Review Category : Taxes

Are Charitable Deductions Going To Be Wiped Out Under Trump?

For many American families who prepare for year end tax planning, no discussion is complete without talking about charitable contributions.   Many families make charitable contributions by tithing a percentage of their family income, giving cash to local charities, or they end up taking non-cash items from their household and donating them to a worthy charity.  With the potential shake up in the tax law under a Trump regime, will you have your charitable contributions completely wiped out in 2017? First things first.   You don’t really need to worry about charitable contributions if you don’t itemize your deductions at all.  Today, a single filer has a $6,300 standard deduction and a married couple has $12,600 for a standard deduction. In addition, you get to deduct you, your spouse, and your children as personal exemptions on your tax return.  The suggested policy going forward would be to wipe out the personal exemptions and offer a larger standard deduction of $15,000 for a ...

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One BIG 2017 Georgia 529 Plan Change For College

As the cost continues to rise for college education, the state of Georgia is stepping up for the residents of Georgia and offering a new increased tax deduction that can really help Georgia taxpayers. All Georgia single taxpayers may deduct up to $2,000 each year on behalf of any beneficiary regardless of their annual income. Beginning with returns filed in 2017, all Georgia joint taxpayers may now deduct up to $4,000 each year on behalf of any beneficiary regardless of their annual income. Please note that a transfer of funds from another state’s 529 plan is not eligible for the Georgia income tax deduction. Georgia tax forms refer to the Path2College 529 Plan as the “Georgia Higher Education Savings Plan” (GHESP); the Path2College 529 Plan is established by the GHESP. Contributions made during the tax year, or before the following year’s federal tax filing deadline are eligible for the deduction. State tax benefits offered in connection with the Path2College 529 ...

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Be Careful About “Washing” Out Your Tax Losses

With more investors trading stocks as a hobby and the number of day traders who have decided to take over their own portfolios, it is incredibly important that you recognize one little nasty piece of the tax code that can hurt you called the wash rule. The wash rule was set up to more closely define how tax losses can be taken for the short term trading of the same securities.   If an individual decided to sell or trade a security they own at a loss and within 30 days of the sale buys a substantially identical stock or security (or an option) their tax losses may be disallowed.  Remember, the rule can also apply if your spouse buys a substantial amount of the security as well. In our current tax code, the wash sale can affect your personal finances with the following consequences. You will not be able to “realize” or claim, the loss on the sale The disallowed ...

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Don’t Be Fooled By Hillary’s Small Business Plan

I usually don’t read the USA today, but I happened to have a chance to read an article recently (http://usat.ly/2bVCjaz) about Hillary Clinton’s plan to be the President for small business owners.   I was intrigued by the article to see what real change might be coming and as an entrepreneur of many businesses I quickly realized that the proposal was something that only the Stay Puff Marshmallow business person would actually gain any benefit from currently.    Here are the points from the article and then I’ll share on each point my insights on what meaningful proposals could really truly help small business owners do better.  BTW, I haven’t really seen any proposal from Trump yet at all but I do know what I hear from local owners every week Hillary Proposed Problem: Citing licensing and other burdens, Clinton’s campaign says it takes longer to start a business in the U.S. than in countries such as Canada or Denmark.  I laughed ...

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How Did Apple Get A 14.5 Billion Dollar Tax

In the past week it was announced that the European Commission completed its investigation and concluded that Apple would need to pay back a 14.5 billion dollar tax to the EU.   While 14.5 billion only represents about 6% of the cash and investments Apple has on hand, the big question is what kind of precedence this might set for the future of big business overseas in light of the upcoming Presidential Election.   So, in simple terms, how did this tax even happen? This all started when Apple struck at tax deal with Ireland to locate their European Headquarters in Ireland in 1991.   Ireland create tax arrangement between now two Irish companies, Apple Sales International and Apple Operation Europe.    The profits that came from European sales for Apple were recorded in Ireland some of which were taxed and the majority of the profits were recorded through something called a “head office”.  In simple terms, this was an offshore company that wasn’t ...

