- How to Avoid Capital Gains Tax on Real Estate
Home prices doubled over the past decade – and that could mean you owe some serious taxes if you are selling your home. After bottoming out at around $259,000 in 2011, the average sale price of a house has marched steadily upward to more than $500,000 in 2024. This type of growth often leads to… read more…
- Earned Income Credit vs. Child Tax Credit
The Earned Income Tax Credit and the Child Tax Credit are both programs designed to help alleviate poverty, but there are key differences. The EITC is a credit available to employed, low-income households. It is intended to boost the effective income of people who are employed. The CTC is a credit available to employed households with children. This… read more…
- Many Tax Refunds Will Be Delayed, Treasury Says: How to Get Yours Sooner
On Monday, Jan. 10, the Treasury Department announced that the IRS is facing significant challenges this year due to budget concerns and issues caused by the COVID-19 pandemic. Officials are warning that many taxpayers could see significant delays in receiving their tax refunds this year. There are millions of tax returns that the agency has… read more…
- What Is Tangible Personal Property? Definition and Examples
In addition to paying sales tax on the things you buy, you may also be required to pay taxes on its perceived fair market value later on. These personal and business taxes are assessed on certain tangible personal property items,… read more…
- W-2 vs. W-4: Key Differences
If you are an employee of a business, you are required by the Internal Revenue Service (IRS) to fill out payroll tax forms that tell your employer how much tax to deduct from your income. This is the W-4. Your… read more…
- How to Avoid Capital Gains Taxes
Capital gains taxes can take a major bite out of your investment earnings if you don’t manage your portfolio specifically for them. The strategies that allow you to minimize the capital gains tax include holding investments for the long term,… read more…
- 2025 Marginal Tax Rates and Definition
With the April 2023 tax deadline just around the corner, it’s not too soon to acquaint yourself with the relevant federal tax brackets. The Internal Revenue Service (IRS) adjusts them annually for changes in the cost of living. Those changes may impact… read more…
- 401(k) Inheritance Tax Rules for Estate Planning
Inheriting a 401(k) comes with some complex tax rules. When the estate plan includes workplace plans and individual retirement accounts (IRAs), they’re treated differently than real estate or other assets. If you anticipate inheriting a 401(k) from a parent, a spouse, or someone else, it’s important to understand the tax liability associated with making withdrawals… read more…
- How to Reduce Your Taxes on 1099-MISC
Earned income is generally recorded in two ways for federal tax purposes. There is W-2 income and 1099-MISC income. The former is for employees, either full- or part-time; the latter is for contract workers, sometimes known as a freelancers. Here’s… read more…
- Real Estate: 1031 Exchange Examples
When investors want to diversify their portfolios, they often consider real estate. But if you’re interested in real property, you need to know the ins and outs of purchasing and selling. One method many investors rely on is called a… read more…
- Value-Added Tax (VAT): A Guide for Business Owners
Value-added taxes (VAT), which are a type of consumption tax, are major sources of revenue for countries in the Organization for Economic Co-operation and Development (OECD), among other regions. According to the Tax Foundation, VAT actually contributed to one-third of… read more…
- Understanding How Carbon Tax Works
A carbon tax is a tax levied on the emission of carbon dioxide into the atmosphere. Carbon taxes are seen as a way to reduce carbon emissions by encouraging businesses and consumers to switch to less carbon-intensive products and services, and also to encourage investors to pursue ESG strategies. Revenue raised by carbon taxes can… read more…
- Student Loan Interest Deduction for 2024 and 2025
The student loan interest tax deduction is for students and their parents who are repaying federal student financial aid. It’s the “above the line” adjustment to your adjusted gross income (AGI) if you have paid interest to a qualified loan program… read more…
- How to Get a Foreign Tax Credit
In some circumstances you can get a deduction or credit on your federal income taxes for taxes that you’ve paid to other non-U.S. governments. The foreign tax credit is one of these cases. If you live overseas, work overseas or… read more…
- 2024 and 2025 Foreign Earned Income Exclusion
Expat taxes aren’t easy. They depend on what you do for a living. They depend on where you do it, what taxes the local government charges, where you hold investments, which passports you hold and much more. For Americans who… read more…
- What Is a Section 121 Exclusion? Definition, Example and Basics
The Section 121 Exclusion is an IRS rule that allows you to exclude from taxable income a gain of up to $250,000 from the sale of your principal residence. A couple filing a joint return gets to exclude up to… read more…
- Should Biden’s Tax Plan Lead to Investment Sell-Offs?
Seismic changes could be coming to the way America’s wealthiest investors are taxed. Under President Joe Biden’s $1.8 trillion American Families Plan, taxpayers whose incomes exceed $1 million would pay nearly twice the current long-term capital gains tax rate. While Biden’s tax proposal may have you looking to sell positions to stave off a hefty… read more…
- When Do You Have to Pay Investment Taxes?
Investment tax must be paid on interest income and rent from investment property. You also pay investment tax on dividend and capital gains income from stocks, mutual funds and exchange-traded funds. Holding stocks and bonds in taxable accounts allows for a larger tax liability than if you hold the securities inside a retirement account with… read more…
- Form 1099-DIV: What You Need to Know
Dividends can be an important part of your income from investments, especially if you have significant fixed-income holdings. Internal Revenue Service Form 1099-DIV supplies you with all the information on your dividend income that you will use when you file… read more…
- Tax Efficient Investing – A Guide
Tax efficient investing allows investors to reduce, delay and otherwise manage taxes generated by investment activities, potentially improving after-tax returns. Investors can use a variety of methods to manage taxes efficiently, including selecting tax-advantaged investments, practicing tax-aware strategies and using IRAs, 401(k)s and other tax-deferring accounts. Sorting through the various ways to boost the tax efficiency… read more…
- Investment Tax Forms – What You Need to Know
The Internal Revenue Service (IRS) sends U.S. investors a myriad of tax forms every year. While the number and complexity of these forms can be off-putting and confusing, it’s important that you understand them and what your responsibilities regarding these are. Here’s an overview of common IRS investment tax forms and what you need to… read more…
- Why Do I Owe State Taxes?
Filing taxes may not be your favorite financial chore but it is a necessary one to stay in the good graces of the IRS. Why do I owe state taxes is a question you might have if filing your return… read more…
- 2024 and 2025 Work From Home Tax Deductions
The 2017 tax reform law ended the ability for most taxpayers to deduct expenses for working from home just in time for millions more people to begin working from in response to the Covid pandemic. Nowadays only a few select… read more…
- Inside Biden’s Capital Gains Tax Plan
President Joe Biden proposed doubling capital gains taxes for investors making over $1 million to fund his $1.8 trillion American Families Plan. This could compel some high-income investors to sell off assets before the tax hike takes effect. Others will… read more…
- How Did the Trump Tax Bill Affect Itemized Deductions? – 2021 Study
The Trump tax bill – formally known as the Tax Cuts and Jobs Act (TCJA) – nearly doubled the standard deduction while also limiting some itemized deductions. From 2017 to 2018, the standard deduction rose from $6,350 to $12,000 for singles, from $12,700 to $24,000 for married couples filing jointly and from $9,350 to $18,000… read more…