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Taxes

Apr 19, 2019 Many people dread tax season. But if you're expecting a tax refund for the 2018 tax season (which you filed in 2019), you've got something to look forward to. With your extra funds, you may be able to pay off some debt, start saving in a high-interest savings account or otherwise get serious about your financial plan. Wondering when your refund will arrive? Most people will get their tax refund within three weeks, but it varies based on how you file and how you get your refund. Check out our chart below to see the refund schedule and how long it takes for the IRS to… Read More...

Jan 18, 2019 In December 2017, President Trump signed the new tax plan into law. This new plan changed the  federal income tax brackets for the 2018 tax year, which you will file in early 2019. (If you're preparing for next year, you can read this article for all of the details on the Trump tax plan and how it could impact you.) Let’s take a look at the federal income tax brackets for the 2018 tax year. Read More...

Jan 23, 2019 President Trump signed a new tax bill, the Tax Cuts and Jobs Act, into law in December 2017. This bill largely didn't affect individual income taxes until the 2018 tax year, which you file in early 2019. How exactly the Trump tax plan affects you depends on your income, your current filing status and the deductions you take. Take a look at the following guide to help you better understand the main features of the new tax plan. Read More...

Jul 24, 2019 The start of a new year means it’s time to file your federal tax return. Many people stress about filing taxes but there are a number of tax filing services to make the process easier. Two of the most well-known services are H&R Block and TurboTax. They both offer a friendly user experience. They provide information along the way so you understand what you're doing. And they both offer affordable filing options. Which of these services should you use when you file your 2018 taxes? Read More...

Jan 23, 2019 Filing your taxes yourself has never been easier. As long as you have internet access, you can submit your tax return from the comfort of your couch. In fact, according to the IRS, 92% of tax returns were e-filed in 2017 and over 51 million were filed from home. Before you get started, however, you'll have to choose which online tax software to trust with all your financial details. That's not always easy. Read More...

Aug 15, 2019 Scoring as many tax breaks as possible can make the filing process a little easier to bear, especially if you end up getting a big refund or owing less money to Uncle Sam. Claiming tax credits and deductions can go a long way toward shrinking your income tax bill. But they work in very different ways. Here's a quick breakdown of the difference between tax credits and deductions. Read More...

Aug 14, 2019 There are two key education tax benefits that can help families who are paying for college: the Lifetime Learning Credit and the American Opportunity Tax Credit (AOTC). In general, it may be wise to take the American Opportunity Tax Credit if you qualify. It could provide a larger credit, and you may not have to spend as much in order to get it. Here's how to know if you qualify for the American Opportunity Tax Credit, plus how it works. Read More...

Jul 09, 2019 When filing taxes, it's important to make sure you're reporting all of your income correctly. That includes making note of early distributions from qualified retirement plans or other tax-favored accounts that may be subject to a 10% early withdrawal penalty. Failing to report those distributions could result in a major tax headache if the IRS determines you owe additional taxes or penalties later. If you've taken a withdrawal from an individual retirement account (IRA) or another account with tax-advantaged status, you may need to file Read More...

Aug 01, 2019 Both gross income and net income can refer to an individual and a business. For individuals or employees, gross income is the total pay you earn from employers or clients before taxes or other deductions. This is not limited to income received in cash, and can also include property or services received. Net income refers to your income after taxes and deductions are taken into account.   Read More...

Jun 27, 2019 In the world of accounting, finance and taxes, there's more than one type of year. In addition to regular years, there are a number of different fiscal years. A fiscal year is the 12-month period a company uses for accounting purposes. Here's how it works and why it's important in business and taxes. Read More...

Jun 27, 2019 If you're self-employed or a freelancer, you likely get paid as an independent contractor rather than an employee. The IRS defines an independent contractor as someone who performs work for someone else, while controlling the way in which the work is done. In other words, someone pays you to perform a service or deliver a product, but they only have a say in the final outcome. As an independent contractor, there are some unique responsibilities where taxes are concerned. Understanding the guidelines for filing and paying taxes as an independent contractor can help you avoid issues with the IRS. Read More...

Jun 17, 2019 Paying for health insurance and medical bills can get costly. Luckily, you can recoup some of those costs when you file your taxes by taking a deduction for medical expenses. To do so, the expenses in questions must meet the qualifications outlined by the IRS. You should also know that the recent Tax Cut and Jobs Act made some changes that make it harder to deduct medical expenses. We'll show you how to figure out whether your expenses qualify, and how to calculate and take your deductions. Read More...

Aug 21, 2019 If you're considering buying a new home, a tax abatement may provide an incentive that's hard to pass up. These beneficial tax programs allow for a long-term break on your  property tax bill. Savings like that will undoubtedly impact your bottom line in a positive way. However, tax abatements are only available in specific areas of certain cities, so you may need to do some digging.  Read More...

