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Fewer Americans Renounce Citizenship, But Taxes Still Drive Them Serving the Rogue Valley as

Robert W. Wood

Certified Public Accountants and

May 14, 2018

Business Advisors since 1987 For the first time in five years, the number of Americans who renounced their citizenship fell slightly in 2017

At Nagel & Padilla we bring an integrated

(5,133) from the previous year (5,411), which had been a

approach to anticipating and meeting

record. The total for the first quarter of 2018 was 1,099. In

client needs that merges traditional

recent years there has been a marked upswing in

accounting with strategic planning and

expatriations, and tax considerations are often at least a

advisory services. With this holistic

part of the equation. Moreover, these published numbers

approach our goal, ultimately, is to support

are probably lower than the actual number of those who expatriated. How complete these lists

our clients in achieving business, financial

are remains unclear. Despite the official list, many leavers are not counted, and both the IRS

and personal goals.

and FBI track Americans who renounce.

Se Habla Español

The figures for recent years show an important trend. The total for calendar year 2016 was 5,411, up 26% from 2015, which had 4,279 published expatriates. The 2015 total was 58% more than in 2014. The reasons for renouncing can be family, tax and legal complications, and some renouncers write why they gave up their U.S. citizenship. Expats have long clamored for tax relief. One law motivating some is FATCA, the Foreign Account Tax Compliance Act. FATCA has been ramped up worldwide, and requiring an annual Form 8938 filing if your foreign assets meet a threshold.

Tax Considerations For Business Owners In The Cryptocurrency Space

Latest News What to do when your Tax Return is late Haven't filed a 2017 tax return yet? Don't worry; it's not too late--and it may be easier than you think.... Using a Car for Business: New Rules under TCJA Many of the tax provisions under tax reform were favorable to small business owners

By Bryce Welker

including those relating to using a ...

May 14, 2018

Selling your Small Business

The blockchain has completely dominated the news cycle

If you've decided to sell your business, you

for the last quarter of 2017 and is looking to do the same

may be looking forward to lazy days ahead with

for the first quarter of 2018. Bitcoin and Ethereum, two

plenty of cash on hand. The ...

forms of blockchain-based virtual currency that were only spoken of in nerdy subcultures only a few years ago, have suddenly become household names. With tales of massive fortunes being amassed through the buying and selling of these coins, everyone is looking to get a piece of the pie in this gold rush for the 21st century. Part of the reason for the staggering highs that these blockchain-based currencies have achieved is the lack of regulation. As a radically new and decentralized form of currency, Bitcoin and altcoins like it have been subject to market surges and crashes that may have been manipulated artificially by bad players. If cryptocurrency is to replace fiat currency as the dominant holder of value, it’s going to need to address this complete lack of regulation.

IRS adjusts health savings account limits for 2019 Michael Cohn May 11 2018

The Internal Revenue Service has issued a revenue procedure providing the 2019 inflation-adjusted amounts for health savings accounts. In Revenue Procedure 2018-30, the IRS said the annual limitation on deductions for an individual with self -only coverage under a high deductible health plan is $3,500 for calendar year 2019. Also for next year, the annual limitation on deductions for an individual with family coverage under a high deductible health plan is $7,000. A “high deductible health plan” is defined as a health plan with an annual deductible of no less than $1,350 for self-only coverage or $2,700 for family coverage, and the annual out-ofpocket expenses (deductibles, co- payments, and other amounts, but not premiums) don’t exceed $6,750 for self-only coverage or $13,500 for family coverage for 2019.

10 Financial Scams to Avoid in Retirement By Rachel Hartman May 9, 2018

Those who have saved consistently are likely to enter retirement with a large nest egg. While your accumulated savings can provide a comfortable living, this strategy also has certain risks. Predators know that many retirees have spent years saving, and thieves set up specific schemes geared toward seniors. Here are some common scams to be aware of in retirement, as well as what to do to protect your finances. 1. Medicare scams. A person calls you or knocks on your door and claims to be a Medicare representative. You’ll then be asked to share personal information, including an insurance identification number. Once you share this information, the scammer will use it to bill Medicare for fake services, and then pocket the money. “If someone says you need a replacement Medicare card or that you need a new supplemental policy, hang up the phone or close the door,” says Justin Lavelle, chief communications director of BeenVerified, an online background check platform. Medicare will not be calling individuals about the new Medicare cards that will be mailed out in 2018 and 2019, and there is no charge for the updated card.

Planning for a Secure Retirement Penelope Wang February 8, 2018

Retirement planning has always been full of uncertainties: How much longer will you be able to work? How much savings will you have when you stop working? How many decades will that money need to last? But for anyone nearing retirement, or already there, the level of uncertainty has rarely been greater than it is right now. Most significantly, Congress and the White House have been overhauling many rules that have a big impact on consumers generally and retirement savers in particular. One of the most sweeping changes is the new tax law that will greatly limit deductions and other breaks. That could have a major impact on your taxable income.

Restaurant tips rule change could short-change wait staff Kay Bell February 4, 2018

If you're going to a restaurant or bar today to watch the Super Bowl instead of to your buddy's for an LII party, tip your servers well. They soon could be losing their gratuities. That's the worst-case scenario feared by wait staff and employee advocacy groups under the Trump Administration's effort to reinstate tip pooling.

Five Things You Need To Know About Identity Theft And Tax Returns Kelly Phillips Erb February 2, 2018

With tax season in full swing, identity-theft-related tax fraud has become a hot topic. While taking steps to protect yourself from identity theft is always smart, it's important that you don't get too caught up in the hype. I've received a number of emails from panicked taxpayers who, after watching various news spots on the dangers of identity-theft-related tax fraud, are feeling confused and pressured. Unfortunately, some of the advice making the rounds - while certainly sensational isn't very practical. Here are five things you need to know about identity theft and tax returns: 1. Not all data breaches or computer hacks result in identity-theft-related tax fraud.

If you've maxed your 401(k), here's another way to save big Darla Mercado February 1, 2018

Financial advisors don't have to look far for the next big growth opportunity: It's right in clients' health-care plans. Say hello to the health savings account, which works in tandem with high-deductible health insurance. HSAs offer a triple-tax benefit: Assets in them grow free of taxes. Savers can contribute to them on a pretax or taxdeductible basis. Finally, account holders can tap the assets free of taxes, provided the money goes toward qualified medical expenses.

3 tax moves to make in February 2018 Kay Bell February 1, 2018

OK, I took some liberties with the traditional poem. But it is true that despite its reduced days, February still provides plenty of time to make some key tax moves. Here, since it is a short month, are three.

Planning for a Secure Retirement Penelope Wang February 1, 2018

Retirement planning has always been full of uncertainties: How much longer will you be able to work? How much savings will you have when you stop working? How many decades will that money need to last? But for anyone nearing retirement, or already there, the level of uncertainty has rarely been greater than it is right now. Most significantly, Congress and the White House have been overhauling many rules that have a big impact on consumers generally and retirement savers in particular. One of the most sweeping changes is the new tax law that will greatly limit deductions and other breaks. That could have a major impact on your taxable income.

Most tax statements should be at least on their way today Kay Bell January 31, 2018

Every tax season, the April filing deadline gets the most attention. But today, Jan. 31, also is a big tax day. It's when most statements with information you need to complete your Form 1040 (or 1040A or 1040EZ) are supposed to be delivered. Technically, the Internal Revenue Service gives these information statements the same leeway it offers filers on Tax Day. Earnings and other tax-related statements due today are considered on time as long as they're on the way, either electronically (if you agree to that delivery method) or via snail mail by Jan. 31.

Timing Tax Savings With Deduction Lumping And Charitable Clumping Michael Kitces January 31, 2018

Congress allows taxpayers to claim various tax deductions that will reduce their taxable income. In some cases, the deductions are intended as tax incentives to encourage certain behaviors (e.g., deductions for charitable giving); in other cases, they’re tax subsidies to mitigate the net after-tax cost (such as the deduction for mortgage interest or various miscellaneous itemized deductions). To simplify the tax filing process, all taxpayers have the option to simply claim a “Standard Deduction” – literally, a standardized dollar amount, depending on your tax filing status, that is available to virtually everyone. In 2017, these thresholds were $6,350 for individuals, and $12,700 for married couples (plus an additional standard deduction for those who are blind, or over age 65).

Tax Reform Moves to the States: State Revenue Implications and Reform Opportunities Following Federal Tax Reform Jared Walczak January 31, 2018

Key Findings States incorporate provisions of the federal tax codes into their own codes in varying degrees, meaning that federal tax reform has implications for state revenue beyond any broader economic effects of tax reform. Because the base-broadening provisions of the new federal tax law often flow through to states, while the corresponding rate reductions do not, most states will experience a revenue increase. The vast majority of filers will receive a tax cut at the federal level, but they could easily see a state tax increase unless states act to prevent one.

After 45 Birthdays, Here Are '12 Rules for Life' Megan McArdle January 30, 2018

Yesterday was Jan. 29, meaning that Oprah Winfrey and I are each a year older: 64 and 45. Forty-five is somehow a very definite year; there is no question that you are middle aged.

Voices Pros and cons of the new tax law for real estate owners Heidi Henderson January 30, 2018

The new tax laws have both experts and amateurs pouring over the details as the upcoming tax season dawns. For real estate owners, however, there's one surefire boon: bonus depreciation. Under the prior law, there was a 50% bonus depreciation for property placed in service in 2017, 40% for 2018, and 30% for 2019. Qualified property has to be new, not used.

Alicia Munnell: The Social Security Fix No One Wants Jane Wollman Rusoff January 30, 2018

Most retirees’ eagerly anticipated golden years will be tarnished by insufficient income and a consequential decline in standard of living unless consumers and policymakers get cracking now to avert this bleak scenario. So says Alica H. Munnell, professor of management sciences at Boston College and director of its Center for Retirement Research, who, in an interview with ThinkAdvisor, discusses three critically important pieces of advice financial advisors can give clients who are nearing retirement.

House Passes Senior Safe Act Melanie Waddell January 29, 2018

The U.S. House of Representatives passed H.R. 2255 legislation, which includes The Senior Safe Act, late Monday to help protect seniors from financial exploitation. Both H.R. 2255, the Housing Opportunities Made Easier (HOME) Act, and the Senior Safe Act (formerly H.R. 3758), had been standalone bills.

5 Things Your Kids Should Know Before They Inherit Your Money Matt Hausman January 29, 2018

An inheritance shouldn't come as a big surprise to your beneficiaries. They need to be prepared for the gift, and the taxes and decisions that come with it. So even if it's awkward, you need to have a chat. Many parents fail to get their financial affairs in order, neglecting to take care of such things as wills, living wills and powers of attorney. But even those who think they’ve covered all of their estate-planning bases often leave one of the most important tasks undone: They fail to talk to their adult children about the money they’ll be leaving them someday.

Americans will need $1.5M to retire comfortably John Aidan Byrn January 27, 2018

They’ve moved the goal posts for Americans hoping to score a financially-sound retirement — and millions of workers are going to be irked. You’re now going to need a minimum of about $1.5 million to retire comfortably — not the cool $1 million that had been prescribed for decades. You can thank the fact that Americans are living longer, interest on savings is low and that Social Security is no longer a foregone conclusion, according to Rebecca Walser, a tax lawyer and certified financial planner.

As Tax Season Kicks Off, Here's What's New On Your 2017 Tax Return Kelly Phillips Erb January 27, 2018 There has been a great deal of information about the new tax reform law and what it means for the current tax year. But with tax season for the 2017 tax year just around the corner, taxpayers want to know what’s new for 2017. Here’s what you need to know about changes to your 2017 tax returns (the one you’ll be filing beginning on Monday): Do I have to file a federal income tax return?

Three high-tax states sue to fight legislation that cuts deductions Ben Popken January 26, 2018 Homeowners in areas with high state and local property taxes are hopping mad after the new federal tax bill passed — and now Democratic governors in some of those states are fighting back. New Jersey and Connecticut joined New York in suing the federal government over the new GOP-led tax overhaul plan signed by President Donald Trump just before Christmas. The plan would cap the deductions taxpayers can take for their state and local taxes, or SALT, including their property taxes, at $10,000 — less than half what New Jersey's average property owner currently claims.

Californians Love Living in Oregon, Study Shows. Oregonians Want to Live Someplace Else. Elise Herron January 26, 2018 Portland's housing crunch, and the fight over whether to solve it by building into the sky, made WW's front page this week. The failure of Portland to build apartments to keep up with demand has caused many to blame at a familiar scapegoat: transplants moving here from out of state. But an illuminating new study shows that Oregonians are moving out of the state just as frequently as people from other states are moving in.

It’s Tax Time: What to Remember Ann Carns January 26, 2018 Tax season officially opens next week, so it’s time to get your documents organized if you haven’t already. The Internal Revenue Service will officially begin accepting individual returns on Monday. You can file earlier, however, if you’re ready and have all the necessary forms, like the W-2 income statement from your employer. If you want yours to be among the nearly 155 million individual returns the I.R.S. receives this year, you can prepare it now using do-it-yourself software — or have it done by a professional tax preparer — and have the form sent automatically when the agency opens for business next week.

It has been 20 years now — are you taking advantage of a Roth IRA? Russ Wiles January 25, 2018 Roth Individual Retirement Accounts have been around 20 years now, which is long enough for most Americans to have gotten familiar with them. But a lot of people still don't own one of these accounts or hold relatively small balances, despite their substantial tax benefits. "Not enough people are taking advantage of them," said Ed Slott, a retirement-account specialist in suburban New York City who publishes an online newsletter devoted to IRAs of both the traditional and Roth variety.

The top retirement decisions facing older workers Steve Vernon January 25, 2018

As workers in their 50s and 60s transition into their retirement years, they face several important planning decisions. But which ones will have the most impact on their finances? You might think that finding the very best investments or minimizing taxes are really important. However, those would be the wrong answers for many middle-income workers.

How High Are Cigarette Tax Rates in Your State? Colin Cook January 25, 2018

For this week’s map, we take a look at cigarette tax rates across the nation and how they vary from state to state. Each state’s cigarette tax is levied in addition to the federal tax rate of $1.0066 per 20-pack of cigarettes. Connecticut and New York share the highest tax rate with $4.35 per pack, trailed by Rhode Island ($4.25), Massachusetts ($3.51), and Hawaii ($3.20). Conversely, Missouri has the lowest rate at 17 cents per pack, followed by Virginia ($0.30), Georgia ($0.37), and North Dakota ($0.44). The average tax rate among states is $1.70 per pack.

Who can take the new business tax deduction? Even tax experts aren't sure Jeanne Sahadi January 25, 2018

That's because there are many unanswered questions about a major business tax break under the new tax law: A 20% deduction on business income for owners, partners and shareholders in so-called pass-through entities -- e.g., S-corps, LLCs, partnerships and sole proprietorships. Not everyone will qualify. And if they do, the deduction may apply to a smaller percentage of their income than they'd expect.

U.S. Existing-Home Sales Fall as Supply Drops to Record Low Katia Dmitrieva January 24, 2018

Sales of previously-owned U.S. homes fell in December for the first time in four months, as the market struggles with record-low supply and rising prices, figures from the National Association of Realtors showed Wednesday. Key Takeaways The decline, deeper than economists estimated, indicates inventory issues across the U.S. are limiting Americans’ ability to purchase despite low mortgage rates and a solid job market. The low supply reflects a confluence of trends: New construction hasn’t kept up with housing needs; baby boomers are living longer and more often aging in place; and single-family homes that might have been purchased by first-time buyers are instead being rented out by investors who gobbled up foreclosures after last decade’s crash.

Do You Need To File A Tax Return In 2018? Kelly Phillips Erb January 24, 2018

Tax season opens on Monday, January 29, 2018. The Internal Revenue Service (IRS) expects to process nearly 155 million individual tax returns in 2018. Will you be filing one of those returns? And more important, do you need to? For the 2018 tax filing season, you'll report the income and corresponding deductions for the tax year 2017. That includes pay received in 2017 but not pay that you receive in 2018 for services performed in 2017 (you'll report that income next year).

Here's how much your home remodel will pay you back Diana Olick January 24, 2018

As home prices and mortgage rates rise, more and more homeowners are choosing to stay put and remodel. Yet, depending on the project, some of the returns are diminishing. Remodeling spending is expected to approach $340 billion in 2018, a 7.5 percent increase over last year, according to Harvard's Joint Center for Housing Studies.

Government funding bill postpones 3 Obamacare taxes Kay Bell January 23, 2017

When Congress overwhelmingly approved — a 266-150 vote in the House, 81-18 margin in the Senate — a bill on Monday (Jan. 22) to fund the federal government, a lot of folks celebrated. Federal workers, who were off work just one day, of course were happy.

Retirement Risks Keep Rising, and This Is Why Justin Fox January 22, 2018

Half of working-age households in the U.S. were on track in 2016 to be able to maintain their standard of living in retirement, according to the National Retirement Risk Index report out this month from the Center for Retirement Research at Boston College. Thanks mainly to rising home values, 1 that's better than in 2010 or 2013. But it still means that half of working-age households aren't prepared for retirement, up from just 30.4 percent in 1989. The National Retirement Risk Index

Congress Blesses Roth IRAs For Everyone, Even The Well Paid Ashlea Ebeling January 22, 2018

It works like this: If you earn more than $120,000 as a single, or $186,000 as a couple, you contribute to a traditional, nondeductible IRA, instead of a Roth. Then, presto chango, you immediately convert the money in the traditional IRA to a Roth IRA. Congressional tax writers, in what’s known as a conference committee report, described the move as allowed by current law, legitimizing it. Previously, some tax experts expressed concern that the Internal Revenue Service might argue that the two-step process violates what’s known as the step-transaction doctrine. “When Congress says what its intent is, that’s it. They absolutely, clearly say it’s okay. You can make a contribution to a nondeductible IRA and convert it to a Roth,” says CPA and IRA expert Ed Slott who publishes the IRA Advisor Newsletter.

Guest column: The importance of having an estate plan Zachary F. Lamb and Bray Creech January 21, 2018

Many people perceive estate planning as being only for the ultra-wealthy. We believe, however, that estate planning is really about making sure your wishes are carried out during difficult life events, regardless of your wealth or income level. Historically, estate planning focused on minimizing estate taxes at death, but here we refer to estate planning as putting a plan in place that is triggered when you die or become incapacitated due to accident, illness or otherwise.

The New 20% Pass-Through Tax Deduction: An Advisor’s Guide Jeffrey Levine January 17, 2018

In December 2017, President Donald Trump signed the Tax Cuts and Jobs Act into law, ushering in the biggest changes to the tax code in more than 30 years. Among the more significant changes made by the law is the creation of a new 20% deduction for certain pass-through business income. The deduction — sometimes referred to as the 199A deduction, after the section of the Internal Revenue Code in which it can be found — has the potential to reduce some clients’ taxable income by tens, if not hundreds of thousands of dollars.

The IRS Private Debt Collection Program Once Again Looks Like A Failure Howard Gleckman January 12, 2018

What’s the old line about “fool me once?” When it comes to privatizing debt collections for the IRS, Congress has now tried to fool American taxpayers for the third time. According to a new report by the agency’s Taxpayer Advocate Service, the outcome is roughly the same as the last two episodes—the agency is spending far more on the program than the firms are collecting and remitting to the Treasury. This time, according to the TAS, the agency spent $20 million in fiscal years 2016-2017 on a program that generated $6.7 million in payments through last October.

Ask The Taxgirl: The $10,000 SALT Cap & Rental Real Estate Kelly Phillips Erb January 12, 2018

Taxpayer asks: Dear Taxgirl, Would someone who owns business real property in their own name (not in a LLC or Partnership or corporation) and files on Schedule E face the $10,000 cap.

10 cities where housing is still a buyer's market Bonnie Sinnock January 12, 2018

A tight housing inventory has led to rising prices and stiff competition for house hunters in much of the country. But in some cities, homebuyers still have the upper hand. "With reduced inventory and appreciating home prices an issue in much of the country, real estate market conditions are challenging," says Phil Karp, senior manager of brokerage services at Owners.com. "Many markets have become overheated, but there are still markets where smart buyers can find more affordable homes."

Should Tax Reform Change How You Save for Retirement? Maryalene LaPonsie January 11, 2018

It's the most sweeping tax reform enacted in decades, but don't expect the Tax Cuts and Jobs Act to significantly change how you save for retirement. "I don't know that it fundamentally changes the advice we give," says David Brinkman, an investment relationship manager for Schneider Downs Wealth Management Advisors in Columbus, Ohio.

IRS Releases New 2018 Withholding Tables To Reflect Tax Law Changes Kelly Phillips Erb January 11, 2018

The Internal Revenue Service (IRS) has updated the income-tax withholding tables for 2018 to reflect changes made by the new tax law. The updated tables reflect the new rates for employers to use during the 2018 tax year. Employers are instructed to use the 2018 withholding tables as soon as possible, but not later than February 15, 2018. Until employers make the switch, they're instructed to use the 2017 withholding tables. That's why your early 2018 paychecks may look a little different than you expect - by the end of February, your check should reflect the changes (the exact timing depends on your employer and your pay period/frequency).

Where Did Americans Move in 2017? Morgan Scarboro January 11, 2018

States compete with each other in a variety of ways. Competing to attract and retain new residents is just one example. United Van Lines tracks its customers’ state-to-state migration and releases the data yearly. By comparing the number of inbound moves to the number of outbound moves, United Van Lines data gives us early insights into annual interstate migration, available much sooner than government data sources.

Tax identity thieves get a head start on 2018 filing season Kay Bell January 10, 2018

Some folks are taking seriously the traditional tax advice to start annual tax filing tasks early. Unfortunately, those folks are crooks. The Internal Revenue Service and its Security Summit partners in state tax agencies and the tax industry have announced that they're seeing early signs that cyber criminals already are working to infiltrate the tax process.

Here’s Five Reasons to Use Direct Deposit for a Tax Refund IRS January 9, 2018

As taxpayers prepare for the January 29 start of filing season, they should consider a direct deposit of any refunds due. It’s easy, safe, fast — and the best way to get a refund. That’s why 80 percent of taxpayers choose it every year. IRS Direct Deposit: Is Fast. The quickest way for taxpayers to get their refund is to electronically file their federal tax return and use direct deposit. They can use IRS Free File to prepare and efile federal returns for free. Taxpayers who file a paper return can also use direct deposit.

What You Need To Know About Taxes & Cryptocurrency Kelly Phillips Erb January 9, 2018

Cryptocurrency is riding high these days. But even as more investors are taking a chance on new currencies like Bitcoin, Ethereum, and Ripple, many are still confused about how to treat it for federal income tax purposes. In 2014, the Internal Revenue Service (IRS) issued guidance to taxpayers (downloads as a pdf) making it clear that virtual currency will be treated as a capital asset, provided they are convertible into cash. In simple terms, this means that capital gains rules apply to any gains or losses. But taxes are rarely simple. Things can get complicated very quickly. Here are the basics: For those taxpayers buying and selling cryptocurrency as an investment, calculating gains and losses are figured the same as buying and selling stock. That's true, as well, when it comes to basis, holding period and a triggering event.

21 Million Taxpayers Will Stop Taking the Charitable Deduction Under The TCJA Howard Gleckman January 8, 2018

The Tax Cuts and Jobs Act (TCJA) will shrink the number of households claiming an itemized deduction for their gifts to non-profits from about 37 million to about 16 million in 2018, according to new Tax Policy Center estimates. At the same time, the new law will reduce the federal income tax subsidy for charitable giving by onethird, from about $63 billion to roughly $42 billion. Overall, the TCJA will reduce the marginal tax benefit of giving to charity by more than onequarter in 2018, raising the after-tax cost of donating by about 7 percent.

Britain looking at 'latte levy' to reduce coffee cup waste Kay Bell January 7, 2018

While I make my coffee at home during the week, I'm a Starbucks fan on weekends. During hot Texas summers, those icy Frappuccinos are heaven. Heck, even in our not-that-cold winters, I get them. (Note to Starbucks: I sooo missed the Chile Mocha option this past holiday season. This flavor should be a regular, year-round option, especially here in Texas where chile peppers are one of the major food groups. We even have an official state pepper. But I digress. But bring it back, please!)

To Incorporate Or Not To Incorporate: Breaking Down Your Options Under The New Tax Law Kelly Phillips Erb January 5, 2018

The Tax Cuts and Jobs Act (TCJA), or what's referred to as the new tax reform law, was signed into law on December 22, 2017. Since that time, taxpayers and tax professionals alike have been mulling what the provisions of the new law might mean - and how to be best get around them. Tops in the minds of many taxpayers: Should I incorporate to save money? There is no one size fits all answer to this question. But here are some general guidelines:

Trump poised to take action on Medicaid work requirements Peter Sullivan January 5, 2018

The Trump administration is preparing to release guidelines soon for requiring Medicaid recipients to work, according to sources familiar with the plans, a major shift in the 50-year-old program. The guidelines will set the conditions for allowing states to add work requirements to their Medicaid programs for the first time, putting a conservative twist on the health insurance program for the poor.

What Percentage of Lottery Winnings Would be Withheld in Your State? Morgan Scarboro and Jared Walczak January 5, 2018

The Powerball Jackpot has hit $550 million and Americans in 43 states and D.C. are lining up for tickets. Sooner or later, there will be at least forty-five big winners of the current Powerball game, and forty-four of them are already known. That’s because only about half of Powerball ticket revenue is returned in the form of prizes, which is lower than the average for other lottery games. The rest of the jackpot, less the consortium’s administrative costs, fills the coffers of the fortyfour states participating in Powerball.

Taxes as Charity? New Jersey Towns Try to Elude G.O.P. Tax Law Nick Corasaniti and Alan Rappeport January 5, 2018

FAIR LAWN, N.J. — Faced with a new federal tax law that limits state and local tax deductions, three communities in New Jersey have come up with a novel solution: They want people to donate to a town-run charity as a way of mitigating their property taxes. The three towns — Paramus, Park Ridge and Fair Lawn — announced on Friday that they would allow residents to donate the same sum they would have been charged in property taxes to pay for municipal services. Under the tax bill signed by President Trump last month, deductions for state and local taxes, including property taxes, are limited, but charitable donations are not.

Tax Law Changes You Haven’t Heard Keith Schroeder January 5, 2018

Plenty has been written about the recent tax bill. Most news reports repeat the same information. I want to expand on what is widely known to include some lesser opportunities to reduce taxes and pitfalls most people (and many tax professionals) are unaware of. This post will cover a wide variety of tax issues that are changing. It will repeat a few facts published here and here previously.

State Strategies to Preserve SALT Deductions for High-Income Taxpayers: Will They Work? Jared Walczak January 5, 2018

Key Findings Several states are exploring strategies to preserve the full state and local tax deduction for high-income residents, which is capped at $10,000 under the new tax law. In California, legislation has been filed to allow residents to make contributions in lieu of taxes, making a voluntary contribution to a new California Excellence Fund and then claiming the full amount as a credit against state income tax liability, since the state and local tax deduction is capped but the charitable deduction is not.

Economy adds 148K jobs in December Vicki Needham January 5, 2018

The U.S. economy added a modest 148,000 jobs in December, below expectations, but the figure caps off the seventh consecutive year of annual employment growth above 2 million, the longest streak since the web boom of the 1990s. The unemployment rate held at 4.1 percent for the third straight month, the lowest level since December 2000, when it was 3.9 percent, as the economy maintained steady growth through a series of major hurricanes late in the summer, the Labor Department reported on Friday.

State governments are already gaming the Republican tax overhaul Patrick Clark, Bloomberg News January 4, 2018

Before the ink was dry on the Republican tax bill signed into law late last month, experts predicted that state governments would try to shield their residents from tax hikes they’ll suffer from a sharp reduction in state and local deductions. It didn’t take long.

Give Your 401(k) a New Year's Checkup Rebecca Lake January 3, 2018

Have you thought about your 401(k) lately? A 2017 survey from Scarborough Capital Management found that 43.6 percent of retirement savers spend just one to two hours per year managing their workplace plan. A little more than 25 percent said they lacked basic know-how about their 401(k). If you've been more hands-off than hands-on with your plan, the beginning of a new year is a prime opportunity to check in and see how your portfolio is progressing.

Nonprofits Must Move Swiftly to Fight for Sound Public Policies Tim Delaney and David L. Thompson January 3, 2018

The destructive tsunami the new federal tax law unleashes is about to pound the nation’s nonprofits and foundations. The law that Congress passed and the president signed in the waning days of 2017 has created the most dangerous policy environment across the state, local, and federal levels that we’ve ever seen in the decades we’ve spent focusing on how governments and nonprofits interact. That may sound like hyperbole. It is not.

When To Take Social Security – A Pro/Con Cory S. Fawcett January 3, 2018

Surgeon, physician, and blogger Cory S. Fawcett published a blog post a few months ago advocating that physicians take their Social Security as soon as they can. I told him that I thought he blew it with that post but thought it might make for a very interesting Pro/Con post on the site if I wasn’t able to change his mind. We set up the ground rules so that we were both operating from similar assumptions with our numbers. We assumed a single doctor who had made $200K a year during his career and was stopping work at age 62 with a $2M nest egg composed of 60% tax-deferred money, 30% taxable money, and 10% Roth money. This doctor was facing a decision of whether to start taking Social Security right then or delay it to 70. We’ll start with Dr. Fawcett’s post. Take Your Social Security At Age 62 – Dr. Cory S. Fawcett

Early Retirement Aligns With Early Death, Study Finds Emily Zulz January 2, 2018

Many Americans choose to claim Social Security as soon as possible. Social Security eligibility begins at age 62, and approximately 31% of all Americans begin claiming Social Security in their first month of eligibility, with men and women doing so at similar rates.

What to do with math error notice letters from the IRS Russell Zhaochu Li, Ph.D.; Clement Chen, CPA, Ph.D.; and Keith Jones, CPA, Ph.D. January 1, 2018

In 2015, the IRS received more than 146 million individual tax returns and audited 1.2 million of them, a mere 0.8% (IRS 2016). At the same time, the IRS found more than 2.17 million math errors from individual tax returns and sent more than 1.67 million math error notice letters (some returns have more than one error). What are these math errors, and how should taxpayers and tax practitioners respond to them? MATH ERROR PROGRAM

Op-Ed The GOP tax plan creates one of the largest new loopholes in decades Lily Batchelder and David Kamin December 31, 2017

The tax plan that President Trump signed into law last week creates one of the largest new loopholes in decades: a 20% deduction for “pass-through income.” Pass-through income is business income that is immediately “passed through” to the owner’s personal tax return, thereby avoiding the corporate income tax. Proponents of the Republican tax plan claim the cut benefits small businesses, but that’s a red herring. In reality, the new deduction disproportionately benefits the wealthy, penalizes workers and, in part because it is so complex, will ultimately reward those who can afford the best tax advice.

