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Gift Tax: 3 Easy Ways To Avoid Paying A Gift Tax | TaxAct Blog

1. Double (or quadruple) your limit. The key to avoiding paying a gift tax is to give no more than the annual exclusion amount to any one person in a given tax year. For 2020, that amount is $15,000. This means if you want to give ten people $15,000 each in one year, the IRS won’t care. However, if you give $16,000 to just one person, you

Actived: Monday Aug 2, 2021

Detail: https://blog.taxact.com/ways-avoid-gift-tax/

Stimulus Payments for the Deceased: Should I Keep It ...

(52 years ago) A: According to the IRS FAQ page on its website, families who receive a stimulus payment on behalf of a deceased loved one should send the money back to the government. The FAQ specifically states: A Payment made to someone who died before receipt of the Payment should be returned to the IRS by following the instructions about repayments.

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5 Tax Tips for Spouses of Disabled Taxpayers | TaxAct Blog

(52 years ago) If your spouse’s employer pays disability benefits, or if your spouse receives benefits from an insurance plan paid for by his or her employer, the taxable income includes those benefits. 2. Adjust your income tax withholding, if necessary. If you are now in a lower tax bracket because your spouse is unable to work, you probably owe far less ...

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How to Handle Finances as a Couple - 10 Tips ... - TaxAct Blog

(52 years ago) It may not even be a good idea to add each other to all credit cards right away, especially if one person has a better credit history than the other. 2. Decide together how much of your finances you eventually expect to merge, or not merge. Try to sort this out before you get married or move in together. 3. Communicate, communicate, communicate.

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Is It Better to Buy or Lease a Car? | TaxAct Blog

(52 years ago) Nov 27, 2018 · It’s almost always cheaper in the short term to lease a car rather than buy it. In one analysis, leasing a new SUV costing $27,142 was about $6,000 less out-of-pocket over six years than buying a similarly priced new car. But remember, at the end of a leasing period, you don’t own the car and can’t resell it.

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Lottery Tax Calculator - How Lottery Winnings Are Taxed ...

(52 years ago) Lottery winnings are considered ordinary taxable income for both federal and state tax purposes. That means your winnings are taxed the same as your wages or salary. And you must report the entire amount you receive each year on your tax return. For example, let’s say you elected to receive your lottery winnings in the form of annuity ...

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6 Steps to Minimize Retirement Income Taxes | TaxAct Blog

(52 years ago) If your income nudges past a bracket threshold, only the income past the threshold is taxed at the higher rate. For example, say you’re filing status is married filing jointly. You pay 10 percent tax on your first $18,450 of taxable income. Your income between $18,451 and $74,900 is taxed at 15% percent. Income between $74,901 and $151,200 is ...

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How the New Form W-4 Affects Your Tax Refund | TaxAct Blog

(52 years ago) Taxes. Form W-4, which instructs your employer on how much tax to withhold from your paycheck, received a makeover at the start of 2020. It’s the first major redesign of the form in 33 years, dating all the way back to 1987. The adjustments simplified the form and implemented the tax code changes that went into effect as part of the Tax Cuts ...

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4 Tax Tips for Newly Married Couples | TaxAct Blog

(52 years ago) Avoid having too much or too little withheld. One of the first things you should do after you get married is file a new Form W-4 with your employer. You may need to have more tax withheld, or less than you did before you were married. It’s not likely to stay the same. It’s not a good idea to guess when you’re filling out your Form W-4.

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How to Report Stock Sales on Your Tax Return | TaxAct Blog

(52 years ago) The formula is simple: capital gains = selling price – purchase price. How much you will owe in taxes will depend on a few factors. Capital gains fall into one of two categories: short-term or long-term holdings. A short-term holding is one you had for less than a year, and, depending on your income, it can be taxed up to 37 percent.

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Tax Implications Of Owning a Rental Property | TaxAct Blog

(52 years ago) The tax benefits of owning rental real estate. If you’ve read “get rich” real estate books, a common theme is that rental property can help you save money on taxes. The key is the depreciation deduction – a deduction you can take for a percentage of your basis in rental buildings each year. When you sell the property, all those ...