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Trump vs. Clinton Tax Plans

While the election is kicking into high gear, there may be many reasons why you may choose one candidate over the other.  Or, you just may choose to vote for one of the independents this year.   Since I write a column mostly about smart money moves, it might be in the best interest of your family to understand the basics of what the candidates are proposing for tax overhaul and reform.  Here is the high level of Trump v. Clinton for income taxes. PERSONAL INCOME TAX Trump is proposing we move to four tax brackets 0%, 10%, 20%, 25%. More importantly, he is wanting to make the standard deduction for single people at $25,000 and for married couples $50,000 which means those families will pay no tax at all. Clinton is going to hold the same general similar tax bracket structure we have in today’s world. However, she is looking to make two major changes: one being a 4% surtax ...

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Helping You Know What You Need to Pay Taxes On!

How to Get Rich w/ oXYGen Financial – Ted Jenkin | Atlanta Money Guy Topic: Oxygen Financial Helps You Know What You Need to Pay Taxes On! Taped 8/8/16 Listen every Tuesday morning at 8:00 a.m. on ROCK 100.5 | Atlanta’s Rock Station to “Your Smart Money Moves” with The Rock 100.5 Morning Show and oXYGen Financial. Ted Jenkin, CFP® and Kile Lewis, CRPC® are the founders of oXYGen Financial, and our chief financial officers. All your money questions answered Breathe easier at http://oXYGenFinancial.net ...

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How The New Overtime Rules May Affect Your Business

The Department Of Labor is at it again, now changing the game for businesses as it pertains to overtime rules.   Since, that is what we really need . . . some more rules.  If it wasn’t challenging enough for small businesses dealing with making payroll and figuring out to maintain the costs of health insurance, now you’ll have to pay double attention to these new overtime rules which will become effective December 1st. Here’s a bet I’m willing to make on the record.  The cost for businesses across the country to manage and track all of these changes will far supersede the benefits that will actually be paid for people working overtime.  The administration believes by making these changes that many hard working Americans will earn overtime, but let me clue everyone in on four your smart money moves secrets. Right now, if you are a salaried worker who makes in between $23,660 and $47,476 and you have a reasonable ...

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Tax Tips Before You File 2015 Taxes

Now that you are getting organized for getting your 2015 taxes done, it would be remiss not to have an annual review of potential tax saves before you click the button to send your tax filing up to the IRS.  There are so many people who don’t look under the hood and assume that once the calendar year closes out that all tax opportunities are lost.  Here is my smart money moves list of last minute tax ideas before you file. FORM 2106- JOB EXPENSES The truth is that your employer may not reimburse everything during the year including mileage or other business related expenses.  This could be  a great opportunity to list out those expenses and take an additional tax deduction if you itemize your tax deductions. What’s the catch?- Must Exceed 2% Of Your Adjusted Gross Income (AGI) SELF EMPLOYED BUSINESS EXPENSES? Did you get a 1099 this year or do you have a small business? I’m still ...

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Breaking Down The Tax Plans Of Our Future President

With both the Republican and Democratic debates heating up now, it is probably a good time to attempt to separate fact from fiction when it comes to the future plans of the nominees on how they will change the tax code.  With our national debt soaring to 19 trillion dollars, it is certain we will need a way to balance our budget and right the ship of the financials in this country.  As a finance and accounting guy, I full well know that you cannot run a negative debt situation in perpetuity.  It just doesn’t work.  So, here are the cliff notes to some of the tax plans being bandied about by the frontrunners. Donald Trump (www.donaldjtrump.com) – Trump’s plan has married couples earning less than $50,000 paying no income taxes which will remove more than 75 million households and offers a top tax rate of 25%. The Trump Tax Plan Achieves These Goals: If you are single and earn ...