Legal Weed Isn’t The Boon Small Businesses Thought It Would Be Lester Black December 29, 2017

The business of selling legal weed is big and getting bigger. North Americans spent $6.7 billion on legal cannabis last year, and some analysts think that with California set to open recreational dispensaries on Jan. 1 and Massachusetts and Canada soon to follow, the market could expand to more than $20.2 billion by 2021. So it’s no surprise that you see eager business people across the country lining up to investmillions of dollars in this green rush. But here’s a word of warning for those looking to dive head-first into these brand-new legal weed markets: The data behind the first four years of legal pot sales, with drops in retail prices and an increase in well-funded cannabis growing operations, shows a market that increasingly favors big businesses with deep pockets. As legal weed keeps expanding, pot prices are likely to continue to decline, making the odds of running a profitable small pot farm even longer.

IRS Advisory: Prepaid Real Property Taxes May Be Deductible in 2017 if Assessed and Paid in 2017 IRS December 27, 2017

WASHINGTON - The Internal Revenue Service advised tax professionals and taxpayers today that pre-paying 2018 state and local real property taxes in 2017 may be tax deductible under certain circumstances. The IRS has received a number of questions from the tax community concerning the deductibility of prepaid real property taxes. In general, whether a taxpayer is allowed a deduction for the prepayment of state or local real property taxes in 2017 depends on whether the taxpayer makes the payment in 2017 and the real property taxes are assessed prior to 2018. A prepayment of anticipated real property taxes that have not been assessed prior to 2018 are not deductible in 2017. State or local law determines whether and when a property tax is assessed, which is generally when the taxpayer becomes liable for the property tax imposed.

10 Relatively Stress-Free Year-End Moves To Make To Save On Taxes After Tax Reform Kelly Phillips Erb December 23, 2017

At year-end, there's generally a flurry of last-minute efforts to reduce tax bills. However, with tax reform now law (you can read about some of the provisions now), taxpayers are stressing more than usual this year over what to do to avoid writing a big check for the 2017 tax year - and not be caught off-guard in 2018. Many questions involve some pretty serious changes like, "Should I incorporate?" or "Should I capitalize my business?" But you don't have to make monumental changes in your lifestyle to see a little extra change in your pocket come tax time. Here are ten relatively stress-free year-end moves to make to save on taxes after tax reform: 1. Give To Charity.

Trump's tax law creates new challenges for IRS Naomi Jagoda December 23, 2017

The Republican tax bill is the law of the land — but for federal officials, the work is just beginning. The Treasury Department and the IRS now have a mammoth task on their hands as they seek to turn the sweeping tax provisions passed by Congress into new rules and regulations.

Charities fear tax bill could turn philanthropy into a pursuit only for the rich Todd C. Frankel December 23, 2017

Many U.S. charities are worried the tax overhaul bill signed by President Trump on Friday could spur a landmark shift in philanthropy, speeding along the decline of middle-class donors and transforming charitable giftgiving into a pursuit largely left to the wealthy. The source of concern is how the tax bill is expected to sharply reduce the number of taxpayers who qualify for the charitable tax deduction — a big driver of gifts to nonprofits. One study predicts that donations will fall by at least $13 billion, about 4.5 percent, next year. That decline is expected to be concentrated among gifts from the middle of the income scale. The richest Americans will mostly keep their ability to take the tax break.

TPC Shows How The New Tax Law Would Affect Different Households Howard Gleckman December 22, 2017

Yesterday, the Tax Policy Center released a new online tax calculator that allows you to compare the Tax Cuts and Jobs Act with the current tax law. Today, TPC is releasing a set of new case studies that show how the new law will affect households in different situations. The examples show what the law will mean for singles versus married couples, for people with wage income compared to those who own their own businesses, and for those who live in high-, low- and moderate tax states.

Bitcoin Sellers Cut Taxes By Moving Before Sale Robert W. Wood December 21, 2017

Bitcoin has captured the hearts and wallets of techies everywhere, and the returns have been positively heady. But taxes can be painful too. At the start of the crypto craze, it seemed anonymous. But now, the IRS is getting Coinbase customer data. It now seems practically mainstream, with futures and institutional investors. And on the subject of taxes, many a Bitcoin millionaire may be thinking like their forefathers did with appreciated stock. In general, shares of stocks are considered intangible assets for tax purposes. One effect of that rule is that, for tax purposes, you can take them with you when you move. If you live in California and sell your stocks and bonds, they are sourced to California where you reside for tax purposes.

What Your Itemized Deductions On Schedule A Will Look Like After Tax Reform Kelly Phillips Erb December 20, 2017

With all of the focus on new tax rates after Congress green-lighted tax reform (you can see those new rates here), it's easy to forget that some of the biggest changes don't have anything to do with tax rates: They're about deductions. For 2018, the standard deduction amounts will increase from $6,500 for individuals, $9,550 for heads of households (HOH), and $13,000 for married couples filing jointly, to $12,000 for individuals, $18,000 for HOH, and $24,000 for married couples filing jointly. Most taxpayers will claim the standard deduction.

How tax overhaul would change business taxes Alistar M. Nevius December 20, 2017

The tax reform bill that Congress voted to approve Dec. 20 contains numerous changes that will affect businesses large and small. H.R. 1, known as the Tax Cuts and Jobs Act, would make sweeping modifications to the Internal Revenue Code, including a much lower corporate tax rate, changes to credits and deductions, and a move to a territorial system for corporations that have overseas earnings. Here are many of the bill’s business provisions.

CHART: How The Final Version Of The Republican Tax Bill Would Affect You Danielle Kurtzleben December 20, 2017

On Wednesday, congressional Republicans passed their tax cut plan, handing the party and the president a major legislative victory. The final bill looks a lot like earlier versions from the House and Senate, with minor modifications — for example, it lowers the corporate tax rate from 35 to 21 percent, as opposed to the 20 percent in both of the earlier House and Senate bills. In other cases, it finds the middle ground between the two chambers' previous bills — it limits taxpayers to deducting the interest on new mortgages up to $750,000, as opposed to $500,000 in the House bill and $1 million in the Senate bill, which is also the amount set under current law.

Without the Insurance Mandate, Health Care’s Future May Be in Doubt Robert Pear December 18, 2017

WASHINGTON — For years, the Obama administration said the health care system as constructed by the Affordable Care Act could not survive without a mandate that most Americans have health insurance. With surgical precision, the sweeping tax bill that Republicans plan to pass this week will do away with that mandate. What comes next for health care is unclear.

Individual Tax Planning Under The Tax Cuts And Jobs Act Of 2017 Michael Kitces December 18, 2017

GOP Tax Plan Summary Of TCJA Over the past month, both the House GOP and Senate have put forth their respective proposals for tax reform – each of which passed with relatively narrow margins in their respective chambers, and both of which generated substantial controversy around key provisions. Leaving just a few weeks before the end of the year to reconcile the two in an effort to have President Trump sign the Tax Cuts and Jobs Act into law in 2017.

Have You Ever Felt Sorry for the I.R.S.? Now Might Be the Time Patricia Cohen December 18, 2017

After years of upbraiding and even threatening to abolish the Internal Revenue Service, Republicans must now depend on the agency to carry out their signature legislative accomplishment: a comprehensive revision of the tax code. The task is monumental. While processing tens of millions of tax returns for 2017 under the current rules, the I.R.S. would also have to figure out how to interpret and explain a new system and put it into practice.

California considers ‘green banking’ as it transitions to fully legal pot Patrick McGreevy December 17, 2017

California has a possible solution to the problem of banks being unwilling to handle money from the state’s multibillion-dollar legal marijuana industry, one that officials say would be the first system of its kind in the nation. Talks are underway between the state, banks and federal regulators on a plan to allow banks to serve a marijuana market that is expected to grow to $7 billion annually by 2020 in California. Starting Jan. 1, it will be legal to grow and sell marijuana for recreational and medical uses.

Letter: Medicare and Social Security are not entitlements Rolayne Fairclough December 16, 2017

We need to change the term used for Social Security and Medicare. They are not “entitlements.” Entitlement suggests a benefit that is given without merit. Excuse me. I have paid for my Social Security throughout my working life. My Social Security is taxed, and my Medicare payment is subtracted from my Social Security check each month. A provision in the Senate’s tax bill that Medicare recipients will no longer have cancer treatments paid for by Medicare is a breach of contract. The same for Social Security; this is a retirement insurance policy paid over the years. If an insurance company in the private sector were to deny or lessen coverage it would be sued and put out of business.

Details of the Conference Report for the Tax Cuts and Jobs Act Jared Walczak, Joseph Bishop-Henchman, and Nicole Kaeding December 15, 2017

On Friday, House and Senate conferees signed off on a conference report resolving the differences between the versions of the Tax Cuts and Jobs Act that passed each chamber. Votes are expected in the House and Senate early next week. The 503-page conference report hews more closely to the language of the Senate than the House version, but it also reflects a range of compromises, fixes, and negotiated agreements that reflect the concerns and priorities of members in both chambers. Even—perhaps especially—those who have followed every twist and turn of the tax reform debate can easily lose track of which provisions are in or out. Throughout the process, we have outlined the details of both the House and Senate versions, and tracked their amendments. Now that we have final language, it makes sense to start with a clean slate, looking at the provisions of the conference committee report against a current law baseline.

Dep’t. of Small Mercies: Johnson Amendment Repeal Gone from Still-Terrible GOP Tax Bill Ruth Mccambridge December 15, 2017

The Washington Post is reporting that the final GOP tax bill will not include a repeal of the Johnson Amendment, which is a provision that has been in effect since 1954 and prohibits partisan political activities by 501c3 nonprofits, including houses of worship. This protects charitable nonprofits from partisan pressures while still leaving room for nonpartisan organizing and advocacy. As readers will remember, the House had, in its version of the tax bill, included the repeal applicable to all nonprofits and houses of worship, but the Senate did not include it, so it might have gone either way in the reconciliation process.

IRS issues 2018 standard mileage rates Sally P. Schreiber, J.D. December 14, 2017

The optional standard mileage rates for business use of a vehicle will increase slightly in 2018, after decreasing in the two previous years, the IRS announced Thursday (Notice 20183). For business use of a car, van, pickup truck, or panel truck, the rate for 2018 will be 54.5 cents per mile, up from 53.5 cents per mile in 2017. Taxpayers can use the optional standard mileage rates to calculate the deductible costs of operating an automobile. Driving for medical or moving purposes may be deducted at 18 cents per mile, which is one cent higher than for 2017. (The medical and moving expense deductions may be affected by the pending tax reform legislation.)

Does Your State’s Individual Income Tax Code Conform with the Federal Tax Code? Nicole Kaeding December 13, 2017

As the federal government continues to debate tax reform, states, and many taxpayers, are asking an important question: How is my state’s tax code impacted? The exact impacts won’t be known until the federal bill is finalized, but states have a number of things to monitor, as my colleague, Joseph Bishop-Henchman, wrote earlier this month. To understand how federal tax reform would change state tax codes and revenues, we need to explore the idea of conformity. For reasons of administrative simplicity, states frequently seek to conform many, though rarely all, elements of their tax codes to the federal tax code. This harmonization of definitions and policies reduces compliance costs for individuals and businesses with liability in multiple states and limits the potential for double taxation of income. No state conforms to the federal code in all respects, and not all provisions of the federal code make for good tax policy, but greater conformity substantially reduces tax complexity and has significant value.

Everything you want to know about Medicare's rules on health savings accounts Philip Moeller December 13, 2017

The rise of high-deductible employer health plans has created one of the most unpleasant surprises for older employees: anyone on Medicare is no longer allowed to make tax-free contributions to a health savings account (HSA). To the further consternation of many such employees, anyone age 65 or older receiving Social Security benefits must, by law, also be signed up for Part A of Medicare. This requirement, seemingly unrelated to their health plan, also will end their ability to make HSA contributions.

Average US household owes $15,654 in credit card debt Brittany Jones-Cooper December 11, 2017

As 2017 comes to a close, many Americans will set financial goals for the upcoming year. Based on a recent survey, we’re guessing those goals will probably include paying down debt.

4 Big Problems with Treasury’s Report Showing Tax Cuts Pay for Themselves Yuval Rosenberg December 11, 2017

For months, Treasury Secretary Steven Mnuchin has claimed that the Republican tax plan will more than pay for itself by generating faster economic growth, adding that more than 100 people in his department were “working around the clock” on modeling various estimates of the plan’s effects. But the promised Treasury analysis supporting that claim had been conspicuously missing from the debate over the tax plan. Maybe the administration was better off that way.

Republicans fret over tax bill's unpopularity Alexander Bolton and Naomi Jagoda December 11, 2017

Republican lawmakers are concerned about how their tax bill is being viewed by the public and say they need to do a better job of selling it to middle-class and low-income voters. A CBS News poll conducted last week found that 53 percent of people nationwide disapprove of the GOP tax bill and only 35 percent approve.

Personal Solutions to the Healthcare Crisis Keith Schroeder December 11, 2017

In the United States healthcare has gone from crisis to tragedy. Double digit increases in insurance premiums for many years on one hand and a tax code that forces you to pay up on the other is a painful experience for many family budgets. The current tax code contains a health insurance mandate; have health insurance or pay a tax penalty. Congress has unsuccessfully tried to end the mandate, but the current tax bill might contain language ending required health insurance coverage.

IRS Bitcoin Hunt Ramps Up, But Tax Amnesty Could Follow: Expert Blog Robert W. Wood December 11, 2017

Don’t get excited or fearful just yet. The IRS has not yet announced a tax amnesty for people who failed to report their gains and income from Bitcoin and other virtual currencies. But there has long been speculation that it might happen. And given recent developments, we may now be one step closer. It is well-known that the IRS is looking hard at Bitcoin and other cryptocurrency transactions, hoping to scoop up some tax dollars. Frighteningly, much of the IRS attention now appears to be focused on the criminal end of the spectrum. IRS Criminal Investigation Agents evidently are being trained in the field.

Kansas's ravaged economy a cautionary tale as Trump plans huge tax cuts for rich Dominic Rushe December 10, 2017

Is Donald Trump about to turn America into Kansas? It’s a question some worried people who live in the state are asking as the Republican party pushes through the biggest tax overhaul in a generation – an overhaul that, they claim, bears an uncanny resemblance to a tax plan that left their midwestern home in disarray. After a failed economic experiment meant to boost economic growth blew a holein the Kansas budget as big as a prairie sky (a $350m deficit in the current fiscal year and nearly $600m in the next) state jobs and services have been slashed.

How to Increase Your Social Security Benefits -- After You Start Getting Them Wendy Connick, The Motley Fool December 9, 2017

Want a bigger Social Security benefits check? Try one of these three approaches. Once you claim your Social Security benefits, your options for increasing said benefits are somewhat limited. However, there are a few tricks you can use to bump up your Social Security benefits even at that point. Here are three. Withdraw your claim

The Most Important Social Security Chart You'll Ever See Christy Bieber, The Motley Fool December 9, 2017

More than 40% of pre-retirees and 25% of millennials plan for Social Security to provide the bulk of their retirement income, according to a 2017 Gallup poll. If you're one of the millions counting on Social Security to take care of you, take a close look at the chart posted below. Arguably the most important Social Security chart you'll ever see, it clearly illustrates exactly why you can't rely on Social Security benefits and highlights a common mistake retirees make that could cost them thousands over the course of their lives.

Jeff Sessions wants to crack down on legal weed — will Congress let him? Amanda Marcotte December 8, 2017

In all the budget and tax negotiations frantically being hammered out on Capitol Hill, one small amendment that might get lost in the shuffle could have huge ramifications. The Rohrabacher-Blumenauer amendment was originally set to expire on Friday (see update above), which would open the door for Attorney General Jeff Sessions to do what he's been hinting he wants to: Launch a federal war on states that have partly or completely legalized marijuana use. The Rohrabacher-Blumenauer amendment, originally passed as the the RohrabacherFarr amendment in 2014, bars the Department of Justice from using federal funds to prosecute people buying or selling medical marijuana in states that have legalized it. It's a popular bipartisan amendment that protects 46 states, but there have been concerns about whether it will be renewed after Sessions exerted pressure in May on Congress to let the amendment die.

TaxVox: Campaigns, Proposals, and Reforms William G. Gale December 8, 2017

The House and Senate have passed different versions of the Tax Cuts and Jobs Act (TCJA). Both bills would reduce federal revenues by more than $1.4 trillion over the next decade, and would introduce large corporate tax cuts; large tax cuts for pass-through businesses and estates; and smaller tax cuts for most individual wage and salary earners. A key question is how the plans would change the distribution of taxes paid. Most analysts focus only on the direct provisions of the TCJA. But government budget constraints imply that tax cuts are not free. Tax cuts eventually will have to be paid for with higher taxes or lower spending.

Tax Court: Alimony Payments May Not Be Deductible Ken Berry December 8, 2017

Under current law, taxpayers who fork over alimony to a divorced or separated spouse can deduct the payments, while the recipient spouse owes tax on the income. However, as evidenced by a new case, Logue, TC Memo 2017-234, 11/27/17, not all payments qualify as deductible alimony. The terms of the divorce decree must meet specific requirements spelled out in the tax law. And proposed legislation of late can change the alimony deduction.

Meet the "Spend Safely in Retirement" strategy Steve Vernon December 8, 2017

How will ordinary workers retire in a world that no longer offers traditional pensions for most? How will they decide if they have enough savings to afford retirement? And how can they generate reliable, lifetime retirement income? These questions pose serious challenges for older workers approaching their retirement years -- especially now because the switch from traditional pension plans to 401(k) plans has placed a serious responsibility on them. They need to be their own investment managers and actuaries, and they have to decide how to best deploy their savings in retirement. It should surprise nobody that most workers don't have the skills needed to successfully answer these questions.

Rep. Walden, are you working for Oregon?: Editorial The Oregon Editorial Board December 8, 2017

The Republicans' $1.5 trillion federal tax reform package calls for eliminating a benefit that will end up hitting Oregon and a handful of other states with high taxes particularly hard. So hard, in fact, 12 of the 13 Republicans who voted against the House version were from the high-tax states of California, New York and New Jersey. One Republican congressman from California recently blasted the bill, saying it would disenfranchise his constituents.

The Social Security number isn't dead yet, but its days are numbered Travis Jarae December 7, 2017

America's outdated identification methods are ripe for change, particularly from the outdated, static Social Security number to a more secure, robust and modern system. That transition is likely to be hastened by a pressing need for greater security, privacy and transparency in the digital age, following numerous disastrous data breaches. Most notoriously, the Equifax hack saw the potential exposure of highly sensitive Social Security numbers for more than half of all American adults.

Paul Ryan aims for Medicare, Medicaid, Social Security cuts in 2018 Charlie May December 7, 2017

There has been one inescapable question surrounding the newly passed GOP tax plan: Who will pay for it? The answer is actually not complicated, because top Republicans have already told everyone. House Speaker Paul Ryan, R-Wis., who has long dedicated his career to drawing ire over the ever-rising national debt and deficit, has made lobbying for cuts a big part of his legislative agenda.

The Social Security number isn't dead yet, but its days are numbered Travis Jarae December 7, 2017

America's outdated identification methods are ripe for change, particularly from the outdated, static Social Security number to a more secure, robust and modern system. That transition is likely to be hastened by a pressing need for greater security, privacy and transparency in the digital age, following numerous disastrous data breaches. Most notoriously, the Equifax hack saw the potential exposure of highly sensitive Social Security numbers for more than half of all American adults.

Paul Ryan aims for Medicare, Medicaid, Social Security cuts in 2018 Charlie May December 7, 2017

There has been one inescapable question surrounding the newly passed GOP tax plan: Who will pay for it? The answer is actually not complicated, because top Republicans have already told everyone. House Speaker Paul Ryan, R-Wis., who has long dedicated his career to drawing ire over the ever-rising national debt and deficit, has made lobbying for cuts a big part of his legislative agenda.

How would the TCJA treat my family? The same, but different Renu Zaretsky December 6, 2017

Just two weeks ago we hosted my parents, siblings, their spouses, and their children for Thanksgiving. We didn’t talk much about the Tax Cuts and Jobs Act (our 15 mouths were too full of food). Maybe we should have. We may soon be living in a new tax world, and with all the changes in the House and Senate versions of the TCJA it is hard to know what it all means. We can learn some basics about the tax code, and use a handy interactive tooldeveloped by The New York Times to get a rough idea of how our tax bills might change. We can also review TPC’s analysis of the bills.

Here Are the Housing Markets That Are Going to Get Hammered by the Republican Tax Plan Jordan Weissmann December 6, 2017

Tough break, New Jersey. Because they’re designed to cap popular deductions that benefit homeowners and limit the number of itemizers, the Republican tax bills are expected to put a dent in house prices around much of the United States. And, under the recently passed Senate version, nowhere seems to get it worse than the Garden State. According to modeling by Moody’s Analytics, 15 of the country’s 30 hardest hit counties would be in New Jersey. Homes in the lovely bedroom communities of Essex County, just over the river from Manhattan, would suffer the country’s biggest setback, losing more than a tenth of their value.

Only 1,700 Estates Would Owe Estate Tax in 2018 Under the TCJA Howard Gleckman December 6, 2017

The House and Senate versions of the Tax Cuts and Jobs Act would reduce the number of taxable estates by about twothirds in 2018, and save the heirs of a few thousand wealthy decedents almost $7 billion dollars, according to new estimates by the Tax Policy Center. Next year, only about 1,700 estates would owe federal estate tax under either bill. Currently, the first $5.49 million in assets (nearly $11 million for couples) are exempt from the estate tax. As a result, only about 5,500 estates pay the tax, representing about 0.2 percent of all deaths in the US. Both versions of the TCJA would roughly double the exemption to $11.18 million ($20.36 million for couples) in 2018. Starting in 2018, they'd index the exemption for inflation using the less generous chained CPI that would also apply to the individual income tax. After 2024, the House bill would repeal the tax entirely. After 2025, the Senate bill would revert to a $5 million exemption, indexed for inflation.

This is how much money parents lose supporting their adult children Kari Paul December 6, 2017

Leaving the nest doesn’t always mean entering financial independence for kids these days, and parents are paying a high price for it. Some 80% of parents are covering or have covered basic expenses for their children after they turn 18, which could cost parents $227,000 in lost savings over the course of retirement, a new study from personal finance website NerdWallet found.

My taxes probably are going up. Are yours? Beth Pinsker December 6, 2017

NEW YORK (Reuters) - No matter what version of the U.S. tax overhaul being considered by Congress becomes law, it looks like I am going to be paying more in taxes next year. By how much, I do not know.

Experts are starting to find massive errors in the GOP tax bill after it went through Congress at lightning speed Bob Bryan December 6, 2017

As Republicans hurtle toward making their massive tax plan into law, experts are starting to find a slew of errors they say are most likely the result of a rushed process. Republicans have argued that the plan is the culmination of years of work. But the resulting bill has moved through both chambers of Congress at legislative light speed.

13 states that tax Social Security income Maurie Backman, The Motley Fool December 6, 2017

Many seniors are caught off guard when they learn that they are, in fact, responsible for paying taxes in retirement. But while you may have heard that you'll be taxed on your traditional IRA or 401(k) withdrawals, as well as any income you receive from a part-time job, you may be surprised to learn that depending on where you live, your Social Security benefits could be taxed as well. States that tax Social Security

When it’s best to claim Social Security before age 70 Mark Hulbert December 5, 2017

Everyone “knows” that so long as you can afford to do so, you should wait until age 70 to begin claiming your Social Security benefits. But it turns out that this isn’t always the best thing to do. Perhaps the late Joe Granville, editor of the Granville Market Letter, was right when he said: “If it’s obvious, it’s obviously wrong.”

How Social Security Will Change in 2018 Mary C. Hickey December 5, 2017

The big news for Social Security in 2018 is a small pay hike for the program’s 61 million beneficiaries. The average monthly payment will go up by 2 percent: from $1,377 to $1,404 next year. It’s not much—and, worse, not everyone will see that extra money in their check because of the way deductions for Medicare premiums are taken (see more on this below). But it’s noteworthy because it represents the first significant cost-of-living adjustment (COLA) since 2012, when there was a 3.6 percent hike. Last year, seniors got just a 0.3 percent increase, and there was no raise at all in 2016.

Trump Is About to Make Tip-Pooling Legal Again. Here’s What That Means for Restaurant Workers Andrea Strong December 5, 2017

Here’s everything you need to know: If just-announced changes to Department of Labor regulations go past the proposal stage, employers will be able to pool tips earned by servers, allowing them to share the tips with untipped employees like cooks, dishwashers, and others in the back of house — if they share them at all.

Should You Pay Off Your Mortgage Before Retirement? Tom Sightings December 5, 2017

Owning a home can lead to a comfortable retirement. In theory, you buy a house when you're 30, faithfully make the mortgage payments for 30 years and at age 60 you own your house, free and clear. Now you have a solid nest egg and can sail into a worry-free retirement. But more often, here's how it works in practice. You move from a starter home to a bigger house, with a bigger mortgage. You refinance to get a lower interest rate and take out some money in the process. And at age 60 you're still paying a mortgage.

RMD Decisions: 5 Great Uses For Required Minimum Distributions Judith Ward December 5, 2017

If you’re approaching age 70½, get ready for the annual ritual of taking required minimum distributions (RMDs) from your tax-deferred retirement accounts. These accounts include: Traditional Individual Retirement Arrangements (IRAs), Rollover IRAs, Simplified Employee Pension (SEP-IRAs), and Savings Incentive Match Plan for Employees (SIMPLE IRAs), as well as other employer-sponsored retirement plans.* It’s finally time to pay taxes on these accounts after years of tax-deferred savings and growth.

Voices Optimizing small-biz owners’ retirement plans Sal Favarolo December 5, 2017

Accountants are always looking for savvy ways to help their small-business clients save on income taxes. Some strategies are more complicated than others, while some are simpler. One notable area that offers a lot of potential for income tax savings is in a client’s retirement plan. If they do not have one, accountants are well equipped to help their client establish a plan. If your client does have one, now is a perfect time to take it out and look it over. It is important to not only ensure that clients have maximized their contributions, but also that they have maximized their tax savings. In other words, are they in the right plan? This is an important question because it is often overlooked.

Despite Many Changes, The Senate’s Tax Cut Still Mostly Benefits Business and High-Income Households Howard Gleckman December 4, 2017

Though the Senate made dozens of changes to the Tax Cuts and Jobs Act (TCJA) before passing the measure early Saturday morning, the bill’s overall effect on households changed little, according to a new analysis by the Tax Policy Center. Similar to the version approved by the Senate Finance Committee, the final Senate bill would cut taxes by an average of about $1,200 in 2019, with most of the benefits going to the highest income households. By 2027, after nearly all of the bill’s individual income tax provision would expire, the average tax cut would shrink to less than $300 and the tax benefit would be even more highly skewed to the highest-income households.

How a Company Actually Plans to Spend Its Tax Cut Money Natalie Kitroeff December 3, 2017

ORO GRANDE, Calif. — Republicans have pitched their tax plan as an economic godsend that will offer deliverance from middling growth and set off a torrent of investment, hiring and raises. But at a quarry here in Southern California’s high desert, the outcome doesn’t look so straightforward. The pit of rock belongs to CalPortland, which mines limestone to create the cement that goes into some of the country’s most iconic stadiums and hotels. The company would hardly object to keeping a chunk of profits that currently goes to the government. But the extra cash probably wouldn’t be enough for CalPortland to expand immediately in ways requiring serious hiring.

3 Social Security Moves to Make in Your 50s Maurie Backman, The Motley Fool December 3, 2017

Your 50s are a pivotal time in the grand scheme of retirement -- mostly because they might be the last full decade you actually spend in the workforce. And since retirement and Social Security go hand in hand, it pays to focus on the latter in the years leading up to the former. Here are three key Social Security moves to aim for during your 50s that will eventually help you make the most of your benefits. 1. Review your earnings record for accuracy

How to avoid outliving your retirement savings Liz Weston December 3, 2017

Dear Liz: The wife and I are both 65. We both work, with a combined income of $125,000, of which we spend almost all. We have $550,000 in IRAs and $1 million in other investments, plus home equity of about $500,000. We’ll get $3,800 from Social Security if we start next year but plan to work until age 67. Should we wait until then to claim? Answer: Both of you needn’t wait, but one of you should — the one who has the larger benefit.

6 Ways to Be Better at Money in 2018 Tim Herrera December 3, 2017

Though there’s never a wrong time to get your finances in order, a new year is the perfect excuse to take a deep look at your relationship with money. Whether you’re just starting out in your career or you’re nearing retirement, below is The Times’s best financial advice from this year on earning and saving more money and, more important, deciding what to do with all of it.

Even a $1 million retirement nest egg isn't enough anymore Jessica Dickler December 2, 2017

A cool $1 million has long been considered the gold standard of retirement savings. These days, it's only a fraction of what you will really need. For instance, a 67-year-old baby boomer retiring now with $1 million in the bank will generate $40,000 a year to live on adjusted for inflation and assuming a sustainable withdrawal rate of 4 percent, said Mark Avallone, president of Potomac Wealth Advisors and author of "Countdown to Financial Freedom."

How 4 different households would fare under the tax bill the Senate passed Irina Ivanova, Moneywatch December 2, 2017

The Senate tax bill — which Republicans passed early Saturday morning with no Democratic support — is supposed to provide "broad relief" to companies and families. That is complicated by the Joint Committee on Taxation's finding that the bill will still add at least $1 trillion to the deficit and grow the economy slower than Republicans had hoped. The nonpartisan JCT has also said "every tax bracket" would pay less. Its proponents, including recent supporter Sen. John McCain, have claimed that the bill would "directly benefit all Americans." Critics, meanwhile, point to the millions of low- and middle-income families whose tax cut would be modest and whose taxes would rise in 10 years.

