Image by Bessi via Pixabay Happy Halloween! It's a special one, as it comes — despite the pumpkin-hued image above — on a Blue Moon, the second full moon in a month. Celebrations this year also will be different for most of us. The COVID-19 pandemic means that Oct. 31 festivities will be really, truly scary during a time when mingling with strangers is traditional. We're likely to see more face masks than Michael Myers or Scream masks. But regardless of how or where you'll celebrate All Hallows' Eve, one thing likely will remain the same. There will be candy.... Read more →
Taxes
Technology is great, until it isn't. That's how a lot of people are feeling after recently trying to use the Internal Revenue Service's Income Verification Express Service, or IVES. Financial community members use the program to expedite loan processing. This week, though, that wasn't happening. Expedited income confirmation: The IRS created the service so that registered users can more quickly confirm borrowers' incomes. Once taxpayers give a lender the OK to use IVES to check their earnings, the lender logs on to the IRS website to request the loan applicants' transcripts. That tax return, W-2 and 1099 transcript information generally... 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 →
Welcome to Part 3 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 annual retirement plan contribution amounts, and, for some taxpayers, tax deduction and credit options and limitations. 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... Read more →
Welcome to Part 2 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 item also has a directory, at the end of the post, of all of next year's tax-related inflation updates. Today we look at standard and itemized deductions, certain limitations on some Schedule A claims and the sort-of still around personal exemption amount. 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... Read more →
It's that time of the tax year when things start coming at us fast. We just wrapped up the 2019 tax return filing season, giving us around two months to focus on tax moves to make before year's end to lessen the 2020 tax-year bite. Then each fall the Internal Revenue Service throws a ton of numbers at us that change things for the soon-to-arrive next tax year. C'mon, taxman! Sure, we've all learned to multitask, but really? Now? Do we really need this huge 2021 data dump at the end of a crazy COVID-19 tax year where we already... Read more →
In addition to selecting who gets to go to, or stay in, Washington, D.C., voters across the country on Nov. 3 will decide on a variety of ballot measures. This coming Election Day, citizens in 32 states will decide the fate of 120 statewide initiatives. There also are measures on the ballots in the District of Columbia, Puerto Rico and the U.S. Virgin Islands. And yes, there are plenty of tax questions that will be decided. Ballotpedia, the Wisconsin-based nonprofit that's been tracking election data since 2007, says this year voters in 12 states will decide 19 tax-related ballot measures.... Read more →
Photo via Office of the U.S. Postal Service Inspector General One of the downsides of the Internal Revenue Service closing most of its offices earlier this year as a COVID-19 precaution was that taxpayer returns piled up. And it was a huge pile of mail, estimated at one point to be more than 12 million pieces. Some of that snail mail stack included tax payments. But since they weren't recorded, the compliant taxpayers still got automated tax-due notices. To the agency's credit, when it realized it was sending out erroneous notices demanding already delivered money, it stopped. But now, the... Read more →
The continuing COVID-19 chaos, plus an extended 2020 filing season for those coping with this year's natural disaster onslaught, could create more challenges in 2021 for taxpayers and the Internal Revenue Service. Are we — and the agency — ready for it? 2020, a year that many of us would just as soon forget, will end in just more than two months. This federal tax filing season, however, will continue for folks who've endured some of the notable natural disasters that have helped make 2020 so terrible. Last week, the Internal Revenue Service issued more disaster-related tax relief in connection... Read more →
While Congress is still, sort of, working on a second round of COVID-19 stimulus payments, the Internal Revenue Service is trying to get the first batch out to people who've yet to collect money for which they're eligible. For the most part, these are individuals who usually don't have to file a tax return. Since the IRS is using this tax filing information to distribute the economic impact payments (EIPs), these non-filers are out of luck. But they can get their data to the IRS by using the agency's online registration tool at the IRS.gov special Non-Filers: Enter Info Here... Read more →
Free tax-preparation and filing help is offered through groups like United Way, which partnered with volunteers at this Rutherford County, Tennessee, VITA office. Not only does the IRS train the tax assistors, each year it awards grants to keep the sites running across the country. Meeting your tax responsibilities can be a challenge for many — OK, most — of us. But things can be even more difficult when you can't afford to hire help to finish your returns or your advancing age makes doing your taxes tougher. There are some dedicated volunteers who work every year to meet the... Read more →