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First Time Homeowners: Adjust Your Tax Withholdings on W-4

(52 years ago) A withholding allowance is an employee-claimed exemption on Form W-4. Based on the number of allowances listed, employers determine how much to subtract from an employee’s paycheck for taxes. For tax year 2017, each withholding allowance assumes an annual exemption amount of $4,050. That means for each $4,050 in deductions, you can consider ...

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Affordable Care Act (ACA) For Senior Americans | TaxAct Blog

(52 years ago) An advanced premium tax credit is one type of subsidy available to families with incomes between 100% and 400% of the federally defined poverty guideline. At 400%, families aren’t required to spend more than 9.5% of income on premiums. Next year, subsidies are available for individuals with annual incomes between $11,490 and $45,960, and from ...

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Home Office Tax Deduction in 2021 - New Updates | TaxAct

(52 years ago) Home office business expenses. You can deduct direct expenses related to your office, including maintenance, furniture and equipment, supplies, and so on. You can also deduct a portion of your expenses related to your home. Those expenses can include mortgage interest, insurance, utilities, maintenance, property taxes, and security system fees.

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How to Claim Crowdfunding Campaigns on Tax Return

(52 years ago) For example, if someone donates $100 to you and do not receive anything in return, the $100 is a non-taxable gift. However, if someone donates $100 to you and you give them a gift worth $20 in return, then your non-taxable gift is $80. If the donation is a gift, a gift tax may apply; however, the person responsible for the gift tax would be the ...

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What to Do If You Missed the Tax Deadline | TaxAct

(52 years ago) If you owe tax with your return, you will owe a hefty late filing penalty of 5 percent of additional taxes owed for every month or partial month your return is late, up to a maximum penalty of 25 percent. Note that the late filing penalty is much higher than the late payment penalty. You can’t file for an automatic extension after the April ...

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What the Self-Employed Tax Deferral Means - TaxAct Blog

(52 years ago) According to the IRS, “self-employed individuals may defer the payment of 50 percent of the Social Security tax imposed under section 1401 (a) of the Internal Revenue Code on net earnings from self-employment income for the period beginning on March 27, 2020 and ending December 31, 2020.”.

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Energy Efficient Home Improvement Tax Credits | Energy Tax ...

(52 years ago) The credit is only available for those who did not claim more than $500 worth of home energy credits in earlier years. Any credit amount that was received after 2005 must be subtracted from “lifetime” $500 credit cap. Within that credit cap, there are several limits on individual items: Windows: $200. Furnace circulating fan: $50.

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How Do I Know If I'm Self-Employed | TaxAct Blog

(52 years ago) Generally, the Internal Revenue Service (IRS) considers you to be self-employed if you fall into any of these categories of individuals who carry on a trade or business: A “solo” is one person who owns an unincorporated business. An LLC combines some tax and other advantages of a corporation and a partnership. An LLC can consist of a sole ...

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Gift Tax: Do I have to pay gift tax when someone gives me ...

(52 years ago) The person gifting files the gift tax return, if necessary, and pays any tax. If someone gives you more than the annual gift tax exclusion amount ($15,000 in 2020), the giver must file a gift tax return. That still doesn’t mean they owe gift tax. For example, say someone gives you $20,000 in one year, and you and the giver are both single.

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What to Do After Filing Tax Extension | Tax Extension ...

(52 years ago) If you didn’t quite finish your tax return by April 18, filing for a tax extension was a smart move.. It’s easy to complete Form 4868, Application for Automatic Extension of Time to File, and get another six months to put everything together.

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529 Savings Plans in 2019 | College Savings Plan | TaxAct Blog

(52 years ago) A 529 savings plan is a state-originated tax-benefitted education savings program that lets you either prepay tuition or contribute to an investment account to save for future tuition, fees, equipment, and room and board. 529 plans are also called Qualified Tuition Programs (QTPs).

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Tax Implications of Supporting Adult Children | TaxAct Blog

(52 years ago) Every dependent you claim on your return reduces your taxable income by $3,900. You can claim your son, daughter, stepchild, eligible foster child, brother, sister, half-sibling, step-sibling, or a descendant of any of the above as a qualifying relative. Your adult children …

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Quarterly Estimated Tax Payments - What You Need To Know

(52 years ago) If you’ve been an employee all your working life, you’re probably used to having income tax withheld from your pay. When it comes time to retirement, however, you might be surprised to find you may need to make estimated tax payments on your income four times a year.