Living in cars, working for Amazon: meet America's new nomads Jessica Bruder December 2, 2017

Millions of Americans are wrestling with the impossibility of a traditional middle-class existence. In homes across the country, kitchen tables are strewn with unpaid bills. Lights burn late into the night. The same calculations get performed again and again, through exhaustion and sometimes tears. Wages minus grocery receipts. Minus medical bills. Minus credit card debt. Minus utility fees. Minus student loan and car payments. Minus the biggest expense of all: rent.

How the tax overhaul could affect your bottom line Reuben Fischer-Baum, Kim Soffen, and Heather Long December 2, 2017

The Senate passed a long-awaited tax overhaul bill early Saturday morning. The bill, the biggest rewrite of the individual and corporate tax code in 30 years, would affect the pocketbooks of most Americans. It still has to be reconciled with a tax overhaul passed by the House last month before being sent to President Trump for his signature. How the bill will affect your pocketbook will depend on many factors. And the impact could change over time, since the individual tax code provisions expire at the end of 2025. But enter your income below for a prediction about how you could be affected:

What will feature in the final version of the Republican tax plan? Lauren Gambino December 2, 2017

The House and Senate drafts, which help corporations and the rich and could leave millions without health insurance, must be reconciled into a single bill. All Republicans want for Christmas is tax reform – and they are poised to get it. The Senate Republican tax overhaul that passed early on Saturday morning is filled with traditional GOP priorities, including big treats for corporations and the most affluent sections of society. But the bill will now need to be reconciled with the House-passed version.

Senate passes tax overhaul, securing major GOP victory Jordain Carney and Naomi Jagoda December 2, 2017

The Senate passed legislation to overhaul the tax code early Saturday morning, handing Republicans a badly needed legislative and political victory. Senators voted 51-49 to pass the plan, capping off days of debate and hand-wringing as leadership worked frantically behind the scenes to win over holdouts and get the proposal in line with the chamber’s rules.

Important Differences Between the House and Senate Tax Reform Bills Heading into Conference Jared Walczak December 2, 2017

After the Senate’s vote on the Tax Cuts and Jobs Act in the early hours of Saturday morning, Senate Majority Leader Mitch McConnell (R-KY) told reporters that while he was not predicting that the conference committee with the House would be “a piece of cake,” he was confident that the chambers could reconcile their differences. He cited efforts to “preconference” the bill by adopting key House priorities. For instance: “We’ve moved our initial thinking on this in the direction of the House bill, for example the property tax deduction, in order to get the bills closer together than they were.” That will be important. When the chambers pass different versions of a bill, conferees are appointed by both the House and the Senate to produce a “conference report” that is satisfactory to the majority of conferees from each chamber. (More on this later, after the table.) The closer the two sides are going into conference, the easier the resulting process.

Advice on Dividing IRAs in a Divorce David Ellis, CPA December 1, 2017

When a couple divorces, it is not unusual for the retirement plan of one or both spouses to be the most significant asset that must be divided. If the plan is a “Qualified Plan” such as a Defined Benefit or 401k, the plan may be divided between the spouses using a Qualified Domestic Relations Order (QDRO). A QDRO not only allows for the tax-free division of the plan’s assets, but distributions from Qualified Plans pursuant to a QDRO are not subject to the 10% penalty for early withdrawal. Regardless of the age of the spouse receiving the QDRO distribution, no early withdrawal penalty applies (IRC Section 72(t)(2)(c)).

Realtors Predict Tax Bill Will Cause Housing Prices To Drop In Every State Kelly Phillips Erb December 1, 2017

Republicans in the Senate have announced that they have enough votes to move their latest version of the tax reform bill forward. That's the case despite provisions in the proposal that have raised concerns, causing Senate Majority Leader Mitch McConnell (R-KY) to refer to the process as a "challenging exercise." One of the most controversial issues is how the bill might affect the housing market: The National Association of Realtors (NAR) is warning that the bill will cause housing prices to drop. At first blush, that might sound a little surprising. After all, both the House and Senate bills would preserve the mortgage interest deduction - albeit with limitations. Specifically, under the House bill, new mortgages would be capped at $500,000 for purposes of the deduction, and the deduction would only apply to your primary residence. Under the Senate bill, the deduction would remain in place for mortgages up to $1,000,000, but the deduction for equity debt (meaning re-financing not related to improving your home) would be eliminated.

10 tax moves to make by Dec. 31 — and before Congress changes the tax laws Kay Bell December 1, 2017

Hello, holidays! We're so happy you and your good cheer have finally arrived. But the arrival of December also means 2017 is almost over, giving us only 31 days to take care of tax tasks that could save us money when we file our returns next year. This year, it also looks like Congress might actually make some tax changes, if not accomplish real tax reform. If that does happen, the good news is that we don't have to worry about deciphering them before we do our 2017 taxes.

Health Coverage Is No Slam Dunk Janet Bodnar December 2017

When I was editor of this magazine, I read every story— usually more than once. So when I was planning my retirement as editor earlier this year, I thought I had everything under control. Imagine my dismay when I learned that, well prepared though I was, I hadn’t reckoned on some curveballs along the way—especially with regard to Medicare and health insurance—or how labor-intensive it would be to iron out all the devilish details. So I’d like to share a few nuggets of wisdom to smooth the way for future retirees. Nugget No. 1:

Your Social Security Income Can Make or Break Your Plan – Don't Mess It Up Brian Levy December 2017

The rules and strategies for how and when to claim Social Security benefits are so complex that many an uninformed and/or overeager retiree has lost thousands of dollars — even tens of thousands — by making the wrong choice. According to the Social Security Administration, nearly nine out of 10 individuals 65 and up receive Social Security benefits — and for many, it is their major source of income. So, clearly, the decisions you make about claiming Social Security retirement benefits are probably some of the most important financial moves you will ever make.

Tax Reform: Worst Policy Since The Great Depression John Early November 30, 2017

Summary The last 30 years growing at 2.5% is the weakest 30 year period since 1939. The three times the top marginal tax rate was cut below 38% were all followed by below average growth.

Social Security Admin lowers 2018 taxable wage base Kay Bell November 30, 2017

Back in mid-October, the Social Security Administration (SSA) announced that the wage base, that's the amount of each worker's earnings that are subject to the Social Security portion of payroll withholding, would increase to $128,700. This week, the SSA revised that number downward.

The IRS Has Come Knocking at Bitcoin's Door Rhett Jones November 30, 2017

At a time when regulations, glitches, price swings, forks, hacks, and fraud can’t seem to keep the cryptocurrency-mania down, there’s a new hurdle for it to overcome: the taxman. Coinbase is one the largest cryptocurrency exchanges in the world and its backing by high profile investors like Union Square Ventures and Andreessen Horowitz has given it a certain amount of respectability. But it’s also a prime target for the Internal Revenue Service. Last year, the IRS asked a federal judge to order Coinbase to surrender its customer records for the years of 2013-2015 because it suspects many people trading in digital currency aren’t reporting their gains to the government. Coinbase fought the summons, but on Wednesday it lost the battle.

How much income will you actually need in retirement? Walter Updegrave November 29, 2017

The rule of thumb you're referring to stems from "replacement ratios" -- or the percentage of pre-retirement income you need to replace in retirement to maintain the standard of living you enjoyed during your career -- that have been calculated over the years by researchers at Georgia State University and professional services firm Aon. The replacement percentages are based largely on household spending data from the Department of Labor's Consumer Expenditure Survey. Although the 70% figure you mention is often cited -- indeed, some people refer to "the 70% rule" -- the research shows the replacement ratio may actually be more in the neighborhood of 80% for many retirees, and upwards of 90% or so for those with very low or very high incomes (although Social Security will provide the bulk of the retirement income for low-earners, while high-earners will have to rely more heavily on savings).

Retirement Success Isn't About Net Worth, It's About Net Income Shane Brosnan November 29, 2017

If you're wondering if you have enough saved to retire, you won't find the answer to that critical question on the bottom of your 401(k) statement. This isn’t your grandparents’ retirement. America’s move from pensions to 401(k)s and IRAs has changed the way most workers think about their retirement money — and not for the better.

National Tax Security Awareness Week: Five Steps Data Breach Victims Can Take IRS November 29, 2017

Every day, data thefts put people’s personal and financial information at risk. There are steps that identity theft victims can take to protect their financial accounts, their identities and their tax returns. This tip is part of National Tax Security Awareness Week. The IRS is partnering with state tax agencies, the tax industry and groups across the country to remind people about the importance of data protection.

New IRMAA Surcharges On Medicare Part B and Part D Taking Effect In 2018 Michael Kitces November 29, 2017

Origins Of Medicare Premium Cost Sharing Subsidies Health insurance is expensive, including and especially for retirees who tend to have more frequent health complications associated with their age. To help manage the cost, in 1965 President Johnson signed into law the legislation that established Medicare as the health insurance foundation for senior citizens over the age of 65 (further supported by Medicaid for certain especially-low-income populations).

National Tax Security Awareness Week: Recognize Phishing Email Scams IRS November 28, 2017

The IRS reminds people to be on the lookout for new, sophisticated email phishing scams. These scams not only endanger someone’s personal information, but they can also affect a taxpayer’s refund in 2018. This tip is part of National Tax Security Awareness Week. The IRS is partnering with state tax agencies, the tax industry and groups across the country to remind people about the importance of data protection.

US Consumer Confidence Rises, Hits Highest Level Since 2000 Paul Wiseman November 28, 2017

WASHINGTON (AP) — American consumers are feeling confident as the holiday season approaches. The Conference Board said Tuesday that its consumer confidence index hit 129.5 this month, up from 126.2 in October and highest since November 2000.

Tax bill clears Senate Budget Committee Naomi Jagoda November 28, 2017

The Senate Budget Committee on Tuesday advanced the chamber's GOP tax bill. The measure was approved by a party-line vote of 12-11, with two key Republicans voting for the measure after previously expressing concerns.

How Owning a Home Can Help (or Hinder) Your Retirement Maryalene LaPonsie November 27, 2017

Is it possible that most Americans are getting a major part of their retirement wrong? According to Census Bureau data, nearly 80 percent of those age 65 or older owned a home in 2017. But it may not be the right living arrangement for everyone. Not only could renting be a better option for some retirees, it could allow younger workers the opportunity to save additional money for their retirement.

Tax Bills Doom Tax-Free 1031 Exchanges Of Cryptocurrency Robert W. Wood November 27, 2017

Whether you can make a tax-free swap of cryptocurrency is controversial. A 1031 exchange is a swap of one business or investment asset for another. Under the tax code, most swaps are taxable as sales. That's why the IRS says bartering is taxable to both sides, whether for goods or services. Section 1031 is an exception to the rule that swaps are generally fully taxable. If you can manage to come within 1031, you can change the form of your investment without (as the IRS sees it) cashing out or recognizing income. But can you swap one cryptocurrency for another, or for other property?

This Holiday Shopping Season May Be Your Last Chance To Deduct Sales Taxes Kelly Phillips Erb November 25, 2017

Feeling like shopping until you drop this holiday weekend? Save those receipts because you might be able to deduct them on your federal income tax return for 2017 - but it may be the last year that you can take advantage of the deduction. The tax reform bill currently in Congress would eliminate the sales tax deduction, along with the state and local income tax deduction.

The Form 990: Not-for-profits, you can run, but you can’t hide Lana Richards November 22, 2017

When it comes time to file the Internal Revenue Service’s Form 990, Return of Organization Exempt From Income Tax, do you think of it as just another task to cross off your to-do list? If so, you should know that there’s more to it than meets the eye. Form 990: A refresher course

OregonSaves Automatically Enrolls Oregon Workers in Roth IRAs Nicole Dieker November 22, 2017

Here’s one more news item to be thankful for, I think— Oregon is now giving workers the opportunity to save for retirement through an automatic deduction program called OregonSaves. Here’s a quick overview of how it works: If you don’t want to watch the video, the tl;dw is that OregonSaves is offering retirement plans for people whose employers don’t offer retirement plans. Workers are automatically enrolled into OregonSaves, and 5 percent of their gross paycheck is automatically put into a Roth IRA, where they can choose between three different investment options: “capital preservation fund,” “target-date retirement fund,” and “growth fund.”

States Warn of Budget Crunch Under Republican Tax Plan Alan Rappeport November 22, 2017

WASHINGTON — Since getting crushed by the recession a decade ago, the state of Oregon has been on an economic upswing. The jobless rate has dipped below 4 percent from a high of 12 percent in 2009, home values are up and people are flocking to the state. Net migration accounted for roughly 88 percent of Oregon’s population growth between 2016 and 2017, according to a Portland State University study.

If You Care about Social Security and Medicare, You Should Care about these Tax Bills Melissa M. Favreault November 21, 2017

The Joint Committee on Taxation, Congressional Budget Office, and Tax Policy Center agree that, without significant changes, the House-passed tax bill (the Tax Cuts and Jobs Act, or TCJA) would add about $1.5 trillion to our nation’s debt over the 10-year budget window. Over the longer range, this proposal would increase the debt even more. Someone must eventually pay for these net tax cuts, which are expected to benefit higherincome households much more than those with lower- and middle-incomes. Unless the tax cuts spur immense economic growth, which many prominent economists doubt based on decades of evidence, these cuts will harm future workers and Social Security and Medicare beneficiaries.

Senate Tax Bill Could Make Stock Sales More Expensive Tracey Longo November 21, 2017

The Senate wants to take away investor choice when it comes to deciding which shares to sell when offloading stock. Lawmakers have included a provision in the Senate tax reform bill that would require investors to use the FIFO (first-in-first-out) method when selling stock. In the current rising market, forcing investors to sell their oldest shares first would mean forcing the recognition of larger gains at tax time.

5 steps to make the most of your HSA Kelli B. Grant November 21, 2017

If you're hoping to build retirement wealth in a health savings account, it helps to have a game plan. There's growing buzz and excitement around health savings accounts, or HSAs, Peter Stahl, a certified financial planner and president of Bedrock Business Results, told advisors last week at Schwab IMPACT 2017 in Chicago.

IRS budget cut again, but not as much as Trump wanted Kay Bell November 21, 2017

It's going to be a mixed Thanksgiving in Internal Revenue Service households. The agency definitely won't be thankful for the Senate funding bill released on Nov. 20. That Financial Services & General Government Appropriations measure proposes the IRS get $11.1 billion in fiscal year 2018.

With Year-End On The Way, Don't Forget About Tax Form Due Dates Kelly Phillips Erb November 20, 2017

The end of the year will be here before you know it - and that means year-end tax forms will soon be on their way. That's right - many year-end tax forms are now due in January. As part of the Protecting Americans from Tax Hikes (PATH) Act, the filing deadline for employers to submit forms W-2 (and forms W-3) to the Social Security Administration, is January 31. The January 31 filing deadline also applies to certain forms 1099-MISC reporting non-employee compensation such as payments to independent contractors.

3 ways to get your finances in order before the end of the year Zameena Mejia November 20, 2017

For many, the holiday season marks a time of festivities, gift exchanges and time off from work. But as one year comes to an end and the next approaches, this is also a great time to get your finances in order. That's according to Sallie Krawcheck, co-founder and CEO of Ellevestand former Wall Street executive at major institutions including Morgan Stanley, Merrill Lynch and Citigroup.

One in five American households have ‘zero or negative’ wealth Quentin Fottrell November 19, 2017

Millions of Americans are living on the edge. One in five households has zero or negative wealth, according to a report released this week by the Institute for Policy Studies, a progressive think tank based in Washington, D.C. What’s more, an even greater share of African-American (30%) and Latino (27%) households are “underwater” financially. The combined impact of $1 trillion in credit-card debt, $1.4 trillion in student loan debt, and stagnant wages are taking a toll.

Why Smart People Take Social Security at 62 Motley Fool November 19, 2017

Many of us daydream about retiring early -- and then assume that we can't. It's true that if you're way behind in saving up for retirement, you may have to toil far longer than you'd like. But early retirement is more possible for many people than they think, and Social Security can be a big help toward that end. Here's a look at why you might want to start collecting Social Security at age 62.

When Unpaid Student Loan Bills Mean You Can No Longer Work Jessica Silver-Greenbery, Stacy Cowley, and Natalie Kitroeff November 18, 2017

Fall behind on your student loan payments, lose your job. Few people realize that the loans they take out to pay for their education could eventually derail their careers. But in 19 states, government agencies can seize state-issued professional licenses from residents who default on their educational debts. Another state, South Dakota, suspends driver’s licenses, making it nearly impossible for people to get to work.

Beware year-end ID theft and quick cash scams Kay Bell November 17, 2017

I know we've yet to celebrate Thanksgiving, but I can tell that Christmas is near, too. How? Well, in addition to having already decorated our house (interior only so far for us, but ho-ho-holiday lights are already on some of our neighbors' houses) for Santa's annual arrival, I'm getting the usual year-end flood of spam phishing scams promising me money just in time for the gift buying season.

In Oregon, You Can Now Save for Retirement. Unless You Object. Elizabeth Olson November 17, 2017

The lack of retirement savings among Americans is almost universally bemoaned but nudging, prodding and lecturing have done little to build up nest eggs for old age. So some states say they are going to make it easier to save with a simple plan: an automatic payroll deduction for retirement savings. Oregon is the first state to roll out a plan that covers private sector workers who do not otherwise have access to a savings plan in their workplace. The deduction is an automatic 5 percent of gross pay, unless the worker opts out. Participants can reduce the percentage, if they choose. The state directs the money gathered under the OregonSaves plan to privately run low-cost investment funds.

3 Ways to Have a Happy Retirement, According to People Who've Already Retired Walter Updegrave November 17, 2017

“Happiness,” it’s been said, “is like a butterfly. The more you chase it, the more it will evade you.” In other words, by actively pursuing a happy state, you reduce your chances of achieving it. That may be true from a philosophical standpoint, but when it comes to retirement planning, new research suggests there may in fact be specific steps you can take to enjoy a more rewarding postcareer life.

Accountants wouldn't get lower rate under House bill Michael Cohn November 16, 2017

The tax reform bill passed by the House on Thursday doesn’t align with the Senate proposal in the way they tax pass-through businesses such as accounting firms. “Service industries including accounting firms, engineering firms and other firms do not get the benefit of the lower 25 percent tax rate,” said Brent Lipschultz, a tax partner in PricewaterhouseCoopers’ personal financial services practice in New York. “If you look at U.S. GDP, it comprises mostly service industries in the United States. This was just a way to appease the small business group out there. In general, partners at accounting firms will not get the benefit of the lower rate.”

Senate Plan Would Raise Taxes on the Poor, a Report Says Jim Tankersley and Alan Rappeport November 16, 2017

WASHINGTON — The congressional Joint Committee on Taxation said on Thursday that the latest version of the Senate tax bill would effectively raise taxes for lowerincome Americans by 2021. An analysis by the nonpartisan committee projected that, if the Senate bill becomes law, Americans earning $30,000 a year or below would pay higher taxes beginning in 2021 than they would if the bill is not enacted. The projected increase stems from the bill’s repeal of the Affordable Care Act’s mandate that most people have health insurance, a provision that was tucked into an amended version of the legislation this week.

What You Need to Know About Tax Relief for Victims of Natural Disasters Julian Block November 16, 2017

Natural disasters such as winter ice storms, hurricanes, tornadoes, and wildfires have struck repeatedly in 2017, affecting millions of Americans. A spate of hurricanes in August and September have devastated coastal areas in Texas and Florida as well as U.S. territories in Puerto Rico and the Virgin Islands, pushing the IRS to spring into action with tax relief. The tax code authorizes immediate relief for individuals — whose homes, household goods, and other properties suffer damage or are destroyed by such disasters — in the form of deductions and other tax breaks for casualty losses caused by events that the IRS describes as “sudden, unexpected, or unusual.”

Obamacare provision muddies Senate tax plan chances Kay Bell November 16, 2017

The House is still on track to pass its tax reform bill this evening has passed its tax reform bill, but things are much less settled in the Senate. A big part of the problem is that the upper chamber is grappling with the Byrd Rule. This is a part of Senate arcana, named for former West Virginia Democrat Robert Byrd, under the budget reconciliation process, which allows for bills to be approved by a simple 51-vote majority. But to do that, the tax bill can only increase the deficit by $1.5 trillion in the first 10 years.

Homeownership doesn't build wealth, study finds Diana Olick November 16, 2017

Owning a home may help you save money, but it won't help you make money. Households are better off taking control of their finances than relying on fluctuating home values. That is the finding of a new study conducted by Florida Atlantic University, Florida International University and the University of Wyoming.

Senate Markup Would Make Individual Tax Cuts Temporary, Corporate Tax Cuts Permanent Kelly Phillips Erb November 16, 2017

Days after the Senate announced the details of their version of the Tax Cuts and Jobs Act, the real work began: marking it up. Sen. Orrin Hatch (R-UT), as Chair of the Senate Committee on Finance, has released the "Chairman’s Mark" to the Act. The "Chairman's Mark" describes proposed changes to the plan. Here are some of the highlights which affect individual taxpayers and small businesses:

5 ways an identity thief can use your Social Security number Christine DiGangi November 15, 2017

Having your Social Security number or card stolen isn’t quite like getting your bank account information taken — though granted, both are stressful experiences. The major difference is that you can get a new bank account number, while the Social Security Administration very rarely issues new Social Security numbers. Why you need a Social Security number

How do you tell when it's the right time to retire? Walter Updegrave November 15, 2017

I don't know of any generally recognized gauge or barometer for calling it a career, but I can tell you that the decision to retire definitely isn't just about reaching a certain age. I recently took personal finance guru Suze Orman to task for suggesting as much when she recently asserted in no uncertain terms that "70 is the new retirement age -- not a month or year before." She's right that many people may need to stay on the job longer these days to accumulate a large enough nest egg to support them in retirement. But to say that 70 -- or any single age, for that matter -- is the right age to retire? That's far too simplistic. The decision to retire involves too many subjective factors that can vary significantly from person to person to be boiled down a single number.

The House Tax Bill Is Not Very Charitable to Nonprofits Joseph Rosenberg and Phillip Stallworth November 15, 2017

Even though the House version of the Tax Cuts and Jobs Act (TCJA) preserves the charitable income tax deduction, other income tax provisions of the bill could reduce charitable giving by between $12 billion and $20 billion in 2018, based on new estimates from the Tax Policy Center. A second provision—repeal of the estate tax— could reduce giving by another $4 billion in the longer run. By nearly doubling the standard deduction and either repealing or scaling back most itemized deductions, the House version of the TCJA would substantially reduce the number of taxpayers who elect to itemize. TPC estimates that fewer than 13 million taxpayers would itemize deductions in 2018 under the House version of the TCJA, down from more than 46 million under current law.

Five Facts about Charitable Contributions IRS November 15, 2017

With the holidays around the corner, many people will be making donations to benefit charitable organizations. However, come tax time, the person who made the donation might also benefit. That’s because taxpayers who donate to a charity may be able to claim a deduction for the donation on their federal tax return. Here are five facts about charitable donations:

IRS Shows How to Avoid Estimated Tax Penalties Ken Berry November 14, 2017

The IRS is reminding taxpayers that they still have time to avoid an estimated tax penalty for the 2017 tax year (IR2017-182, 10/31/17), by directing them to a web page to help raise awareness on the matter. The “Pay As You Go, So You Don’t Owe” page features tips and resources designed to help taxpayers, including those involved in the sharing economy, better understand the rules and avoid an unexpected penalty.

The most expensive states for a private room in a nursing home Maddy Perkins November 14, 2017

Many clients may have to live in a nursing home later in their retirement. While overall prices are increasing nationwide, the cost of care in a private room at a nursing home varies by state and sometimes city. Advisors with clients who live in pricier states need to be prepared to help them with those expenses should they arise. The median monthly cost for an assisted living community in the U.S. is $8,121 per month, an increase of 5.50% from 2016, according to Genworth's annual Cost of Care study. The median annual cost is $97,433. There can be a wide disparity in cost between states as well as cities, with some facing even triple the median cost.

Tax increases could force home sales, survey finds Brad Finkelstein November 14, 2017

As Congress debates tax reform and which deductions to remove, a majority of homeowners from both parties worry that rising property taxes could force them to sell their house. Over 54% of those that identified as a Democrat and 52% of Republicans feared that rising property taxes could push them out of their homes, according to Zillow's Housing Aspirations Survey.

Senate GOP Wants To Eliminate Obamacare Mandate As Part Of Tax Reform Efforts Kelly Phillips Erb November 14, 2017

When it comes to tax reform efforts, there's one thing that Republicans and Democrats can both agree on: it's expensive. As Senate leaders search for ways to make the numbers work, Republicans believe they might have a solution. Although there was no mention of Obamacare repeal in either of the House or Senate original plans, Republicans now plan to include language to repeal the Affordable Care Act's individual mandate .

6 Challenges of Phased Retirement Emily Brandon November 13, 2017

Gradually cutting back your work hours to four days a week and then three or working 20 hours per week instead of 40 or 50 sounds appealing to many people approaching retirement age. You can work fewer hours and have less responsibility, but still have a place to go where you feel productive and have enough money coming in to avoid large retirement account withdrawals. However, phased retirement arrangements aren't common because of a number of obstacles to making these programs work. Only 11 percent of early baby boomers gradually retired from their full-time jobs, according to a 2017 Government Accountability Office report. Here's a look at some of the challenges of setting up a gradual retirement.

4 Common Questions About End-of-Year Charitable Giving Strategies William H. Byrnes and Robert Bloink November 13, 2017

As the year-end approaches, it‘s a good time for you, or each client’s tax professional, to review the client’s tax planning strategy to see if there is any advantage to making a charitable contribution that will included on this year’s return. Congress is debating major changes to the Internal Revenue Code (IRC), and any changes that make it into law could affect charitable giving strategies. For now, however, the current laws still apply, and financial professionals will likely need to understand the current laws, thoroughly, to understand the changes.

Your 990: What Nonfinancial Matters Does It Reveal to the Media and Donors? Michael Wyland November 13, 2017

The last major revision of the IRS Form 990 was done for the 2008 tax year. Even though it’s been almost a decade, many nonprofit leaders—both staff and volunteer—seem unaware of the annual information return as anything more than something the auditor or CPA fills out as part of their work. What most people don’t realize is that the changes have made the Form 990 even more a diverse document than it was in the past. They may also not realize that their organization’s 990 is a public document, available online for free from websites such as Guidestar.org and nccs.urban.org. In addition, all nonprofit organizations must keep copies of their last three years’ 990 filings at their principal place of business and make them available for inspection immediately upon request during normal business hours.

Pass-through taxation, part 2: The Senate tax reform bill Kay Bell November 13, 2017

Republicans continue to work on their tax reform bills. The House plans/hopes to vote on its bill this week, while the Senate's version, released Nov. 9, is still being analyzed. One area getting a lot of attention is the two bill's differing treatments of pass-through entities. Income from these businesses — which include sole proprietorships, partnerships, limited liability companies (LLC) and S-corporations — is passed through to the business owners, who then report it on their personal tax returns.

3 Unique Financial Issues for Special Needs Tom Halloran November 13, 2017

According to the National Organization on Disability, more than 57 million people across the U.S. are living with a physical or cognitive disability. With limited assistance from government programs, this group – along with their caregivers – will need to consider additional planning decisions, especially when it comes to creating a financial strategy for retirement. As with any challenge, knowing where to begin can be the hardest part. To help you get started, here are some considerations to keep in mind – no matter what your situation.

Preliminary Details and Analysis of the Senate’s 2017 Tax Cuts and Jobs Act Tax Foundation November 10, 2017

Key Findings The Senate’s version of the Tax Cuts and Jobs Act would reform both individual income and corporate income taxes and would move the United States to a territorial system of business taxation. According to the Tax Foundation’s Taxes and Growth Model, the plan would significantly lower marginal tax rates and the cost of capital, which would lead to a 3.7 percent increase in GDP over the long term, 2.9 percent higher wages, and an additional 925,000 full-time equivalent jobs.

Senate to delay corporate tax cut, breaking with Trump and House Brett Samuels and Jordain Carney November 9, 2017

Senate Republicans plan to propose delaying a cut in the corporate tax rate until 2019, according to a GOP senator. Sen. Bill Cassidy (R-La.) also said the individual mandate will not be repealed as part of the Senate tax overhaul proposal expected to be released Thursday.

Plaintiff In Successful Multimillion Dollar Suit Against IRS Speaks Out Adam Steele, CPA November 9, 2017

We accountants were getting nickel and dimed to death by regulatory fees and costs, and that affects the tax preparation fees that our clients have to pay. It got to the point where you say someone's gotta do something, but, when one says that, it's important to remember that each of us is someone. It's particularly hard on CPAs and EAs (Enrolled Agents), who have always had to pay licensing fees (in Minnesota, CPAs have to annually renew both an individual, and a firm, permit; each with a fee, even if the CPA is the only one at the firm), and for required Continuing Professional Education (CPE), and for travel to get the CPEs. And woe be unto a CPA who files a renewal form, or pays a fee, or reports CPEs, a little late, he gets walloped with a steep late fee as well. All of these fees and costs factor into what the client eventually has to pay the accountant to get his taxes done.

Changes in Washington Are Fueling a Charitable Giving Boost Michael S. Fischer November 8, 2017

Forty-five percent of experienced donors in a new survey said they expected to increase their charitable giving this year, while only 7% expected to give less than last year, according to Exponent Philanthropy, an association of some 2,000 funders. Of the 480 members who participated in the organization’s early September Pulse Check survey, 19% cited the current political and regulatory environment as influencing their 2017 giving.

Inflation tweaks offer U.S. workers abroad some tax relief Kay Bell November 8, 2017

People definitely are peripatetic. Millions of us move every year, with around 56 million crossing national borders to new homes. But there's one thing Americans who go abroad, be it for work or purely personal reasons (love and adventure join career as the top three reasons for expatriation), cannot leave behind. The U.S. tax code.