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179 Reasons Business Owners Need This Tax Deduction

In the flurry of tax changes that happened for 2016, one of the most overlooked deductions by small business owners is the Section 179 tax deduction.   This deduction was set up to allow business owners to deduct many different types of equipment used for their business.  In fact, there were certain loopholes within this tax code to allow for the purchase of certain vehicles as well. The IRS has set the Section 179 tax deduction limit in 2016 for $500,000 and the overall phase out is $2 million.   There was a little known act that got enacted called PATH (Protecting Americans From Tax Hikes Act of 2015).   PATH presented business owners with a significant opportunity to purchase software, technology, and equipment and if structured correctly expense all of it off in the year they pay for it versus depreciating it down the road. One of the most frequently asked questions is when businesses lease or buy equipment is whether or ...

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Important 2016 Rules For IRA’s and 401(k)’s

As 2016 rapidly approaches us, it’s important that you know the rules about changes upcoming for 401(k)’s and IRA’s so you get off to a great start in 2016.    People often overlook funding an IRA because they don’t how the qualifications work within their family.  Whether you are a few years from retirement or you are just beginning your savings plan, keep this handy article by your side so you make the most of your retirement contributions for 2016. How Much Can I Contribute? The good news is that 2016 brings a calendar year where nothing really changes in terms of your overall maximum contributions for 401(k)’s and IRA’s.   For 401(k)/403(b) investors, if you are under 50 years old you can put away up to $18,000, and those that turn the age of 50 in 2016 or are older than 50 can make a ‘catch up’ contribution of $6,000 (the maximum being $24,000 overall).  For IRA/Roth IRA investors, if you ...

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7 Ways To Save Money On School Supplies

It’s school time again and the alarm clocks will begin to get set for early morning once again.   Traffic patterns to work will become heavier and the weekly routine will be in full swing.   Even though the summer days are fading, you’ll begin to get notices around what school supplies your child is required to bring.    This means it is time to be a smart shopper and make sure you save a few bucks when you get around to buying the student school supplies.  Here are seven quick ideas to stretch your dollar during the back to school season. Use Social Media– In this day and age all of the big stores from Office Depot, Staples, and Best Buy will have ads up on their Facebook business page.  You should check their Twitter feeds and most certainly at least Google the word ‘discount’ and the name of the store to see what coupons exist to trim down your back to ...

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5 Financial Wins For Same Sex Couples

In 2013, the Federal Government struck down a law that prevented the Government from recognizing same sex marriages.  It was still banned in thirteen states, including the state of Georgia.  With recent landmark Supreme Court ruling that allows for same sex marriages, the only victory won wasn’t in the wedding aisle.  A slew of financial benefits will come out of this for same sex couples.  Here are five financial wins for LBGT couples. Inheritance- Generally, when you die, everything will transfer from one spouse to another with a legally recognized marriage with the exception of ‘named beneficiaries’ within contracts such as life insurance and IRA accounts.  This should help same sex couples deal with having to write odd wording in wills and trust to do work arounds within various states. Social Security- Same sex couples who were not recognized in those thirteen states could now see even bigger benefits from Social Security.  The key here as with married heterosexual couples ...

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47% Of Americans Pay No Income Taxes

It’s pretty interesting to look at who pays income tax in America and who does not.  That is until you realize you might just be in the top 1% of all wage earners in America and the differential in the percentage of taxes you pay relative to overall adjusted gross income does not match at all when you add up the numbers.  What’s truly amazing about the data below is that the top 1% of wage earners is about $380,354 and the top 5% of wage earners is about $159,619, but the top 5% account for 58.72% of the taxes. When compared to their share of adjusted gross income, the top 1% are almost double the income taxes against their actual AGI contributed into the mix. WHO ARE THE 47% WHO PAY NO FEDERAL INCOME TAXES? (this excerpt was taking from www.financialsamurai.com) The Tax Policy Center’s Donald Marron said they fall into three main groups: The working poor. The earned income ...

