(BPT) – With the Tax Cuts and Jobs Act of 2017 having been signed into law, here are some of the things you should be thinking about as tax season approaches, according to Robert Fishbein, vice president, and corporate counsel, Prudential Financial Inc.
2017 tax returns
The new tax law is generally effective starting in 2018, which means that your 2017 income tax return is largely unaffected. However, there may be actions you can take now to benefit from the change. For example, assuming you are eligible, you could fund a traditional IRA before the due date of your tax return; the income exclusion may be more valuable under higher 2017 tax rates.
The new Tax Cuts & Job Act (TCJA) has been a hot topic most of this year, both in social and financial circles. Tax reform will have different effects on many taxpayers in different situations.
Previous articles have discussed how millennials are affected by the TCJA tax reform, and now another group is in the spot light. Baby Boomers it’s now your turn.
To assist you in visualizing just how tax reform will affect various individuals in the baby boomer generation, we’ve provided a Tax Reform Calculator. Check out the different scenarios and create your own to give you an idea where you stand.
As you hear the drum roll in the background, we are about to reveal the parts of the TCJA that will mostly affect baby boomers.
Finally A Solution to the Current, Highly Complex, & Unfair US Tax Code
If I were to ask this question to a group of American taxpayers, ” Are you happy with our current tax system” what do you think their response would be? I would imagine some would want to see the entire unfair US tax code burned and its authors tarred and feathered.
I think most of us would have to agree the current and extremely complex tax code is far from perfect. So imperfect in fact, that two groups have formulated plans to replace the present tax code. Our goal in this article is to compare the two plans for you to decide if either one has merit. One plan is the Flat Tax and the other is the Fair Tax.
Proponents of the Fair Tax and Flat Tax alternatives both agree that when comparing our tax system with other countries, it shows that the USA lags far behind their more effective method of raising taxes. Each says the best way to correct our ineffective system is to use their particular method of taxation.
By now, most of you have either seen the new Form 1040, or have read a lot of comments on the Internet. Is it really the size of a post card? Can you file your taxes using just this new form?
Pretty much. (See the front and back below)
Some may. Probably not for most.
What is the Form 1040?
This form was first introduced over a hundred years ago as the primary summary form for individual tax returns. In the beginning, all Form 1040 returnswere done by hand. Eventually when computers came upon the scene, a few outside vendors were preparing tax returns for accounting firms.
These returns, however, had to be mailed in by the taxpayer. Then in 1986, e-filing was introduced by the IRS, and this was the point that forever changed the method you could file your taxes. View full post…
Posted: August 19, 2018 Under: Income Tax By: Gust Lenglet
10 New Business Mistakes that Can Get You Into Trouble
Thinking of starting your own business? Are you self-motivated in such a way that you’ll put in the long hours necessary to succeed? If so, you may have what it takes to prevent new business mistakes from becoming a bad habit.
Unfortunately, some individuals have the misconception that becoming financially independent can be accomplished in a short period of time. Well, I suppose its possible, but for most, they quickly learn the business facts of life.
Operating your own business can be very rewarding such as being your own boss, but there are a number of things that you have to comply with if you want to stay in business. The primary one is paying the various taxesthat are required.
This is one area where a new business owner needs to consult an experienced, qualified accountant before setting up a business entity. A lot depends on the type of business and how to structure it so that overall taxes can be minimized.
In my state, a few years ago, the LLC designation was added to the state level types of organizations. Practically every new View full post…
Do I have to Pay Taxes on My Scholarship or Fellowship? Maybe.
Have you ever heard the expression “There is no such a thing as a free lunch?” When it comes to fellowships, grants and other free money from a college, you may not have a tax free scholarship.
Financial aid that you receive for higher education expenses, even when the college says its free, doesn’t mean that it is. Depending upon how the money is used, you could end up owing the IRSbig bucks.
Various types of financial assistance, such as fellowship grants, scholarships, and teaching assistantships, are very important to families. Often times, it may determine if your child will be able to attend the college of his/her choice.
College tuition and other associated expenses have been rising for years. Currently, the average fees and tuition for a full-time student attending a public college in state is 25,290.00. The average for a private college is 50,900.00.
This is why its very important to find out if your free money View full post…
Posted: July 14, 2018 Under: Income Tax By: Gust Lenglet
Having tax regrets? Here are 5 ways to pay less and save more on your taxes
(BPT) – Most of us know the feeling: Tax season can be a frustrating and stressful time. You have to gather lots of documents, remember all the changes in your life over the past year that might affect your return, and file the required paperwork before tax day rolls around. It’s worth it though to save more on your taxes.
And while you do all of that, there’s always that nagging feeling: Did you take advantage of all the deductions and credits the IRS has to offer? Is there more you can do to prevent taxes from eroding the value of your investment portfolio and eating away at your income? Are you prepared for the changes that are coming due to the new tax law?
Like thousands of others, you might be experiencing a “tax hangover,” that sense of regret that you overlooked some fine detail, that you could have paid less and ended up with more money in your pocket.
The truth is: Your taxes shouldn’t be top of mind just once a year. Tax planning is an important part of overall financial planning, and there are things you can do now to avoid having another exhausting experience next year.
Why We Think 1040.com is the Best Way to File Taxes
Did I hear you correctly? You haven’t filed your taxes yet? If not, there’s no reason to panic. We can guide you in finding the best way to file taxes – and at a low cost. What’s more, it won’t take you very long and it’s quite easy to do. Just follow our simple instructions and before you know it, filing your taxes will be nothing but a pleasant memory.
Find all of your tax documents that were sent to you
You wouldn’t start a building project without plans and filing your taxes is no different. Gather your W-2 and 1099 forms that you got in the mail, plus View full post…
Posted: May 15, 2018 Under: Income Tax By: Gust Lenglet
If you’ve ever researched the current tax code trying to find out if there were any tax advantages in being foster parents, it had to be confusing at best. Normally, a foster child does not qualify for the same tax credits or deductions that you would receive for an adopted or a biological child. However, there are a couple of very important tax advantages that are available.
A definition of a foster child is someone who has been placed in your care by a court order or an authorized state or local government agency. If the child has not been placed with you under those rules, there are no tax breaks available. Under IRS regulations though, the child may be able to be claimed by you as a dependent. You can find out more at the IRS website, Who You Can Claim as a Dependent.
Tax Deductible Items for your Job – Keep Accurate Records
Most individuals who are employed, and earn W-2 wages, usually don’t have on the job expenses. However, many others do have various tax deductible items that can be used on their tax return to reduce their taxable income.
Various professions, such as law enforcement, outside sales, and construction workers, to name a few, incur expenses in the performance of their job that are not reimbursed by their employer.
These could include tools, uniforms, use of personal auto, uniform cleaning, and many others. The important thing to remember is that these employee business expenses can be deductible if you personally paid for them and you were not reimbursed by your employer.
Where do you claim and deduct these tax deductible items?
As an individual employee, you can deduct these items if you use the itemized deduction method on Schedule A, and are not using the standard deduction.
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