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Everything You Need to Know About the First Stimulus ...

(52 years ago) Apr 15, 2020 · Individuals (aka Single filing status) who have an adjusted gross income (AGI) of $75,000 or less are eligible to receive the full payment amount, which is $1,200. That payment reduces by $5 for every $100 in income above $75,000. Reduced payments will …

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When Does Capital Gains Tax Apply? - TaxAct Blog

(52 years ago) You should generally pay the capital gains tax you expect to owe before the due date for payments that apply to the quarter of the sale. The quarterly due dates are April 15 for the first quarter, June 15 for second quarter, September 15 for third quarter and January 15 of the following year for the fourth quarter.

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Adjust Your Self-Employed Estimated Tax Payments | TaxAct

(52 years ago) Business Finance Quarterly Tax Payments Self-Employment Tax Planning Taxes. If you make quarterly estimated tax payments to the Internal Revenue Service (IRS), you probably determined at the beginning of the year how much you should pay each quarter. You may have even used TaxAct to estimate your tax payments and print vouchers.

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The Tax Benefits of Contributing to an IRA - TaxAct Blog

(52 years ago) To calculate how much you can save in taxes by contributing to a Traditional IRA, take your Federal tax bracket percentage multiplied by your contribution amount. If you are in the 28 percent Federal tax bracket and contribute $5,000 to an IRA that year, multiply $5,000 by .28. That equals $1,400 and is the amount you won’t owe in taxes that ...

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How to Manage Taxes with a Full-Time Job and a Side Gig ...

(52 years ago) One trick to this method is to be sure you’re appropriately adjusting your tax withholdings as you start to earn more side gig income. You may eventually decide it’s not worth constantly manipulating your full-time paycheck to adjust taxes withheld and choose to calculate and …

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Coronavirus and Stock Market Drops | Capital Gains Tax ...

(52 years ago) Capital Gains. Put simply, if you sell an investment (like stocks) for more than you paid for it, you have capital gains. Or, as most people think of it, you’ve made a profit. Those capital gains are usually taxed, and depending on your income, they could be taxed as much as 20 percent if they are a long-term capital gain (held more than one ...

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Child Tax Credit: Monthly Payments Begin July 15 for ...

(52 years ago) Jul 15, 2021 · Last Updated: July 15, 2021 With the introduction of the American Rescue Plan back in March, the Child Tax Credit underwent a couple temporary changes for tax year 2021. One of the main adjustments included allowing families to receive part of the Child Tax Credit as monthly payments rather than waiting to get all of […]

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Medical Debt: How to Deal with High Medical Bills | TaxAct ...

(52 years ago) Read every line of your bill, as ask your main provider if you’re not sure a charge is correct. 3. If you’re paying cash, ask for the cash rate. Medical providers save time and paperwork when you pay cash. They may have a reduced rate if you ask. 4. If you cannot pay a large bill, ask for help. Hospitals and other institutions routinely ...

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How to Claim Mileage and Business Car Expenses on Taxes

(52 years ago) You can deduct your vehicle expenses in one of two ways. You can track all your car expenses, including gas, oil, repairs, insurance, and depreciation, and deduct the portion of your total car expenses that apply to business miles. Or you can deduct a flat rate for every business mile you drive, which is called the standard mileage deduction.

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Reduce Your Taxable Income With a 401(k) - TaxAct Blog

(52 years ago) But now you want to start contributing five percent of your pay into your employer-sponsored 401 (k) plan. Five percent of a $40,000 annual salary results in $2,000 saved for retirement in a year. Since that $2,000 was deducted pre-tax, your total taxable income lowers to $38,000. At the same 25 percent tax bracket, you now only owe $9,500 in ...

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Advantages and Disadvantages of Buying Gold Coins as an ...

(52 years ago) Disadvantages to buy gold coins. On the other hand, gold has some disadvantages: A thief could take your gold if you’re not careful. Unlike stocks and bonds, a purchase of gold is not an investment in company growth. You won’t get dividends or interest from tangible gold. You may have to wait years for gold to go up in value.

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Where’s My West Virginia (WV) Tax Refund | West Virginia ...

