Photo by Nikola Knezevic on Unsplash The famous saying about all politics being local also applies to taxes, most notably property taxes. Property taxes are locally levied, usually by counties (or parishes if you're in Louisiana), meaning they vary widely across, and within, the 50 states. Local jurisdictions set the tax rate, but if real estate values increase, even a relatively low rate can mean a big tax bill on your home. Because of the complicated considerations involved in calculation property taxes, the Tax Foundation's latest analysis took a two-pronged approach. The Washington, D.C.-based tax policy nonprofit looked at median... Read more →
Tax rates
Unsplash+ in collaboration with Getty Images When we watch streaming shows, the hubby and I get a kick out of the warnings that pop up before the programs start. The one that shows how things have changed the most is the alert that we will see people smoking. We both grew up in homes where both our parents smoked. So did their friends. And I smoked way to many cigarettes for almost a decade, before quitting as my wedding gift to the never inhaled any product hubby. While my smoking days ended because of love, money is a reason that... Read more →
America's elite billionaires club last week welcomed a new member. The person who has the sole winning ticket, purchased at a Publix grocery store in Neptune Beach, Florida, can claim the $1.58 billion Mega Millions jackpot. The Aug. 8 jackpot was the largest Mega Millions jackpot awarded, according to the national lottery. The winner, who has yet to come forward, has the option of taking the nearly $1.6 billion spread out over 30 years. Or the winner can slide into the millionaires' club by getting a single cash payment of $783.3 million. One vs. 30 payouts: Most people opt for... Read more →
Reviewed and updated Tuesday, Jan. 2, 2024 The New Year's Day 2024 Powerball drawing was life-changing for the yet-to-be identified person who bought the lone winning ticket in Grand Blanc, Michigan. Congrats to the winner of the $842.4 million jackpot, which has a one-time cash payment value of $425.2 million. And better luck next time for the rest of us! Picking lucky numbers from a lottery game dispenser. Benjamin Franklin wasn't wrong, but he did live in pre-national lottery times. Today, joining death and taxes as life's constants is Americans' love of gambling. One of the most popular betting options... Read more →
Vice President Kamala Harris and President Joe Biden share a lighter moment. Last week, they also shared their 2022 federal and state tax returns with the American public. (Photo courtesy K. Harris/White House) The U.S. president's and vice president's tax returns were among the more than 117 million filings that the Internal Revenue Service has received through mid-April. We know this because, as is once again tradition, President Joe Biden and his wife, First Lady Jill Biden, made their 2022 tax return public. So did Vice President Kamala Harris and Second Gentleman Douglas Emhoff. The Bidens' filing showed they paid... Read more →
Photo by Nicola Barts If you turned 72 last year and didn't take your first required minimum distribution (RMD) by Dec. 31, 2022, you have a few days to take the mandatory withdrawal. April 1 is your deadline to take out the specified amount from your tax-deferred retirement savings account(s). This year, however, is the last one for the age 72 RMD trigger. The latest retirement law changes in the Setting Every Community Up for Retirement Enhancement (SECURE) Act 2.0 changed the RMD starting age to 73. However, there's been a bit of confusion about the change. Some people have... Read more →
Reviewed and updated Nov. 23, 2023 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... Read more →
A single winning ticket for the record $2.04 billion Powerball lottery jackpot was sold in Altadena, California. The good news for the buyer, or buyers if it's a shared ticket, is that California is one of two states that don't tax lottery winnings. The other is Delaware. The bad news is that the U.S. Treasury still gets a big chuck of the huge payout when the winner(s) finally collect. Winnings are ordinary taxable income: Since lottery winnings are considered under the Internal Revenue Code as gambling proceeds, the Internal Revenue Service will get a cut. When winnings are more than... Read more →
Before law changes, the now inflation-indexed Alternative Minimum Tax, known as the AMT, seemed to work like an ATM for the Internal Revenue Service, allowing it to collect this parallel tax from more than the wealthy for whom it was created. (Photo by Erik Mclean) Calculating one tax bill is bad enough, but some people have to deal with a second one at tax filing time. The Alternative Minimum Tax, or AMT, is a separate tax system created to ensure that the wealthiest pay at least some tax. The parallel AMT was added to the Internal Revenue Code in 1969... Read more →
Plus a look at how higher costs of living affect capital gains, youngsters' investment earnings, gifts, and more. Image via Giphy Them that got, are them that get. Not only is that a lyric (and theme) from a fabulous Ray Charles song, it's a good synopsis of the current estate tax law, especially with 2023 inflation adjustments. Many of the current wealth-related tax provisions help the richest among us stay that way. But some of them can help all of us, regardless of our income level, increase our relative wealth. And, as reviewed in this Part 6 of the ol'... Read more →
