Planning for retirement is important, so investing your money and saving should be imperative when planning for long-term financial security. The question is, how can you save for retirement while also lowering your annual taxes owed (or refund)? Well luckily for the savvy investor and saver, there are a number of ways you can lower your due taxes.
The first way is to boost your 401(k) savings rate. Many people have their 401(k) contributions automatically subtracted from their paycheck before they ever get a chance to see the money. The trick is to check with your 401(k) and see if they will allow you to increase the amount withheld (many will allow this). In turn, this may qualify you for a larger tax break....
Estate planning is an essential part of planning for your loved ones after you’re gone. Under the new tax law, there are some changes to be aware of, such as the estate tax threshold. One specific part worth noting, is that all the provisions surrounding the change in estate tax will revert back to their previous thresholds in 2025.
The first part to notice is that the estate tax threshold has been raised to $11.18 million per person, or $23.36 million for a married couple. Both of these numbers are significant increase over prior limits. Additionally, this eliminates any federal estate taxes on amounts under the threshold for property gifted to heirs during your lifetime or after your death.
In every town there are small business owners that are helping America’s citizens whether it be through services, sales, or other business ventures. The problem is sometimes running a small business can be expensive and difficult, sometimes the owners are struggling to find ways to save money. Well fear not because there are some deductions on your taxes you may be forgetting about! These will help you save money on your year-end taxes, and maybe a larger tax refund.
One deduction that many people may forget about is salaries and wages. This applies to payments to employees that include salaries, wages, bonuses, commissions, and taxable fringe benefits. These are all deductible business expenses.
Depreciation is another deductible that is highly valuable, and it is us...
By now everyone remembers when the TCJA was passed and all the tax changes that occurred. What some people may not know is that there are still some discrepancies that are being debated among the IRS. One of the biggest debates was over the meal deduction and to what extent it was allowed to be used. Luckily for us, recently the IRS issued guidance relating to the meal deduction.
A good starting point to understand is that the IRS clarified that taxpayers will generally be able to continue deducting 50% of the food and beverage expenses associated with operating their trade or business. Under the current guidance, taxpayers may deduct allowable business meal expense if:...
Many Americans think of April as tax season, you rush to make sure you file by the deadline, then wait another year and do it again. However, for many Americans, the deadline passes April 18 and moves on to October 15 because of extensions. Some people need extensions to gather forms, while others need the extensions because of the sheer complexity of their filings. Here are a few notes and tips when filing for an extension.
First and foremost, realize that filing an extension does not allow the taxpayer to put off paying any tax liability until October. An extension allows more time to file, but your tax liability is due by the April deadline, whether or not you request an extension.
Is it finally on its way? House Republican tax writers have finalized the “Tax Reform 2.0” legislative package which is supposed to reach the House floor for a vote a soon. Back on September 13, the House Ways and Means Committee debated the presentation of the bill which lasted almost 7 hours. The bill focuses primarily on making permanent individual and small business tax cuts, creating incentives for retirement savings and business innovation. Additionally, they approved three bills:
Protecting Family and Small Business Tax Cuts Act of 2018
Family Savings Act of 2018
American Innovation Act of 2018
The individual and small business tax cuts will aim to make the current tax cuts permanent. Some of the temporary cuts they aim to make permanent will inclu...
Across the United States many states have enacted specific acts to protect the rights of tenants and landlords alike. In Illinois, the legislature has enacted the Landlord and Tenant act which sets out the requirements on both sides to protect an even relationship between the two.
For tenants it is important to understand and adhere to the terms set forth in the lease agreement, but what happens if the landlord breaks the contract or doesn’t live up to their end? There are remedies and rights for the tenant to exercise if there are any infringements. One area that is often disputed is the security deposit. Security deposits in Illinois are not required, nor do they have a limit, but they are often the equivalent to one month’s rent. The landlord is required to pay back the...
Let’s talk about medical deductions because depending on your health coverage, it can be an important part of your yearly taxes. The first thing to understand is that you are able to deduct health expenses, but only so long as they are not reimbursed. This bars any deductions for coverage by health insurance or an employer, but if they’re covering the cost it won’t be hurting your pockets anyway.
The second part to understand is that the TCJA has changed the threshold for the deduction. For years 2017 and 2018 the minimum threshold for medical expenses has been lowered to 7.5% of the taxpayer’s annual gross income. Therefore, if your expenses do not exceed the threshold, you will be unable to file for the deduction. If your expenses do exceed the threshold then there i...