Mar 27, 2019 Doing your taxes is never easy, but for small business owners there are some extra layers of complexity. Schedule C is a tax form that some small business proprietors use to file their tax returns each year. For those using it, command over the Schedule C is an important part of making sure they are compliant with federal regulations and not paying more in taxes than they need to be. If you want help with your small business taxes, consider finding a financial advisor with SmartAsset’s free financial advisor matching service. Read More...

Mar 04, 2019 Net income refers to a company’s earnings minus business and operating expenses. An individual’s net income is equal to total income minus applicable deductions and taxes paid. Net income helps you understand how profitable your business is. If you’re an investor, it can help you analyze a company’s stock. And as an individual, it can help you understand your actual take-home pay. If you want hands-on guidance as a business owner or investor with net income, check out our free financial advisor matching tool to link up with up to three advisors in your area best suited to your particular needs. Read More...

Jul 24, 2019 AGI is short for “adjusted gross income.” This number appears on your Form 1040 and helps determine which deductions and credits you can take and therefore how much tax you finally pay. For tax year 2018 (what you file in early 2019), your AGI goes on line 7 of the newly redesigned  Form 1040. Read More...

Mar 26, 2019 A large majority (75%) of taxpayers overpay on taxes and receive a tax refund, according to IRS data. A smaller proportion (19%) see the opposite: They will have overestimated their withholdings and learn they still owe the IRS some money. Apart from overpaying and underpaying, there is another small, exclusive group of savvy Americans who manage the Goldilocks fantasy: withholding just the right amount so, come tax time, the tax balance between them and the IRS reads an even zero. Read More...

Aug 21, 2019 For many employees in America, especially those at tech companies and other startups, stock options are a part of compensation packages. While the right to buy stock in a company at a set price is an attractive form of compensation, stock options have more complex tax implications than straight cash. It's important to factor your stock options into your tax return. The way you do so will depend on whether you have incentive stock options (ISOs) or non-qualified stock options (NQSOs). A financial advisor can help you get it right in either circumstance. SmartAsset can help you find an advisor with our Read More...

Aug 21, 2019 The U.S. experienced a partial government shutdown from Dec. 22, 2018 to Jan. 25, 2019. This 35-day shutdown was the longest in U.S. history and disrupted the service of multiple federal agencies, such as the National Park Service. However, the IRS did not stop work entirely. Many of its employees were furloughed (temporarily laid off) and some services experienced interruptions or delays, but others didn’t. What does this mean for your tax return? Read More...

Feb 06, 2019 Donating your car to charity is a thoughtful and generous act. It's also one that can save you some money on taxes. Many non-profit organizations that take automobile donations advertise it heavily, but doing research is necessary before you hand over your keys. Here's what you should know if you want to find the best charities to donate your vehicle. Read More...

Feb 01, 2019 If in 2018 you gave someone cash or property valued at more than $15,000 or if you do so in 2019, you’ll have to fill out Form 709 for gift tax purposes. But don’t fret. This doesn’t always mean you’ll owe an actual tax. The government requires this to keep track of your lifetime gift and estate tax exemption. Only once you use up that large exemption would you owe an out-of-pocket tax. Still, filling out Form 709 can get complicated. This article will walk you through the process step-by step. It'll also help you determine if you need to fill out a Form 709 in the first place. We can also help you work with a financial advisor who can guide you through the process so you won… Read More...

Feb 22, 2019 Filling out your taxes can be a real headache. It’s no surprise, then, that online software like TurboTax has been growing in recent years to meet the demands of taxpayers in need of expert advice. But there are more resources available to you beyond tax software. Many states have programs to help taxpayers fill out their forms, and some states have an abundance of high-skilled accountants ready to work for those willing to pay. And, given the potentially severe consequences of a tax-filing mistake, the cost may well be worth it. Of course, not all states are equally equipped to help you stay in good standing with the IRS. Below, we look at the best states to get help completing your taxes. Read More...

Feb 22, 2019 About 75% of American taxpayers overpaid on taxes in tax year 2016, according to IRS data. And though they may have been overjoyed to get a handsome tax refund, this scenario means they are simply being reimbursed for money they've lent the government. This tax season, whether or not an individual has a windfall on the way depends on his or her tax-planning savvy, but residents of certain states overpay more on their taxes and thus get higher refunds.   Read More...

Jul 24, 2019 One of the most popular ways to organize a business is as a limited liability company, otherwise known as an LLC. LLCs require less paperwork than C corporations and S corporations, while giving owners some of the same protections against being held personally liable for any actions of the business. But the true advantage of this title comes in the form of tax benefits. LLCs give business owners significantly greater federal income tax flexibility than a sole proprietorship,a  partnership and other popular forms of business organization. Read on to learn more about the tax benefits of an LLC. Read More...

