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income tax

Why are Social Security benefits taxed?

Why are Social Security benefits taxed? This article explores the history behind this seemingly “tax on tax” situation and provides some clarity.

Don’t Forget the Saver’s Credit on Your Tax Return

The IRS provides a way to make your saving activities pay off more for you, by way of the Saver’s Credit. If you are eligible, it’s a great benefit.

The 1040X – 15 Facts About Amending Your Tax Return

Do you understand all of the rules for amending your tax return? It’s important to get this right, or you might end up having to amend again or pay up.

Tax-Efficient Charitable Giving from your IRA

Illustrated example of charitable giving using an IRA and the qualified charitable distribution (QCD) option. Only available to folks over age 70½.

Time for your paycheck checkup!

This time of year is a perfect time for a paycheck checkup to make sure that you are having enough tax withheld from your pay. Do it soon!

Who should do a mid-year tax checkup?

There are certain groups of people who really need to do a mid-year withholding checkup, according to this notice from the IRS.

Mid-year estimated payments checkup

It’s a good idea to do a mid-year estimated payments checkup to make certain you are having enough tax withheld throughout the year.

Mid-year withholding checkup

It’s a good idea to do a withholding checkup early in the tax year to make sure that you’re having the proper amount of tax withheld from your paychecks.

Exemptions and Dependents for 2017 Tax Returns

It’s important to know the rules regarding dependents and exemptions for your 2017 tax return. The determinations can be complicated.

Best and Worst States for Retirement Finances

Where you live in retirement can make a big difference. Learn which are the best and worst states to retire to. You may be surprised!

Taxpayer Bill of Rights – Do You Know Your Rights?

Do you know your rights as a taxpayer? There’s a Taxpayer Bill of Rights, and you should become familiar with it. Know your rights!

Traveling for Charity? You may have deductions

If your volunteering activities find you traveling for charity, you may be able to take valuable tax deductions for your travel expenses.

What to do When You Owe Taxes

If you have found yourself in a situation where you owe taxes to the IRS, there are ways to arrange a payment plan with the IRS. Here’s how.

IRS’ Offer in Compromise

The IRS has a process to provide a compromise when you owe taxes and penalties and you have no capacity to pay. The compromise is a reduction in the tax.

The Sharing Economy and Taxes

If you rent out a room to others using airbnb or drive your car for Uber to take part in the sharing economy, the money you earn may be taxable.

Tax Bill Too High? Try This Trick

Some individuals get the nice surprise of a big tax refund every tax year (if this is you, don’t be too happy – you’ve been lending Uncle Sam money interest free). Other folks get the unpleasant surprise of having to write a big check to Uncle Sam. For the latter individuals, there may be a way to lower their tax bill and save more for retirement. Let’s look at an example. Assume an individual has a tax bill of $4,000 and they want to reduce this. Naturally, there are other deductions they may qualify for, but in this case, they’ve exhausted all other options except this one: saving to their 401k. Let’s also assume this individual’s marginal tax rate is 25%. The individual can take their tax rate and divide it into their tax liability for the year – in this case $4,000 divided by 25%. This comes to $16,000. […]

Adjusting Withholding Saved 44% of the Tax Bill

Adjusting withholding on your income taxes can produce some surprising results. See how one taxpayer saved 44% in taxes by adjusting his withholding.

Answers to Common DIY Income Tax Questions

DIY income tax preparation can cause lots of questions to come up. Here we review some of the more common questions with DIY income tax.

IRS Warns of Phishing Scam

IRS has been tracking an email phishing scam lately. This one is particularly nasty, and it’s evolving in the targeted organizations.

Tax Refund Myths Debunked

Recently the IRS published a Special Edition Tax Tip which debunks some very common myths about your income tax refund. You may find some of these surprising. These myths are pervasive and can lead you astray if you believe them. In my experience the information in the Tip below is great advice for finding information about your tax refund. The complete text of the Tip (IRS Special Edition Tax Tip 2017-02) follows below: IRS Debunks Myths Surrounding Your Tax Refund As millions of people begin filing their tax returns, the Internal Revenue Service reminds taxpayers about some basic tips to keep in mind about refunds. During the early parts of the tax season, taxpayers are anxious to get details about their refunds. In some social media, this can lead to misunderstandings and speculation about refunds. The IRS offers these tips to keep in mind. Myth 1: All Refunds Are Delayed […]