• New option for unused funds in a 529 college savings plan

    With the high cost of college, many parents begin saving with 529 plans when their children are babies. Contributions to these plans aren’t tax deductible, but they grow tax deferred. Earnings used to pay qualified education expenses can be withdrawn tax-free. However, earnings used for other purposes may be subject to income tax plus a 10% penalty. What if you have a substantial balance in [...]

    Published On: March 4, 2024Categories: Featured, Individual Tax
  • If you didn’t contribute to an IRA last year, there’s still time

    If you’re gathering documents to file your 2023 tax return and you’re concerned that your tax bill may be higher than you’d like, there might still be an opportunity to lower it. If you qualify, you can make a deductible contribution to a traditional IRA right up until the April 15, 2024, filing date and benefit from the tax savings on your 2023 return. Who [...]

    Published On: March 1, 2024Categories: Featured, Individual Tax
  • Get ready for the 2023 gift tax return deadline

      Did you make large gifts to your children, grandchildren or others last year? If so, it’s important to determine if you’re required to file a 2023 gift tax return. In some cases, it might be beneficial to file one — even if it’s not required. Who must file? The annual gift tax exclusion has increased in 2024 to $18,000 but was $17,000 for 2023. [...]

    Published On: February 20, 2024Categories: Featured, Individual Tax
  • Filing jointly or separately as a married couple: What’s the difference?

      When you file your tax return, a tax filing status must be chosen. This status is used to determine your standard deduction, tax rates, eligibility for certain tax breaks and your correct tax. The five filing statuses are: Single Married filing jointly, Married filing separately, Head of household, and Qualifying surviving spouse. If you’re married, you may wonder if you should file joint or [...]

    Published On: February 13, 2024Categories: Featured, Individual Tax
  • If you gave to charity in 2023, check to see that you have substantiation

    Did you donate to charity last year? Acknowledgment letters from the charities you gave to may have already shown up in your mailbox. But if you don’t receive such a letter, can you still claim a deduction for the gift on your 2023 income tax return? It depends. What the law requires To prove a charitable donation for which you claim a tax deduction, you [...]

    Published On: February 12, 2024Categories: Featured, Individual Tax
  • IRAs: Build a tax-favored retirement nest egg

      Although traditional IRAs and Roth IRAs have been around for decades, the rules involved have changed many times. The Secure 2.0 law, which was enacted at the end of 2022, brought even more changes that made IRAs more advantageous for many taxpayers. What hasn’t changed is that they can help you save for retirement on a tax-favored basis. Here’s an overview of the basic [...]

    Published On: February 9, 2024Categories: Featured, Individual Tax
  • Answers to your tax season questions

    The IRS announced it will open the 2024 income tax return filing season on January 29. That’s when the tax agency will begin accepting and processing 2023 tax year returns. Here are answers to seven tax season questions we receive at this time of year. 1. What are this year’s deadlines? The filing deadline to submit 2023 returns or file an extension is Monday, April [...]

    Published On: February 8, 2024Categories: Featured, Individual Tax
  • The kiddie tax could affect your children until they’re young adults

    The so-called “kiddie tax” can cause some of a child’s unearned income to be taxed at the parent’s higher marginal federal income tax rates instead of at the usually much lower rates that a child would otherwise pay. For purposes of this federal income tax provision, a “child” can be up to 23 years old. So, the kiddie tax can potentially affect young adults as [...]

    Published On: January 16, 2024Categories: Featured, Individual Tax
  • It’s possible (but not easy) to claim a medical expense tax deduction

    One of your New Year’s resolutions may be to pay more attention to your health. Of course, that may cost you. Can you deduct your out-of-pocket medical costs on your tax return? It depends. Many expenses are tax deductible, but there are several requirements and limitations that make it difficult for many taxpayers to actually claim a deduction. The rules Medical expenses can be claimed [...]

    Published On: January 15, 2024Categories: Featured, Individual Tax
  • Don’t overlook taxes when contemplating a move to another state

    When you retire, you may think about moving to another state — perhaps because the weather is more temperate or because you want to be closer to family members. Don’t forget to factor state and local taxes into the equation. Establishing residency for state tax purposes may be more complex than you think. Pinpoint all applicable taxes It may seem like a smart idea to [...]

    Published On: January 15, 2024Categories: Featured, Individual Tax
  • Court awards and out-of-court settlements may (or may not) be taxed

    Monetary awards and settlements are often provided for an array of reasons. For example, a person could receive compensatory and punitive damage payments for personal injury, discrimination or harassment. Some of this money is taxed by the federal government, and perhaps by state governments. Hopefully, you’ll never need to know how payments for personal injuries are taxed. But here are the basic rules — just [...]

    Published On: January 13, 2024Categories: Featured, Individual Tax
  • The “nanny tax” must be paid for nannies and other household workers

    You may have heard of the “nanny tax.” But if you don’t employ a nanny, you may think it doesn’t apply to you. Check again. Hiring a housekeeper, gardener or other household employee (who isn’t an independent contractor) may make you liable for federal income and other taxes. You may also have state tax obligations. If you employ a household worker, you aren’t required to [...]

    Published On: January 12, 2024Categories: Featured, Individual Tax
  • Key 2024 inflation-adjusted tax amounts for individuals

    The IRS recently announced various 2024 inflation-adjusted federal tax amounts that affect individual taxpayers. Most of the federal income tax rate bracket thresholds are about 5.4% higher than for 2023. That means that you can generally have about 5.4% more income next year without owing more to the federal government. Standard deduction Here are the inflation-adjusted standard deduction numbers for 2024 for those who don’t [...]

    Published On: January 11, 2024Categories: Featured, Individual Tax
  • The tax implications of renting out a vacation home

    Many Americans own a vacation home or aspire to purchase one. If you own a second home in a waterfront community, in the mountains or in a resort area, you may want to rent it out for part of the year. The tax implications of these transactions can be complicated. It depends on how many days the home is rented and your level of personal [...]

    Published On: October 13, 2023Categories: Featured, Individual Tax