Jan 09, 2019 California doesn’t enforce its own gift tax. However, the federal government does. That tax rate can climb to as high as 40%. Still, there are plenty of ways you can minimize the hit or avoid it all together. For the 2018 and 2019 tax years, you can give away up to $15,000 to any individual without triggering a gift tax. But even if you go over the limit, you may just need to file some extra paperwork come tax time. You won’t owe an actual tax until you exceed your lifetime gift and estate tax exemption. We’ll explain how that works, and how you can give without ever setting off a gift tax. But first, let’s define what a gift really is in the eyes of the IRS. We can also help you Read More...

Jan 25, 2019 It can be difficult to look at your paycheck and see upwards of 15% of it sent to the government. Of course, those taxes pay for worthwhile causes, a fact that doesn’t always lessen the initial sting of seeing your money disappear. Thanks to local and state taxes, though, residents in some places have it much worse than others. Below, we look at data from the 25 largest cities to estimate how much the average full-time worker pays in income taxes. Read More...

Jan 04, 2019 An annuity can provide you with income that is guaranteed for as long as you live.  These retirement savings vehicles do provide some tax benefits by letting earnings grow tax-deferred. However, at least part of your annuity payments may be subject to federal income taxes. Throughout this guide, we highlight the different ways the IRS taxes annuities. Read More...

Jan 03, 2019 North Carolina no longer enforces its own gift tax. However, you may trigger a gift tax at the federal level depending on the value of the gifts you provide.  But you won’t owe a gift tax until you breach your lifetime gift and estate tax exemption. The Tax Cuts and Jobs Act signed by President Donald Trump recently raised that threshold dramatically to $11.18 million for 2018 and $11.40 million for 2019. Nonetheless, you may still have to report some gifts that fall far below that value in order to avoid trouble with the IRS. But don’t worry. We’ll explain exactly how the gift tax works. We’ll also cover steps you can take to steer clear of this tax you may unwittingly trigger. We can also help you find a Read More...

Jan 03, 2019 There is no Florida gift tax, but the federal government enforces one. Nonetheless, you may just need to report a gift to an individual in a particular year that’s valued at more than $15,000. In most cases, you won’t pay an actual gift tax unless you exceed your lifetime gift and estate tax exemption. The Tax Cuts and Jobs Act recently raised that threshold significantly. We’ll explain how gift taxes work in detail, as well as ways you can legally avoid them or minimize the hit. We can also help you find a financial advisor to help you with all estate planning and tax-related matters. Read More...

Jan 03, 2019 New Jersey doesn’t have a gift tax. However, you may still owe a federal gift tax if the value of the gifts you provide exceed a certain amount. Following the passing of the Tax Cuts and Jobs Act, the federal gift tax exclusion rose to $15,000 a year. So you can give someone $15,000 worth of cash, assets or property annually without worrying about a gift tax. You would have to report it if you breach that threshold. But you won't owe anything out of pocket until you exceed your lifetime exclusion limit. This article will cover everything you need to know about the gift tax as well as steps you can take to avoid or minimize your tax payment obligations. We can also help you find a financial… Read More...

Jan 02, 2019 Minnesota no longer enforces its own gift tax, but you may still owe one at the federal level if you exceed your lifetime gift and estate tax exemption. However, the Tax Cuts and Jobs Act signed into law by President Trump raised that limit to $11.18 million for 2018 and $11.4 million in 2019 per individual. Still, you may need to report a gift if it’s valued at more than $15,000. But don’t worry. We’ll explain exactly how gift taxes work and what you need to watch out for. We’ll also explain how to make non-taxable gifts and steer clear of a potential gift tax. We can also help you find a financial advisor who can guide you through the entire estate planning and charitable giving… Read More...

Dec 13, 2018 Connecticut recently increased its lifetime gift tax exemption to $2.6 million, and it will continue to climb in the coming years. This means you won't owe a Connecticut gift tax unless the gifts you provide in those years exceed their corresponding exemption levels. But even if you do, there are plenty of steps you can take to protect your assets and your estate from taxes. This article will explain everything you need to know about Connecticut and federal gift taxes, as well as ways you can steer clear of these taxes. We can also help you find a financial advisor to guide you through the entire estate… Read More...

Jan 30, 2019 If you recently received a sizable gift from mom and dad, don’t fret. When it comes to gift tax, the IRS generally holds the giver liable. And unless the person is handing over a small fortune, he or she won’t owe any gift taxes either. But if your parents are being generous, you might want to fill them in on how the IRS may look at that. This article would help you understand all about the gift tax. But because rules behind calculating gift tax can be complex, your parents should find a financial advisor if they might trigger a tax bill. Read More...

Nov 16, 2018 If you run your own business, you need a way to identify it to the government when it comes time to do your taxes. The same is also true if you're the executor of an estate, the creator of a trust or the founder of a non-profit. The way entities accomplish this is with an Employer Identification Number (EIN). If you don’t yet have an EIN, you can apply to receive one with IRS Form SS-4. Read More...

