When the tax laws changed in 2018, most people no longer had to use the itemized deductions (Schedule A), but found it easier and more beneficial to just use the standard deduction. Generally, I find that there is a small minority that still itemize. They usually have a lot of property taxes, large amounts mortgage interest and give a generous amount to charities (such as tithing 10% to their church).
One of the biggest tax pains in the last two decades in the tax preparation world has been when two separated or divorced parents both try to claim the same child - regardless of who had the right to. You see, the IRS doesn't care what a separation or divorce decree says. They got tired of reading them to make determinations. So they came us with the custodial parent rules.
Because they don't trust United States persons resident abroad and green card holders to pay their taxes, the IRS has issued final regulations on required income tax withholding for certain types of retirement distributions. These regulations apply to distributions from deferred compensation plans (such as 401(k)s), IRAs, and commercial annuities.
I'm always amazed each tax season that people don't really know how the profits and losses from stock sales (capital gains) are taxed at the federal level, much less the state level. Depending on your income, they can be taxed at three different rates: 0%, 15%, or 20%.
The US Supreme Court recently ruled in a case called Polselli v. IRS, that the IRS can sometimes secretly probe bank records without notice to taxpayers. Under an existing statute, the IRS can also without notice request and examine bank records of people who don't even owe it money - like friends, family, and associates of a taxpayer who does owe the IRS.
This dispute began when a taxpayer (Remo Polselli) owed more than $2 million in taxes to the IRS.
The Internal Revenue Service announced today the annual inflation adjustments for tax year 2025 - in case you are planning how much money you have to hand over for them to waste next year.
The tax year 2025 adjustments described below generally apply to income tax returns to be filed starting tax season 2026. The tax items for tax year 2025 of greatest interest to many taxpayers include the following dollar amounts:
As the year winds down, it's time to start thinking about preparing your finances for the end of the year. QuickBooks, a popular accounting software, can be a valuable tool in this process. In this blog post, we'll explore how QuickBooks can help you organize your financial records, track your income and expenses, and ensure that you're ready for tax season.
One of subjects that seems to come up when doing people's taxes and I see that they have changed jobs that had retirement plans is: What did you do with your retirement plan at your previous employer?
I have also found it amazing how many people have not even thought about it, or know what their options are. So, here is a short primer on your options.
#1 - 401(k) rollover: Keep you savings with your previous employer's plan
And the evil in the world just keeps chugging along. Case in point:
In the wake of Hurricanes Milton and Helene, the IRS has warned in a Oct 15th statement that fraudsters have been exploiting the generosity of individuals looking to help disaster victims by soliciting donations through fake charitable organizations. These scams are designed not only to steal donations but also to harvest personal and financial data from unsuspecting Americans, which opens the door to identity theft.
The Inflation Reduction Act created the corporate AMT, which imposes a 15% minimum tax based on book income rather than taxable income on corporations with adjusted financial statement income (AFSI) of more than $1 billion beginning after Dec. 31, 2022. The Treasury Department estimates that approximately 100 of the largest U.S. corporations will pay the corporate AMT annually.
The IRS can take the fun out of just about anything. Case in point: Last week, baseball phenom Shohei Ohtani became the first major league player to start the “50-50 club” by hitting 50 home runs and stealing 50 bases in a single season. And when he did that, one lucky fan in Miami caught the 50th home run ball and walked away with it even though he had the opportunity to give it to the Dodgers. No one yet knows whether the lucky fan will keep the ball or sell it. Should he decide to sell it , it could be worth hundreds of thousands, or even more than a million dollars.