(52 years ago) Visit TaxAct blog to learn how to check status of your West Virginia state tax return. Includes West Virginia state tax brackets and taxable income.

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Answer These 6 Questions Before You Co-Sign A Loan | TaxAct

(52 years ago) Answer These 6 Questions before You Co-Sign a Loan for a Family Member. Personal Finance. What’s the simplest answer to whether you should co-sign a loan for a family member? “No.”. That’s what all too many co-signers wish they had said when they were asked to …

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Millennials and debt — a shift in mindset - TaxAct Blog

(52 years ago) Millennials and debt — a shift in mindset. Millennials are special – and not just because we were all raised getting gold stars. The generation is refusing to adhere to the American society’s traditional checklist of life events. This is partly thanks to the average graduate’s $30,000 of student loans. It’s also due to a shift in ...

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The Top 12 Most Overlooked Tax Credits and Deductions for ...

(52 years ago) The Lifetime Learning Credit. With this credit, you can claim up to $2,000 on your tax return for your higher education expenses, even if you aren’t in a degree program. Additionally, you can claim school supplies and expenses such as lab fees and books for your classes. 5. …

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How Self Employment is Tax Calculated | TaxAct Blog

(52 years ago) Officially known as the Self-Employment Contributions Act tax, the SE tax is the self-employed community’s version of the taxes paid by employers and their employees for Social Security and Medicare. Whether you run a bakeshop on the weekends, author blog posts as a freelance writer, or design logos for local businesses, you should know how ...

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How to Save for Retirement if You Are Self-Employed | TaxAct

(52 years ago) The Savings Incentive Match Plan for Employees (SIMPLE IRA) is a tax-deferred, employer-provided plan. It allows employees and employers to contribute to a traditional IRA set up for employees. This is a great option if you don’t want to provide full retirement benefits. In 2017, you can contribute up to $12,500 to a SIMPLE IRA.

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Home Expenses To Claim When You're Self-Employed | TaxAct

(52 years ago) Work from home. If you are self-employed and use a separate area in your home for your business, you may take a home office deduction on your tax return. Your deduction should include direct business expenses, such as cleaning and maintenance of your office, and a portion of your main home expenses, like utilities and property taxes.

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Claim Medical Expense Deduction on Your Wig | TaxAct Blog

(52 years ago) Unreimbursed treatments, surgeries, preventive care, dental and vision care are deductible expenses. You can also write off prescriptions and medical aids (contacts, glasses, etc.) along with mental health care costs. Don’t forget: You can also deduct expenses accrued getting to and from appointments – think mileage, public transportation ...

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5 Reasons to Stop Worrying About a Tax Audit | TaxAct Blog

(52 years ago) According to the IRS, most tax audits are regarding returns filed within the last three years. If they find a substantial error, they may add more years. But even then, they seldom go back more than six years. 4. You can reduce your chances of an audit. Certain items on your tax return may attract the attention of the IRS and make you a more ...

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Family Loans: Do Loans Count As Income & Are Taxable?

(52 years ago) Other family loans that are safe from tax consequences. You don’t have to worry about family loans being subject to gift tax rules if: You lend a child $10,000 or less, and the child does not use the money for investments, such as stocks or bonds. You lend a child $100,000 or less, and the child’s net investment income is not more than ...

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How COVID-19 Affects Mortgage Interest Rates & Deductions

(52 years ago) Lower payments, more equity. Lower interest rates offer significant benefits to borrowers, such as lower monthly payments or the ability to build equity faster. But since mortgage interest is tax deductible, lower rates could decrease your deduction and therefore increase your tax bill.

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Deductions vs. Credits: How Do They Affect My Refund ...

(52 years ago) This reduces the amount of taxes you owe. How a deduction affects your income varies based on the amount of the deduction and your tax bracket. If your household happens to fall into the 24% tax bracket for 2020, a $1,000 deduction will net you a $240 reduction in your taxes owed. If you file single and earned between $39,476 and $84,200 for ...

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Save Capital Gains Tax by Avoiding These 5 Mistakes | TaxAct

(52 years ago) Mistake #2. Don’t: Hang on to losing investments, just to avoid taking a loss. Do: Consider selling assets at a loss to offset capital gains. If you’re holding good investments because you have faith they’re coming back up in value, that’s great. If you’re hanging on because you …

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