Category: Taxation-Individuals

Inflation has been surging this year. The July 2022 consumer price index (CPI) was up 8.5% year over year, according to the latest data from the U.S. Bureau of Labor Statistics. The rate of inflation is expected to stay high for at least the rest of the year. Many taxpayers are understandably concerned about how elevated inflation rates will impact their 2023 tax situation. When planning for the rest of your 2022 tax year, it’s important to understand what tax… Read more ›

The Inflation Reduction Act (IRA) includes a wide range of tax incentives aimed at combating the dire effects of climate change. One of the provisions receiving considerable attention from consumers is the expansion of the Qualified Plug-in Electric Drive Motor Vehicle Credit (IRC Section 30D), now known as the Clean Vehicle Credit. While the expanded credit seems promising, questions have arisen about just how immediate its impact will be. Here’s what you need to know about the credit if you’re… Read more ›

Taxpayers will soon have access to a resource to protect against tax-related identity theft and the potentially serious outcomes that come with it. Before the next tax filing, the IRS will roll out to each tax filer a six-digit PIN number, as part of its new Identity Protection (IP) PIN opt-in program individuals can use. Participation in the program is voluntary and includes the following features: ●     The IP PIN should be entered onto an electronic tax return when prompted… Read more ›

While the recently announced student loan debt relief has captured numerous headlines, it’s estimated that another federal relief program announced on the same day will provide more than $1.2 billion in tax refunds or credits. Specifically, IRS Notice 2022-36 extends penalty relief to both individuals and businesses who missed the filing deadlines for certain 2019 and/or 2020 tax and information returns. The relief covers many of the most commonly filed forms. Broad Relief for Late Taxpayers The intent behind the… Read more ›

If you’re looking for money to buy a new car or pay off some bills, your 401(k) plan may seem like a pot of untapped gold. The temptation to tap your retirement funds often comes when you switch jobs and must decide how to handle your account. But in most cases, breaking into a retirement plan early is a mistake that will just melt away your savings. Unfortunately, many people make the unfortunate decision to “cash out” their retirement accounts… Read more ›

First the bad news: Despite passage of the Tax Cuts and Jobs Act (TCJA), the individual alternative minimum tax (AMT) is still in place. But there’s some good news: The law has made AMT rules more taxpayer-friendly through 2025. In addition, other TCJA changes reduce the odds that you’ll owe the AMT for those years. Even so, you may still benefit from taking steps now to avoid or minimize it. Know the Basics The AMT is connected to, but separate… Read more ›

Following passage by the U.S. Senate and House of Representatives, President Biden has signed into law the Inflation Reduction Act (IRA). The IRA includes significant provisions related to climate change, health care, and, of course, taxes. The IRA also addresses the federal budget deficit. According to the Congressional Budget Office (CBO), the IRA is projected to reduce the deficit by around $90 billion over the next 10 years. Although the IRA falls far short of Biden’s originally proposed $2 trillion… Read more ›

Tax-free shopping returns to Maryland and Virginia in August for those looking for a good deal on back-to-school shopping and emergency preparedness items. Below are details on qualified items. Maryland Tax-Free Week | August 14 – 20, 2022 Which items are eligible? Clothing and footwear Qualified articles of clothing or footwear – $100 or less Backpacks – $40 or less Click here for frequently asked questions and valuable facts provided by the Comptroller of Maryland. Virginia’s 3-Day Sales Tax Holiday… Read more ›

You may think you don’t need disability insurance — but you probably do. Whether you have group disability insurance from your employer or buy it yourself, chances are you’re underestimate and may not be able to afford what you need for short-term or long-term insurance in the event of sickness or injury. Even if you have group disability insurance, it may not be enough. The drawbacks include: Coverage may be limited to a short term, perhaps only two years, Coverage… Read more ›

When a divorce happens, there are often major financial consequences and some important tax issues too. Here are the tax rules that generally apply when a couple’s assets are split up in a divorce property settlement. State Law Is Important How assets are split up in a divorce depends largely on where the divorcing couple lives. The following nine states are community property states: California, Texas, Washington, Wisconsin, Arizona, Nevada, New Mexico, Louisiana, and Idaho. In these states, the general… Read more ›