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When Can I Hire My Kids In The Business?

When you run a small business, you often look for almost any tax deduction that you can take off your bottom line that has a legitimacy when it comes to filing your taxes. For most business owners, there is always a blurred line between your personal life and your business life. Often, your children end up getting involved whether it comes to running errands, filing papers, or even assisting with your company Facebook page. So, the big question is when can your hire your children in the family business and how do you document this when it comes to filing your taxes? I truly believe that one of the most underutilized tax deductions for small business owners is getting their children engaged in the family business. By placing children (or even grandchildren) on the payroll who are under the age of 18, you can create a great opportunity to take advantage of something called income shifting. Your company can hire ...

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How Much Of My Mileage Can I Tax Deduct This Year?

During tax time, we often get the question from employees and business owners about how much of their auto mileage they can deduct on their tax return. This is one of the biggest questions where a slippery slope can occur without approaching this topic in the right manner. For most people including business owners, their automobile is not used 100% for business purposes. Thus, if you use the car for both business and personal purposes, you can only deduct the mileage related to the business portion of using the car. Here are some ‘your smart money moves’ guidelines when thinking about how much of your mileage you can deduct on your tax return. You can generally figure the amount of your deductible car expense by using one of two methods: the standard mileage rate method or the actual expense method. If you qualify to use both methods, you may want to figure your deduction both ways before choosing a method ...

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When Can You Tax Deduct Meals And Entertainment?

Tax time is coming up and inevitably there are questions we get each and every year from small business owners and employees about what they can and cannot deduct.  Of course, it’s probably best to consult a CPA that matches your style of being conservative, middle of the road, or aggressive, but I thought I would give you some direction on several of the questions we get over and over again during tax time.  Here is the ‘your smart money moves’ post on deducting your meals and entertainment expenses. Let’s face the facts.  Most small business owners are downright lousy when it comes to keeping high quality records of their meals and entertainment expenses.  All they do know is that they would like to deduct every trip to Starbuck’s, every lunch they had at Taco Mac, and every dinner they ate on their last vacation.  But the question really is where does the line start and where does the line ...

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FREE Always Comes With A Significant Cost

The President recently announced his intention to get a proposal through Congress that would make two years of community college ‘free’ for students.  Of course, the plan doesn’t have an actual price tag attached to it yet.  I guess it may not matter because all we do know is that it would be ‘significant’ if some 9 million students across all 50 states would benefit with an average bill of close to $4,000 per child. I am personally not for this proposal, but here are some potential thoughts on some pros and cons of creating this new type of free schooling proposition: CONS: Doesn’t solve the real problem:  The real issue is the runaway freight train of college costs.  We already have well over 50 colleges and universities that more than a 1 billion dollar endowment.   And, these are supposed to be non-profit organizations, right?  There’s an oxymoron if I have ever heard one. Will needy children actually benefit?:  Most ...

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Do I Need To Make Estimated Tax Payments?

You recently lost your job or your job lost you and now you have decided to take some freelance consulting jobs to pick up some spare cash. You fill out a W-9 in order to get paid, and a few weeks later a check comes in the mail made out to you. You are really excited because no taxes have been taken out and you feel flush with cash. Now, you are beginning to file taxes for 2014 and are starting to wonder when the Government is going to ask you to pay taxes. The reality is that most of you who earned your first 1099 will likely file Schedule C (sole proprietor) with your first year of income. Some of you may set up an LLC, but are still uncertain how exactly money gets from the check that got deposited in your bank account to the IRS for federal taxes and your state for state income taxes. In order ...

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Have You Done The Research?