Nov 11, 2018 Selling a home is a major life change. Maybe you’re moving into a bigger house after outgrowing your starter home, or you're downsizing as your kids go off to college. Or, perhaps, you're buying a house in a different part of the country because of a new job. No matter what your reason is, selling the place you’ve called home is a big deal. One potentially confusing part of the process is figuring out the taxes on selling a house and how the sale will impact your finances for the years to come. Read More...

Oct 23, 2018 If you have a traditional IRA, you will need to start collecting distributions when you reach age 70.5. The amount of these required minimum distributions (RMDs) depends on your age and the value of your account. Failing to withdraw enough results in a large penalty. You will need to pay federal income tax on your IRA RMDs, but you may not have to if you donate your RMD directly to a qualified charity. This is called a qualified charitable distribution. You may also see it called an IRA charitable rollover. Let’s look at how these distributions work. Read More...

Oct 19, 2018 Being a landlord can significantly bolster your savings, but it's also a lot of work. On top of the finances and responsibilities of your own living space, you have to find tenants, secure insurance and pay a mortgage and property taxes. Renting a home can also complicate your personal tax situation. Luckily, Uncle Sam allows you to deduct some expenses associated with running a rental property. The IRS stipulates that deductible expenses must be ordinary and generally accepted in the rental business, along with being necessary for managing and maintaining the property. From mortgage interest and insurance to utilities and repairs, here are some rental property tax deductions landlords should take advantage of. Read More...

Sep 25, 2018 There are a lot of reasons to give to charity. The most obvious is that you're giving money to a cause or group that you believe in. This can make you feel like you’re making a difference in the world. However, there is a common reason beyond that to make a donation: the charity tax deduction. When you give money to charity, you can use the gift to reduce the amount of money on which you must pay taxes. It’s a fairly simple process to get the charity tax deduction, though it does require you to take a few actions to get the most out of your donation. This guide will take you through how to get your charity tax deduction, what qualifies as a charity tax deduction and other questions about the process. Read More...

Sep 12, 2018 Social Security is one of the largest government programs in the U.S., accounting for just under a quarter of federal spending. Roughly one in four Americans are collecting some kind of Social Security retirement benefit each month, and all of the money has to come from somewhere. That’s where the Social Security tax comes in. Paying the Social Security tax with each paycheck is a fact of life for almost every American worker. However, maximizing the benefits you'll receive in retirement can help you come out ahead in the long run. This is where a Read More...

Jan 28, 2019 The first-time home buyer tax credit emerged during the 2008 financial crisis to help make buying a home more affordable for Americans. Though various other mortgage programs and loans exist, the tax provision here was strictly for first-time home buyers. Simply put, it offered home buyers a significant tax credit for the year in which they purchased their home. Read More...

Jan 29, 2019 When you're filing your taxes, there's a whole lot to consider. From figuring out who counts as a dependent to organizing your income streams, you may find the process a bit overwhelming. And if you're a new homeowner tackling mortgage payments, there's another key question you'll want to know the answer to this tax season as you try to lower your tax liability: Are closing costs deductible on your recent home purchase? Below, we give you the rundown: Read More...

Jul 19, 2018 State and local taxes (SALT) are a frustrating part of living in a high-tax locale. Before the passing of the Tax Cuts and Jobs Act at the end of 2017, which ushered in sweeping tax legislation overhaul, Americans could deduct state and local taxes, including income and property taxes, from their federal income taxes. Under the new tax law, that deduction has been capped at $10,000. This change will disproportionately affect residents who pay high state and local taxes. Read More...

Jan 18, 2019 After you accept a job offer, your new employer will ask you to fill out Form W-4. The U.S. government requires employees to fill out a W-4. It tells your employer how much money to withhold from your paycheck for federal income taxes. As daunting as that may sound, the W-4 is a relatively easy form. It takes up less than one page and there are only seven lines for you to actually fill out. So whether you're a hiring manager or a hopeful new employee, let's break down the purpose of the W-4 and the information it contains. Read More...

Oct 30, 2018 If you’re getting a divorce, the tax implications probably are not the most pressing issue in your mind. The specifics of filing taxes after divorce and how you draw up your divorce agreement could make a big difference when it comes to  your tax refund. As you prepare for life after your divorce, here are things to think about so you can stay on top of your taxes. Read More...

Aug 21, 2019 Earning dividends is a great incentive for investing in certain companies or mutual funds. Dividends are particularly useful for people who need to supplement their retirement income. However, you will need to pay tax on any dividends you receive. Your dividend tax rate will depend on what type of dividends you have, how much you made from those dividends and how much other income you have. It can also be helpful to consult with a financial advisor to learn more about dividends and dividend taxes. Read More...

