Why You DON’T Want a Large Income Tax Refund

You’re probably wondering, “Why wouldn’t I want a large tax refund?”  Short Answer: You’ll have more cash in your wallet all year instead.,.. Consider this… Most people don’t want to give the government an interest free loan for more than a year. They’re holding your money hostage while you may be cutting corners to cover all your expenses. You are not in any way required or obligated to overpay your taxes every year, so why put yourself at a disadvantage unnecessarily? Large Tax Refund Cases Over the past 30 years I have seen a few instances where taxpayers need to have a large refund. It comes down to one factor –… Read More

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It’s Divorce Season. Are You Ready?

It’s Divorce Season. Are You Ready?   What is Divorce Season? Did you know that more people decide to divorce in the first four months of the year than any other time of year? That’s why they call it divorce season. It does make sense. The families have all gotten through the holidays. The spouses may have been giving it one last try to see if the holiday spirit would revive the relationship. Unfortunately in many cases that is not successful. As the marriage continues to unravel men and women begin to take a close look at their lives and realize they may need to prepare for a new start… Read More

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New 2018 Tax Law Standard Deductions and Itemized Deductions Guide

Did You Know??? Itemized Deductions are NOT Just For Homeowners with Mortgages. For 2018 tax returns Standard Deductions have increased substantially. The biggest question individuals have when preparing their tax returns is whether to take the Standard Deduction or claim the mysterious Itemized Deductions on the IRS form Schedule A. Here’s the info that can help you save you the most tax dollars, taking the higher of the standard or itemized deductions.. :First, identify your Standard Deduction based on the chart below, taken from the IRS Publication 501.   Table 6. New Standard Deductions for 2018 Tax Returns If your filing status is … Your standard deduction is… Single or Married filing… Read More

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Do You Suffer From MATHLEXIA?

What is Mathlexia?   To my surprise, “mathlexia” is actually a disorder, commonly known as dyscalculia. The 1974 work of a Czechoslovakian researcher, Ladislav Kosc defines this disorder as “a structural disorder of mathematical abilities” caused by impairment to the parts of the brain used in mathematical calculations, without simultaneous impairment to one’s general mental abilities. (In layman’s terms: You’re bad at math because parts of your brain aren’t working properly, but you’re not otherwise mentally handicapped.) It has also been referred to as “math dyslexia” and “math learning disability.” The Urban Dictionary defines it a bit differently, “The inability to do math in your head.” So if you’re not good… Read More

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5 Divorce Mistakes That Can Cost You Lots of Money… and Sleep

Whoosh! That’s the sound of money from divorce mistakes flying out of your wallet. You chase after it, but never seem to catch up… You’re doing everything you think you’re supposed to, but nothing is working. Your accounts seem to become self-draining, and you can’t seem to stop the leaks. You wonder what you’re doing wrong…  and why this has become so complicated. Chasing your money, running from meeting to meeting… And your emotions are all over the place, like your money. You’re frantic about your future because it seems everything is unknown. Then… suddenly at 3 am… in a panic… you wake up. It was all a bad dream…… Read More

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Tax Implications of Divorce Property Transfers

When property and financial assets are divided in divorce, certain assets or portions thereof are transferred from one spouse to the other. The most common are the marital home, financial accounts and jewelry. During the marriage, such transfers are considered to be gifts of a non-taxable nature. Transfers for purposes of divorce are subject to specific regulations in order to maintain the same non-taxable status. As per the Internal Revenue Service Publication 504, Divorced or Separated Individuals , the following are required:   Transfer Between Spouses Generally, no gain or loss is recognized on a transfer of property from you to (or in trust for the benefit of): Your spouse,… Read More

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Tax Tip If You Moved Into A New Home

Have You Moved? Or Are You Planning To? If you recently moved into a new home, no matter the reason, it can be very disruptive. You have to change addresses for everything – banking and investment institutions, credit card companies, and so many other businesses. So who would even think about the IRS???  There’s great news! You don’t have to worry about telling the IRS that you’ve moved right away, although if you make estimated payments, you may want to, just to avoid confusion. And with the caliber of those at the IRS, the last thing you would want is to take a chance on them becoming confused. I’ll get… Read More

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Estimated Tax Payments – The Real Deal

What Are Estimated Tax Payments? Some people don’t have to even think about what estimated payments are all about. They have their federal and state income taxes withheld by their employers, retirement payouts, and even Social Security benefits. However there are many who have no withholdings and face an excessive tax balance at the end of the year when they file their tax returns. In addition to self-employed folks, this occurs when people have income from investments, such as bank and bond interest, sales of stocks, and rental income to name a few. Many retirees and senior citizens make estimated tax payments. The Internal Revenue Service is a “pay as… Read More

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How the New 2018 Tax Law Impacts Alimony Payments

Alimony tax laws (for spousal support) are changing.   The Basics of Alimony Alimony payments are based on the earned income of the husband and wife individually. There is a formula that determines the amount the higher earner will pay the lower earner. It is an attempt to generally equalize earnings for both individuals and at the same time attempt to allow them both to continue to maintain a similar lifestyle to their pre-divorce situation. The key word is attempt. This is not always possible.   Pre-2018 Alimony Tax Laws Before and during the divorce process any support received is generally not considered alimony. Therefore it is not claimed as… Read More

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Four Tax Considerations For Divorcing Couples

Tax season is upon us, and many divorcing couples need to think about what to do now, and what they should know for the future. 1. Consider filing a joint tax return during your divorce. If you are married there are two choices – married filing jointly or married filing separately. However if your spouse is a bit “aggressive” with his or her deductions and you sign that return, you will also be liable for any future tax balances and penalties, so be cautious.  When filing separately the same income is subject to a higher tax, which is a penalty of sorts. Also certain deductions are disallowed. In the case… Read More

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