Giving to a good cause can evoke some of the most wonderful emotions we feel. The problem is that many individuals give without always doing the proper research on the charities or what the charities do with the donated money. Most of you can remember the Seinfeld episodes where George gets people to donate lots of money to the human fund without anybody asking any real questions about the charity. When they did, George gave them a few concise answers and people just accepted it as fact. Nowadays, friends ask us all the time through social media to donate money to various causes by clicking a link and filling out a form. Companies ask us to round up while shopping on line or make a $1 donation at the cash register while checking out our groceries. If you have budgeted aside a percentage of your income or a dollar amount that you can afford to give away, I recommend that ...

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Balance The Budget

Like many Americans, I am simply sick and tired of the bickering and fighting that is going back and forth between Congress and the President. If I could wave a wand and get one compromise between the President and the new Congress it would be to simply balance the budget here in America. As a personal finance person, it’s abundantly clear that no individual, family, or business can continue to accrue debt in perpetuity. Eventually, debt chews you up, drags you down, and paralyzes you from moving forward. This is exactly what debt is doing to this country. If you get the chance over the next week and have never gone to the website www.usdebtclock.org, I recommend that you take the opportunity to spend five or ten minutes on the site. As I drafted this article, I noticed that national debt according to the site has now crossed over $18 trillion dollars in debt. The way you build up debt ...

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Five Smart Money Moves To Make In 2015

Can anyone remember Y2K just like me and thinking I can’t believe it is the year 2000?  Well, before the blink of an eye we are now at 2015 and another new year to take stock of where you are financially and what moves you should make this year to improve your bottom line.   Since there are so many financial items to watch as the CEO of your family finances, here are my five items to put on your financial list as moves to consider in 2015. Shop Your Bills– January is one of the best months to get on the phone and shop each and every one of your bills.  One of the quickest ways to free up more disposable income to pay off debt or increase your savings is to gain back more cash flow in your family profit and loss statement.  Remember, companies like to know that they have booked their recurring business for the year in ...

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Be Careful About The Rules Around Saving For Healthcare

With so many changes happening with our tax code every year, it is really important that you sit down and review how this will affect your family finances. As 2015, approaches us, one tax issue that could affect your family center around the changes intertwined with Flexible Spending Accounts (FSA’s) and Health Savings Accounts (HSA’s). In many prior years, traditionally FSA’s were you use it or you lose it plans if the money is not spend by year-end. Since 2013, you were allowed to roll money over from the prior year and carry it forward into the current. However, going into 2015 there is a BIG twist that you should consider before the 2014 year is over. If you elect to carry forward the $500 in your FSA plan from 2014 into 2015, you will immediately become ineligible to participate in a Health Savings Account for 2015. This is true for the entire calendar year. So, if you opted to ...

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Three Financial Moves To Make When You Get Promoted

There are few things in life that deserve a glass of champagne more than a well-earned promotion.  After years of blood, sweat, and tears, your company has finally recognized your efforts and decided to move you into a more meaningful role within your company.  Sometimes, only title are associated with these promotions, but more often than not there will be financial rewards as well.   This is exactly your time to fall into the lifestyle inflation trap and make some really smart financial moves that will pay dividends down the road. The Pay Raise– Generally, a new promotion will also mean more responsibility which often equals more pay.  If your salary jumps by $10,000 or even $50,000 dollars this will mean a significant bump in your cash flow for your family.   What should you do with this money?  Is it best to add to your 401(k)?  Start paying down the mortgage?  Or time to purchase that new vacation home?   With pay ...

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Did You Just Get A Raise In November

It’s pretty amazing to me how many people truly still don’t understand our payroll tax system.  When you work as a W-2 for an employer, both you and your employer are going to pay certain payroll taxes.  The two main types of taxes are the Federal Insurance Contributions Act (FICA) tax and the Medicare tax.   Both you and your employer pay 6.2% into FICA up to $117,000 this year and Medicare is a perpetuity tax at 1.45%.  In 2014, when wages, compensation, etc. get above $200,000 for an individual and $250,000 for a married couple, you will incur an additional .9% Medicare tax this year.   When your w-2 gets above $200,000, your payroll provider should be deducting that amount from your paycheck now, but it is important you double check at work. Since there are many individuals who pay their full amount into social security and their income exceeds $117,000 in a particular calendar year, unfortunately your HR department won’t ...

