In mid-December, Congress finally acted on tax breaks that had expired at the end of 2013. The bill renewed deductions, credits and exclusions that taxpayers have come to rely on, but it is a good news/bad news law: The tax extenders were renewed for all of 2014 -- retroactive to Jan. 1 -- but no further. The slate was wiped clean once again as the 113th Congress handed the debate over to the 114th.
There are a thousand reasons people fall behind on their taxes. There are medical emergencies; loved ones unexpectedly pass away; car and house repairs drain the savings account -- it can be anything that wipes you out financially or even emotionally. And for some of us, once that deadline passes, it is so much easier to forget about it.
There are so many moving parts to an income tax return that it can be hard to keep track of everything. It isn't unusual for the average taxpayer to be distracted by the difficult details and to miss the easy ones. In some ways, preparing a tax return is like taking a multiple choice test: Knock the easy ones out first, then move on to the ones that require more complicated calculations and documentation.
Charitable giving is important all year 'round, but it's often this time of year when we receive the vast majority of solicitations. Why? Well, charities know that if you're in the position to itemize, you may be looking for a few more deductions to offset some gains and bring your entire tax bill down.
In a strange way, our discussion of the law of civil forfeiture in our last post made us think of the expression, "Hate the sin, but love the sinner." The law allows the IRS to seize the property of a private citizen or a business if the IRS suspects that the property is somehow tied to illegal activity.
Was it 9/11 or the financial meltdown and recession that put more small businesses in the IRS's crosshairs? A mere sideways look from the agency can cost a small business more time, money and credibility than most can afford -- even if the business has done nothing wrong. Welcome to the land of civil forfeiture.
This is the time of year that many people start thinking about their taxes. There is time left in 2014 to reduce a tax bill, and there are a number of ways to do that. For those among us who have a little extra cash, it may be time to think about donating to a charity.
California law now allows taxpayers to claim a credit for donating to the Cal Grant B program. The program helps low-income students in the state pay for college books and housing. In an effort to increase the amount of money and the number of students who benefit, lawmakers developed a plan that also benefits taxpayers.
The news is full of stories about the student loan debt crisis. The Consumer Financial Protection Bureau reported recently that the debt burden for both private and federal loans in this country has topped $1.2 trillion And, more than 7 million American borrowers have defaulted on their loans.
Scammers have been contacting taxpayers in California and Oregon lately telling them they owe money to the federal government. The taxpayer must pay immediately, the caller says, and only by wire transfer or temporary debit card. Saying no reportedly earns an aggressive response: The taxpayers are told they will be arrested or deported or will have their driver's licenses suspended, among other threats.