Do you have a side gig? Make sure you understand your tax obligations
The number of people engaged in the “gig” or sharing economy has grown in recent years, according to a 2019 IRS report. And there are tax consequences for the people who perform these jobs, such as providing car rides, renting spare bedrooms, delivering food, walking dogs or providing other services. Basically, if you receive income […]
3 last-minute tips that may help trim your tax bill
If you’re starting to fret about your 2019 tax bill, there’s good news — you may still have time to reduce your liability. Three strategies are available that may help you cut your taxes before year-end, including: 1. Accelerate deductions/defer income. Certain tax deductions are claimed for the year of payment, such as the mortgage […]
Using your 401(k) plan to save this year and next
You can reduce taxes and save for retirement by contributing to a tax-advantaged retirement plan. If your employer offers a 401(k) or Roth 401(k) plan, contributing to it is a taxwise way to build a nest egg. If you’re not already contributing the maximum allowed, consider increasing your contribution rate between now and year end. […]
What is your taxpayer filing status?
For tax purposes, December 31 means more than New Year’s Eve celebrations. It affects the filing status box that will be checked on your tax return for the year. When you file your return, you do so with one of five filing statuses, which depend in part on whether you’re married or unmarried on December […]
Medical expenses: What it takes to qualify for a tax deduction
As we all know, medical services and prescription drugs are expensive. You may be able to deduct some of your expenses on your tax return but the rules make it difficult for many people to qualify. However, with proper planning, you may be able to time discretionary medical expenses to your advantage for tax purposes. […]
Uncle Sam may provide relief from college costs on your tax return
We all know the cost of college is expensive. The latest figures from the College Board show that the average annual cost of tuition and fees was $10,230 for in-state students at public four-year universities — and $35,830 for students at private not-for-profit four-year institutions. These amounts don’t include room and board, books, supplies, transportation […]
Take advantage of the gift tax exclusion rules
As we head toward the gift-giving season, you may be considering giving gifts of cash or securities to your loved ones. Taxpayers can transfer substantial amounts free of gift taxes to their children and others each year through the use of the annual federal gift tax exclusion. The amount is adjusted for inflation annually. For […]
Do you need to file gift tax returns?
As the combined gift and estate tax exemption continues to increase, fewer families will be subject to federal gift taxes. If a person’s wealth is well within the exemption amount, does that mean he or she doesn’t need to file a gift tax return? This article examines situations in which it’s necessary (and desirable) to […]
Charitable IRA rollover eases tax pain of RMDs
One downside of contributing to a traditional IRA is that, once you reach age 70½, you must begin taking required minimum distributions (RMDs) — and pay taxes on those distributions — whether you need the money or not. But if you’re charitably inclined, you can use a qualified charitable distribution (QCD) to avoid taxes on […]
Kiddie tax: New hazards, new opportunities
Despite its name, the “kiddie tax” is far from child’s play. And a change made by the Tax Cuts and Jobs Act (TCJA) puts some adult teeth into the tax. Now, children with unearned income may find themselves in a tax bracket higher than that of their parents. At the same time, the TCJA creates […]