Providing Small Business Health Insurance Benefits With A QSEHRA Michael Kitces November 8, 2017

A key change to health insurance under the Affordable Care Act was the requirement that all group health insurance plans offer various “Essential Benefits” – including emergency services and hospitalizations, pregnancy and maternity and newborn care, mental health and substance abuse disorders, lab services, and prescription drugs – in addition to covering certain preventive health services at no cost, and no lifetime limits on coverage. The changes were meant to ensure that, no matter what health insurance plan someone purchased, he/she could be confident that all the typical “essential” benefits that might be expected would be included.

Paradise Papers Expose Rich And Famous Using Tax Havens Robert W. Wood November 5, 2017

Forget Panama. The newest big leak showing how the powerful and ultra-wealthy stash money and assets in offshore tax havens is the Paradise Papers. It will hardly be paradise to those whose names and details are being teased out of the morass. The leak contains a massive 13.4 million documents, mostly from a single offshore finance firm. As with the leak of the Panama Papers, the Paradise Papers come from the German newspaper Süddeutsche Zeitung. The paper called in the International Consortium of Investigative Journalists (ICIJ) to oversee the investigation. The Guardian is among nearly 100 media partners involved in investigating the treasure trove of documents.

New tax “reform” bill could seriously screw nonprofits and the people we serve Vu November 5, 2017

Hi everyone. Before we launch into today’s exciting topic, check out the pilot episode of this hilarious show called “The Humanitarians.” It’s set at an organization called Stuff We Don’t Want (SWEDOW), and had me cracking up at clever one-liners like “Have we assessed the actual need for winter coats in Sub-Saharan Africa?” Check it out. We need to support more shows about nonprofit work. Unfortunately, the rest of this post is about tax “reform.” I know, I know, I don’t really want to talk about it either. But, like taking out the compost or putting on deodorant or remembering our partner’s birthdays, we have to do it, or else bad things happen. To reward you for reading, though, and for me to actually write this, I’m putting in pictures of bunnies throughout this post. The bunnies have nothing to do with taxes.

IRS Warns It Has Not Announced 2018 Filing Season Start Date, Despite Rumors Kelly Phillips Erb November 4, 2017

Think you know when the 2018 tax filing season will open? Think again. The Internal Revenue Service (IRS) has not yet announced the date that it will begin accepting individual tax returns for the 2018 tax filing season. As the tax agency does every year, it's continuing to update its programming and processing systems for the upcoming season. Additionally, the IRS says it "continues to closely monitor potential legislation that could affect the 2018 tax season" - in addition to the GOP tax proposal which was just announced this week, upcoming votes could include "extender" tax provisions that expired at the end of 2016 which might be renewed for the tax year 2017.

Top 5 Ways to Derail Financial Independence and Early Retirement The White Coat Investor November 4, 2017

Does the concept of financial independence appeal to you? Would you like to have the option to retire early? Great! Me too! One of my goals is to help give you the knowledge and motivation to help make FI a reality. I’ve talked about why you might want to retire early and how to go about it. I would be remiss if I didn’t talk about how not to do it.

The House Tax Cuts and Jobs Act: The Impacts on Jobs and Incomes by State Nicole Kaeding, Morgan Scarboro, and Scott A Hodge November 3, 2017

With yesterday’s release of the House Tax Cuts and Jobs Act, Americans are trying to understand how these tax changes would impact their families. The pro-growth tax plan would simplify the tax code by eliminating most itemized deductions, while reducing marginal tax rates. Using the Tax Foundation’s Taxes and Growth (TAG) macroeconomic tax model, our analysis found that the “the plan would significantly lower marginal tax rates and the cost of capital, which would lead to 3.9 percent higher GDP over the long term [and] 3.1 percent higher wages.”

Americans Renouncing Citizenship Hits New Record; Tax Bill Won't Change That Robert W. Wood November 3, 2017

The number of Americans handing in their passports forever is statistically small, but there has been another notable spike. The total for the first quarter of 2017 was 1,313. The number on the second quarter's list went up to 1,759, which is the second highest quarterly number ever (second only to the fourth quarter of 2016, which had 2,365 published expatriates). The total for the third quarter of 2017 was 1,376, putting the annual tally on track to top 2016’s record. Some observers may want to blame President Trump for the spike, but it is much more likely that longstanding tax issues are the real culprits. And the tax reform now being considered is hardly a game-changer. These 'published' numbers are probably lower than the real ones, for a variety of reasons.

Which bracket will you be in under the GOP tax reform plan? Kay Bell November 3, 2017

The shiniest part of the Republicans' new tax plan is the reduction in tax rates. We would go from the current seven to just four. So how much of our earnings will fall into these new brackets? Here's what the Grand Old Party's tax writers want in H.R. 1, the Tax Cuts and Jobs Act:

Tax Bill Kills State Tax Deduction, So California's 13.3% Prompts More Exits Robert W. Wood November 3, 2017

The Tax Cuts and Jobs Act is out, and you can wade through the 429 pages here. As this helpful summary of the plan states, it would eliminate the state and local tax deduction. If you pay high state income taxes--think California, New York, and many other places--you'll care about this. Tens of millions of Americans claim this tax deduction, writing off their state and local taxes to reduce their federal income tax. Lots of taxpayers, Republicans and Democrats alike, could even rethink where they want to live. After all, it already hurts to pay high state taxes. No deduction is some serious lemon juice in that state tax paper cut.

Tax Change on Mortgages Could Shake Up the Housing Market Conor Dougherty November 2, 2017

The Republican tax plan unveiled on Thursday takes aim at the most sacred of cows: the provision that subsidizes homeownership by allowing the deduction of interest on mortgage debt. For most of America, the impact would be minimal. The proposed bill would make the interest deduction available on mortgage debt of up to $500,000 — half the current ceiling. But that is still more than double the median home price in the United States of roughly $200,000. Fewer than 3 percent of home mortgages are more than $500,000, according to data from CoreLogic.

How Do The Proposed Tax Cuts Compare To The 2018 Tax Rates? Kelly Phillips Erb November 2, 2017

Earlier today, House Republican leaders released their tax reform bill, the Tax Cuts and Jobs Act. You can read the text of the bill, which downloads as a pdf, here. Fair warning: it's a densely written 429 pages. If you don't want to trudge through it, I've written a summary of the plan, which highlights some of the big changes - no commentary, just the facts.

How To Get Approved For Student Loan Refinancing Zack Friedman November 2, 2017

If you are one of the 44 million student loan borrowers who, according to personal finance comparison site Make Lemonade, collectively owe more than $1.4 trillion, then student loan refinancing should be at the top of your to-do list. Here is what you need to know to get approved for student loan refinancing.

Don't Make These Common Mistakes Assessing Your Retirement Preparedness Katheryn Thayer November 1, 2017

Do you have a good sense of how prepared you are for retirement? The majority of working-age Americans (52%) are “at risk” of not having enough to maintain their living standards when they retire, according to the National Retirement Risk Index calculated by Boston College's Center for Retirement Research. So academics there were curious: how well we are able to assess our own retirement readiness? Do those who are off-track know it? Do the well-prepared still worry? Alicia Munnell, the director of Center for Retirement research and co-author of the Do Households Have a Good Sense of Their Retirement Preparedness? brief, says, “Almost 20 percent incorrectly think they are prepared, in large part because they do not recognize that their 401(k) savings are inadequate to last for their whole retirement period.” 60% do know if they are on track or not, and the other 20% think they are not prepared when in fact they could afford to maintain the same standard of living they have now.

Next Biggest CyberScare After Equifax: 'Walking Dead' Bank Accounts John Wasik November 1, 2017

After Equifax got hacked and cyberthieves stole data from more than 140 million accounts, what could be worse? Enter the "zombie" bank account. I'm not making this up. Cybercriminals are setting up fake or "phantom" accounts to fleece even more unsuspecting folks.

Ask The Taxgirl: Dependent Care Expenses & Stay-At-Home Parents Kelly Phillips Erb November 1, 2017

Taxpayer asks: I’m a stay at home mom and my husband works full time. My youngest is going to pre-school 2 days per week. My husband’s employer offers a Dependent Care Flex Spending account. Are we allowed to take advantage of that if I’m not working (or looking for work)? I’ve seen this question asked a few times with regards to the Dependent Care Credit, but I’m not sure if that is related to Flex Spending or if it’s something totally separate.

IRS.gov has the Latest Information for Taxpayers in Disaster Areas IRS November 1, 2017

Taxpayers who live in an area affected by one of the many disasters this year can visit IRS.gov. The website has details about tax relief that might benefit them. The Tax Relief in Disaster Situations page on IRS.gov has resources that can walk taxpayers through information related to these disasters: Hurricane Irma affected Florida, Georgia, South Carolina, the U.S. Virgin Islands and Puerto Rico Hurricane Maria hit the U.S. Virgin Islands and Puerto Rico Hurricane Harvey affected Texas and Louisiana

How to Provide Financial Help to Aging Parents Eileen Ambrose and Sandra Block November 2017

Mark Kress, 59, of Sterling, Va., first realized his 88-yearold father, Willard, needed help after he saw some bills with past-due balances stacked on his father’s kitchen table. That was completely out of character for Willard, who had a successful career as a certified public accountant. Initially, Willard didn’t believe he needed help. For most of his adult life, he had managed his investment portfolio and done his own taxes. But over five years, Kress and his four siblings gradually persuaded their father to let them take control of his finances.

Use This Hack to Get the Most Out of Social Security Kathy Kristof November 2017

Getting the most out of Social Security is all about waiting as long as possible to start filing for benefits, right? Not quite--especially if, as a business owner, you get to decide how you are paid. You can actually live on a lot more money in retirement if you make some changes right now to your salary and take some steps to adjust your current tax bills, says Matthew Allen, a co-founder of New York City-based Social Security Advisors.

50 Ways to Save on Health Care Kimberly Lankford November 2017

Even with good insurance from your employer, you're most likely paying a larger share of your medical expenses than in the past -- $11,600 for the average family in 2017, according to the Milliman Medical Index. A growing portion of that cost accrues during the year, from deductibles, co-payments and coinsurance -- which now account for $4,534 of the average family's expenses. The median deductible for in-network care charged by large employers is $1,300 for employeeonly coverage and $3,000 for families, according to the National Business Group on Health. Foreign Investors Win Big, Tax-free Steven M. Rosenthal October 31, 2017 Last week, I described how, in the short run, foreign investors would receive 35 percent of the benefits of the lower corporate income tax rates proposed by the Trump Administration and congressional Republican leaders (the Big Six). But their windfall could be especially generous because increases in asset values produced by the corporate rate cut would largely be tax-free to foreign investors at the shareholder level. By comparison, US individuals generally would be subject to a 23.8 percent shareholder-level tax on their long term capital gains or dividends received. Four Things to Know about Taxes and Starting a Business IRS October 31, 2017 New business owners have tax-related things to do before launching their companies. IRS.gov has resources to help. Here are some items to consider before scheduling a ribboncutting event. Choose a business structure When starting a business, an owner must decide what type of entity it will be. This type determines which tax forms a business needs to file. Owners can learn about business structures at IRS.gov. The most common forms of businesses are: How to support your parents while saving for retirement Jim Sandager, For the Register October 31, 2017 In their 2015 financial support survey, TD Ameritrade found that 13% of American adults are financially supporting their parents. And it appears to be a growing issue. According to the survey, 19% of millennials are helping pay their parents’ bills, compared to 13% of Generation Xers and 8% of Baby Boomers. So what happens if you are, or become, one of those 13%? How do you help your parents through their retirement end of their lives, while still preparing for your own? 2017 International Tax Competitiveness Index Kyle Pomerleau, Jared Walczak, and Scott A. Hodge October 31, 2017 The structure of a country’s tax code is an important determinant of its economic performance. A well-structured tax code is easy for taxpayers to comply with and can promote economic development, while raising sufficient revenue for a government’s priorities. In contrast, poorly structured tax systems can be costly, distort economic decision-making, and harm domestic economies. Many countries have recognized this and have reformed their tax codes. Over the past few decades, marginal tax rates on corporate and individual income have declined significantly across the Organisation for Economic Co-operation and Development (OECD). Now, most nations raise a significant amount of revenue from broad-based taxes such as payroll taxes and value-added taxes (VAT). Top House Republican tax writers delay their reform bill until Thursday for a 'few finishing touches' Everett Rosenfeld and Matthew J. Belvedere October 31, 2017 House Republicans, in consultation with President Donald Trump, postponed the release of their tax bill by one day until Thursday. "We just had a few finishing touches to do," House Budget Chairwoman Diane Black told CNBC. "We wanted to make sure we had this right when we put it out." Tax Bill Delay Gives Republicans More Time to Wrestle With Key Details Alan Rappeport and Jim Tankerskley October 31, 2017 House Republicans are (still) just one day away from unveiling their long-awaited tax plan and many key details still remain in flux. Lawmakers have paved the way for a $1.5 trillion tax cut, but the provisions under discussion would far exceed that cost. Republicans are still struggling with how to make the math work, including how to treat the wealthiest Americans, whether to get rid of some of the most valuable tax deductions and whether to make the income tax cuts temporary. Beer Is Not A Metaphor For Tax Fairness Leonard E. Burman October 31, 2017 Yesterday my twitter feed exploded with cranky tweets about White House Press Secretary Sarah Sanders’s press briefing, which started with an anecdote about bar tabs and tax fairness. I thought she did a good job illustrating why some analysts think the percentage change in tax liability is the right measure of progressivity for a tax change. Her anecdote also makes quite clear why that measure is inappropriate for assessing deficitfinanced tax cuts. U.S. Consumer Confidence Just Hit Its Highest Level in Almost 17 Years Sho Chandra October 31, 2017 U.S. consumer confidence rose more than expected in October to the highest in almost 17 years as Americans grew more confident about the economy and job market, according to figures Tuesday from the New York-based Conference Board. Key Takeaways Voices Objective CPAs should oversee elections Peter Mandel October 30, 2017 “Voters out there are frustrated,” said a cable news analyst I flipped on the other day. It could have been almost any news show. Any political angle. Any evening. The analyst cited “lack of disclosure” as the root cause of this problem. Not so, insisted someone in a suit on set. It’s about conflicts of interest, he said. An absence of objectivity. Where in-home health aides cost the most Maddy Perkins October 30, 2017 While the cost of care rose considerably across all options this year, the largest percentage increase in price occurred for home health aides, according to Genworth's 2017 Cost of Care survey. The national median yearly cost of care for home health aides is $49,192, up 6.17% this year. Retirees opting to receive home care can expect to pay caretakers up to $21.50 an hour. Despite the hike in costs, it’s worth taking a close look at options because there are wide cost discrepancies between cities — even within the more expensive states. Clients living in pricier states might find relief for the cost burden by relocating to a city where care is less expensive. IRS Encourages Taxpayers to Check Their Withholding; Checking Now Helps Avoid Surprises at Tax Time IRS October 30, 2017 WASHINGTON — As the end of 2017 approaches, the Internal Revenue Service today encouraged taxpayers to consider a tax withholding checkup. Taking a closer look at the taxes being withheld now can help ensure the right amount is withheld, either for tax refund purposes or to avoid an unexpected tax bill next year. The withholding review takes on even more importance given a tax law change that started last year. This change requires the IRS to hold refunds a few weeks for some early filers claiming the Earned Income Tax Credit and the Additional Child Tax Credit. In addition, the IRS and state tax administrators continue to strengthen identity theft and refund fraud protections, which means some tax returns could require additional review time next year to protect against fraud. Insurance Guide 2018: Oregonians flock to high deductible health plans Dana Tims October 29, 2017 The number of Oregonians enrolled in high-deductible health plans surged last year, and now represents nearly half those with access to employer-sponsored coverage, new data show. An additional 105,200 Oregon workers joined highdeductible health plans in 2016, according to research from the University of Minnesota's State Health Access Data Assistance Center. That brings total enrollment to 368,100, a 40 percent increase from 2015. GOP plans tax blitzkrieg Scott Wong and Alexander Bolton October 28, 2017 Congressional Republicans are feeling enormous pressure to deliver a win on tax reform before Christmas Day. After a humiliating defeat on ObamaCare repeal, GOP leaders are desperate for their first major legislative victory of 2017 and are doubling down on their ambitious timeline to overhaul the U.S. tax code. Tax evasion is a side hustle side effect Kay Bell October 28, 2017 Picking up some extra cash is nothing new. People have always taken on added work when they've needed or wanted a few more dollars. Now, however, side hustles have become a viable employment option. They've also become a problem for the Internal Revenue Service. The Big Six Tax Outline Would Lose $2.4 Trillion Over 10 Years, According To TPC’s New Dynamic Score Howard Gleckman October 27, 2017 A new Tax Policy Center “dynamic analysis” of the Big Six’s “Unified Framework” tax plan finds it would fail to achieve President Trump’s promise of a significant, permanent boost in economic growth. As a result, the outline would reduce federal tax revenue by roughly $2.4 trillion over the next decade, nearly the same as under conventional scoring. The Memo: Trump tax reform nears crunch time Niall Stanage October 27, 2017 President Trump faces a stark question as he and Republicans in Congress move ahead on tax reform: Can he come up with a plan that helps the people who elected him, or will most of the rewards go to the richest Americans? The president ran for the White House as the voice of working- and middle-class Americans. His populism, stoked by close aides like erstwhile chief strategist Stephen Bannon, helped carry him to victory last November in struggling states across the Rust Belt. Rosy White House tax cut forecast clashes with independent analysis David Morgan and Saqib Iqbal Ahmed October 27, 2017 (Reuters) - The White House promoted President Donald Trump's tax cut plan on Friday with a forecast of faster U.S. economic expansion and wage growth, as independent analysts said the plan would swell the budget deficit and provide little spark to the economy. The rival projections reflected the many unknowns swirling around the plan, expected to be unveiled in legislative form on Wednesday. Republicans were still undecided on some of the hardest parts, such as how to pay for the costly cuts proposed. 6 Things A Trust Can Do That You May Not Realize Mark Eghrari October 27, 2017 To many people, a trust seems like a basic (albeit highly effective) estate planning tool. The maker of the trust transfers ownership of certain assets to the trust, and a trustee manages those assets for the beneficiary or that trust. But your trust can do a lot more than that. Virginia, New Jersey Elections Could Offer Tax Cut Lessons Richard C. Auxier October 26, 2017 Taxes are front and center in the only two gubernatorial races this year. The Virginia campaign centers on the Republican candidate’s individual income tax cut promises. While New Jersey’s matchup is a classic contest between a Republican pledging to cut taxes and a Democrat vowing to raise them. Like congressional Republicans, the GOP candidates in Virginia and New Jersey are betting that tax cuts will help them navigate difficult political headwinds. Their success could boost GOP tax cut efforts in Congress, while their failure could suggest that tax relief will have limited appeal in the 2018 congressional races. Budget vote raises red flag for GOP on tax reform Naomi Jagoda and Christina Marcos October 26, 2017 The tight 216-212 House vote Thursday to pass the GOP budget is raising a red flag for Republicans on tax reform. The GOP barely scraped up enough votes to pass their partisan budget, as 20 on their side defected. House Narrowly Approves Budget In March Towards $1.5 Trillion Tax Cuts Kelly Phillips Erb October 26, 2017 Despite the crowing coming out of D.C., there are still no new tax cuts. It is true that there was another vote in Congress. And it is also true that the vote likely paved the way for tax cuts. But for now, we're still in procedure mode. Here's what you need to know. The House of Representatives passed a budget resolution by a vote of 216-212. All 216 of the yes votes were cast by Republicans; 20 Republicans joined 192 Democrats in voting no. You can see how your Representative voted here. David Kautter to be named acting IRS commissioner Alistair M. Nevius October 26, 2017 The White House announced on Thursday that President Donald Trump will name David Kautter acting commissioner of the IRS. The designation will take effect Nov. 13. Currently Kautter is assistant secretary of the Treasury, Tax Policy, a post that he started in August. Treasury announced that while he is serving as acting commissioner, Kautter will continue to carry out his duties as assistant secretary. The day-to-day operations of the IRS will continue to be overseen by deputy commissioners Kirsten Wielobob and Jeff Tribiano. Estate and gift tax exclusions increase in 2018, but kiddie tax earnings don't get any inflation bump Kay Bell October 26, 2017 It's always good to be rich, even when the inevitabilities of death and taxes meet. That's because the Internal Revenue Code, for now, excludes a nice chunk of change from federal taxation. Estate tax exclusion increase: It's possible that the estate tax could die again like it did in 2010, and for more than just one year if the Republican Party gets the tax reform it wants. ‘I could live simpler’: Floods and fires make Americans rethink their love affair with stuff Lisa Bonos and Jura Koncius October 25, 2017 David Goldman/AP

As Hurricane Irma barreled toward Florida last month, Stephanie Kurleman and her family packed up three cars and evacuated to a friend’s home. “I thought I wouldn’t come back to anything,” Kurleman said, recalling the moment her family drove away from Clearwater Beach. In addition to the basics, she said they gathered documents, photos, her Bible, jewelry, plus the kids’ kiteboards.

