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 →
Shout Out
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 →
Photo by Alexander Mils So far this year, 17 states have or will issue rebate money to their residents. Massachusetts is about to up that list count to 18, thanks to a 1986 state law. The Bay State's Department of Revenue this summer reported a fiscal-year-end tax revenue surplus of nearly $3 billion. Once the state auditor certifies the amount, which at the last unofficial count was $2.941 billion, the tax cap law known as Chapter 62F takes effect. The payback law, a referendum approved 36 years ago by Massachusetts voters, requires the state rebate its taxpayers a percentage of... Read more →
Photo by Evelyn Giggles, Flickr CC Schools nationwide are open. That means lots of teachers' bank accounts are taking hits. Last year, the National School Supply and Equipment Association's (NSSEA) survey found that educators spent an average of $750 of their own money to ensure their students have what they need to learn. Another report by Expect that cost to increase this term — another report by My eLearning World sets this year's per-teacher cost at $820 — in part due to inflation. Some small tax savings for teachers: Inflation also helped out a bit with a of tax relief... Read more →
Photo by Ben Vardi (Ben Vardi, Public Domain) It's the three-day Labor Day holiday weekend marking the end of summer. It's also three straight days of college football games. So, of course, folks are enjoying cookouts and/or tailgating. Both those events typically involve adult beverages, surreptitiously in the case of college football games, depending on where you're holding your "Go Team!" pre-game celebration. Today's multiple Saturday Shout Outs welcome this convergence of the United States' most popular sport and Labor Day weekend. First, there's the legal aspect of booze and parking lot football parties. Intoxalock looks at 5 Alcohol Laws... Read more →
College can be fun. Paying for it, not so much, especially when you have to take out loans. Some student borrowers are getting loan relief from the White House, but also might end up owing state taxes on their forgiven student debt. (Photo by cottonbro) Around 20 million folks who borrowed money to attend college got good news last week when President Joe Biden canceled a chunk of their student loan debt. The Biden plan's major component says that individuals earning less than $125,000 (or $250,000 for married couples or heads of households) a year will be eligible for up... Read more →
The Biden Administration notched a big win last when the president signed the Inflation Relief Act into law. Despite the name, The Inflation Reduction Act is a slimmed-down version of the Joe Biden's original Build Back Better bill. The new law, which took effect on Aug. 16, doesn't have most of the social safety net provisions Biden wanted. It also, by some accounts, won't do much about inflation. But it does contain some major climate change provisions, will eventually lower the price Medicare recipients pay for some prescription drugs, raise taxes on corporations, and allow the Internal Revenue Service to... Read more →
Photo by krakenimages on Unsplash Are you freaking out about the possibility that one of the new Internal Revenue Service enforcement agents will be coming for you? Most of us don't have to worry. The prime targets are the very wealthy. Why has the IRS been instructed to go after this filing demographic? One reason is because the richest taxpayers who try to hide taxable assets offer the biggest return when they are caught. Another reason is that they've been flying under the IRS audit radar for way too long. Dramatic drop in high wealth audits: A Government Accountability Office... Read more →
Some on Capitol Hill want to make it easier for you to use your Bitcoin and other cryptocurrencies to make small, every day purchases. The 2022 election year legislative calendar might be working against them, but Congressional fans of cryptocurrency still are looking at ways to make it more appealing to mass consumers. On July 26, two Senate Banking Committee members, including the committee's top Republican, introduced the Virtual Currency Tax Fairness Act. The bill, cosponsored by Ranking Member Sen. Pat Toomey (R-Pennsylvania) and Sen. Kyrsten Sinema (D-Arizona) would, in part, make small personal virtual currency transactions for goods and... Read more →
Geralt via Pixabay Economists use a variety of measurements to track inflation, but the one that matters most to you and me is the personal consumption expenditure, or PCE, price index. This gauge of consumer spending increased 1.1 percent in June. The difficulty many folks are having in meeting their rising living expenses finally prompted some Congressional action. The Senate is expected to vote next week on what's been dubbed the Inflation Reduction Act of 2022, a budget reconciliation package that includes tax, climate change mitigation, and health care provisions. But closer to home, 16 state governments are taking more... Read more →
Figuring out how to pay off student loans is a math problem that goes well beyond school days. (Photo by Karolina Grabowska) The payment pause on student loans expires in six weeks. As that Aug. 31 deadline approaches, former students also are waiting for President Joe Biden to take further action to help lessen, or eliminate, their higher education debt. In addition to the political ramifications of any White House action, especially in an important midterm election year, there also are tax implications. Taxable forgiven debt: The tax code generally treats forgiven or canceled debt as taxable income. It's officially... Read more →
Photo by Karolina Grabowska Cryptocurrencies are going through a rough patch, at least as far as the investment world is concerned. But devotees of the virtual assets insist they are here to stay, and that general acceptance of digital currency as payments for retail purchases is on the way. A recent survey seems to support that position. Widespread retail crypto payments expected soon: A majority of U.S. retailers expect digital currency payments to be the norm in the next five years, according to a study released last month by Deloitte in collaboration with PayPal. The study's poll in December 2021... Read more →
The White House's proposed federal gasoline tax three-month holiday proposal is not just stalled. A metaphorical Congressional tow truck has pulled it from the legislative roadside where it was sputtering. The main reason is, as noted earlier, is surprisingly united Capitol Hill opposition to waiving the 18.4 cents per gallon federal gas tax. In fact, lawmakers also have been united in refusing to increase it. It hasn't been hiked since 1993. Another reason is, despite the grousing and social media posts of auto fill-up pump prices, people are still hitting the roads, at least early this summer. That's taken some... Read more →
Photo by John-Mark Smith Federal law changes tend to get the most attention. That's understandable. They affect billions of people across the United States. Plus, it's easier for the major media to focus on one governmental entity instead of 50. But for many of us, our state's law changes are just as critical. Sometimes, they affect us even more. Some of those new state laws took effect when the calendar page flipped to July. Since this is a tax blog, we're looking specifically tax laws. Notable changes to tax codes became law in 14 states on Friday, July 1, says... Read more →
With inflation at historic levels, U.S. families are re-examining their budgets. Uncle Sam recently did the same with his money, or rather the Congressional Budget Office (CBO) did. What this federal agency within the government's legislative branch found was surprising. The word that the CBO actually used was unexplained in connection with the robust growth of tax collections. Unexplained income tax revenue: "Tax collections in both 2020 and 2021 were larger than the currently available data on economic activity would suggest," according to the CBO report "The Budget and Economic Outlook: 2022 to 2032" issued on May 24. "That unexplained... Read more →
Juneteenth is officially on the day that gives it its contraction name, June 19th. But since that was on Sunday, federal offices, the stock market, and some states observance Juneteenth on Monday, June 20. It's the second year of Juneteenth being celebrated as a federal holiday. Since today is Sunday, federal offices will observe it on Monday, June 20. As a native Texan, I was aware of the date. It's was the day in 1865 when recalcitrant (insert your own R word if you wish) early Lone Star Staters were forced to acknowledge — and let enslaved Texans know —... Read more →