Jan 30, 2019 For many Americans, filing federal income taxes means getting a refund. The average tax refund, according to the IRS, was $2,763 for the 2017 tax season. That’s a nice chunk of change to get back, but what if you need the money before the IRS sends your refund? Life happens, and if you can’t wait for your tax refund, you may want to consider a tax refund loan.  Read More...

Jan 23, 2019 Once you've gone through the burdensome process of filing your taxes, your sigh of relief might be short-lived. That's because you'll start tapping your feet and wondering, "How long does it take to get a tax refund?" But as excited as you may be to get that refund check from your federal income tax return, you may be disappointed with IRS processing times. So as you plan your budget for the year, let's look at how long it will take to get your federal tax refund. Read More...

Jan 23, 2019 President Donald Trump signed a law that dramatically overhauled the U.S. tax code in December 2017. The law created new income tax brackets and resulted in changes to what many Americans pay in taxes. Most changes went into effect on Jan. 1, 2018 and so they didn't affect your  tax return until the 2018 tax year, which you file in 2019. Let's take a look at how the tax changes could have affected you. Read More...

Jan 29, 2019 Tax season can be stressful but the saving grace is that many tax filers will receive a refund. In past years, about 75% of filers receives refunds after filing their federal income tax returns. Many people even count on a refund to help them pay down debt or cover bills early in the year. That means a delayed refund can cause problems for some. Let’s look at common reasons for a tax refund delay and how you may be able to prevent it. Read More...

Jul 24, 2019 When you file federal income  tax return, you have the choice between taking the standard deduction and itemizing your deductions. Which you choose should depend on which strategy will maximize your tax benefits. Your calculations may also have changed recently because of the new tax plan passed by President Trump and Congressional Republicans. Here’s a look at who should itemize under the new tax plan. Read More...

Apr 03, 2018 The IRS recently reminded taxpayers that cryptocurrency transactions, which the agency refers to as virtual currency transactions, must be reported on income tax returns. Because cryptocurrency is a new frontier for many, we’ve listed a few helpful hints to keep in mind as you sort out your tax situation if you've made transactions using Bitcoin or other digital currencies. Failure to report these transactions on your tax return can result in penalties and interest, along with substantial fines. Read More...

Jan 30, 2019 When you file your federal income tax return, you can check the status of your refund by visiting the IRS website or its mobile app. However, each state has its own process for handling state income taxes. If you expect a refund, your state may take only a few days to process it or the state may take a few months. There is no hard-and-fast rule but you can expect paper returns taking significantly longer to process than e-filed returns. Luckily, each state with an income tax also has an online system that lets you check the status of your state tax refund. Read More...

Jan 30, 2019 When filing federal income taxes, everyone has to choose a filing status. There are five filing statuses: single, married filing jointly, married filing separately, head of household and qualifying widow/er with dependent child. Most people are only eligible for one or two of the statuses and your status is likely to change at some point in your life. One common change is going from filing single to filing married. In this article, let's look at how your tax situation could change when your filing status changes from single to married. Read More...

Jun 25, 2018 Everyone filing federal income taxes for the 2017 tax year will need to get their returns in by the filing deadline. There is one general date by which most filers need to get returns in. You may have a different deadline if you filed for an extension or if you are a corporation. Here's a rundown of all the deadlines you need to keep track of. Read More...

Jul 24, 2019 Want to get a big tax refund come tax filing season? You can minimize your tax liability, and potentially snag a larger refund, by taking advantage of every possible tax break. Here are a few things to keep in mind as you look to get the biggest refund you can. Read More...

Mar 14, 2018 If filing your federal income taxes has you filled with apprehension, you may want to find a tax filing service to help you. The right service will not only take the pain out of filing your taxes, but it will also give you confidence by helping you understand the process. Different people will want different features from a tax filing service, but there are a few things you should always look for. For example, you want responsive technical support no matter how much you know about taxes. Below are six things you should look for when choosing a tax filing service. Read More...

Mar 26, 2018 After filing your federal income taxes, the wait for your tax refund is on. But you might want to take a step back before you spend that "extra" money. It helps to have a plan for how you'll spend. That way, you can avoid blowing the whole refund on things you don't really need. There are ways to spend that cash to better your financial situation, especially in the long run. Read More...

Jul 23, 2019 If you own an investment property and collect rent from your tenants, it's important to declare that rental income on your taxes. You can, however, deduct expenses you incur to maintain your rental property. In other words, becoming a landlord for the first time will make filing your taxes more complicated. Read on to find out more about the taxes on rental income.  Read More...

Jan 23, 2019 When you start a new job, there's a lot of paperwork to fill out, from direct deposit documents and benefits enrollments to your W-4 form. But when you're a contractor or self-employed person, income taxes work a little differently. You will still have to report your earnings to the Internal Revenue Service (IRS), and the companies that use your services will have to report those earnings, too. That’s where the W-9 form comes in. Read More...