When the storm passed, they drove back and found only minor damage. But the experience left Kurleman with an urge to purge. “I was weighed down by too much stuff,” Kurleman, 50, said. “I was prepared to start over with what I had with me,” she said, adding: “I could live simpler.” Medical tax provisions affected in 2018 by inflation Kay Bell October 25, 2017 The only thing worse than being sick is having to pay for medical treatment. One remedy that could help your pocketbook if not your ailment is the Internal Revenue Code. There are some tax code provisions that can help cover some medical costs. What are the Most Tax-Friendly States? Dominique Molina October 25, 2017 Thinking of moving to a tax-friendly state or perhaps you have clients who want to know which states have the best corporate tax rates? Wyoming leads the list with an overall rank of #1, most likely due to favorable corporate tax and individual taxes. Wyoming is followed by South Dakota and Alaska to round out the top 3. But it’s not all cold weather and northern locations, Florida holds tightly in rank #4. Spousal Rollover And Stretch Rules For Inherited Traditional And Roth IRAs Michael Kitces October 25, 2017 Under IRC Section 401(a)(9)(B), the standard rule for inherited retirement accounts (whether an IRA or an employer retirement plan like a 401(k), Roth or traditional) is that any remaining retirement account balance after the death of the original owner that is payable to a designated beneficiary shall be distributed “over the life expectancy, or over a time period not extending beyond the life expectancy” of that designated beneficiary. For the purpose of these rules, a “designated” beneficiary is defined in IRC Section 401(a)(9)(E) as “any individual designated as a beneficiary” – the key point being an individual (i.e., a human being that has a pulse and, thus, a life expectancy over which distributions can be stretched). Ask The Taxgirl: The Difference Between Innocent Spouse And Injured Spouse Kelly Phillips Erb October 24, 2017 Taxpayer asks: What's the difference in injured and innocent spouse? Years ago I separated and the IRS withheld my tax refund because of unpaid tax from my now Ex. Do I have any way to get that back? Taxgirl says: Tax deductions & credits affected in 2018 by inflation Kay Bell October 24, 2017 Millions of taxpayers depend each year on tax deductions and tax credits to cut their annual tax bills. The main tax reduction strategy is claiming the standard or an itemized amount. Adjustments for the 2018 tax year to these tax write-offs were covered in Part 2 two of my annual tax inflation series. On a Home Sale, Improvements or Repairs Make a Difference on Taxable Profit Julian Block October 23, 2017 In a story on home ownership and use tests published last week, I explained how the law allows a home seller an exclusion from taxes. This time we’ll talk about how identifying an improvement or repair to your home can have an impact on taxable profit following a sale. Exclusions from taxes apply from taxes of up to $250,000 in profit on home sales for single filers and up to $500,000 for married couples filing jointly. But a seller whose gain exceeds the exclusion cap of $250,000 or $500,000 is stuck with taxes on the excess. Hurricanes, tax reform could delay 2019 tax season Kay Bell October 23, 2017 Where the heck has 2017 gone? The countdown clock over in the ol' blog's right column is steadily ticking away the time left until Dec. 31, the deadline for most moves that could affect this year's taxes. The Internal Revenue Service, however, has its eyes on November, which is just little more than a week away. A closer look at the next 1040 Jeffrey Pretsfelder October 23, 2017 The Internal Revenue Service has made a draft of the Form 1040 for the 2017 tax year available on its Web site. Jeffrey Pretsfelder, a senior analyst with Thomson Reuters Checkpoint, highlights some of the key changes. (A text version of these changes is also available.) The Finger-Pointing at the Finance Firm TIAA Gretchen Morgenson October 21, 2017 In the treacherous world of finance, where investors confront biased advice, hidden costs and onerous fees, one investment giant seems to stand apart — the Teachers Insurance and Annuity Association, also known as TIAA. Calling itself a “mission-based organization” with a “nonprofit heritage,” TIAA has enjoyed a reputation as a selfless steward of its clients’ assets for almost a century. “Our values make us a different kind of financial services organization, known for our integrity,” Roger W. Ferguson Jr., TIAA’s president and chief executive, says on the company’s website. The Long Story of the Movement Toward College Cost Clarity Ron Lieber October 20, 2017 Once upon a time, paying for college was a relatively simple task. Parents who could often did. Teenagers with parents who lacked either the ability or the willingness to pay worked their way through school, which was easy enough to do at many schools before 1985 or so. Rate of people without health insurance rises for first time since 2014 Peter Sullivan October 20, 2017 The percentage of people who do not have health insurance rose to 12.3 percent in the third quarter of the year, the first such rise since ObamaCare took effect in 2014. The hike in the uninsured rate, up 1.4 percent according to Gallup since the beginning of the year, comes as the GOP Congress has sought to repeal the law and as President Trump has threatened to allow its implosion. When 'Independent Contractors' Get Unemployment Benefits, What It Means For Employers Robert W. Wood October 20, 2017 With Uber, Lyft, and many other companies that provide many different services and products, the norm these days seems to be independent contractors. The companies avoid the huge taxes, expenses, and liabilities of having employees. The workers get the freedom to work on their own, managing their own schedules. One of the great unanswered questions, of course, is how much control is too much for independent contractors, without making them employees. Many lawsuits brought by workers and by third parties are about this very question. Tax Cuts Won’t Make America Great Again William G. Gale October 20, 2017 In a speech earlier this week, Donald Trump invoked Ronald Reagan’s 1981 tax cuts as a model for his own plan. Trump said Reagan’s tax cuts “unleashed the economic miracle of the 1980s” and promised his own tax cuts would boost economic growth substantially. Consider those statements “alternative facts.” In principle, well-designed tax cuts can increase economic activity since lower marginal tax rates boost the reward for firms that invest and hire and for people who work and save more. But there is another part of the story: Lower rates also reduce the need for people to work and save more to achieve a desired living standard. And if tax rate cuts are not offset by other tax increases or spending cuts, they’ll require higher government borrowing. Those effects discourage future economic growth. 6 Myths About Credit Freezes Maryalene LaPonsie October 19, 2017 For nearly three months this year, hackers had access to files at Equifax, a financial services company and one of the big three credit reporting bureaus. All told, more than 145 million people may have had their Social Security numbers, birth dates and addresses stolen. Some driver's license and credit card numbers may also have been taken. While not the biggest security breach in history, it could be the one that causes the most damage. With Social Security numbers, addresses and birthdates, thieves can do everything from open new bank accounts to file fraudulent tax returns. Tax Breaks On Selling Your Home, Vacation, Or Investment Property Robert W. Wood October 19, 2017 With a personal residence, investment real estate, or other investment property, consider taxes before you sign. Your gain will often be long term capital gain, meaning a federal tax rate of 15 to 20%, depending on your income. Depending on your income, you may have to add another 3.8% in federal taxes. That’s the net investment income tax added by Obamacare. President Trump said he would repeal it, but so far that hasn't happened. IRS issues 2018 inflation-adjusted tax tables and many other tax provisions Sally P. Schreiber, J.D. October 19, 2017 On Thursday, the IRS issued the annual inflation adjustments for 2017 for more than 50 tax provisions as well as the 2017 tax rate tables for individuals and estates and trusts (Rev. Proc. 2017-58). These provisions are used to file tax year 2018 returns in 2019. Most provisions are increasing for inflation in 2018, including the personal exemption, which increases from $4,050 in 2017 to $4,150 for 2018. The standard deduction for married taxpayers filing joint returns increases to $13,000, $300 more than in 2017. It also increases slightly for single taxpayers and married taxpayers filing separately to $6,500. The standard deduction increases for heads of household, from $9,350 in 2017 to $9,550 in 2018. Will Corporate Tax Cuts Really Increase worker Incomes By $4,000? Howard Gleckman October 18, 2017 The White House Council of Economic Advisers put out a paper this week defending a very bold prediction: A cut in the corporate tax rate from 35 percent to 20 percent would boost incomes of US workers by at least $4,000-a-year. CEA chair Kevin Hassett is a leading proponent of the theory that workers ultimately pay all the corporate tax and, thus, would receive huge benefits from a cut in the levy. If true, it would be a politically compelling argument at a time when public opinion surveys show that as much as 60 percent of the public is opposed to cutting corporate taxes. 5 amended tax return filing tips Kay Bell October 17, 2017 To err on tax returns is human. To forgive is Xtraordinary, and yes, the misspelling is intentional. Tax law lets us correct mistakes we make on our 1040s via another form, the 1040X. Most people file 1040X, which is known as amending your return, because they discovered they didn't claim a tax break that give them a (or a bigger) tax refund. Lessons From Dentist's Tax Evasion: Cover-Up Is Worse Than Crime Robert W. Wood October 17, 2017 No one wants to be accused of tax evasion. And most people who end up in the situation probably did not think a criminal prosecution, much less a criminal conviction, was a serious or even a remote possibility. Recently, a Tennessee dentist named Andrea M. Henry pleaded guilty to tax evasion. Dr. Henry, 45, owned The Henry Polk Dental Group D.P.C. and The Smile Spa LLC. These dental practices were located in Cordova, Tennessee. Dr. Henry filed personal income tax returns for 2005, 2006, 2008 and 2010 to 2013, but did not pay $113,781 in income and self-employment taxes due to the IRS. Got $1 million to retire? Here’s how long it will last, by U.S. state Sally French October 16, 2017 If your vision for retirement was basking in a tropical paradise, let’s hope your vision of tropical paradise resembles something more like Mississippi and less like Hawaii. Either that, or let’s hope you were planning on a short retirement. Data analysis site HowMuch analyzed how far $1 million goes in retirement in every U.S. state. And it turns out, you can stretch $1 million about twice as far in Mississippi as you can in Hawaii. HowMuch crunched the numbers based on the Cost of Living Index for Q2 of 2017 as well as average annual expenditure of persons with 65 years and above. California, U.S. territory taxpayers get disaster tax relief Kay Bell October 14, 2017 To borrow from James Taylor's plaintive classic, the Internal Revenue Service has seen fire and rain and is making tax accommodations for Americans having to deal with those disastrous aftermaths. Hurricane Maria made landfall in Puerto Rico on Sept. 20, pummeling the U.S. territory with category 5 force. Three weeks later, many of the island's 3.4 million residents are still withoutpower, drinking water, food and medicine. Here’s how much Social Security checks could increase in 2018 Jeffry Bartash October 13, 2017 Hurricanes Harvey and Irma caused a lot of hardship, but there may be a silver lining for seniors: The storms could end up giving retirees a few extra dollars in their Social Security checks next year. Harvey shut down major refineries in the Gulf Coast to force up the price of gasoline. And auto prices rose as many people sought to replace cars and trucks damaged by flooding in Texas and Florida. Social Security checks are getting their biggest boost in six years Jeffry Bartash October 13, 2017 Seniors who collect Social Security will get a 2% increase in their monthly checks in 2018, marking the biggest gain in six years. The cost-of-living adjustment announced by the Social Security Administration is the largest since a 3.6% increase in 2012. Might not sound like much, but it’s a lot more than the nation’s 42 million retirees got in 2016 or 2015. Eight Lessons on How to Design Tax Reform C. Eugene Steuerle October 13, 2017 Endorsing the concept of tax reform is just one small step towards making it a reality. How do lawmakers, who are confronted with an almost infinite number of policy options, ensure that reform serves the public in a meaningful way? To help focus those choices, here are eight lessons that were vital to the organization of the Department of Treasury study (“Treasury I”) that led to the Tax Reform Act of 1986, the only comprehensive base-broadening tax reform in the hundred-plus year history of the income tax. IRS suspends contract with Equifax after malware discovered Kathy Kristof October 12, 2017 The IRS said late Thursday that it has temporarily suspended the agency's $7.1 million data security contract with Equifax (EFX) after malware found on the credit bureau's website again called its security systems into question. Equifax, now notorious for exposing more than half of all adult Americans to identify theft, maintained the latest security breach was not officially a hack. Trump to cut off key ObamaCare payments Rebecca Savranksy and Nathaniel Weixel October 12, 2017 President Trump will end key payments to insurers selling ObamaCare plans, the White House announced late Thursday, marking Trump's most aggressive move yet to dismantle the law after multiple GOP efforts to repeal and replace it failed this year. The Trump administration has continued making the the disbursements to insurers, known as cost-sharing reduction payments, on a monthly basis. But Trump had consistently threatened to end the payments, which are worth an estimated $7 billion this year. More scams moving to social media, experts warn Mark Huffman October 12, 2017 Phishing scams have moved to social media sites, security experts warn, requiring consumers to think before they click. The 2016 presidential campaign was rife with content labeled “fake news,” designed to sway a voter one way or the other. But scammers have adopted similar tactics, seeking access to your bank account, or even your identity, rather than your vote. The 5 Best College Savings Plans John Wasik October 12, 2017 Over the years, I've become a big fan of 529 college savings plans. I set up two of them for my daughters, one of whom is in college. They are great savings vehicles with lots of flexibility and healthy tax breaks. But not all "529" plans are equal. Some of them are downright rip-offs because they charge high fees and commissions. Trump eases ObamaCare rules with executive order Peter Sullivan October 12, 2017 President Trump on Thursday signed an executive order aimed at taking action on ObamaCare on his own after Congress failed to repeal the law. Trump said Thursday the order is "starting that process" to repeal ObamaCare. It will be the "first steps to providing millions of Americans with ObamaCare relief," Trump said. How to buy your first home Danish Mehboob October 12, 2017 The real estate market is soaring. But Millennials shouldn't feel pressure to get in on the action, according to financial experts. They're the largest group of homebuyers in the market today. Buying a home is one of the most -- if not the most -significant purchases of your adult life. So, you'll want to make sure you're really ready. 4 signs you might never retire Maurie Backman October 12, 2017 Countless Americans look forward to retirement and the flexible lifestyle it tends to offer. Unfortunately, a large number of workers might never get there. In a TD Ameritrade study, 25% of U.S. adults say they don't think they'll ever retire. And they're probably not the only ones. That's because 1 out of every 3 workers have no money set aside for the future, and that includes 30% of folks 55 and over. Why Do We Make It So Hard For Immigrants To Pay Their Taxes? Howard Gleckman October 12, 2017 Why do we make it so hard for immigrants to pay their federal income taxes? Why do we throw so many roadblocks between them and their civic duty? Many are citizens, though they may have family members who are not. Some are legal residents and some are undocumented. But wherever you come down on the current immigration debate, it seems beyond dispute that people who want to pay their taxes should be able to do so without getting hopelessly lost in a bureaucratic morass. The road to retirement starts here Jonathan Lynch, Manager October 11, 2017 When it comes to saving for retirement, there is no onesize-fits-all plan. Each American has a unique and fluid situation, impacted by a variety of factors. Fortunately, CPA financial planners are well-versed in the different aspects that go into a tailoring a retirement plan that best fits their client’s needs. I sat down with Leonard Wright, CPA/PFS and member of the AICPA Personal Financial Specialist Credential Committee, to learn some best practices for starting a retirement plan that helps maximize enjoyment during your golden years. The GOP Had One Big Divide On Health Care. It Has Three On Taxes. Perry Bacon Jr. October 11, 2017 Remember how divided Republicans in Washington were on their plans to repeal the Affordable Care Act? Well, they are even more divided so far on their push to change America’s tax system — a bad sign for a party desperate for a big achievement in a year in which they control both houses of Congress and the presidency. The congressional GOP divide on Obamacare repeal was fairly simple and one dimensional: a bloc of conservative members (such as the House Freedom Caucus and senators like Utah’s Mike Lee and Kentucky’s Rand Paul) who wanted to eliminate as much of the ACA as possible versus a group of more moderate Republicans (such as Maine Sen. Susan Collins) who wanted to preserve many parts of the law. White House officials and party leaders spent months unsuccessfully trying to find a middle course between these two camps. Key conservative Republican eyes bigger tax break for charity Naomi Jagoda October 10, 2017 The leader of the biggest group of House conservatives is quietly pushing to expand the number of people who can claim a tax break for charitable giving in the GOP taxreform legislation, expected to be released within weeks. Rep. Mark Walker (R-N.C.), the chairman of the Republican Study Committee, introduced a bill late last week without fanfare to create a new deduction for charitable contributions for those who don’t itemize. His office predicts it will likely be merged within the tax bill that Republicans are counting on to deliver their first big legislative victory this year. Ask The Taxgirl: Should I Cancel A Form W-9? Kelly Phillips Erb October 10, 2017 Taxpayer asks: I'm a contractor who signed a w-9 form but am no longer gonna do the work, am I okay or how do I cancel the w-9 form???? Taxgirl says: You should be fine. Here's why. The Unintended Consequences of Killing the Estate Tax Daniel Berger October 9, 2017 The United Framework for tax reform outlined last week by the congressional Republican leadership and the Trump Administration included a proposal to eliminate the estate tax. It also explicitly preserved the tax deduction for charitable giving, presumably because the GOP believes that contributing to non-profits is a valuable public good. Yet, by repealing the estate tax, the proposal could sharply reduce charitable contributions. 7 States With the Highest Income Tax Matthew Frankel (TMFMathGuy) October 9, 2017 Many Americans, especially those who haven't moved around much, are often surprised at the range of tax burdens there are across the United States. States with the highest property taxes, for example, have average rates that are more than four times that of the states with the lowest property taxes. Income taxes vary even more. On one hand, there are seven U.S. states with no individual income taxes whatsoever, and two more that are close. On the other end of the spectrum, some states have rather high income taxes, especially for high earners. Here's a closer look at the seven U.S. states with the highest individual income tax burdens, according to a report by WalletHub. Traditional stores’ days are numbered, Aviva warns Tom Knowles October 9, 2017 One of Britain’s biggest property owners has predicted the death of the traditional shop, as it warns that most physical stores on the high street will be wiped out by the relentless rise of online shopping. Aviva Investors, which has £20 billion worth of property under management in the UK including several shopping centres, believes that store-based retail is set to “decline significantly”. Family businesses get estate tax break thanks to Treasury decision to revoke tax regulation Kay Bell October 8, 2017 Remember back in July when the U.S. Treasury announced eight tax regulations it said were burdensome and needed to be changed or axed? Treasury Secretary Steven Mnuchin and his staff have now finalized what they want to do with these eight rules. Three would be tossed out, including one that many say hurt familyowned and operated businesses. Two would be partially revoked. The final three would be substantially revised. How to Plan for the Unforeseen Paul Sullivan October 6, 2017 Even thinking about an unexpected, life-changing event can be unsettling. But death or illness can happen at any time. Unfortunately, people do not plan for such events. And statistically, most younger people could go years without planning and not really worry. Capitol Hill demands IRS answers about Equifax deal Kay Bell October 6, 2017 Equifax isn't the only entity taking heat in the wake of the company's cyber security breach that exposed the personal and financial data of 145.5 million consumers. The Internal Revenue Service is now under fire for awarding the credit reporting bureau a nobid contract. Should You Invest Your I.R.A. in Friends, Family or Charitable Work? Abby Ellin October 6, 2017 About five years ago, a good friend of William C. Brown, a tax lawyer in Des Moines, lost his job. The friend’s wife ran a child-care center in a building she owned — but because of their financial difficulties, the couple fell behind on their mortgage payments. Their bank threatened to foreclose. ACA: Tax Reform Should Tackle The Worldwide Tax System Marylouise Serrato October 6, 2017 Often overlooked and misunderstood by the Congress, US citizens living and working overseas now appear to be poised to benefit from the Administration and Congress' desire for tax reform. There is a real possibility that new international tax rules will be passed in a greater tax reform overhaul and these rules will no doubt address tax policy for individuals as well as corporations. Las Vegas has brought in millions in donations. But where will they go? Chris Kudialis October 5, 2017 When tragedy struck Las Vegas on Sunday, community members, elected officials and corporations alike stepped up not only with their hearts and labor, but their pocketbooks. More than $14 million in donations have been made to the victims of Sunday’s massacre per crowdsourcing sites like GoFundMe as well as direct individual contributions. On Sunday evening, gunman Stephen Paddock fatally wounded at least 59 attendees at a country music festival from his 32nd-floor room at Mandalay Bay. Workers Like the Idea of State-Sponsored Auto-IRA Programs John Manganaro October 5, 2017 A new analysis from the Pew Charitable Trusts, “Worker Reactions to State-Sponsored AutoIRA Programs,” makes a clear argument that workers in the U.S. broadly favor the option of turning to the government for savings opportunities when an employer is unwilling or unable to provide a retirement plan. The analysis suggests these types of plans could likely help a lot of people who are more or less shut out of the defined contribution (DC) retirement plan arena: “At least one-quarter of nongovernmental, nonagricultural full-time workers do not have access to an employersponsored retirement plan, and fewer than 15% of households contribute to an individual retirement account (IRA).” Given these facts, policymakers, particularly at the state level, are examining ways to bolster retirement savings, Pew reports. Will A Corporate Rate Cut Really Increase US Jobs And Wages? Howard Gleckman October 5, 2017 Kevin Hassett, chair of President Trump’s Council of Economic Advisers, argued today that the corporate tax cuts in the Sept. 27 Republican Unified Framework would boost overall economic growth. How? In large part because its corporate tax rate reductions would encourage firms to shift jobs from overseas to the US. But the claim is unsupported by the evidence. U.S. baby boomers fall behind in paying off mortgages: Fannie Mae Reuters Staff October 5, 2017 (Reuters) - Older American homeowners are trailing the prior generation in paying off their mortgages, complicating their finances if they carry the loans into retirement, a report from Fannie Mae released on Thursday showed. This lag has persisted even with an improving economy since the last recession and a housing recovery in the aftermath of the housing bust in the late 1990s, Patrick Simmons, Fannie Mae’s director of strategic planning, wrote in the article. Does Your State Levy a Capital Stock Tax? Morgan Scarboro October 5, 2017 Only 16 states levy a capital stock tax, a tax on the net worth of a business. These taxes are often levied at a low percentage on the wealth of a firm. Because the tax is paid in good times and bad, businesses often find themselves using precious cash flow to pay it. In broad economic terms, capital stock taxes (referred to as franchise taxes in many states) are destructive because they disincentivize the accumulation of additional wealth, or capital, which distorts the size of firms. Yahoo Breach Update: Every single Yahoo account was impacted by the 2013 breach, now three times larger than initially reported Michelle Caruthers October 4, 2017 The Yahoo data breach incident that happened in 2013 was initially reported to have only impacted 1 billion users at the time making it the largest data breach in history. However, it has just been announced that the impact was, in fact, much worse as the massive data breach affected not just 1 billion but all 3 billion Yahoo users. In addition to those who registered Yahoo email addresses, anyone with accounts for Yahooowned services like Flickr, Tumblr or Yahoo fantasy sports leagues are also included in the 3 billion records impacted. Treasury to withdraw proposed estate tax rules Naomi Jagoda October 4, 2017 The Treasury Department announced on Wednesday that it is planning to withdraw estate-tax rules proposed by the Obama administration that were widely opposed by GOP lawmakers and business groups. The department in a report called the rules' approach "unworkable." 7 Questions Rich People Ask Their Accountant Keith Schroeder October 4, 2017 A year ago I started tracking the questions clients asked me. Clients were put into three categories: those with income below $50,000; those with income over $400,000; and everyone else in between in the final category. Obsessive-compulsive disorder isn’t the reason for my behavior. I noticed questions frequently were based upon wealth. I needed to track data for a period of time to verify what I suspected was true. Cannabis Executives Share Their Stories of Personal Financial Discrimination Alan Bronchstein, CFA October 4, 2017 The cannabis industry is booming. One would think that nothing could be as exciting as being a cannabis entrepreneur, but cannabis executives face challenges with financial transactions that many of us take for granted, like getting a bank account, maintaining a securities account, qualifying for life insurance or getting even getting a mortgage. It’s not that the financial institutions are necessarily anti-cannabis, but they are concerned that taking cash that is derived from federally illegal sources could jeopardize their regulatory status. Financial discrimination is widespread throughout the industry and extends beyond the hurdles over which the businesses themselves must jump. 5 Types Of Fraud In Business That Could Put You In A Bind Mike Kappel October 4, 2017 Running a business is hard enough when everything goes smoothly. But when you’re an entrepreneur, the unexpected happens. You need to prepare yourself for every possible situation, including fraud. Business fraud isn’t as rare as you might think. It’s important that you know how to prevent and deal with fraud if it comes your way. With Affordable Care Act’s Future Cloudy, Costs for Many Seem Sure to Soar Reed Abelson October 3, 2017 Health insurers are aggressively increasing prices next year for individual policies sold under the federal health care law, with some raising premiums by more than 50 percent. By approving such steep increases for 2018 in recent weeks, regulators in many states appeared to be coaxing companies to hang in there, despite turmoil in the market and continuing uncertainty in Congress about the future of the law, the Affordable Care Act. 7 Ways the New Tax Fight Could Hit Annuities Allison Bell October 3, 2017 For the people who create and sell annuities and other insurance-based retirement planning products, the start of high-energy efforts in Washington to update federal tax rules and programs is creating hope, and fear. The efforts could make the economy more efficient, put more money in consumers' pockets, and leave consumers in a better position to prepare for post-retirement income, acute health care and long-term care needs. The changes could even help the world create the kinds of housing, health care advances, long-term care workforce and long-term care technology that could make the aging of the world's population easier to handle. Will Equifax hack affect 2018 tax filing season? Kay Bell October 3, 2017 Human error, specifically one human's error, is why 145 million of us are worrying about what crooks will do with the data that was stolen earlier this year in a data breach of Equifax. Richard Smith, the credit reporting bureau's former CEO, in testimony before House Energy and Commerce Committee today blamed the initial failure to patch a known security risk on a specific individual. He did not name that person. All Your Equifax Breach Questions (and Some Answers) in One Place Ron Lieber October 3, 2017 Three weeks after Equifax acknowledged that hackers had breached the company’s system, the company’s interim chief executive, Paulino do Rego Barros Jr., apologized for its messy response. The breach meant that potentially millions of Social Security numbers, driver’s licenses and other information had been stolen, leaving many of us to wonder how vulnerable we might to identify theft. “Answers to key consumer questions were too often delayed, incomplete or both,” Mr. Barros wrote in an op-ed column in the Wall Street Journal on Thursday. Testimony: The Startup Slump: Can Tax Reform Help Revive American Entrepreneurship? Scott A. Hodge October 3, 2017 Chairman Tiberi, Senator Heinrich, members of the Committee, thank you for the opportunity to talk with you today about how to make our tax system more friendly to entrepreneurship. The Tax Foundation’s mission is to work toward a tax code that doesn’t stand in the way of success, so we applaud the interest in making our tax code friendlier to entrepreneurs. Despite our Byzantine tax code, America is a land of entrepreneurs. The dynamism of our entrepreneurs—the willingness to try and possibly fail—is what separates the U.S. from every other nation on earth. If you expect to get Social Security, this is the one thing to do in the aftermath of the Equifax breach Michelle Singletary October 2, 2017 The financial exploitation of seniors is already a problem. Bradley C Bower/AP Now with the massive data breach by Equifax, it’s just one more thing to concern the elderly. Many people are scrambling, trying to put in place credit freezes to prevent identity thieves from opening up credit in their name. But if you expect to get a Social Security check or you’re already getting a benefit there’s something else you should do and fast. 5 Signs Elder Care Is Ruining A Client's Retirement Juliette Fairley October 2, 2017 Americans caring for an aging parent may be cutting back on their own expenses, having trouble paying the bills and dipping into their savings, according to a new study. “Our clients who are retirement age who still have parents who are alive and aging are coming into the position where they might want to be helping their parents out financially,” said Suzanne Shier, chief tax strategist with Northern Trust. “It’s not something they factored in when they were planning their own retirement years. It’s a conversation we are having more and more.” 4 Ways To Net More Financial Aid John Wasik October 2, 2017 The way college financial aid is determined in this country is all wrong. You shouldn't have to jump through multiple hoops and fill out forms to qualify. It should be as simple as one click. Why, in an age in which you can order nearly anything and get it the next day, do we have to be tortured by financial aid forms? I don't have the answer for that, but I can tell you what you need to know to get aid and obtain a debt-free degree. 12 Strategies to Generate Income in Retirement Sandra Block October 2017 When it comes to saving for retirement, maybe you've done everything right. You started early, maxed out your 401(k) plan, invested in a diversified portfolio and avoided costly mistakes, such as cashing out your retirement plan. Fantastic. But now comes the hard part: making sure you don't outlive your money. That's a tall order for today's retirees. Taxes, unpredictable investment returns, rising health care costs and inflation down the road can significantly erode the value of your nest egg. And perhaps the biggest challenge is that you'll probably need the money for a long time. A 65year-old man has a life expectancy of 19.3 years; it's 21.6 years for a 65-year-old woman. If you're married, there's a 45% chance that one of you will live to age 90 and a nearly 20% chance that you or your spouse will live to 95. How does the US tax plan compare to other countries? BBC News September 30, 2017 Taxes - the perennial bugbear of the Republican party are back in the spotlight in Washington. Republicans this week outlined a plan to dramatically lower taxes on businesses and overhaul the code for individuals and families. Changing the way Americans are taxed was a key campaign issue of US President Donald Trump. 7 money shows to listen to on International Podcast Day Kay Bell September 30, 2017 It's International Podcast Day! Why are you reading (although thank you for stopping by)? You should be listening. That's why on this day celebrating the internet's audio offerings, this Shout Out Saturdaygoes to seven of my favorite financial podcasts. 1. Money Girl How to stop your devices from listening to (and saving) what you say Kim Komando September 29, 2017 Yes, voice technology is amazing. You can ask your phone a question. You can talk to your speaker system and even book an Uber. With the right setup, you can verbally lock the doors in your house, dim the lights, and change the thermostat. All across America, people are embracing their oral fixation. Virtual assistants are handy, but they’re always listening. As more manufacturers and developers jump onto the audio tracking bandwagon, you may wonder how much your devices are recording. And what happens to the audio files they gather? The Equifax Hack Has the Hallmarks of State-Sponsored Pros Michael Riley, Jordan Robertson, and Anita Sharpe September 29, 2017 Investigations into the massive breach aren't complete, but the intruders used techniques that have been linked to nation-state hackers in the past. In the corridors and break rooms of Equifax Inc.'s giant Atlanta headquarters, employees used to joke that their enormously successful credit reporting company was just one hack away from bankruptcy. They weren't being disparaging, just darkly honest: Founded in the 19th century as a retail credit company, Equifax had over the years morphed into one of the largest repositories of Americans' most sensitive financial data, which the company sliced and diced and sold to banks and hedge funds. In short, the viability of Equifax and the security of its data were one and the same. Using a reverse mortgage to delay Social Security: does it make sense? Mark Miller September 28, 2017 CHICAGO (Reuters) - Delaying your Social Security benefit claim offers one of the best routes to higher retirement income - annual benefits increase 8 percent for every 12 months that you delay from age 62 to 70. But the strategy often comes with a challenge: how to meet living expenses while you wait? How about this solution? Borrow against your house. What Would the “Big Six” Framework Mean for Lower-Middle Income Households? Scott Greenberg September 29, 2017 On Wednesday, Republican leadership released a framework for a tax reform bill. One major question about the framework so far has been about how the plan would impact the tax burden of lower-middle income households.[1] In anticipation of the plan’s release, there was already a great deal of confusion about this question. Initial reports suggested that the plan would include a 12 percent bottom bracket, which would be higher than the current bottom bracket of 10 percent – leading some to speculate that the Republican framework would raise taxes on some lower-middle income households. How High Are Excise Tax Collections Where You Live? Morgan Scarboro September 29, 2017 Excise taxes are particular taxes levied on specific goods or activities, not general tax bases like income or consumption. Some excise taxes are fairly well-known to the public, like cigarette or alcohol taxes, but others are more hidden, like taxes on admission for amusement businesses. On average, these excise taxes make up a relatively small portion of state and local tax revenue – about 11 percent – but per capita collections vary widely among states. Vermont has the highest state and local collections at $1,068 per capita, followed by Nevada with $910, and Hawaii with $885 in collections per capita. Getting personal with the GOP tax reform proposal Kay Bell September 28, 2017 How expensive is owning a home? So expensive that many homeowners view "The Money Pit" as a documentary. But, we console ourselves, at least we get some nice tax breaks for our piece of the American Dream. How to Pay Off Your Mortgage Before You Retire Wendy Connick September 28, 2017 Housing is the single biggest monthly expense for many families, so if you don't have a housing payment to worry about during your retirement years your savings will last you a lot longer. Paying off your mortgage by the time you retire isn't complicated; it just requires a little preparation. Your repayment plan If you know how much you owe on your mortgage, your interest rate, and how long it will be before you retire, figuring out how to get rid of the mortgage in time isn't difficult. You can even use a mortgage payoff calculator to see the effect of adding extra payments. Inherited vs Gifted Can Lead to Big Tax Gap on a Home Sale Julian Block September 28, 2017 Long-standing tax rules authorize an exceptional benefit for people who sell inherited assets that have increased in value — homes, stocks, real estate and works of art, to cite some common examples. Inherited property gets what’s called a “step-up in basis” to its fair market value on the date of death of the previous owner. Thus, for tax purposes, the asset’s basis (generally, the cost of acquiring the property) becomes its value at the date of death, rather than the actual purchase price. Boomers, Millennials Race Ahead Of Gen Xers In Retirement Planning Gregory Bresiger September 27, 2017 More baby boomers are getting better at saving for retirement. So are millennials, but Gen Xers still have lots of work to do. Those are some of the conclusions of a new study from Allianz Life Insurance of North America that found 72 percent of boomers feel financially prepared for retirement, up 15 percent from a similar study in 2010. Here's How IRS Taxes Severance Pay Robert W. Wood September 27, 2017 You may get severance pay when you quit your job, are laid off, or fired. You also might get severance later if you sue and settle. Whether or not your pay is labeled “severance,” and regardless of when it is paid, the IRS generally views severance like any other pay. It’s taxed as wages, so is subject to withholding and employment taxes. If your employer hands you a severance check as you walk out the door, you may well expect it to have all the payroll deductions you’re used to seeing on your regular paycheck. The Staggering Prices of Long-Term Care 2017 Emily Gurnon September 26, 2017 The cost of long-term care just keeps going up and most Americans keep believing — incorrectly — that the government will cover most or all of it. Those are the findings of a new report, the Genworth 2017 Cost of Care Survey, released today by Genworth Financial. Pot Farmer to Neighbors: Chill Out. Neighbors: No. Laura M. Holson September 26, 2017 McMinnville, Ore. — “This is hostile territory. Everyone hates us.” I was riding up a steep hill near Highway 18 one August afternoon when Richard Wagner blurted out what his lawyer had told me weeks earlier: No one wanted to be his neighbor. Mr. Wagner, 33, was seated next to his mother, Mary, who was behind the wheel of her Subaru Outback, navigating a strip of dry grass and rocks in a meadow here overlooking the Willamette Valley. Mr. Wagner’s neighbors had made it possible last year for his parents to buy 6.7 acres of land. But in February, when he told them he was going to grow and process marijuana, his quaint country fellows suddenly weren’t so chill. The cheapest places to retire Jessica Dickler September 25, 2017 If, like most Americans, your retirement savings are falling short, pack your bags. You'll be better off living in Birmingham, Alabama, Memphis, Tennessee, or Detroit. Using criteria such as groceries, housing, utilities, transportation and health care, GoBankingRates found the cheapest places to retire in the country's 150 biggest cities. How High Are Property Tax Collections Where You Live? Morgan Scarboro September 21, 2017 States collect property taxes in a number of ways: some impose a rate or a millage on the fair market value of property, while others impose it on some percentage (the assessment ratio) of the market value, yielding an assessed value. Regardless of how they are collected, property taxes are an important revenue tool for state and local governments. In fiscal year 2014, they comprised the largest source of state and local tax collections, at 31.3 percent. They also make up the largest revenue source for local governments. Why you should discuss the nonfinancial aspects of retirement with your clients Allan Kunigis September 18, 2017 While there's no denying the importance of being financially prepared for life after one stops receiving a paycheck, planning for retirement needs to involve much more. Keith Lawrence, founding partner of coaching firm LifeScape Solutions and co-author of the book Your Retirement Quest, discovered the importance of planning for the nonfinancial side to retirement while working as a human resources executive as Procter & Gamble. He saw recently retired employees returning to the company after six months. "They were bored or their spouse practically kicked them out of the house," he recalled. Equifax Breach: Two Executives Step Down as Investigation Continues Nicole Perlroth and Cade Metz September 18, 2017 SAN FRANCISCO — Equifax, the credit reporting agency, said Friday that its chief information officer and chief security officer were retiring “effective immediately.” The announcement came one week after the company revealed that a cyberattack potentially compromised confidential information of 143 million Americans. On Friday, the company also provided further details about when it had discovered the breach and which part of its website had been targeted by hackers. But many details about the breach, who was behind it and the computer security defenses at Equifax are still unclear. What We Know Tap your retirement plan for a disaster? Usually other options are better Russ Wiles September 15, 2017 In the wake of a disaster like Hurricane Harvey or Irma, a job loss or other financial trauma, it's natural to look to 401(k)-style retirement plans or Individual Retirement Accounts for help. Retirement plans are among the largest sources of fairly liquid, non-housing money available to millions of Americans. They are tempting sources of ready cash. Real estate: 4 reasons fewer Americans are buying homes Matthew Frankel, The Motley Fool September 15, 2017 While the U.S. homeownership rate has climbed slightly since reaching a 50-year low in 2016, it remains near a generational low at just 63.7%. Simply put, more people are choosing to rent than buy their homes in recent years than at any point since the 1960s. RealtyMogul, an online real estate investment platform, recently commissioned Harris Poll to conduct a survey to shed some light on the reasons why more people are choosing to rent, and here are four major trends that help to explain the shift toward renting. How Much Does Your State Collect in Sales Tax Per Capita? Morgan Scarboro September 14, 2017 Forty-five states and the District of Columbia levy a statewide sales tax. State rates vary widely among states, from 2.9 percent in Colorado to 7.25 percent in California. This does not take into account the local sales tax rates that are levied in thirty-eight states, which can significantly change the combined rate for consumers. Hawaii and North Dakota collect the most in statewide sales tax per capita at $2,090 and $1,835 respectively, but both states’ sales tax base is extremely broad and includes many services, so they’re not strictly comparable to other states. Among the more comparable states, Washington state collects the most per capita ($1,746), followed by Nevada ($1,412). On the opposite end of the spectrum, Georgia ($515) and Alabama ($507) collect the least per capita. Nonprofit Leaders and Fundraisers Call For Greater Diversity Rebecca Koenig and Timothy Sandoval September 14, 2017 Charity leaders and fundraisers called on nonprofits to build more diverse staffs and do more to engage donors from a wide variety of backgrounds at The Chronicle’sPhilanthropy NEXT conference, a gathering that tackled race, gender, and sexual orientation in philanthropy. Nonprofit leaders must be honest with themselves about how well their organizations have grappled with diversity, some speakers said at the gathering, which was held on Thursday. 3 Big Mistakes That Can Screw Up Even the Best Retirement Plan Walter Updegrave September 14, 2017 If you've been saving diligently and investing prudently for retirement, that's terrific. But it's not enough. Even people who get the basics right often fall down when it comes to other key areas of retirement planning. Which is why you want to avoid these three big mistakes that new research shows can often trip us up and undermine our retirement planning efforts. Tax Court: Beauty Pageant Winner Loses Tax Contest Ken Berry September 14, 2017 Beauty is in the eye of the beholder, but the tax law isn’t as subjective, as evidenced by a new case, Lopez, TC Memo. 2017-171, 8/30/17, involving a beauty pageant winner from Indiana. If a child earns income from a competition, he or she is responsible for paying tax on that income, as well as being able to deduct offsetting expenses – even if the parents are the ones pulling the financial strings. Your Social Security Number Isn’t a Secret Bob Sullivan September 13, 2017 Back when identity theft was mainly credit card fraud and a 100,000-record leak was a big deal — the good old days, around 2004 — my hacker friends and I would sit around and brainstorm ways to slow down what some were calling the fastest-growing crime of the century. One method came up again and again: Someone should steal the entire database of Social Security numbers and publish it online. (No one tried — that would be a crime!) Why do something so crazy? Once and for all, it would eliminate the fantasy that a Social Security number is both a unique identifier and a secret to be used as an authenticator. An Experiment: How Low Could Tax Rates Go If Congress Eliminated All Tax Expenditures? Howard Gleckman September 13, 2017 How low could Congress cut tax rates without losing revenue? To put it another way, could President Trump and the House Republican leadership fully fund the sorts of individual and corporate tax rate cuts they have been promoting by eliminating current tax preferences? To find out, the Tax Policy Center ran three experiments: What would happen if Congress wiped out nearly every business and individual tax expenditure –more than 200 of them, by the Joint Committee on Taxation’s count? What would happen if it preserved three important preferences for low- and moderate-income households but repealed the others? Finally, what would happen to tax rates if Congress created a reform plan that not only raised about the same amount of revenue as the current law but also distributed the tax burden in roughly the same way? What is a Backdoor Roth IRA? Alexis Hongamen September 13, 2017 A backdoor Roth IRA (Individual Retirement Account) is a conversion method used by people that are not eligible to contribute to a Roth IRA. Roth IRA Most people are familiar with a Roth IRA. When you fund a Roth IRA, you are taking money out of your bank account that has already been taxed and placing it into this new IRA. The advantage it offers over a traditional IRA is that the growth on the contributions accumulates tax-free, meaning you won’t pay taxes on the money again when you take it out at retirement age.? Equifax waives credit lock fees for consumers, amid criticism Sarah O'Brien September 13, 2017 Equifax, the credit-reporting firm facing a barrage of criticism over its response to a massive data breach at the company, will now waive certain fees related to one of its credit-protection products. The now-free Equifax service, which involves identity-theft protection and credit-file monitoring for a year, also allows you to put a lock on your credit report at Equifax. This basically means a lender cannot access it to check on your credit score or history. You can unlock it temporarily if you need to apply for credit or a loan. What You Need to Know About ‘Medicare for All’ Anna Edney and Zachary Tracer September 13, 2017 In most of the developed world, everybody’s health care is paid for by the government. In the U.S., for years that idea has been relegated to the far-left edge of politics under the name of single payer. Last year, Senator Bernie Sanders, an independent of Vermont called it “Medicare for All” and put it at the forefront of his campaign for the Democratic presidential nomination. Now, with liberals revved up by their so-far successful fight to protect Obamacare from President Donald Trump and a Republican Congress, Sanders’s idea is getting some support. The legislation he introduced todaywould build on Medicare, the hugely popular insurance program for those over 65, to provide coverage to all Americans. 1. What would his Medicare for All bill do? America’s highest-earning state probably isn’t the one you would expect Christopher Ingraham September 13, 2017 Dennis Skley/Flickr

Pop quiz: Which U.S. state had the highest median income in 2016? New York or California, perhaps, home to some of the nation's wealthiest cities? Maryland or Virginia, with their Washington suburbs flush with government cash? Alaska, home of the famous oil revenue checks for every man, woman and child?