At times, it seemed like inflation was heading to infinity and beyond. (Photo by Edvin Richardson) Inflation replaced COVID as the daily topic back in 2021, and things just escalated as that economic figure kept climbing in 2022. Most of the time, the focus has understandably been on how inflation is costing us at the grocery, the gas station and, well, just about everywhere. But we're finally getting some good inflation news from the Internal Revenue Service. Really. Some sections of the Internal Revenue Code are tied to inflation. Every year, the IRS takes a look at these numbers and,... Read more →
Inflation is still a concern, for consumers and politicians, but it is easing a bit (at least for some consumers). One reason for the change is falling gas prices. GasBuddy reported on Sept. 12 that for the thirteenth consecutive week, the nation’s average per-gallon gas price dropped. It went to $3.67 per gallon, down 7.6 cents from a week ago. AAA's daily tracker shows a Sept. 15 national per gallon average of $3.698. But those are averages. Your pump prices may vary. Patrick De Haan, head of petroleum analysis at GasBuddy, noted in the latest analysis that there are "drastically... Read more →
Looking up provides a lovely view of the Idaho statehouse dome. Gem State lawmakers, however, recently went the other direction, lowering the state's top personal income tax rate and making it the lone flat tax amount collected on individual earnings starting in 2023. (Photo by Kencf0618 - Own work, CC BY-SA 3.0) I've spent most of my earnings life in no-individual-income tax states. I was born, grew up, and got my first jobs in Texas. After a stint in Maryland, which collects state and local income taxes, the hubby and I moved to Florida, another no personal income tax state.... Read more →
Panoramic view of Los Angeles, California (Photo by Anthony Brown) There's been a boom this year in the price of houses. Now some Californians are hoping that the money sellers are making also can help the homeless. Los Angeles voters will decide in November on a higher tax rate on sales of high-value homes. The proposed 4 percent tax on the sale of homes valued $5 to $10 million and 5.5 percent on homes valued at more than $10 million would go toward affordable housing and homelessness prevention efforts. In addition to applying to residential sales, commercial property sellers would... Read more →
A group of Kentucky homeowners switched to a different, higher-rate tax district so their increased taxes would pay for things like street cleaning. A transcription error meant they got it and other services for free for eight years. (Photo by Kay Bell) Property tax bills are a major expense for homeowners. They also can be confusing. Here in Texas, most property tax money goes to the homeowners' local school districts. But there's usually more. Our real estate bill, for example, has collections for our independent school district, as well as five other taxing jurisdictions. That's why every tax bill recipient... Read more →
I have a stock app on my phone. Yeah, that's it above, with all those ugly, jagged red lines. I'm smart enough not to get alerts, but now and then when I check other news, I see it. Like today, which got me thinking it's time to delete this piece of electronic info, at least for a while. But while I'm not enjoying the prospect of delaying the start of my golden years, the declining stock market is good news for some retirement account owners. If they have traditional IRAs, the current down market could be a good time for... Read more →
Vice President Kamala Harris looks on as President Joe Biden makes remarks on the White House lawn. (White House photo) Tax tradition return redux: Biden and Harris again release their tax returns The United States' top two elected officials were among the millions who filed 2021 tax returns this year. President Joe Biden and First Lady Jill Biden reported on their joint Form 1040 adjusted gross income of $610,702. After the figuring was done, they paid $150,439 in federal income tax, which was a 24.6 percent effective tax rate. Vice President Kamala Harris and her husband Douglas Emhoff reported more... Read more →
President Joe Biden's fiscal year 2023 budget proposal of a minimum tax on the wealthiest Americans, as well as a levy on unrealized gains on assets (including stock holdings), is getting the most attention. Biden's plan to collect at least a 20 percent tax on U.S. households worth more than $100 million would apply to about 20,000 households, but more than half the revenue would come from households worth more than $1 billion, according to White House estimates. It also would, says the administration, help reduce the nation's budget deficit by $1 trillion over the next decade. Wish list only:... Read more →
Photo by Anna Shvets from Pexels Inflation is the biggest domestic, and political, concern right now. And after months of waiting, the Federal Reserve's expected reaction to rising prices came last week. The board members of the United States' central bank raised interest rates on Wednesday, March 16, for the first time since 2018. The bump of a quarter percentage point to its benchmark rate is the first of expected increases to combat the country's highest inflation in four decades. When all is said and done, most financial observers say the previously near-zero interest rates to be near 2 percent... Read more →
Reviewed and updated on Monday, Feb. 19, 2024 Today is the federal holiday celebrating George Washington's birthday. That's it. Just George. Not his Mount Rushmore colleagues Tom or Teddy or Abe. Not any other man who's been Commander in Chief. But most of us refer to this annual February celebration as Presidents Day. The unofficial public renaming actually happened somewhat organically. Evolution from one to all presidents: When Washington's Feb. 22nd birthday became the first federal holiday to honor an American president back in 1879 , it was celebrated on the actual date. But under the 1971 Uniform Monday Holiday... Read more →