Feb 14, 2018 Hollywood and New York City probably come to mind when you think about the places with the most million-dollar earners. While location plays a part in how much money you earn, there are other factors that can help you reach millionaire status. Plenty of patient saving is most likely required. Many people seek professional advice from a financial advisor to help them make the best decisions about their finances. Below, we looked at the unique economic profiles of each state through IRS data to find the states with the most million-dollar earners. Read More...

Jul 24, 2019 With the new year starting, it’s just about the time to file your federal tax return. But there’s no need to get stressed out. Tax filing services are making it easier than ever to file your taxes. You will need to choose between those filing service though. So in this article, let's compare two of the largest tax filers: TurboTax vs. TaxSlayer. Read More...

Jan 31, 2018 For most people, the only fun part of doing your taxes is getting your tax refund. Not everyone receives a refund. Technically speaking, tax refund is money you overpaid in taxes, meaning it was always your money and the government was just "borrowing" it for a while. Regardless, it always feels good to get a large check. Below we look at this topic at a state level, to determine which states have the largest average income tax refund. Read More...

Jul 24, 2019 In December 2017, President Trump signed the new tax plan into law. While most of the changes from the plan went into effect on Jan. 1, 2018, they will not affect taxpayers when they file their federal income taxes by April 17, 2018. However, some parts of the tax plan applied retroactively. A small number of taxpayers saw changes to their 2017 taxes as a result. There are also a couple of changes that won’t take full effect until 2019. Let’s take a look at when the provisions of the tax plan will take effect. Read More...

Jan 17, 2018 Many taxpayers fret over where their hard-earned money goes once they've paid their share of taxes. This is true for residents of all states. But some states get a better deal when it comes to income taxes paid and benefits received. These states, and their economies, rely on the federal government for support to a greater extent than other states. Below we rank the states most dependent on the federal government. Read More...

Jan 10, 2018 Many Americans try to reduce the stress of filing taxes by using online tax software or hiring an accountant. In some states getting this tax help is easier than others due to more affordable rates for accountants and better internet access. Below we look at the states where it's easiest to get help during tax season. Read More...

Aug 20, 2018 The majority of U.S. states charge a sales tax on retail goods and services. New York state is no different. The state's sales tax is relatively low but once you add on taxes from individual counties and cities, it can add up to a substantial chunk of change. Read on as we explain what New York sales tax is and how it differs across the state. Read More...

Dec 29, 2017 In late December, President Trump signed sweeping tax legislation into law. Under the new law, taxpayers can only deduct $10,000 in combined  property taxes and other state and local taxes (SALT) from their federal taxes. This change will go into effect in January 2018, meaning it will impact the 2018 taxes that you file in April 2019. The cap on the SALT deduction is a cause for concern for many homeowners in high-tax states. To lessen the impact, some of these homeowners are eager to prepay property taxes for 2018 by December 31 in order to deduct them from their 2017 tax bill. Read More...

Feb 04, 2019 Governments, at all levels, may charge sales tax for goods and services. Retailers collect sales tax at the point of sale on their goods and then they send their collections to the government. Currently, 45 states charge sales tax with some counties and cities charging their own taxes. No state has quite perfected the art of sales tax like California. Read More...

Jan 18, 2019 Some of us like to maximize our  tax return. That can mean filing taxes yourself to save on tax preparation fees, or, using an online option to save costs. While online filing is certainly more affordable than many in-person tax services, in many cases, you don't even have to pay for the basic level. That means you have several excellent options for free online tax software. Read More...

Nov 16, 2017 The United States is the second-most generous country in the world, according to 2016 data from the Charities Aid Foundation. But not all states in the United States are equally generous. Residents in some states give more to charity or volunteer more free time to causes near and dear to their hearts. Below we rank the America's most charitable states using those and other metrics. Read More...

Apr 02, 2018 Update December 2017: On December 20, the Senate passed the new GOP tax bill that marks the biggest rewrite of the tax code in decades. Later the same day, the House also gave final approval to the bill. On December 22, it was signed into law by President Trump. This study takes a look at an earlier version of Trump's tax plan that was released on November 2. That version of the plan, reduced the number of tax brackets from seven to four. The final version of the plan that Congress passed keeps the seven tax brackets but reduces some of the rates. For more on the latest version of the tax bill, see this article. Read More...

Sep 27, 2017 For many Americans, being your own boss is a long-held aspiration. But striking out on your own can be challenging and risky. There are many factors that can add potential roadblocks to people hoping to start their own businesses. Income tax rates, for example, come into play, as well as local costs of living. Below we analyze data on these and other metrics to find the best cities to be self-employed. Read More...

Jul 24, 2019 As an employee, you may have noticed that your paycheck never matches your full salary. This is because your employer has to withhold certain payroll taxes. You might think that you wouldn't have to worry about those payroll taxes if you worked for yourself. But that's not the case - you'd still have to pay a 15.3% self-employment tax. What is this tax and why do you have to pay it? Read More...