All of those guesses are wrong, according to the latest 2016 income datareleased by the U.S. Census. The correct answer, believe it or not: How to Manage the Long-Term Financial Aftermath of a Natural Disaster Geoff Williams September 12, 2017 Natural disasters come and go in the news, but the actual aftermath lingers long after the TV cameras go away. Not long after Hurricane Harvey hammered the South Texas coast, the administrator of the Federal Emergency Management Agency, Brock Long, said on CNN, "FEMA is going to be there for years." At the time of this writing, with Hurricane Irma storming the country, it's unfortunately looking like FEMA will also be pretty busy in Florida and possibly in other parts of the U.S. Having kids can really mess up retirement saving Marlene Y. Satter September 12, 2017 If you have children, you might not believe this (unless you have teenagers) – but parenthood could be putting your eventual retirement at risk. But there are ways to avoid that risk. So says a brief from the Center for Retirement Research at Boston College, which used the National Retirement Risk Index (NRRI) to gauge the impact of having children on the retirement security of current older working households. IRS Collections: A primer for tax preparers Roger Russell September 12, 2017 CPAs, Enrolled Agents and attorneys are part of a privileged group that can represent taxpayers at all levels before the IRS, yet many choose not to extend their practice when collections issues arise. For those that do, there are some things they should know about, according to Curtis Hunter, a shareholder in the Coral Gables office of law firm Becker & Poliakoff PA. “The first step in resolving tax disputes with the IRS is to understand the taxpayer’s rights and the alternative defenses available. Although understaffed, Collections is still a significant activity of the IRS,” said Hunter, who specializes in the areas of federal and state tax, estate planning and litigation. Expert: Fraudsters may already be trying to use breached Equifax data Nicole Sinclair September 12, 2017 Forter, an e-commerce fraud prevention company, said they saw a “significant” spike in what appears to be fraudulent account takeovers this summer, something they believe could be a result of the recently-disclosed Equifax (EFX) data breach. “In the last two months we saw about a 15% increase year-over-year in account takeover attempts,” according to Forter CEO and co-founder Michael Reitblat. “While we can’t confirm that this is related to the Equifax breach, the timing suggests that it could.” Don't Forget Retirement Accounts In Estate Planning Masoof Vojdani September 11, 2017 When thinking about estate planning, the assets that typically come to mind first are your bank accounts, your house and any other owned properties, and your most valued possessions. But an equally important asset – and arguably one of the most intricate when it comes to estate planning – is your retirement account(s). Creating a carefully designed plan with the help of your financial advisor and estate attorney in advance is essential to ensuring that your assets are protected and transferred to your loved ones in an effective way that will maximize their inheritance and minimize taxes or red tape. Teaching Very Young Children About Money And Investing Investment Pancake September 11, 2017 Summary Kids can learn investment basics at an extremely young age. Our experience with teaching our kid about money and investing. A game-like spreadsheet that parents can use to help teach their kids about investing. Tax-advantaged ways grandparents can give to grandchildren Kay Bell September 10, 2017 Happy Grandparents Day! If your pop-pop and mam-maw (insert your own personal and/or regional affectionate nicknames here) are still around, take some time to tell them how much you love and appreciate them. Most of the time, younger — and that's definitely a relative term — folk think of grandparents as ancient. In many cases, elderly grandparents (and parents) do need some help, physically and financially, from their children or grandchildren. If that's your situation, you might be able to claim your older relatives as dependents and get some tax benefits for yourcare giving. What your kids can do when they inherit your retirement accounts Dan Moisand September 9, 2017 Spouses are usually the primary beneficiary on retirement accounts but eventually retirement accounts are left to a non-spouse. Non-spouses have a different set of options to choose from. Q.: What options will my children have when they inherit retirement accounts from mom and dad? Health care costs in retirement will only grow— here’s how to save Alessandra Malito September 9, 2017 An American couple retiring this year should expect to spend $275,000 in health care costs throughout retirement — a number that has risen 6% since last year, and will continue to rise indefinitely. The number assumes the individuals are enrolled in Medicare, but does not include expenses associated with a nursing home or long-term care, according to Fidelity Investments, the Boston-based financial services firm that analyzed these health care costs. Instead, the $275,000 includes monthly expenses that come with health coverage premiums, copayments and deductibles and out-of-pocket expenses for prescription drugs. The expected cost of health care has grown 70% since Fidelity first started tracking health care costs in 2002, and will continue to rise in the future, Adam Stavisky, senior vice president of Fidelity Benefits Consulting. “Medicare is wonderful, but by design it doesn’t cover everything,” Stavisky said. One-quarter of people make this costly mistake when using debit cards Maria Lamagna September 9, 2017 Americans like using debit cards, but many don’t understand what their plastic can and can’t do. Nearly one-quarter of consumers believe activity on their debit card impacts their credit score,when in reality, it has no effect. That’s according to a survey of 2,000 consumers this week from the personal-finance company NerdWallet. For those trying to build or improve their credit, a credit card is often a better choice, provided consumers can pay their bills in full on time, said Kimberly Palmer, a credit card expert at NerdWallet. Bitcoin, Virtual Currency Deals Under $600 Could Become Tax Exempt Robert W. Wood September 8, 2017 The IRS is hunting digital currency users, since very few people seem to be reporting their transactions. The IRS is using John Doe summonses to obtain data on bitcoin and other digital currency users. The IRS is even hunting bitcoin user identities with software. IRS scrutiny is causing many people to worry that they may owe taxes, penalties and interest. Even worse, in extreme cases, the IRS could pursue tax scofflaws criminally. However, help could be on the way. A bipartisan bill, "The CryptoCurrency Tax Fairness Act," was introduced in the House by Rep. Jared Polis (D-Co) and Rep. David Schweikert (R-Az). Financial Statement Changes: 5 Steps for Nonprofit Boards AICPA Communications September 8, 2017 As accounting and finance professionals, we’ve been talking about the coming changes to not-for-profit financial statements for some time now. But many others haven’t heard about the changes, including some not-for-profit board members. Board members are responsible for oversight of the financial reporting process, and as such, they’ll want to take an active role duringimplementation of the new guidance. The Financial Accounting Standards Board's (FASB) Accounting Standards Update (ASU) No. 2016-14, Not-for-Profit Entities: Presentation of Financial Statements of Not-for-Profit Entities, was issued in August 2016. The standard applies to all not-for-profits and is effective for years beginning after December 15, 2017. Early adoption is permitted. What the Rich Won’t Tell You Rachel Sherman September 8, 2017 Over lunch in a downtown restaurant, Beatrice, a New Yorker in her late 30s, told me about two decisions she and her husband were considering. They were thinking about where to buy a second home and whether their young children should go to private school. Then she made a confession: She took the price tags off her clothes so that her nanny would not see them. “I take the label off our six-dollar bread,” she said. She did this, she explained, because she was uncomfortable with the inequality between herself and her nanny, a Latina immigrant. She had a household income of $250,000 and inherited wealth of several million dollars. Relative to the nanny, she told me, “The choices that I have are obscene. Six-dollar bread is obscene.” Would Workers Benefit From A Corporate Tax Cut? Not Much Howard Gleckman September 8, 2017 President Trump and congressional Republicans are pressing ahead on a tax bill that will almost certainly include a major corporate tax cut. And they are framing their push for such a measure around the claim that workers will be the big beneficiaries of those corporate tax reductions. They won’t. Are Americans sacrificing food and clothing to pay their taxes? The Economist - The Data Team September 7, 2017 AMERICAN households are woefully overtaxed. That was the message delivered by President Donald Trump on September 6th in Mandan, North Dakota. Mr Trump told supporters that Americans labour under a “crushing” tax burden that puts the country at an economic disadvantage. He repeated a claim he has made several times, that America is the “highest-taxed nation in the world”. Only with tax cuts—the “biggest since Ronald Reagan”—would middle-income Americans get the pay rise they deserve. Corporate Income Tax Rates around the World, 2017 Kari Jahnsen and Kyle Pomerleau September 7, 2017 Key Findings The United States has the fourth highest statutory corporate income tax rate in the world, levying a 38.91 percent tax on corporate earnings. The only jurisdictions with a higher statutory rate are the United Arab Emirates, Comoros, and Puerto Rico. The worldwide average statutory corporate income tax rate, measured across 202 tax jurisdictions, is 22.96 percent. When weighted by GDP, the average statutory rate is 29.41 percent. How Much Does Your State Collect in Corporate Income Taxes Per Capita? Morgan Scarboro September 7, 2017 The corporate income tax is one of the smallest sources of state tax revenue. According to Census data, in FY 2015, the corporate income tax only comprised 5.3 percent of state tax collections. As we outlined earlier this year, there are several reasons why the corporate income tax share is so low on average. Some mistake the corporate income tax as the entirety of a business’s tax burden. However, businesses pay many types of taxes outside of the corporate income tax, including sales tax, property tax, excise tax, payroll tax, and more. The corporate income tax makes up Reconstructing tax & other records after a natural disaster Kay Bell September 6, 2017 Maybe you didn't think the hurricane's flood waters would reach your neighborhood. Or maybe you just never kept copies, either paper or digital, of your financial and tax records. Now, however, you find you're among the millions dealing with Hurricane Harvey aftermath that destroyed much of the Texas Gulf Coast and the Lone Star State's largest city. Or might soon face a similar situation if (when) Hurricane Irma rakes Florida. Hiding Assets To Thwart IRS Tax Collection Can Be Criminal Robert W. Wood September 5, 2017 Criminal tax charges are not common, and not every charge ends in a conviction. Still, any tax charge is serious, and charges for obstructing the IRS certainly are. For example, a federal grand jury in the District of Hawaii has indicted a businessman and his accountant with tax crimes, including allegedly concealing income and assets to obstruct IRS collections. The indictment charges Wagdy A. Guirguis and Michael H. Higa, his CPA, with conspiring to defraud the IRS. The indictment further charges Guirguis with filing false corporate tax returns, failing to file a corporate tax return, evading individual income tax liabilities, corruptly endeavoring to obstruct the IRS, and tampering with a grand jury witness. Higa was also charged with aiding and assisting in the filing of false corporate and individual tax returns. The $1.4 Million Mistake Too Many Millennials Are Making Michael Douglass (TMFEnterprise) September 5, 2017 Millennials are doing lots of good work with our savings. We're saving earlier than our parents did. We're saving more too. All that despite making around 20% less than our parents did at the same age. But there's one thing many of us are doing wrong: We're investing in the wrong things. U.S. economy could take big hit if DACA is revoked Kay Bell September 2, 2017 The White House is expected to make a decision on President Obama's Deferred Action for Childhood Arrivals (DACA) program as soon as Tuesday, Sept. 5. UPDATE, Sept. 5: It's official. DACA is ending. In a press conference this morning, Attorney General Jeff Sessions said the Trump Administration will stop considering new applications for legal status dated after today, but will allow any DACA recipients with a permit set to expire before March 5, 2018, the opportunity to apply for a two-year renewal. The White House also issued a statement saying the "orderly transition and wind-down of DACA" also provides "a window of opportunity for Congress to finally act" on at least this immigration issue. Net Operating Loss Carryforward & Carryback Provisions by State Morgan Scarboro August 31, 2017 The corporate income tax should tax only the profits of a corporation; however, profitability can vary for businesses. A business’s yearly profit may not capture its true profitability. Businesses in particularly cyclical industries may experience substantial profits during boom years, but also experience substantial losses during bust years. Over time, that same business might actually have an average profit margin. California's 13.3% Tax On Capital Gains Inspires Move Then Sell Tactics Robert W. Wood August 31, 2017 Living in California has many perks, but the state's 13.3% rate is the highest marginal tax rate in the nation. When you add up to 39.6% federal taxes, it can hurt, especially for those who cannot deduct their state taxes against their federal. California's taxes were always high, but Proposition 55 extended the 13.3% tax rate 'temporarily.' How temporarily? Only until 2030! Personal income tax hikes on incomes over $250,000 started in 2012. It impacts Californians with a single income of $263,000 , or a joint income of $526,000. When people talk of moving away, in many cases, the absence of a capital gain rate that can be the straw that breaks the proverbial camel's back. The Effects of Converting the State and Local Tax Deduction into a Credit Kyle Pomerleau August 30, 2017 Over the past couple of years, the state and local tax deduction has been a popular base broadener for the GOP. Nearly all GOP tax reform proposals from Congress and presidential campaigns since 2014 have included eliminating or limiting the deduction to pay for lower statutory tax rates. Under current law, individuals who itemize can deduct the income or sales taxes they pay to state and local governments from their federal taxable income. They are also able to deduct their state and local property taxes. The state and local tax deduction is one of the three largest itemized deductions (the other two being the home mortgage interest deduction and the charitable contribution deduction). According to the IRS, $520 billion in state and local taxes were deducted in 2014; 46.5 percent of state and local taxes were deducted by taxpayers with adjusted gross income over $200,000. IRS loosens rules for retirement plans to lend money to Hurricane Harvey victims Michael Cohn August 30, 2017 The Internal Revenue Service granted additional relief to victims of Hurricane Harvey on Wednesday by making it easier for 401(k)s and other employer-sponsored retirement plans to give loans and hardship distributions to aid victims. The IRS pointed out the relief is similar to what was provided to victims of previous disasters, including Louisiana floods and Hurricane Matthew. Millennials Are Doing a Better Job Investing for Retirement Than They Get Credit For Walter Updegrave August 29, 2017 The accepted narrative when it comes to millennials and investing is that they just don't get it. They're too likely to hunker down in cash, too scared of stocks, and just too conservative for their own good. But recent research, including a new report based on how millennials actually invest their money for retirement, suggests the conventional wisdom is wrong. How climate change could turn US real estate prices upside down Richard Luscombe August 29, 2017 If Florida gleaned anything from Hurricane Andrew, the intensely powerful storm that tore a deadly trail of destruction across Miami-Dade County almost exactly 25 years to the day that Hurricane Harvey barrelled into the Texas coastline, it was that living in areas exposed to the wrath of Mother Nature can come at a substantial cost. At the time the most expensive natural disaster ever to hit the US, Andrew caused an estimated $15bn in insured losses in the state and changed the way insurance companies assessed their exposure to risk for weather-related events. Alan Simpson: AARP is a 'monstrous organization' that blocks changes needed to save Social Security Matthew J. Belvedere August 29, 2017 The only way to stop the cycle of overspending in Washington and then fighting over raising the debt ceiling is to reform entitlements, anti-debt crusader Alan Simpson told CNBC on Tuesday. "Do something with the solvency of Social Security, which is the biggest elephant in all the rooms," said Simpson, retired U.S. senator from Wyoming and GOP co-chair of former President Barack Obama's bipartisan debt commission. Erskine Bowles, former chief of staff during Bill Clinton's presidency, was the Democratic co-chair. How to Turn Your Passions Into Retirement Income Nancy Collamer August 28, 2017 Last year, Mike Liff, now 71, relocated with his wife from San Francisco to Portland, Maine to be closer to family. The retirees explored their new hometown and thanks to a chance conversation at a barbershop, Liff learned that “I’m having such fun,” he said. “I like to say I didn’t retire, I ‘rewired.’ To have a place to go and a purpose is really important to me — and my wife appreciates it too.” How to Prepare Your Business Partnership for New Rules for IRS Audits Bill Smith August 28, 2017 The IRS will begin a new way of auditing partnerships and LLCs (as most are treated as partnerships) for tax years beginning after Dec. 31, 2017. With these new rules comes the potential for a host of new disputes among partners. Various strategies for mitigating effects of the changes will require cooperation from partners who may not be compelled to work together. Partnerships need to develop a roadmap before venturing into this new frontier. Like going to the dentist, an update to the partnership agreement may be a dreaded but necessary task to provide for this roadmap. Estate Planning: Leaving a Home to Heirs While You’re Still Alive Kaya Laterman August 25, 2017 As baby boomers age and head into retirement, estate planning has become a thriving business. And how best to deal with our homes — often our most valuable asset — is among the most fraught questions that need addressing. Sell and downsize to leave a larger pot of cash for heirs to divide? Deed the house or apartment to your adult children now to avoid squabbling after you’re gone? If so, where do you live in the meantime? Which Areas Benefit Most From the Home Mortgage Interest Deduction? Huaqun Li August 24, 2017 This map shows how much U.S. taxpayers deduct in home mortgage interest by county. The measurement used here is the home mortgage interest deduction per return. It is calculated using the total of all home mortgage interest divided by number of returns filed in each county. The data source is 2014 Statistics of Income from the IRS. The map below shows that there is tremendous variation in terms of the average home mortgage deductions among counties. Overall, the average deduction in a county spans from a low of zero to a high of $6,365. There is also strong variation among counties within the same state. In Virginia, for example, filers in Dickenson County take only $216 on average. However, filers in Loudoun County in northern Virginia can take a home mortgage deduction of $6,365 on average. Why Paying Yourself 5% Interest On A 401(k) Loan Is A Bad Investment Deal Michael Kitces August 23, 2017 Contributions to 401(k) and other employer retirement plans are intended to be used for retirement, and as a result, 401(k) plans often have restrictions against withdrawals until an employee retires (or at least, separates from service). As a result, any withdrawals are taxable (and potentially subject to early withdrawal penalties), and even “just” taking a loan against a retirement account is similarly treated as a taxable event under IRC Section 72(p)(1). Yet unfortunately, the reality is that from time to time, employees may need to access the funds in their 401(k) plan before retirement, at least temporarily. To help address the need, Congress created IRC Section 72(p)(2), which does permit employees to take loans directly against their 401(k) or other qualified plan balance from the 401(k) plan administrator, subject to certain restrictions. Octogenarians Rule the Rich Ben Steverman August 23, 2017 Sixty? That’s young — for a rich person. Six of the 25 richest Americans are over 80, according to the Bloomberg Billionaires Index. Carl Icahn and Charles Koch, for example, are 81. Earlier this month, Sheldon Adelson turned 84 and George Soros hit 87. Warren Buffett, the fourth-richest person in the world, with a net worth of $77 billion, celebrates his 87th birthday next week. Got a refund? Paid a big tax bill? Time to adjust withholding! Kay Bell August 23, 2017 All U.S. workers know, simply from looking at their pay stubs, that our tax system is pay-asyou-earn. Our taxes come out of our paychecks as withholding, both for federal income taxes, as well as to cover future Social Security and Medicare benefits. Here's The Kicker: Oregonians To Receive A Tax Rebate In 2018 Chris Lehman August 23, 2017 It’s official: Oregon taxpayers will receive a $464 million kicker next year. The kicker is that unique Oregon institution that dishes out money to taxpayers when the state’s economists underpredict how much revenue the state will collect over a two-year period. How Does Your 401(k) Compare? Suzanne Woolley August 23, 2017 For years, fees on investments in workplace retirement savings plans have been falling. Now, at least for the moment, they’re stalling. The average expense ratio on investments in definedcontribution, or 401(k), plans dropped by a hair to 0.41 percent of assets this year, according to the latest annual survey from investment consulting firm NEPC. That follows three straight years of somewhat deeper declines, spurred in large part by regulatory pressure and a rash of high-profile class action lawsuits alleging excessive fees and plan designs that weren’t in savers’ best interests. Tax Court: Avoiding the Dreaded Trust Fund Penalty Ken Berry August 23, 2017 If payroll taxes aren’t remitted to the IRS in time, a responsible party may be held personally liable for the full amount of the unpaid tax; essentially, you’ll have to pay the IRS out of your own pocket. This harsh “trust fund penalty” is frequently contested in the courts. In a new case, Hartman, DC-MI, 7/26/17, the IRS imposed the penalty on a co-owner who wasn’t even the one handling the payroll duties. Briefly stated, the trust fund penalty may be applied to anyone who is responsible for collecting or paying payroll taxes and willfully fails to do so. Amazon says new accounting rule will change when it recognizes sales of its devices Tonya Garcia August 22, 2017 Amazon.com Inc. says a new revenue-recognition accounting rule that goes into effect for public companies in 2018 will impact the timing of when it will recognize sales of its own electronic devices as well as the gross amount of sales it claims. The Financial Accounting Standards Board, or FASB, Accounting Standards Update (ASU) called ASC 606 will impact a wide range of customer services across retailers and restaurant chains, including credit vouchers, loyaltyprograms and credit card rewards. How Far Does $1 Million Go in Retirement? Suzanne Woolley August 21, 2017 A million dollars—it has a nice ring to it. But as Dr. Evil learned after spending 30 years cryogenically preserved, it may not be enough—for many people, certainly not enough to comfortably retire on, depending on where and how long they live. A new report from GOBankingRates measures how long a million dollars would last for retirees 65 and older, state by state. It did that by multiplying the Bureau of Labor Statistics’ mean annual expenditures for that age group by a cost-of-living measure for each state, provided by the Missouri Economic Research and Information Center. The tally separated out annual spending on health care, housing, groceries, transportation, and utilities. Don't Forget About Taxes When Looking For The Perfect Rental Kelly Phillips Erb August 21, 2017 It may be the end of summer, but with the start of a new school year and a growing economy, the search for the perfect apartment is heating up. Finding the ideal rental in a market like Miami or Manhattan can be tough. When figuring your costs, don't overlook possible tax savings. Yes, they exist. Here's what you need to know about potential tax benefits for renters: 1. If you work from home, you may be able to deduct your rent. You must adjust financial plans to varying inflation and returns Narendra Nathan, ET Bureau August 21, 2017 Goal value will gallop with inflation Rs 1 lakh today will be worth nearly Rs 1.5 lakh in 10ys at just 4% inflation. You will need to inflate your goal amount to ensure you have sufficient resources to realise all goals as prices will not remain the same. You won't be able to afford the same lifestyle with the same income for the next 10 or 20 years. Could you live off Social Security alone? Michelle Singletary August 21, 2017 Matt Rourke/AP

When it comes to retirement, there's one question that is sure to get a lot of people to save: Could you survive if you only received Social Security? But the fact is millions live off their monthly Social Security benefit check. How do they do it? When should you make ‘course corrections’ to your retirement plan? Robert Powell August 19, 2017 Course corrections — whether you’re flying to the moon or sailing across an ocean or just shopping for groceries — are a necessary part of life. Consider, for instance, the historic Apollo 11 flight plan in which there are 13 references to the term “course correction.” Without those and other course corrections,

