsplash Back in October, the Internal Revenue Service announced it had awarded $41 million in grants to 348 programs that help U.S. taxpayers complete their annual federal tax returns. These groups sponsor Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs, where low-to-moderate income and elderly filers can get free tax prep help and e-filing. Even before the sites were announced, the... Read more →
Many companies are sending workers home from their cubicles permanently. Last week's U.S. jobs numbers were surprisingly good. But another group was focused on a different workforce statistic: layoffs. In the last few weeks, there have been mass personnel reductions. Workers at CNN, HLN, Twitter, Meta, Amazon, Salesforce, HP, Lyft, Doordash, and more have been shown the doors in what some are terming, after the pandemic prompted Great Resignation and quiet quitting when workers returned to offices, the era of loud layoffs. At least those let go received some sort of severance package. But that small consolation also has tax... Read more →
Photo by Mikkel Bergmann on Unsplash We're into the Thanksgiving weekend and still noshing on leftover turkey. (Or, in my case, pumpkin pie.) But here's a Tax Turkey you shouldn't let linger. Don't wait to look into converting, in full or partially, your traditional IRA to a Roth IRA. Individual retirement savings options: IRAs, or individual retirement arrangements (although most of us read the A as account), have long been a popular way for individuals, with or without a workplace retirement plan, to save for their post-work year. The original version, now known as a traditional IRA, debuted in 1975,... Read more →
My polling place only had Spanish "¡Yo Voté! / I voted" stickers. But the language doesn't matter. The act of voting, this year and in the future, does. (Photo by Kay Bell) The 2022 midterm elections have come and gone. As the old saying goes, it's all over but the shouting or crying or both. In addition to selecting individuals to lead our local, state, and federal governments, many of us were asked to decide on ballot issues. Overall, according to Ballotpedia, voters in 37 states and the District of Columbia decided Nov. 8 on 132 statewide ballot measures. Since... Read more →
Right now, a lot of folks are thinking they should have been like Larry. The Larry they wished they'd emulated is Larry David, known for his curmudgeonly television character. He tweaked that persona to become a naysayer on several inventions that, per the commercial's Super Bowl debut, changed the world. The television ad for FTX crypto exchange advised viewers, "Don't be like Larry" and instead invest in digital currency via the company. On Friday, Nov. 11, FTX filed for bankruptcy following reports that between $1 billion to $2 billion of FTX customer funds disappeared. Continuing crypto troubles: This is just... Read more →
UPDATE, Nov. 5, 2022, 10:25 p.m. CDT: The Houston Astros win game 6 by a 4-1 score and are 2022 World Series Champions! Houston Astros mascot Orbit hopes to trade in his extra-large regular season cap tonight for a 2022 World Series Champion one. (Photo by Kay Bell) The Houston Astros will play what fans, including me, hope is their last game of the 2022 Major League Baseball season tonight in Minute Maid Park. If they beat the Philadelphia Phillies, they get to hoist the World Series trophy in front of their hometown fans. Some H-Town businesses, however, might be... Read more →
Gig work is the preferred employment life for millions. They enjoy being their own boss. There's the freedom to take as many or as few assignments as desired. You can do the jobs the way you want and during the hours you choose. There's no commuting. Sometimes, however, clients try to control contractor workers a bit too much. When that happens, the workers could in fact be employees, not contractors. They'd lose some of the freedom mentioned earlier, but as employees, they would be entitled to workplace benefits, including health care, paid time off, compensation for expenses, and a minimum... Read more →
Tyle Perry working on one of his many productions. (Facebook photo) Most of us would celebrate getting a $9 million refund from the Internal Revenue Service. But then, most of us aren't billionaire media mogul and philanthropist Tyler Perry. When an IRS audit resulted in Uncle Sam handing over the multimillions, Perry fired his accounting team. "I'll let you make a million mistakes, but you can't do the same thing over and over again. That's how I run my business. Here's the mistake. Let's fix it; let's move forward," Perry told the audience at a recent Earn Your Leisure Conference.... Read more →
The only thing worse than college course overload is the debt you went into to get into the university. Now, some students will be able to have some of their student loan amounts forgiven. (Photo by Pixabay) The Department of Education is now accepting online applications for full or partial discharge of student loans up to $20,000. It's a soft, beta launch, so be prepared to encounter some glitches if you're in a hurry to be done with your college debt. Technically, you'll be a test subject for the Education Department. The webpage notes: We're accepting applications to help us... Read more →
The Internal Revenue Service saw its largest tax fraud case ever end on Aug. 5 when Robert T. Brockman died. The 81-year-old billionaire had been charged with 39 criminal financial crimes, including tax evasion. Federal investigations alleged that Brockman was part of an elaborate offshore tax fraud scheme that cheated the U.S. Treasury out of more than $1.4 billion in taxes, penalties, and interest. While the criminal case is over, legal actions in civil and tax courtrooms to recoup the allegedly unpaid taxes (and add-on charges) continue. Special tax action to protect collection: As part of that process, the IRS... Read more →
I loved this couch, but it was starting to wear so we donated it away while it was still in good shape. Some folks, however, would have sold the sofa. Now, such transactions could trigger a confusing tax situation. With inflation still squeezing budgets, some people have taken to selling old items. Garage sales are the traditional route, but if your neighborhood limits when you can put old items out for sale (dang those HoAs), then there's always the internet. A tax law change, however, could mean a tax hassle for infrequent, small-time online sellers. They could get a tax... Read more →
Photo by Karolina Grabowska I have money in the stock market. When I was a younger investor, I checked my assets a lot. Like almost every day. Then I realized that was just going to make me crazy(ier), so I shifted to a monthly review of where my holdings were. Now I just check quarterly. Most of the reason for my reduction in the frequency of my equity evaluations is that I'm at that part of my life where my holdings are pretty much set for my fast-approaching retirement years. The good news is that the recent market dive, while... Read more →