Mar 22, 2019 Paying taxes can be a real drag. But the government needs the income generated from taxes to provide funding for various programs. If you earn a wage or a salary, you'll likely be subject to two federal payroll taxes collectively known as FICA taxes, which add up to 7.65% of your salary (up to a certain income level). Read on to find out what FICA taxes are, and who's responsible for paying them. Read More...

Jan 30, 2019 The state and local tax (SALT) deduction allows taxpayers of high-tax states to deduct local tax payments on their federal tax returns. The new tax plan signed by President Trump, called the Tax Cuts and Jobs Act, instituted a cap on the SALT deduction. Starting with the 2018 tax year, the maximum SALT deduction available is $10,000. Previously, there was no limit. Lets take a closer look at what the reduced deduction means for residents of high-tax states like California, New York and New Jersey. Read More...

Feb 20, 2019 You're probably familiar with the term adjusted gross income (AGI). It reflects how much taxable income you have after subtracting your above-the-line deductions (also known as adjustments to income) from your gross income. You also have a modified adjusted gross income. Let's take a look at what your modified adjusted gross income is and how it may impact your tax bill. Read More...

Apr 05, 2017 Depending on how proactive you are about investing, you may or may not have heard the term tax-loss harvesting before. If you've only invested in your future by contributing to a retirement account, tax-loss harvesting won't help you. But if you have some taxable investment accounts, tax-loss harvesting may lower your tax liability and potentially save you money. Read More...

Apr 14, 2017 No matter how hard you try to keep your debt under control, sometimes it piles up. Depending on your situation, you may be able to cancel some of your debt. That would probably lift a huge weight off your shoulders. But even if your creditor lets you ditch some of your debt, there might be a catch. In some cases, canceled debt can increase your tax bill. Read More...

Jul 24, 2019 Paying taxes is never fun. Fortunately, you may be able to reduce how much you owe in federal income taxes by claiming certain tax deductions. There are exclusive tax breaks for self-employed Americans. But the key to taking advantage of these benefits is knowing what's tax-deductible. Check out the following seven self-employed tax deductions you might qualify for this season. Read More...

Mar 24, 2017 When it comes to investing, you can expect to experience both gains and losses. You might even incur a capital loss on purpose to get rid of an investment that’s making your portfolio look bad. And while selling an asset at a loss may not seem ideal, it can benefit you at tax time. Besides lowering your taxable income, a capital loss may also help you snag a deduction. Read More...

Mar 14, 2017 Many studies seem to suggest that millennials are in a financial pickle. For starters they earn less than their parents did when they were young adults. Plus, the average millennial has over $30,000 in student debt. For millennials who are struggling to boost their net worth and make the leap to homeownership, the last thing they likely want to face is a large tax bill. But unfortunately, high tax rates are a reality for many millennials across the country. Read More...

Mar 22, 2017 The IRS allows some nonprofits to avoid paying federal income taxes. The only problem is that the application for federal tax exemption ( Form 1023) is extensive. In addition to completing the standard application, you'll likely have to submit additional attachments and financial documents. Wish the application process was shorter? It can be if you're allowed to submit Form 1023-EZ instead. Read on for a breakdown of what the form is and how to fill it out. Read More...

Mar 22, 2017 Businesses and individual consumers have something in common. Both groups have to file taxes. Some groups, however, are automatically tax-exempt, meaning that they're not required to pay federal income taxes. Others must apply for tax-exempt status. If you want your organization to be exempt from federal taxation, you may need to file IRS Form 1023. Here's everything you need to know about it. Read More...

Dec 08, 2017 Owning a home can be expensive. Paying for property taxes, repairs and homeowners insurance can significantly reduce what you can spend on luxury items and discretionary goods and services. Fortunately, homeowners may be able to recoup some of the money they've lost by claiming tax deductions and credits. Let's look at some of the tax breaks for household expenses. Read More...

Aug 15, 2019 Going to college seems to get more expensive every year. Tuition, fees, room and board for an in-state student attending a four-year public institution cost $20,092 for the 2016-2017 school year (on average). A decade ago, an in-state student would've paid an average of $15,180 (in 2016 dollars) for the same expenses. There's not much you can do about rising college costs, but there are a few tax breaks you can use to help offset the cost of college. Read More...

Feb 23, 2017 The IRS knows that some taxpayers provide their kids and relatives with financial support. That's why the government offers folks with dependents the opportunity to reduce their tax burden. Being able to claim someone as a dependent may significantly lower your tax bill, especially if you qualify for a tax break like the Earned Income Tax Credit or the Child Tax Credit. Read More...

Aug 03, 2018 Making sense of the U.S. tax code can be a daunting feat. That's why many taxpayers turn to professionals when they need to file their tax returns. Regardless of whether you're working with a tax accountant or completing your own return at home, it's important to know which tax breaks you're eligible for. After all, claiming tax credits and deductions is one of the easiest ways to reduce your tax burden. If you have questions about claiming miscellaneous expenses, read on for the lowdown on what's deductible. Read More...