Uncle Sam is always on the lookout for people who try to evade taxes by hiding money in foreign accounts. To keep track of taxable money abroad, the federal government relies on two agencies, the Internal Revenue Service and its sister agency within the U.S. Treasury, the Financial Crimes Enforcement Network, usually referred to as FinCEN. FinCEN requires a special filing from some of Form 114, Report of Foreign Bank and Financial Accounts, usually referred to as FBAR. FBAR filings have long been a pain for Americans who hold assets abroad. A couple of years ago, Treasury tried to make... Read more →
Wildfire at night by Chenjack via Flickr While millions of taxpayers rushed to finish their 2109 tax filing last week in order to meet the Oct. 15 extended deadline, others weren't concerned about that deadline. They are the individual and business taxpayers who are dealing with something more pressing than taxes. They are trying to pick up the pieces from a major natural disaster. In these catastrophic cases, the Internal Revenue Service usually gives affected taxpayers more time to take care of their tax filing tasks. Some additional West Coast taxpayers have been added to this year's adjusted tax deadline... 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 →
Image by Daniela Hartmann via Flickr I joked on Twitter last week that coronavirus pandemic self-isolation has gotten to me so much that I'm considering buying all the gadgets whose ads keep popping up in my feed as holiday gifts. OK, I half joked. I've always tended to shop online anyway. COVID-19 has just moved me from 95 percent to 100 percent in that direction. And some of the items really are interesting. C'mon, admit it. You, too, wouldn't mind having a solar-power bird bath fountain or a pocket-sized, snowflake-shaped multi-tool. These items are even more appealing when you realize... Read more →
As we approach the Nov. 3 election, the political claims are fast and furious (but without any exciting car escapades … yet). When it comes to taxes, incumbent Donald J. Trump is relying on the tax breaks that were part of the Tax Cuts and Jobs Act that became law in late 2017. It permanently reduced business tax rates and temporarily revised, through 2025, some key individual taxes. Trump and his fellow Republicans are hoping those tax cuts will be enough to fend off Democratic challengers, both at the presidential and Congressional levels. But their hedging their tax bets by... Read more →
Robert Smith surprised the 2019 class of Morehouse College graduates with a pledge to pay off their student loans. Watch the happy moment via Bloomberg Quick Take on YouTube. It was one of last year's best feel-good stories. On May 19, 2019, billionaire entrepreneur and philanthropist Robert F. Smith promised graduates of Morehouse College listening to his commencement address that he would pay off their college debt. The approximately 400 grads at the historically black college in Atlanta were stunned. Then delighted. And the country cheered Smith's benevolence and commitment to making at least a little bit of the United... Read more →
The Social Security Administration (SSA) just gave retirees and other recipients of the program's payments some good news with the announcement of a small hike in their benefits year. Some higher earners, however, aren't so happy. In the same benefits raise announcement, the SSA noted that the amount of income subject to the Social Security payroll withholding also is going up in 2021. This amount, known as the Social Security wage base, is the maximum of earnings, by both salaried workers and the self-employed, that are subject to that portion of the Federal Insurance Contributions Act (FICA) tax. For the... Read more →
My local H-E-B Grocery smartphone app's barcode reader helps me discover the price of a product if it's not shown on the item packaging or store shelf. I love the technology almost as much as I love potato chips! I love my grocery store app. Not only does it offer digital coupons, it lets me make shopping lists, find the aisles where the products I want are located and if there's no price sticker on the item the shelf, I can use the app to scan the package's barcode code for that info. Now the Internal Revenue Service is becoming... Read more →
A quick Social Security note about for folks not yet at or near the benefits age about taxes on that pre-retirement income. More of it, known as the wage base, will be subject to the Social Security payroll tax. Details are in this post. Retirees checking on their investments. The income could make their Social Security benefits taxable. Today's a good day for millions of Social Security recipients. The Social Security Administration (SSA) has announced that benefits will increase a bit next year. Older folks who get regular monthly Social Security payments, along with those who receive Supplemental Security Income... Read more →