it’s unlikely the astronauts would have reached their goals of walking on the moon and then returning safely to Earth. Hard-Won Advice in Books on Aging and Elder Care Ron Lieber Augst 18, 2017 Longevity is generally better than its alternative. But when the body or especially the mind wears out, caring for yourself or finding someone else to do it for you can impoverish you in short order. We fail to plan for it at our peril. So when it seemed that Republicans in Washington were close to passing legislation that could fundamentally change Medicaid, I wrote five straight columns about the program. Already, the majority of Americans need Medicaid to pay for at least some of their nursing home costs or care at home because they’ve run out of money. Proposed caps on Medicaid, which have not come to pass for now, had the potential to cause enormous problems. Aging Parents With Lots of Stuff, and Children Who Don’t Want It Tom Verde August 18, 2017 Mothers and daughters talk about all kinds of things. But there is one conversation Susan Beauregard, 49, of Hampton, Conn., is reluctant to have with her 89-year-old mother, Anita Shear: What to do — eventually — with Mrs. Shear’s beloved set of Lenox china? Ms. Beauregard said she never uses her own fine china, which she received as a wedding gift long ago. “I feel obligated to take my mom’s Lenox, but it’s just going to sit in the cupboard next to my stuff,” she said. Pre-retirement financial jitters? Here's what to do Sarah O'Brien August 18, 2017 Getting close to retirement and feeling nervous about your finances? You're not alone. For people facing this major life change, angst over transitioning to non-working years can morph into fears about their savings running out even if they have planned well to prevent it. An Inside Look at Trump’s Infrastructure Plans Joseph Henchman August 17, 2017 President Trump signed an infrastructure permitting executive order on Tuesday, the intended highlight of that day’s news conference. The executive order is part of the White House’s “Infrastructure Week,” and has the goal of expediting permitting for infrastructure projects by requiring each project to have a lead federal agency in charge of navigating it through the bureaucracy, and directing federal agencies to determine ways to reduce average permitting time from seven years to two years. President Trump and Secretary Chao displayed a flowchart of the existing federal permitting process, which I’ve pasted at the bottom of this post. The executive order also revoked a flood control planning process relating to global warming mitigation. Struggling To Repay Your Student Loans? You're Not Alone Zach Friedman August 17, 2017 Nearly half of student loan borrowers graduate school owing at least $20,000 – which is double the share of borrowers a decade ago – according to a new report from the Consumer Financial Protection Bureau (CFPB). “The Bureau’s research shows that people are taking on more student debt later in life, and having a tougher time paying it back,” CFPB Director Richard Cordray said. Amazon’s Marketplace Business Isn’t a Tax Avoidance Scheme Joseph Henchman and John Buhl August 16, 2017 President Trump on more than one occasion has accused Amazon of not paying taxes. The latest version came out this morning on Twitter. Most assume that he’s referring to whether the e-commerce company collects sales taxes. So, does Amazon collect sales taxes? The short answer is: Yes. Should You Sell Your Business Before You Retire? Abby Hayes August 16, 2017 Retirement planning is especially complicated for business owners. You have to fund your own retirement plan and decide what to do with your business before you retire. Many retiring business owners decide to sell the business. The proceeds from the sale can help to fund retirement. However, the process of selling a business can be practically difficult and also emotional. You’ve probably spent years or even decades building up your business, products or services. You may know your employees well and want to make sure they are cared for. Fed Officials Confront New Reality: Low Inflation and Low Unemployment Binyamin Appelbaum August 16, 2017 WASHINGTON — Federal Reserve officials are struggling to make sense of a new economic reality in which low inflation and low unemployment are persisting side by side. At the Fed’s most recent meeting, in late July, most officials said they expected the phenomenon to fade away by next year as low unemployment finally starts to drive up inflation. On Anniversary Of Klondike Fever, Here's What You Need To Know About Taxes On Gold Kelly Phillips Erb August 16, 2017 "Gold! Gold! In the Klondike!" On this day in 1896, a group of prospectors discovered gold nuggets in the Klondike River, kicking off a search for riches. Those early prospectors who would immediately become wealthy from the findings were Keish (called Skookum Jim Mason), George Carmack, Kate Carmack, and Dawson (Tagish) Charlie. George Carmack, however, is typically credited for finding the gold because he filed the first claim for property in the area, though many believe that his brotherin-law, Skookum Jim, actually made the discovery. Donating stock is a triple play: Book profits, skip capital gains and pocket a deduction Carla Fried August 16, 2017 With the S&P 500 index up more than 300 percent and the Nasdaq more than 400 percent since the March 2009 low, one of your bigger investment risks may be complacency. "It is surprising the number of people who haven't taken money off the table and rebalanced," said Anthony LoCascio, a Clinton, New Jersey, certified financial planner with serious tax chops. (He's also an enrolled agent.) Grandparents Lose Tax Benefits To Daughter's Common-Law Marriage Peter J Reilly August 15, 2017 The Tax Court dealt with a messy family situation last week and, as is usual, the results are not pretty. The names of the players in TCS 2017-62 are public record now, but I will not contribute further to their fame. There are two couples involved. I will call the first couple, the petitioners, Robin and Terry. The other couple comes in later and I'll call them Blynne and Ashley. Then there are three minor children who even the Tax Court does not name. We'll call them the kids. Everybody lived in Texas, which is important. Grandparents To The Rescue 17 states now impose some fees on electric autos Kay Bell August 15, 2017 President Donald Trump signed an executive order today designed to streamline the approval process for building roads, bridges and other infrastructure. Contractors and the transportation industry say that will help improve the building and repair of the country's roads, bridges and other infrastructure projects. Ask The Taxgirl: Marriage & Money While Living Abroad Kelly Phillips Erb August 15, 2017 Taxpayer asks: I have been married to my second wife for 1 year and I am in the process of finishing up my 2016 tax returns. I have lived in Guatemala for 8 years and have only been in the USA two weeks the last 8 years. I will never spend more than a couple of weeks a year in the USA in future. 6 Ways To Survive Retirement Income Shocks John Wasik August 14, 2017 Nobody likes surprises when it comes to retirement planning. But life is full of bumps and we often suffer income "shocks" along the way. You may lose your job in your prime earning years. Parents may need funds for home or assisted living care. Your children may not be able to find decent employment and move back in. You may get divorced. There are lots of ways to be financially shocked. Ask The Taxgirl: Filling Out A Form W-9 When You're Paid In Cash Kelly Phillips Erb August 14, 2017 Taxpayer asks: If I'm paid in cash can they make me fill out a w-9? Taxgirl says: Yes. How you're paid - in cash, by check, in Bitcoin or barter - doesn't matter when it comes to filling out a form W-9. 6 tax tips for startups Accounting Today August 12, 2017 Taxes are rarely the first thing an entrepreneur thinks about – which is why tax and accounting advisors should. With that in mind, the IRS put together a short list of taxrelated considerations for start-up businesses that experts can share with clients. (The service also offers plenty of information for entrepreneurs and their advisors at the Small Business and Self-Employed Tax Center.) 4 tax tips for new businesses Kay Bell August 11, 2017 You’ve had enough of being a wage slave. It’s time to start your own business. That means it’s also time to consider the tax implications of becoming your own boss. Here are four tax matters to think about as you plan your move from the corporate cubicle to your own self-employed suite. Which States Benefit Most from the Home Mortgage Interest Deduction? Amir El-Sibaie August 10, 2017 Earlier this week, we reported that the Trump administration may consider reducing the cap on the home mortgage interest deduction from a maximum of $1 million acquisition debt to $500,000. We estimated that this proposal could raise as much as $95 billion to $300 billion over the next decade, depending on how the cap is structured. We also found that the tax increase would primarily fall on high-income taxpayers because they are more likely to own larger homes and have more mortgage debt. Middle- and lower-income taxpayers would be much less likely to face a tax increase. IRS didn’t obey federal policy when deploying cloud service Michael Cohn August 10, 2017 The Internal Revenue Service doesn’t have a cloud technology strategy and didn’t adhere to federal government policy when it implemented a cloud service, according to a new report. The report, from the Treasury Inspector General for Tax Administration, noted that in December 2010, the U.S. government’s chief information officer, Vivek Kundra, directed all federal agencies to move to a “cloud first” policy. However, nearly seven years later, the IRS still doesn’t have an enterprise-wide cloud strategy. Although the agency formed a working group in July 2016 to develop such a strategy, it’s incomplete. Protecting Your Accounts by Text or App J.D. Biersdorfer August 8, 2017 Q. Which is better to use for two-step verification: getting the codes sent by text message or using an authentication app? A. Two-step verification — also known as two-factor authentication, or 2FA for short — makes your online accounts safer by requiring a separate numeric code to be typed in after you fill in the typical password. The codes you need for that second security step can be supplied by SMS text message to your phone or from a special authenticator app connected to that account. Preprinted backup codes and voice mail messages are other ways to confirm your identity in a two-factor situation. Employers Will Escape Obamacare-Sized Rate Hikes In 2018 Bruce Japsen August 8, 2017 Unlike the double-digit percentage rate hikes individuals purchasing coverage under the Affordable Care Act will see next year, those with coverage at large employers will face single-digit increases, a new national survey of large employers shows. The National Business Group on Health said Tuesday the percentage increase large companies will see next year is similar to 5% cost increases employers have experienced for five years. In its annual survey of large employers, NBGH says per employee costs are projected to increase 5% to $14,156 in 2018 compared to $13,482 per employee this year . Since employers generally cover about 70% of worker costs, employees’ 30% share next year will be nearly $4,400, which includes premium and out-of-pocket expenses . Now that you're finally retired, don't be afraid to spend money Charlie Jordan August 8, 2017 Many people who have saved millions of dollars to retire comfortably are now scared to spend it. A recently retired client, a woman with approximately $1 million in savings, was asked to join a group of friends on a girls' getaway vacation costing approximately $3,000. Even though she had plenty of money to take the trip, she felt uneasy because it meant breaking her lifetime habit of saving for the future. She's lived a financially disciplined life for so long that she didn't know how to handle this expense without any earnings to pay for it. The 5 Most Powerful Wealth Behaviors John Wasik August 7, 2017 More often than not, other than raw math, financial success is a matter of behaving well. Most people behave badly, but it's always something you can correct. The easiest behavioral fix involves savings. If you can make savings automatic -- either through a 401(k) or some kind of automatic savings plan -- that probably the best thing you can do to ensure you'll have enough for college, healthcare, emergencies and retirement. Is your college scholarship taxable? Probably not Kay Bell August 7, 2017 Here in Austin, fall 2017 classes at the University of Texas will begin on Aug. 30. But students must meet another important deadline on Aug. 18. That’s the day that UT tuition payments are due, either paid in full or in installments. It’s a scenario playing out across the United States. How To Have A Retirement Money Date With Your Partner Tania Brown August 6, 2017 I recently did a workshop with employees less than 5 years away from retirement. You might expect the group to be excited, but the predominant emotion was fear. The biggest fear was the concern that they may be missing something in their retirement planning. I find most people at this stage have at least run a retirement estimator to make sure they were on track to replace about 80% of their income in retirement, adjusting the percentage based on their financial needs in retirement. What I found most people have not done was a thorough retirement spending plan with their partner to make sure both have a clear idea of how much is really needed not only to retire but to stay retired. Consider setting up a “money date” with your partner to do the following: 6 Questions Every Small Business Owner Should Ask a Prospective Accountant Jared Hecht August 4, 2017 Everyone knows that having an accountant to assist you during tax time is critical, but outside of tax time, an accountant can be a valuable resource and trusted advisor year-round when running a business. A good business accountant will be with you each step of the way as you grow your business, helping you to create a business plan and achieve your financial goals. But how do you find the right person or firm? We’ll take a look at the questions you should be asking to choose the right accountant for you. Long List Of Americans Who Renounced Citizenship Is More About Taxes Than Trump Robert W. Wood August 4, 2017 As the dust settles on a long new list of Americans who renounced their citizenship, one organization's refrain is to renounce US citizenship not because of Trump, but because of American taxes. The latest quarterly list published in the Federal Register names the individuals who renounced their U.S. citizenship, or who terminated their long-term U.S. residency (green cards), during the second quarter of 2017. The total for the first quarter of 2017 was 1,313. The number on the second quarter's list went up to 1,759, which is the second highest quarterly number ever (second only to the fourth quarter of 2016 which had 2,365 published expatriates). Some observers may want to blame President Trump for the spike, but it is much more likely that longstanding tax issues are the real culprits. Want To Phase Into Retirement With Reduced Hours? Ashlea Ebeling August 4, 2017 Employers might not advertise the fact that they offer reduced hours—or phased retirement—for older workers, but if you’re interested, you should ask. Even if your employer doesn’t have a formal phased retirement program, there might be informal options, and both are beneficial to employers and employees, according to a recent Government Accountability Office report to the U.S. Senate’s Special Committee on Aging. The reality: A quarter of full-time workers aged 61 to 66 planned to reduce hours, but only 15% ended up doing so. Employers say these programs help with worker retention, knowledge transfer and workforce planning (new workers can be hired at a lower cost). Employees like the gradual shift from full-time to part-time work to ease into retirement. What Is the Real Value of $100 in Your State? Amir El-Sibaie August 3, 2017 This map shows the real value of $100 in each state. Prices for the same goods are often much cheaper in states like Missouri or Ohio than they are in states like New York or California. As a result, the same amount of cash can buy you comparatively more in a low-price state than in a high-price state. The Bureau of Economic Analysis has been measuring this phenomenon for two years now; it recently published its data for prices in 2015. Using this data, we have adjusted the value of $100 to show how much it buys you in each state. 7 Tax Favored Strategies To Plan For Retirement Now Kelly Phillips Erb August 3, 2017 Thinking about retiring early? To ensure that you'll have enough money to live off of in future years, sock away money now. Since income tax rates are typically higher than returns on investment, be sure to include tax planning when looking at the big picture. Here are seven tax-favored strategies to consider if you're planning for retirement now. 1. Contribute to your 401(k) and take advantage of employee matches. A 401(k) plan allows you to contribute pre-tax dollars to a retirement account where it grows tax-deferred. Powell: Saving for retirement in the most tax-efficient manner possible Robert Powell August 2, 2017 Decades ago, saving for retirement was fairly easy. You set aside 10% of your income in a taxable account. But over the years it’s become especially complicated given the many ways we can now save for retirement. In addition to taxable accounts, we now have traditional IRAs, Roth IRAs, traditional 401(k)s, Roth 401(k)s, health savings accounts or HSAs, and all sorts of annuities including, qualifying longevity annuity contracts (QLACs) and deferred income annuities. Plus, retirees can generate income from any number of resources, such as a reverse mortgage or cash value life insurance, when the time comes to fund their living expenses. The Impact Of Early Retirement On Projected Social Security Benefits Michael Kitces August 2, 2017 EXECUTIVE SUMMARY Social Security operates as an income replacement formula, with higher benefits for those who work for more years. As a result, benefits are very limited for those who don’t work for very many years, and are much higher for those with a full working career. To avoid confusing those who haven’t worked very many years yet – but plan to – the standard Social Security benefits statement projects out anticipated future Social Security benefits based on the assumption that the individual will continue working until retirement. Which allows the individual to understand what Social Security benefit they are “on track for” as they continue to work until full retirement age. Except, of course, that not everyone actually plans to work until full retirement age! How to avoid penalties when a planned rollover goes awry Angeline Rice, CPA August 1, 2017 One of the advantages of participating in a retirement plan is that the money in the plan can grow tax deferred until it is withdrawn. There are a variety of types of plans and numerous plan sponsors and institutions that administer the plans. Clients may desire to move retirement funds from one institution to another for many reasons. These reasons could include, but are not limited to: The client may be changing banking or wealth management relationships; the client may desire to consolidate various accounts that may be spread across various institutions and locations; or the client may be looking for different investment options. Ignoring 83% Of Payroll Tax Mismatches, IRS Leaves $7 Billion Uncollected...Until Now Robert W. Wood August 1, 2017 The IRS is well-known for information matching. Take IRS Form 1099. It is common knowledge that if you fail to account for income reported on a Form 1099-MISC, you will receive an IRS notice asking why, or even proposing a tax bill. You might reasonably assume that employment taxes would be even more cross-checked. For example, the IRS's Combined Annual Wage Reporting (CAWR) Program compares: (1) the employee wage and withholding information reported to the IRS on employment tax forms; to (2) withholding documents filed with the Social Security Administration. The purpose of the IRS-CAWR Program is to ensure that employers report the proper amount of employment taxes and Federal income tax withholding on their employment tax returns. Getting Divorced? How to avoid tax pitfalls when splitting up retirement accounts Bill Bischoff August 1, 2017 On top of all the other stuff, getting divorced is also a major financial transaction that can have serious tax implications. This is especially true when it comes to splitting up tax-favored retirement accounts between you and your soon-to-be ex. You need to plan ahead to make sure the tax results turn out OK for you. Recurring litigation between taxpayers and the IRS shows many folks falling into expensive traps that could have been easily avoided. Here’s what you need to know to keep from joining them. Use QDROs to divide up qualified retirement plan accounts Voices Short-term rentals may bring long-term tax problems Rob Stephens August 1, 2017 Short-term rentals, often called vacation rentals, have exploded onto the travel scene, becoming hugely popular with homeowners and travelers alike. With the help of technology, it is incredibly simple for a property owner to broadcast their rental across the world. Millions of people in the U.S. are currently renting their homes or apartments on Web sites such as HomeAway, VRBO and Airbnb. With this level of activity, it is vital that accountants and tax professionals have an understanding of property rentals and income tax implications. Though sometimes overlooked, sales and lodging taxes are an entire class of taxes that expose clients to a significant liability. Considering whether to file an income tax extension Todd Simmens, CPA, J.D., LL.M and Les Williford, CPA August 1, 2017 As practitioners throughout the United States reflect on tax season 2017, the last detail they might consider is whether more clients should be encouraged to file an extension. For some taxpayer clients, an extension is a regular, yearly occurrence. For others, the notion of requesting time beyond the original due date is outlandish. And there also are those for whom the decision to extend comes down to the wire, determined by whether the return can be filed by the original due date. However, an extension of time to file generally should be considered for every taxpayer and for every tax period for which an extension is available, regardless of whether the taxpayer intends to file on or before the original due date of the relevant income tax return. IRS processing of extensions 7 Tips on Choosing the Right Executor for Your Will Daniel A. Timins August 2017 It’s an important question: Who can be trusted to take care of your estate when you’re gone? When you pass away and your will is accepted for probate, your executor “steps into your shoes,” meaning he or she can perform all the legal tasks you used to do. This includes selling your property, paying creditors, bringing lawsuits, reviewing medical records and distributing your assets to others. Clearly, acting as an executor is an important job, so who should you choose to handle your final personal affairs? What traits make for a good executor, and who by default is unable to serve? Retirement Booster: How To Find The Best HSAs John Wasik July 31, 2017 As hybrid investment vehicles, Health Savings Accounts, or HSAs, can be a bit of a windfall. The combine savings accounts with myriad tax breaks. Generally, an HSA is offered through employers who provide high-deductible health plans. The idea is that you can save money in an HSA to cover out-of-pocket medical expenses. Five takeaways from ObamaCare repeal’s collapse Jessie Hellmann and Rachel Roubein July 28, 2017 Three Republicans dealt what appears to be a final, fatal blow to their party’s ObamaCare repeal effort on Friday morning after a yearslong odyssey that now leaves the GOP in the wilderness. Here are five takeaways from this morning’s drama and the monthslong Senate repeal fight. ObamaCare repeal: Now what? Rachel Roubein and Jessie Hellmann July 28, 2017 Senators who walked off the floor around 2 a.m. Friday after the stunning defeat of the latest GOP ObamaCare repeal effort face tough questions on how to move forward. GOP leaders sounded pessimistic notes that the failure would lead to compromise or bipartisan work on healthcare, though some members said they hoped it would spur leaders to start a more formal process of committee work after months on Senate bills being drawn up behind closed doors. Watchdog Report: IRS Continues To Rehire Problem Employees Robert W. Wood July 28, 2017 As an employer, would you rehire a former employee guilty of misconduct? Say, someone you caught falsifying official forms, peeking at secured confidential files, or misusing company property? It is hard to see how.Most employers breathe a sigh of relief when such an employee departs. You don't hire them back. How about rehiring hundreds of such misbehaving workers? Rehiring is for someone you want back, not someone who was a problem. But the IRS may be different from your average employer. The IRS continues to rehire former employees with conduct and performance issues, according to a newly released report from the Treasury Inspector General for Tax Administration (TIGTA). You can see the full report and the full IRS response here. After Healthcare Fail, GOP Moves On To Tax Reform: Here's What They Propose Kelly Phillips Erb July 28, 2017 After failing to repeal, repeal and replace, or even "skinny repeal" Obamacare, Congress is now taking on tax reform - a job many have declared will be even more difficult than health care reform. To emphasize their commitment to the task, joint leadership from the Senate, House and White House released a statement about "fixing America’s broken tax code." The joint statement was delivered by House Speaker Paul Ryan (R-WI), Senate Majority Leader Mitch McConnell (R-KY), Treasury Secretary Steven Mnuchin, National Economic Council Director Gary Cohn, Senate Finance Committee Chairman Orrin Hatch (R-UT), and House Ways and Means Committee Chairman Kevin Brady (R-TX). As before, the notes in the statement were more talking points than specific policy details and echoed prior statements about what the current administration feels is necessary to move the economy forward. White House, GOP close to releasing joint tax-reform principles Naomi Jagoda July 26, 2017 The White House, congressional leaders and the chairmen of the tax-writing committees may release joint tax-reform principles as soon as this week, according to lobbyists. Speaker Paul Ryan (R-Wis.) told attendees at an event Tuesday at the Capitol Hill Club that the unified tax-reform framework would be unveiled later in the week, and that the House Ways and Means Committee would then write legislation based on the principles, according to Hadar Susskind, senior vice president of government relations at the Council on Foundations. A representative of Susskind’s group was at the event. A Bill Funding Arts and Humanities Endowments Passes House Committee Graham Bowley July 20, 2017 Four months after President Trump proposed eliminating the cultural agencies altogether, a bill to continue to finance the National Endowment for the Arts and the National Endowment for the Humanities won approval this week from the House appropriations committee. The House bill, part of the process of thrashing out the federal budget for fiscal year 2018, includes $145 million for each endowment. The amounts represent a cut of about $5 million to each agency, but is a stark contrast to President Trump’s proposal to eliminate the endowments entirely as outlined in his first federal budget plan he announced in March. Adoption tax breaks help cover costs of adding to your family Kay Bell July 19, 2017 If you've been paying attention to Donald Trump Jr.'s meeting with some Russians last summer, you know the White House has given two reasons for the gettogether. The explanation that caught my tax eye was that the group talked about adoptions. The president's oldest son said that one of the Russian nationals came to Trump Tower to lobby for reversal of the Magnitsky Act. The law gets its name from attorney Sergei Magnitsky, who died in 2009 while being held in a Moscow prison. Retirement Dread Is Replacing the American Dream Suzanne Woolley July 18, 2017 With informed discussion, creative thinking, and timely legislative action, Social Security can continue to protect future generations. That boilerplate language has been featured more or less verbatim in the yearly status report from the trustees of the Social Security and Medicare funds since 2001, through presidents George W. Bush, Barack Obama and now, Donald Trump. When you should - and shouldn't - tap your Roth IRA early Arielle O'Shea, NerdWallet July 18, 2017 Most retirement accounts are for one purpose: The money goes in and stays in until retirement — specifically, until the investor turns 59 1/2. Pull it out early and you'll have to pay taxes and penalties. Understandably, that lengthy lockdown doesn't always sit well with younger investors. Sure, you may not need that money now, but there could be plenty of future circumstances in which you might. Having thousands of dollars stashed behind bars won't bail you out of a job loss, get you out of debt or unlock the door to your first home. Airbnb collecting occupancy taxes for more of its clients Kay Bell July 18, 2017 Are you booking your summer vacation stay via Airbnb? You might want to budget a bit more for lodging taxes. The popular private residential rental service collects sales and occupancy taxes on properties' leased in all or parts of 31 states, as well as the District of Columbia and the U.S. Virgin Islands. Internationally, Airbnb also is acting as tax collector in six countries. State Inheritance and Estate Taxes: Rates, Economic Implications, and the Return of Interstate Competition Jared Walczak July 17, 2017 Key Findings Eighteen states and the District of Columbia impose either inheritance or estate taxes, with fourteen states (plus Washington, D.C.) levying estate taxes and six states levying inheritance taxes. Of these, two states (Maryland and New Jersey) impose both taxes, though New Jersey is in the process of repealing its estate tax. For decades, the federal government offered a credit against federal estate tax liability for state inheritance and estate taxes paid, which allowed states to impose a “pick-up” estate tax without increasing residents’ overall tax liability. The elimination of this credit in 2005 ushered in a new era of estate and inheritance tax competition among the states. Trust, but verify: Keep an eye on your college kid’s spending Amber Murakami-Fester, NerdWallet July 16, 2017 When you’re a parent shipping a kid off to college, it’s hard not to worry about every possible financial mishap, for example: is money that was meant for textbooks paying for a music festival ticket? But there are ways to ensure students are making the right financial decisions without hovering over them. Joint bank account Setting up a joint checking or savings account means parents and students have access to money in the account and can see all transactions. Don’t Do It: Don’t Start a Nonprofit Dahna Goldstein July 14, 2017 Do you want to make a difference? Great. Please do. But don’t start a nonprofit. Are you concerned about what is currently happening to vulnerable populations, the environment, and media freedom? I am, too. Are you afraid it’s only going to get worse? You’re probably right. But don’t start a nonprofit. If your Social Security benefit is smaller than expected, here's why Kelli B. Grant July 14, 2017 If you're counting on Social Security benefits, you better make sure you don't owe Uncle Sam. Under certain circumstances, the government can seize part of your Social Security check to satisfy unpaid debts, including overdue federal taxes and delinquent federal student loans, among others. This comes out of your payments before you receive them. Irrevocable Trusts: What You Need to Know Dan Caplinger (TMFGalagan) July 14, 2017 Many people want to provide for their loved ones but in a way that allows them to retain control over their assets. An irrevocable trust can be a great way to achieve these estate planning goals. Irrevocable trusts have advantages over alternatives like wills or revocable trusts, but they also require a different way of thinking about your assets. With the potential for substantial tax savings and other benefits, irrevocable trusts are worth considering in your personal estate planning. How the Medicaid Debate Affects Long-Term Care Insurance Decisions Ron Lieber July 14, 2017 The latest version of the Senate’s health insurance bill appeared on Thursday, and it didn’t do much to change the drastic reductions in Medicaid spending that were in the original legislation. Here’s why that’s important to nearly everyone, even people who are reasonably affluent for now: As I’ve explained in two recent columns, Medicaid is the backstop for retirees who run out of money but still need home-based care or must move into a nursing home. Medicare generally doesn’t cover those costs, and they are high enough that even people with many hundreds of thousands of dollars can end up spending everything they have the years before they die. Not-for-Profit Gifts: Thanks or No Thanks? AICPA Communications July 13, 2017 Not-for-profit organizations are always thankful for the generosity of their donors. Sometimes, however, they must consider whether a proposed gift should be accepted. A gift of $100,000 in cash is easy to immediately direct toward the not-for-profit’s mission. On the other hand, a donation of real estate worth $100,000 may come with additional expenses and effort to sell the property before the proceeds are available to support the organization’s mission. Having a formal gift acceptance policy can help define when an organization should, or should not, accept a proposed gift. Mortgage rates jump as bond market finally buys what the Fed is selling Andrea Riquier July 13, 2017 Rates for home loans jumped in the latest reporting week, taking the benchmark back over a key threshold for the first time since May, mortgage provider Freddie Mac said Thursday. The 30-year fixed-rate mortgage averaged 4.03% in the July 13 week, while the 15-year fixed-rate mortgage averaged 3.29%. The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.21%. All three products rose seven basis points during the week. Social Security trust fund will be depleted in 17 years, according to trustees report Philip Moeller July 13, 2017 The annual trustee reports on Social Security and Medicare were released earlier today and showed little change from last year. With both programs facing longerterm deficits, these annual report cards have become a doomsday clock for senior benefits. The top line of today’s reports is that the estimated insolvency date of Social Security’s big trust fund is 2034 — unchanged from last year. The other big fund is Medicare’s hospital trust fund. Last year, it was projected to run out of funds in 2028, or 12 years. That date was rolled forward a year — to 2029 — in this year’s report. 3 Things That Can Instantly Reduce Your Nest Egg Maurie Backman (TMFBookNerd) July 13, 2017 One of the most challenging aspects of retirement is figuring out how much money to save. While it's not so easy to nail down a specific number, it's fair to say that the more money you sock away, the better positioned you'll be to enjoy retirement to the fullest. But building a strong nest egg isn't just a matter of contributing to a retirement fund and leaving things at that. In fact, if you're not careful, a few mistakes during your working years could set back your savings significantly. Here are a few factors that can slash your nest egg, so be sure to avoid them at all costs. Home care workers have our lives in their hands. They're paid only $10 an hour Sarah Jaffe July 13, 2017 June Barrett’s day as a home care worker starts at 5pm and lasts for 16 hours, overnight. All night long, she checks on her elderly clients, a married couple both in their 90s. They sleep in different parts of their Miami home, and much of Barrett’s job is spent trekking through the corridors, back and forth, to make sure husband nor wife has suddenly taken a turn for the worse. “I’m constantly on my feet,” she says. Two million workers across the US do the kind of home care that Barrett does – the workforce has doubled in size over the past 10 years, and the Bureau of Labor Statistics predicts the field will add more jobs than any other occupation by 2024. Don’t fall for the conventional wisdom when choosing an IRA Kenn Tacchino July 13, 2017 Financial planning rules of thumb can provide useful insight, but they are only a starting point. When it comes to the decision to choose an IRA, the conventional wisdom is to use a Roth IRA if tax rates are expected to rise in retirement and choose the traditional IRA if they are expected to fall in retirement. However, even if you think you will be in a lower bracket after you retire, having some Roth assets could result in less taxes being siphoned from your annual retirement budget, which means more spending money available each year. Think of placing part of your assets in a Roth account as enabling you to have “tax diversification” in retirement regardless of your future marginal tax rate. It's Shocking How Many Entrepreneurs Aren't Saving for Retirement Lydia Belanger July 11, 2017 Most entrepreneurs don’t think their businesses are big enough for 401(k)s. Others think it’d be too expensive to implement retirement plans. More than one-third just plan to cash in by selling their company at a later date. A variety of factors deter entrepreneurs from saving, but there’s a major discrepancy between the percentage of small-business owners who say they’re confident they’re putting away enough for retirement and the percentage who aren’t saving at all. Sixty-two percent say they feel confident that they’re saving enough, but a full 25 percent of small-business owners report they aren’t saving a dime. What You Need to Know About Retirement at Every Age Kelsey Butler July 11, 2017 Retirement evokes images of lounging on a beach, catching early dinners and, most importantly, never having to deal with your ugly morning commute ever again. But before you start fantasizing about that light at the end of the tunnel of your work life, financial experts say you need to get real about preparing for it. No matter what stage of your life you’re in, there are crucial steps you need to be taking to make sure those dreams of a work-free life — while keeping the lifestyle you’re accustomed to — are a reality. Here’s what you need to know about getting ready for retirement in the decades to come. Man Accused Of Literally Giving IRS The Finger Kelly Phillips Erb July 11, 2017 There's angry, and then there's really, really angry. An Olympia, Washington man is under investigation after he allegedly sent a fake bomb to the Internal Revenue Service (IRS). Normand Lariviere has officially been charged with communicating a threat to injury through the mail in violation of Title 18, Unites States Code, Section 876(c). It wasn't the first time that the 68-year-old man has sent the IRS a threatening package. Authorities say that 68-year-old Lariviere had previously mailed a marijuana cigarette, a bullet, and his own finger to the IRS as part of a series of protests. The finger was allegedly cut off with a homemade device which Lariviere later showed to authorities. Millennials' participation in tax-favored workplace retirement plans improves, but still lags other generations Kay Bell July 11, 2017 Every financial adviser recommends that we all keep close eyes on our retirement plans, either by reallocating our investments or contributing more money throughout the year. Just last week, in fact, I put contribute to your retirement accounts on my list of 6 tax moves to make in July. What Tax Deductions Do High-Income Earners Use Most? Terry Sheridan July 11, 2017 New data released by the IRS sheds some light on just what tax deductions high-income earners take. The hands-down winner is the deduction for state and local taxes, with households earning more than $200,000 annually deducting $243 billion in 2014. That’s 47 percent of all state and local taxes deducted by US households that year. More than Medicaid: The Full Cost of ACA Repeal and Replace for States Tracy Gordon July 11, 2017 Congressional plans to repeal and replace the Affordable Care Act have governors worried – and with good reason. Although proposals continue to evolve, states stand to lose upwards of $100 billion each year in federal Medicaid funds under the most recent Senate leadership proposal and a House-passed bill. But that’s not the whole story. Whatever emerges from current negotiations is also likely to restructure tax credits and subsidies now available under the ACA to help low- and moderate-income people purchase health insurance and defray deductibles, copayments, and other out-of-pocket costs. Texan Gets 3 Years Prison For Payroll Taxes, Why You Should Avoid Violations Robert W. Wood July 11, 2017 Richard Floyd Tatum Jr., 57, a Houston, Texas business owner, was sentenced to 36 months in prison for failing to pay over employment taxes. That may sound like a relatively simple tax problem, but it is anything but. Some months ago Tatum pleaded guilty to one count of failing to pay over employment taxes. The dollar amount of the violation was staggering. His company, Associated Marine & Industrial Staffing Inc. (AMI), was an industrial staffing company. It provided temporary labor to businesses in Texas and in other states. Through his company, Tatum employed approximately 1,000 people assigned to work on-site at client locations. 