Jan 17, 2019 Claiming a tax credit is one way to lower your tax bill. And if the tax credit that you're eligible for is refundable, you'll be able to use it to boost your tax refund even if it reduces your tax liability below zero. One example of a refundable tax credit is the earned income tax credit. But not everyone qualifies for it. Read on to find out who the tax credit benefits and how you can claim it on your tax return. Read More...

Feb 27, 2017 Looking for a new job can seem like a job in itself. And after a while, the expenses associated with finding a new gig start to add up. Even if you put effort into writing a resume and going on interviews, there's no guarantee that you'll be able to lock down the position that you want. But at the very least, some of your job hunting expenses may be deductible. Let's take a look at some of the costs that you may be able to write off on your income tax return. Read More...

Jan 26, 2017 Few tax breaks have been more controversial than the mortgage interest deduction. Proponents of the tax benefit contend that it encourages Americans to buy homes. Opponents, on the other hand, argue that it reduces tax revenue and leaves lower-income individuals at a disadvantage. For the second year in a row, SmartAsset assessed how the mortgage interest deduction and the property tax deduction could affect homeowners across the country during tax season. Read More...

Jan 29, 2019 If you're planning on using a tax break to minimize your tax bite, keep in mind that deductions come in different shapes and sizes. There's the standard deduction that any taxpayer can claim every tax year just for filing taxes. And there are itemized deductions that you can write off instead of taking the standard deduction. There are also above-the-line deductions. Here's everything you need to know about above-the-line deductions, including how they work and who can take advantage of them. Read More...

Jan 23, 2017 The election of Donald Trump to the presidency has caused quite a stir. And so far, the new commander-in-chief has proposed quite a few changes. One centers on the federal estate tax, which up until now has been a roadblock for some wealthy investors hoping to create a financial legacy for their heirs. Here's a look at how President Trump's estate tax proposal may affect affluent investors. Read More...

Aug 20, 2018 If you want to shrink your tax bill or beef up your refund, claiming all the deductions you're eligible for can be a smart strategy. Deductions reduce your taxable income. That's a plus if you want to hang on to as many of your hard-earned dollars as possible. But there are limits on what you can deduct. Here's a look at some expenses you can't deduct in most cases. Read More...

Sep 14, 2018 Saving for retirement is something that everyone needs to think about at some point. The earlier you begin socking away money, the brighter your long-term financial outlook. Preparing for your financial future can also work in your favor during tax season. If you've barely saved anything, here are some tax benefits that might motivate you to get serious about planning for retirement. Read More...

Jul 24, 2019 Filing federal income taxes can be stressful. Making sure you plug in all the right numbers and snag every tax break you qualify for can make your head spin. If you're relatively new to tax filing, you may not know the difference between taking the standard deduction and itemizing your deductions. Itemizing isn't right for everyone, so before you file, keep reading to find out whether it makes sense for you. Read More...

Jan 29, 2019 No one likes paying taxes. Having money taken out of your paycheck is one of the most dreaded aspects of entering the workforce. While most of us pay federal income taxes, the taxes we pay at the state and local levels vary depending on where we live. In fact, seven states have no personal  income tax and two states tax dividends and investment income but not wages. Read More...

Jan 24, 2019 Under the tax reform bill that passed into law at the end of 2017, the personal exemption was eliminated. This means you cannot claim it on your 2018 taxes, which you file in early 2019. So the following information on the personal exemption only applies if you are filing a return for a tax year that was 2017 or earlier. Read on to learn more about what a personal exemption is and whether or not you can claim one on your tax return. Read More...

Feb 07, 2018 The NFL salary cap (which limits how much teams can spend on players) has risen from $40 million in 1996 to $155 million in 2016. This means NFL salaries have increased by almost 400% over the past 20 years. To put that in perspective, median incomes in the U.S. rose 12.5% from $24,500 in 2005 to $27,600 in 2015, according to Census Bureau data. While the pay packages are available for public viewing, most people probably don't know how much NFL players pay in taxes. SmartAsset used our income tax calculator to investigate how much the highest-paid players in the NFL pay in taxes. Read More...

Apr 14, 2017 Paying taxes is a fact of life for most Americans. Whether you work for a business from 9 to 5 or you're self-employed, you're expected to turn over a portion of your pay to Uncle Sam. There are many different kinds of income, but not all of them can be taxed. Read on for an explanation of what taxable income is and a rundown of what's taxable and what's not. Read More...

Mar 26, 2018 Filing taxes for the first time can be nerve-racking. But being organized can relieve some of your stress. Knowing what paperwork and materials you'll need is a good place to start, especially if you're concerned about leaving out a key piece of information. If you're preparing to fill out your tax return, here's a breakdown of the documents you'll need to gather. Read More...

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