6 Tax Questions To Ask Before You Retire Brian O'Connell July 10, 2017 Nearly one of every three dollars that high-income retirees spend goes to taxes, including those for federal, state, capital gains, real estate and personal property, according to a study by Lincoln Financial Group. Together, those taxes represent 31.8 percent of all household costs incurred in retirement, the study found. As the Lincoln report points out, most future retirees don't expect taxes to be among their highest bills, which is why Americans in their 50s and 60s who are anticipating a comfortable retirement may want to rerun those numbers. Your best bet is to check with a financial professional and address these key tax and retirement questions – before you get the gold watch. 3 Serious Problems With the 4% Retirement Rule Maurie Backman (TMFBookNerd) July 10, 2017 One of the most stressful aspects of retirement is the idea of running out of money. In fact, recent data has found that older Americans are more concerned with outliving their savings than actually dying. It's for this reason that so many financial experts advise their clients to fall back on the 4% rule. Developed in the mid-1990s by William Bengen, the 4% rules states that if you begin by withdrawing 4% of your nest egg during your first year of retirement, and then adjust subsequent withdrawals to allow for inflation, you stand a strong chance of having your savings last for a 30-year period. To be fair, the 4% rule does have a pretty solid history of success. On the other hand, it doesn't work for everyone and in fact has its share of flaws. Here are three major problems with the 4% rule you need to be aware of. How To Spot The Worst Hidden 401(k) Expense John Wasik July 10, 2017 I've always hated the idea of investors paying too much for mutual funds. You can easily find off-the-shelf mutual and exchange-traded funds that hold most stocks and bonds for less than 0.15% per year in management fees. Yet most people don't shop around for funds, the vehicles in most 401(k)s and other investment portfolios. They spend more time shopping for flat-screen televisions. Seattle City Council approves income tax on the rich, but quick legal challenge likely Daniel Beekman July 10, 2017 The Seattle City Council unanimously approved an income tax on wealthy residents Monday, a move widely expected to draw a quick legal challenge. The measure applies a 2.25 percent tax on total income above $250,000 for individuals and above $500,000 for married couples filing their taxes together. 5 Things to Know About Your Social Security Statement Emily Brandon July 10, 2017 The Social Security Administration stopped mailing paper Social Security statements to everyone under age 60 in 2017. Younger people who want to check their earnings history or taxes paid will need to view their statements online. The SSA says more than 30 million people have created a my Social Security account since they became available in May 2012. The agency expects to save $11.3 million in processing and mailing costs in fiscal year 2017 as a result of the change. Here's why you should take a few minutes to view your benefit statement online. Find out how much you will get when you retire. Opinion: Should I keep my 401(k) with my employer when I retire? Mitch Tuchman July 10, 2017 A new analysis of the retirement business points out that people are increasingly stepping away from trading and into automated, low-cost portfolios. Three cheers for that, we say, but it raises an interesting question. Once you retire, should you stay in your set-itand-forget-it company plan or do something different? How does "investing wellness" continue into retirement? The Face of America's Pension Crisis Motley Fool Staff And Jordan Wathen July 10, 2017 Meet Tony. For years, Tony worked in a plant that manufactured industrial gases. He started working at the plant in 1979, joining the Teamsters after deciding, like many who worked there, that becoming part of the union, and participating in its pension plan, was a smart financial decision. The plant, which used processes that were dangerous in retrospect, according to Tony, eventually declined into technological obsolescence. Newer, safer processes became the standard for producing the gases that his plant produced. After a long career, he retired from the plant, and at 58 years old, he and his wife now work at Sam's Club and continue to save diligently for retirement through Wal-Mart's 401(k) program. Millennials' health care preferences are likely to shape any Obamacare rewrite Kay Bell July 8, 2017 The Senate will get back to work next week crafting an Obamacare repeal-and-replace measure, an already difficult task made more problematic by the messages lawmakers got from their constituents over the July 4th holiday. There are many reasons, both political and practical, that devising a health care system for all of America is so complicated. One of the key ones is because we are so diverse. Experts On: What NOT to Do When You're Trying to Get a Mortgage Julie Sprankles July 7, 2017 While buying a home is one of the most exciting and rewarding things you'll do in your life, it can also undoubtedly be one of the most stressful. This is due in no small part to the mortgage approval process which, at its best, is tricky and, at its worst, downright perplexing. When I purchased my first home, I felt like I had sufficiently done my research. My confidence never wavered as I scrolled through Zillow listings, flagging homes with the same glee I reserved as a child for marking all my musthaves in the Toys 'R Us holiday catalog. Oregon just passed the only bike-specific tax in the country Lizzy Acker July 7, 2017 On Thursday, the Oregon Legislature approved an ambitious $5.3 billion transportation tax and fee package. House Bill 2017, which passed the Senate 22-7, includes a 4-cent gas tax hike, a $16 vehicle registration fee increase, 0.1 percent payroll tax and 0.5 percent tax on new car sales. It also includes something that no other state in the country has: a tax on the sale of bikes. Health savings accounts becoming the new IRAs Jeff Benjamin July 6, 2017 With more than $40 billion in total assets, health savings accounts are starting to add up to real money, which could represent another area of opportunity and responsibility for financial advisers. Today, only about 4% of HSA savers are moving money out of safe investments and investing it in the financial markets. But as account sizes grow, more aggressive investing is expected to become more common inside these tax-friendly accounts. IRAs not serving intended savers: CRR Marlene Y. Satter July 6, 2017 When IRAs were created in 1974 under the Employee Retirement Income Security Act, one big motivator was to give workers who lacked access to a retirement plan at work a way to save for retirement in a tax-deferred account. But according to a new brief from the Center for Retirement Research at Boston College, that’s not what’s happened. Instead, most of the new money flowing into IRAs these days comes from higher-income people, who often also have a 401(k) plan. Yes, You Can Save Enough for Retirement — and Have Your Latte Too Walter Updegrave July 6, 2017 A recent Vanguard blog post on the benefits of compounding interest calculated that if you skipped a $3.50 cup of java every day and invested that money instead in a diversified portfolio earning 6% a year, you would end up with more than $100,000 after 30 years. While this example nicely illustrates how the compounding of investment gains can turn even small sums into big bucks over time, people often over-hype the financial benefits of skipping that daily Starbucks run. After all, what are the odds you will dutifully avoid buying another cup of coffee every day for the next 30 years? More than a job — businesses play a critical role in creating career opportunities for veterans Gary Profit and Brian Stann July 6, 2017 When the Bureau of Labor Statistics releases the Employment Situation Summary this week, there is one group of individuals that might not get your attention but should be at the forefront of our minds: the men and women who have served our country in the U.S. Armed Forces. According to the Department of Defense, in 2016, more than 200,000 military members returned home to civilian life. Unfortunately, many of them find it difficult to navigate the civilian job market and may join the ranks of the more than 340,000 unemployed veterans in our country — 40 percent of whom are between the ages of 18 and 44. Love & Marriage: What's Tax Got To Do With It? Ashley L. Case and Darren T. Case July 6, 2017 Within Dr. Gary Chapman's world-renowned, best-selling book, The Five Love Languages: The Secret to Love that Lasts, disappointingly absent is any reference to the Internal Revenue Code. Surprisingly, only "Words of Affirmation", "Quality Time", "Receiving Gifts", "Acts of Service", and "Physical Touch" made the cut. Surely the 74,000+ page federal tax code (which literally begins with Section 1(a): "Married Individuals Filing Joint Returns…") would garner more attention for a sixth love language of "Favorable Tax Treatment." Why Millennials Won't Be Buying Your House Chris Bryant July 5, 2017 Having been rejected by young people in the recent U.K. election, a senior minister in Theresa May’s government called at the weekend for a “national debate” on England’s 9,250 pound ($12,000) yearly student tuition fees -- which the opposition Labour Party wants to abolish. The minister, Damian Green, got his wish. A lively discussion followed about whether it's fair to ask graduates to pay for their own education. And this isn't just a question of fairness or politics, the economic consequences of student loans are hugely important too. Three retirement savings strategies to use if you plan to retire early Tom Anderson July 5, 2017 If you're lucky to have saved enough money to leave the rat race early, you still need to a retirement strategy that minimizes taxes and penalties. Retirement account rules are stacked against early retirees. People may face a 10 percent early withdrawal penalty if they take money out of their traditional IRAs before age 59½ and before age 55 with traditional 401(k) plans and other workplace retirement plans. IRS Warns That Pay On Disability Is Often Taxable: Here's How To Tell Robert W. Wood July 5, 2017 What is taxed and what isn’t can be confusing. In the case of disability pay, whether it is taxed or not usually depends on who paid for the disability insurance coverage. Perhaps your employer paid and you were covered as a fringe benefit. In that case, when you are disabled and the coverage kicks in, the benefits you receive are taxable. However, what if you paid for your disability insurance yourself, with after-tax dollars? In that case, the payments you later receive on disability are tax-free. How to Win at Retirement Savings Ron Lieber July 5, 2017 While most workers are responsible for their own retirement savings these days, high schools don’t have required classes on 401(k)’s and Individual Retirement Accounts (I.R.A.s). And colleges usually don’t teach anything about Roth I.R.A.s or 403(b)’s. That’s where we come in. Here is what you need to know about saving for life after you stop working and getting on the path toward a comfortable retirement, no matter your career or the size of your paycheck. What to Do if You Contribute Too Much to Your IRA Wendy Connick July 5, 2017 While only the most diligent savers are likely to max out 401(k) contributions, IRAs are another matter. The maximum allowable contribution for IRAs in 2017 is $5,500 (and you can contribute an extra $1,000 if you're 50 or older), which is manageable for many everyday savers. And exceeding this contribution limit has serious consequences. When Debt Is Good Mark Tibergien July 3, 2017 The word “debt” is rarely expressed as a positive notion. Financial advisors coach clients to reduce financial liabilities. Politicians push to eliminate the federal deficit. College graduates bemoan daunting student bank loans. Debt is a four-letter word. That is both an absolute fact and a matter of perception. When the same concept is called “leverage,” wealthy people and business executives see potential. Using other people's money for the purpose of acquiring an asset or funding business growth can be an effective financial management tool for those who can afford the risk and are able to repay the obligation. 6 Things To Know About Your Side Hustle And Taxes Kelly Phillips Erb June 29, 2017 From Uber to Dogwalker.com, there are tons of ways to make some money on the side while pursuing your dream job - or just digging out of debt. If you're hoping to pick up some extra cash with a side gig this year, here's what you need to keep in mind on the tax side. 1. Income is income. It doesn't matter if your extra income is from driving a car or trading stocks, income is reportable unless it's otherwise excluded. 8 Tips to Determine Your Not-for-Profit’s Year-End Marc Kotsonas, CPA June 29, 2017 Not-for-profits have a luxury that most other individuals and businesses do not. They’re allowed to select their fiscal year-ends for IRS purposes. Partnerships, sole proprietorships, S corporations and other legal structures, with limited exceptions, may not. These groups generally are required to use calendar year-ends for tax filings. Read on to find out what a not-for-profit should consider when choosing a year-end date. How does a not-for-profit choose its year-end? If You Pay Cyberattack Ransom, Deduct It On Your Taxes Robert W. Wood June 29, 2017 Yet again, there has been a major cyber attack, this time on a very large scale. This time, the massive cyberattack was traced to tax software. It is said to have impacted people in 64 countries, with its origins in a Ukrainian company's tax accounting software. Reports say impacted systems are offered the chance to get files released for a simple payment of $300 in bitcoin. You might think the haul for the hackers would be huge, but evidently it was not. Still, there were clearly some people who paid, whatever the government and tech advisers were suggesting. It is understandable, since the cost of being frozen out can just be too big. So if you pay hackers ransom to keep your business operating, is it tax deductible? Whether personal or business, it probably is, although the type of deduction can vary. My best friend is a CPA and a CFP — and he gave me the best financial advice I've ever heard Thomas C. Corley, Contributor June 29, 2017 My best friend, Bill King, is 11 years older than I am. Like me, he’s a CPA and a CFP. When I was just starting out in my career, Bill gave me the best financial advice I've ever heard. “Same house, same spouse, same car.” Deducting your cell phone as a business expense Kay Bell June 29, 2017 What were you doing 10 years ago today? If you're an extreme tech geek, you were among the thousands waiting to get your hands on the first ever iPhone. June 29, 2017, is the 10th birthday of the mobile device that, per Steve Job's promise (or threat, depending on your point of view), has irrevocably changed lives worldwide. Oregon Department of Revenue will undergo top-to-bottom review Diane Dietz, Statesman Journal June 28, 2017 The Oregon Legislature is ordering a top-to-bottom review of the state’s troubled tax collecting agency even as it prepares to hand the agency expanded powers to go after bad debts owed to the state. Lawmakers on the Joint General Government Subcommittee ordered the Department of Revenue to undergo a $150,000 comprehensive financial audit and a $350,000 management assessment. What jobs will still be around in 20 years? Read this to prepare your future Arwa Mahdawi June 26, 2017 The robots are coming, the robots are coming! Regular reports warn us that an automation apocalypse is nigh. In January, a McKinsey & Company study found that about 30% of tasks in 60% of occupations could be computerized and last year, the Bank of England’s chief economist said that 80m US and 15m UK jobs might be taken over by robots. 10 Things Retirees Need to Know About Housing Tom Sightings June 26, 2017 For most retirees, your house is your biggest and most valuable asset. You might be planning to retire in place, sell it to move to a retirement mecca, use it to produce some much-needed income or leave it to your kids as part of an estate. But your home's value can fluctuate over time. Here are ten things to know about the current housing market, according to reports from the Joint Center for Housing Studies at Harvard University and the National Association of Realtors. 1. Home prices are up. According to the National Association of Realtors, U.S. home resales rose in May 2017 to 5.62 million, the third highest level in a year. The median home price has reached an all-time high of $252,800, or 5.8 percent better than a year ago. How Much Money Can You Gift Tax-Free? Matthew Frankel (TMFMathGuy) June 25, 2017 Americans can give away millions of dollars tax-free during their lifetimes, but the rules are a bit complicated. To understand how much you can give, you need to know the annual gift tax exclusion, and how estate taxes work. If you have a high net worth, you can potentially use these rules to save your heirs millions of dollars. The annual gift tax exclusion The first part of the answer involves the annual gift tax exclusion, which is currently $14,000 per year, per person. This applies to monetary gifts, as well as to the fair market value of gifted property. You can give up to this amount to as many people you'd like every year, and the federal government won't tax one cent. For example, if you have five children and fifteen grandchildren, you can give them each $14,000 per year. That's $280,000 in tax-free gifts every year. How to Make the Family Business Work Across the Generations Paul Sullivan June 23, 2017 Yuta Suzuki was studying finance with the goal of becoming an investment banker. Then his father called. “He came to me with a serious face and said, ‘I heard you’re good at math,’” Mr. Suzuki, 37, said. “We have a small problem. We need your help.” His father, Toshio Suzuki, was the chef and co-owner of the restaurant Sushi Zen, which had been a Midtown Manhattan institution for more than 30 years. And his problem wasn’t so small. “When I looked at the books it wasn’t healthy,” his son said. What To Do When You Owe Taxes You Can't Pay Larry Light June 23, 2017 Yikes. A whopping tax bill appears and you can’t pay it all at once? What do you do? Our tax expert, Jim Blankenship, founder and principal at Blankenship Financial Planning in New Berlin, Ill., shows how to handle this dilemma: For all your good intentions, you’ve found yourself in a position where you owe taxes to the IRS that you can’t pay right away. All is not lost, there are ways to deal with this situation that can be helpful if you can’t pay. The IRS has several methods you can use to arrange a plan to pay the IRS taxes that you owe over time. Oregon’s Quest for a Gross Receipts Tax Ends…For Now Nicole Kaeding June 22, 2017 After months of discussions, hearings, political maneuvering, and education, the Oregon legislature has abandoned its efforts to create a gross receipts tax this legislative session. This morning, Governor Kate Brown, Speaker Tina Kotek, and Senate President Peter Courtney announced that all consideration would stop until 2019. Following the defeat of Measure 97 on the ballot in November, Oregon’s legislature explored creating a gross receipts tax in a quest to balance its budget—the state has a $1.4 billion deficit for the upcoming 2017-2019 biennium—and to add stability to the state’s revenue streams. Oregon does not have a general sales tax, does have a constitutional restricted property tax, and relies heavily on its individual income tax to generate revenue, which is an incredibly unstable revenue source. Pros and cons of paying off mortgage before retirement Deborah Nason June 22, 2017 Should you pay off your mortgage before you retire? There's no clear-cut answer, as the strategy depends on the client's tax situation, asset and income levels, and attitudes toward debt and investment. Financial advisors discuss the pros and cons. Pros Even Lawyers Face Independent Contractor - Employee Disputes Robert W. Wood June 22, 2017 There is considerable talk about tech workers and worker status. There are also big lawsuits over who is truly an independent contractor and who is actually an employee, whatever you may call them. The stakes are big for governments, for workers, and for companies whose practices are scrutinized. Independent contractor v. employee distinctions can apply just about anywhere. With workers in almost any setting, there are tax, employment law, pension, and fringe benefit reasons that the government, third parties, and workers often argue about worker status. Even lawyers can be independent contractors or employees. Women owe two-thirds of student loan debt. This points to a slow-burning crisis Michelle Chen June 21, 2017 By many measures, women have leapt ahead of their male peers in higher education. Today they have higher college enrollment and graduate at higher rates, and on many campuses, women’s and gender studies programs have mushroomed on campuses nationwide. But women’s educational advancement hasn’t come cheap. The hidden cost of academic gender parity, according to a new analysis by the American Association of University Women, is a disproportionate student debt burden; women are borrowing more to “get ahead” on the career ladder, only to find their futures constrained by the shackles of debt. 10 tax tips for newlyweds Kay Bell June 21, 2017 Ever wonder why June is "the" wedding month? Me, too. So I looked it up. The Old Farmer's Almanac, which I never realized was a go-to wedding planning resource, says that June is the most popular month to marry thanks to some ancient traditions. The Roman goddess Juno, for whom the sixth month was named, was the protector of women in all aspects of life, but especially in marriage and childbearing. So, says the Almanac, a wedding in Juno's month was, and apparently still is, considered most auspicious. 6 Money-Saving Tips You Can’t Afford to Miss Susan C. Allen, CPA, CITP, CGMA June 21, 2017 Those fun, light-hearted GEICO commercials that ask if you are tired of paying too much for car insurance hone in on the idea of wasting your money –– paying too much for something or not getting enough. As a CPA who is passionate about making my hardearned money work for me, it’s important to take time to critically analyze what my cash is doing. Busy lives often lend themselves to costly complacency in one’s personal finances. Basically, we want bill paying done and our retirement planning intact with as minimal effort as possible. Do you need to pay off your mortgage before you retire? Dana Anspach June 21, 2017 Many near-retirees pay extra on the mortgage each month, avidly working toward having it paid off by retirement. Is this necessary to have a secure retirement? In some cases, yes. In others, not so much. When it comes to paying off the mortgage, a one-size-fits-all answer doesn't work. In general, lower income households with total investable assets of less than a million are best served working to pay off the mortgage by retirement. Beware IRS Form 1099 Mistakes That Trigger Big Taxes On Phantom Income Robert W. Wood June 21, 2017 Some tax mistakes make it look like you collected big, when you really didn't. They can cause tax problems, and it can be hard convincing the IRS that you are right. Take the recent case of a woman who was giddy over winning a $43 million casino jackpot. Her excitement was short-lived, as the casino claimed the slot machine malfunctioned. Oops, you didn't win after all, they said. The slot machine said it was "printing cash ticket $42,949,672.76," but it was a mistake. The casino offered her a steak dinner instead, but Katrina Bookman is suing the Resorts World Casino over the $43 million jackpot, demanding her payout. She alleges negligence, breach of contract, and negligent misrepresentation, according to Courthouse News Service. IRS Warns Don't Rely On IRS.Gov -- It Isn't Authority Robert W. Wood June 20, 2017 Can you rely on the IRS? In an audit, can't you cite the IRS to the IRS? You would think so, but the big tax collection agency isn't exactly a warm and fuzzy place. Plainly, the IRS has a tough job to do. Our tax law is famously complex, and administering its twists and turns in a fair way isn't easy. Still, taxpayers and practitioners alike have complained for years that you cannot rely on things the IRS tells you over the phone. In the past, there even used to be surveysshowing the track record of IRS employees answering tax questions. These surveys showed just how reliable (or unreliable), those employees were. Of course, now it’s plenty difficult to just talk to a real person at all, so perhaps the reliability function is not as big a worry as it used to be. Here's How Much a Job Loss Now Will Cost You by Retirement Dan Kadlec June 19, 2017 When Americans struggle financially—if they face a job loss or a bout with illness, for example—one of the first places they turn for relief is their retirement savings accounts. This makes some sense, at least in the short term: Such accounts typically provide ready cash. But the long-term costs are significant, and they plague more people than you might imagine. Why some CPAs bring their dogs to the office Cheryl Meyer June 19, 2017 Teddy, Winston, Louis, Auggie, Baxter, Darby,Jonnah, Toby, Roxy, and Hennessey have a lot in common: Not only are they charming canines, but they also spend their days at public accounting firms with their beloved CPA humans. The dogs bring joy to office staffs, and they help reduce tension for clients, many of whom visit the offices during nerve-wracking tax time. According to a 2016 study by Banfield Pet Hospital, pet-friendly workplaces offer several benefits, including boosting employee morale, reducing employee stress, and providing employers a competitive edge when recruiting. While canine mascots don’t fit with all professions, public accounting sometimes gives its members flexibility to bring their dogs to the office—as long as the dogs have the right temperament and firm owners and clients don’t mind. In advance of Take Your Dog to Work Day on June 23, we asked several CPAs why they bring their dogs to work, and how these four-legged friends impact their offices. Here are their stories: More giving, more benefit for all Jim Eskin, For the Express-News June 19, 2017 Would you give up $1 if you could get $3 in return? That’s how smart the public policy investment in the charitable tax deduction has been. For every dollar a donor gets in tax relief for a donation, the public typically receives $3 of benefit. It’sunlikely government could find a more effective way to leverage private investment in community services. The odds for tax reform appear to be more favorable now than they have been since the Tax Reform Act of 1986. The charitable deduction has buttressed the vitality of American philanthropy for a century now. US workers forfeit half their vacation time Jessica Dickler June 19, 2017 As the official start to summer kicks off this week, many workers are planning their vacations — at least in theory. In fact, workers in this country leave much of their paid time off on the table, according to a recent report by jobs and recruitment website Glassdoor. It said workers, on average, use only 54 percent of their eligible vacation time. As More States Kill Their Estate Taxes, Will The Push To Repeal The Federal Estate Tax Become Irresistible? Paul Caron June 18, 2017 Want proof taxes can actually go down? In the past three years, nine states have eliminated or lowered their estate taxes, mostly by raising exemptions. And more reductions are coming. Minnesota lawmakers recently raised the state’s estate-tax exemption to $2.1 million retroactive to January, and the exemption will rise to $2.4 million next year. Maryland will raise its $3 million exemption to $4 million next year. New Jersey’s exemption, which used to rank last at $675,000 a person, rose to $2 million a person this year. Next year, New Jersey is scheduled to eliminate its estate tax altogether, joining about a half-dozen others that have ended their estate taxes over the past decade. ObamaCare: Six key parts of the Senate bill Jessie Hellmann June 18, 2017 While Senate Republicans are drafting theirhealthcare plan behind closed doors, they’ve given reporters a general idea of what might be in it. The bill is shaping up to have a similar structure as the House’s bill, while more reflecting the principles of centrist Republicans in both chambers. ASK A FINANCIAL PLANNER: Should I save money or pay off debt? Jeff Rose June 18, 2017 Certified financial planner Jeff Rose answers: How should I prioritize spending and saving from my takehome pay when I still have tons of student loans? I've got $30,000 left at an average rate of 7%. How much of my paycheck should be devoted to general spending, saving, and paying those off? Can I get away with just paying the minimum on my loans? I don't have any other debt at the moment. Column: Budgeting for retirement? Plan on spending an eye-popping amount on health costs Gail MarksJarvis June 18, 2017 A quick look at your retirement savings and estimated Social Security payments may convince you that you're well-prepared to retire. But before you do, consider the health care costs that await you in retirement: The average 65-year-old couple retiring in a year can expect to spend $404,253 in today's dollars on health insurance and other health care costs. When using Social Security alone to pay those costs, that couple would need to devote 59 percent of their total Social Security proceeds during retirement to health care. The Car Was Repossessed, but the Debt Remains Jessica Silver-Greenberg and Michael Corkery June 18, 2017 More than a decade after Yvette Harris’s 1997 Mitsubishi was repossessed, she is still paying off her car loan. She has no choice. Her auto lender took her to court and won the right to seize a portion of her income to cover her debt. The lender has so far been able to garnish $4,133 from her paychecks — a drain that at one point forced Ms. Harris, a single mother who lives in the Bronx, to go on public assistance to support her two sons. Social Security benefits for spouses can pump up household income Liz Weston June 18, 2017 Dear Liz: I have a friend who has a selfish, controlling husband. When talking with her recently, she told me she got only $300 a month from Social Security based on her work history while her husband gets $1,800. I told her she should be getting $900, half of his monthly amount, as a spousal benefit. I guess he thought if she got more it would reduce his check. I told her the $900 would be in addition to the $1,800 he gets. She has been collecting her smaller benefit for seven or eight years. Does she have any recourse? I doubt he would take her to the Social Security office but maybe her daughter would. Amazon’s Move Signals End of Line for Many Cashiers Claire Cain Miller June 17, 2017 Imagine this scene from the future: You walk into a store and are greeted by name, by a computer with facial recognition that directs you to the items you need. You peruse a small area — no chance of getting lost or wasting time searching for things — because the store stocks only sample items. You wave your phone in front of anything you want to buy, then walk out. In the back, robots retrieve your items from a warehouse and deliver them to your home via driverless car or drone. Amazon’s $13.4 billion purchase of Whole Foods, announced Friday, could speed that vision along. Amazon has already made shopping for almost everything involve spending less time waiting, doing work or interacting with people, and now it could do the same for groceries. It’s already trying with a store in Seattle, Amazon Go, that has no salespeople or checkout lines. Ways To Reform Taxation Of Small Business Mark J. Mazur June 16, 2017 On June 14, I testified before the Senate Small Business and Entrepreneurship Committee on how tax reform might affect small business. I delivered two key messages: Pass-through businesses are not necessarily the same as small businesses and one useful approach to reform for these firms may be tax simplification. There is a broad consensus that the current system for taxing businesses is in dire need of reform. The US tax system was last overhauled in 1986. And three decades of changing business practices, increased globalization, and expanding aggressiveness in tax planning have made the current system of taxing business income woefully out of date. I told the committee that there are five major problems with the taxation of US businesses: Voices When is it OK to throw out old tax documents? Donna Holm June 16, 2017 After every tax season, it’s tempting to do some spring cleaning, which often includes a massive dump of recently filed tax data. While many firms have migrated to paperless records, many still grapple with the issue of tax record retention. One of the most confusing questions clients ask their accountants is: what do I do with my tax records and how long do I need to keep them? DREAMers, other undocumented workers make major tax contributions to Uncle Sam, state treasuries Kay Bell June 16, 2017 Donald J. Trump's got a lot of campaign promise policy issue irons in the fire. This week, he pulled one out a bit by deciding to let undocumented residents known as DREAMers stay in the United States. The decision was announced as part of a fact sheet released by Homeland Security late June 15. That document's next-to-last line notes: 7 Roth IRA Benefits You Need to Know About Maurie Backman (TMFBookNerd) June 16, 2017 In a recent TIAA survey, only 19% of Americans were found to actively contribute to an IRA. If you've yet to open an account, now's the time to get moving, because the sooner you do, the more time you'll give your retirement savings to grow. Now if you're going to start funding an IRA, you may be wondering whether you should go with a traditional account versus a Roth. While each comes with its share of benefits, here are some Roth IRA advantages you probably don't want to pass up. How To Cut Your College Loan Repayments John Wasik June 16, 2017 It's always fried my bacon how many companies exploit people in debt. From debt collectors to "debt repair" firms, they are always out there. A few years ago, I reported on firms that charged student loan holders fees to reduce or consolidate their college loans. These "debt relief" firms are still operating and only a handful have been sued. The watchdogs can't keep up with them. (Note: My research led to a book on these scams and how you can obtain a debt-free degree.) How High Are Wine Taxes In Your State? Jose Trejos June 15, 2017 The treatment of wine differs extensively across the states, and at higher rates than beer because of greater alcohol content. Check out today’s map below to see where your state lies on the wine tax spectrum. Kentucky has the highest wine excise tax rate at $3.17 per gallon, followed by Alaska ($2.50), Florida ($2.25), Iowa ($1.75), and New Mexico and Alabama (tied at $1.70). The five states with the lowest wine excise rates are California ($0.20), Texas ($0.20), Wisconsin ($0.25), Kansas ($0.30), and New York ($0.30). Notably, these rankings do not include states that control all sales (New Hampshire, Mississippi, Pennsylvania, Utah, Wyoming). IRS Warns On 'New Twist' To Old Phone Scams Kelly Phillips Erb June 15, 2017 Just because it's summer doesn't mean that scammers are taking a break. The Internal Revenue Service (IRS) has issued a warning about a new telephone scam. In the scam, callers posing as IRS representatives advise potential victims that two certified letters were sent to the taxpayer in the mail but were returned as undeliverable. The callers then threaten to arrest the potential victim if a payment is not immediately made through a prepaid debit card. The scammer also tells the victim that the purchase of the card is linked to the Electronic Federal Tax Payment System (EFTPS) system: it is not. Best states for keeping more of your retirement income Ray Martin June 15, 2017 When it comes to finding ways to cut your tax bill in retirement, your federal taxes deserve a lot of attention. For high earners, the top marginal rate is 39.6 percent, and that can go to 43.4 percent when you add the Affordable Care Act surtax of 3.8 percent on investment income. But don't overlook state income taxes, which vary greatly from state to state. California leads the way with a top marginal rate of 13.3 percent. On the other end, seven states have no income tax at all: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. Drop in U.S. Retail Sales Signals Uneven Consumer Spending Sho Chandra June 14, 2017 U.S. retail sales fell in May by the most since the start of 2016, reflecting broad declines in categories including motor vehicles and electronics, Commerce Department figures showed Wednesday. Key Takeaways The May figures highlight a cautious consumer. While the value of gasoline service-station receipts dropped the most since February 2016 and weighed on overall retail sales, Americans pulled back at other merchants. The data aren’t adjusted for prices, so lower fuel costs depress filling-station results. 10 Ways to Generate Income After You Retire Tom Sightings June 13, 2017 Financing retirement has become more challenging than ever. But the good news is that we have more sources of income than we might at first realize. Here are ten ways that people generate income after they retire. Most people only need three or four to be financially comfortable. 1. Social Security. The average retiree collects about $1,360 a month from Social Security. But many people spend more than that on housing, health care, transportation and food. While Social Security may be part of the equation for financing retirement, it does not provide the whole answer. Your benefit may differ significantly from the average, based on your earnings history and the age you retire. You can retire and collect Social Security anytime between 62 and 70. The longer you wait, the higher your monthly check.

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