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Can The Government Garnish Your Social Security Check?

With our nation at 17.5 Trillion dollars in debt (source: debtclock.org) and growing, is it any wonder where the Government will strike next to begin collecting more and more revenue.   With tons of people behind on payments on their student loans, there is a new phenomenon that people collecting social security need to be on guard for . . . that your Social Security check can be garnished.  Yes, that’s right; you can actually have some of your fixed income in retirement taken away from you. With more people going back to get a mid life college degree and more parents and grandparents co-signing loans, once your name gets on the dotted line for a federal loan you will be responsible to pay it back one way or another.   Back in 2000, only six people were being garnished for delinquent loans and now that number has risen to over 156,000 people.   The total garnishments exceeded more than $150 million dollars ...

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Attention All 1099’s… There is a BIG October 1st Deadline!!

Since there are so many people who are getting 1099’s and setting up individual LLC’s or home-based side businesses, you need to keep a close eye out this time of year for setting up one kind of retirement plan, a SIMPLE IRA.   The deadlines are just around the corner in the next few weeks, so could this be the right type of retirement plan for you? A SIMPLE IRA (Savings Incentive Match Plan For Employees) was first available to small business owners in 2001. A SIMPLE IRA plan is an IRA-based plan that gives small employers a simplified method to make contributions toward their employees’ retirement and their own retirement. Under a SIMPLE IRA plan, employees may choose to make salary reduction contributions and the employer makes matching or nonelective contributions. All contributions are made directly to an Individual Retirement Account or Individual Retirement Annuity (IRA) set up for each employee (a SIMPLE IRA). SIMPLE IRA plans are maintained on ...

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How About A $500,000 Tax Break For You?

Publication 523 may end up being your favorite IRS publication.  That is if you can really have an IRS publication that you really like.   When you sell your main home or primary residence, up to $250,000 may be excluded from your income.  The amount jumps up to$500,000 for married couples that sell their primary residence.  When individuals or couples start considering retirement decisions, they often don’t think about the equity in their house nor the tax treatment that may occur when they downsize their primary residence.  (source: IRS.gov) In order to meet the primary residence exclusion requirement you must meet the following requirements: You owned the residence for any two of the last five years. 24 months of 760 days. You occupied your residence for any two of the last five years. You haven’t used the exclusion within the last two years. If you are married you need to meet the following requirements: You are married and file a joint ...

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I will be getting my first 1099 . . . Now What?

You recently lost your job or your job lost youJ and now you have decided to take some freelance consulting job to pick up some spare cash.   You fill out a W-9 in order to get paid, and a few weeks later a check comes in the mail made out to you.  You are really excited because no taxes have been taken out and you feel flush with cash.   At some point next year, you’ll get your first 1099, but what should you be doing here in 2014 to make sure your ducks are in a row come tax filing time? The reality is that most of you who earned your first 1099 will likely file Schedule C (sole proprietor) with your first year of income.   Some of you may set up an LLC, but are still uncertain what you can deduct or how exactly incomes taxes will be paid.  Here are some your smart money moves tips for you. ...

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The Roth 401(k) Conversion: Pros and Cons

Since the Pension Protection Act, Roth 401(k)’s are becoming more popular amongst investors through their employer sponsored retirement plan.   If you have been investing in a 401(k) for some period of time, it’s likely you’ve chosen the pre-tax option and maybe it is time to consider whether or not a Roth 401(k) conversion makes sense for your individual situation. PROS: If you believe you’ll be in a higher tax bracket in the future when you distribute these funds, then converting your existing 401(k) to a Roth 401(k) could make sense. Roth 401(k)’s are subject to Required Minimum Distributions, but you can easily roll your Roth 401(k) into a Roth IRA and this can continue to allow you to defer dollars within your retirement accounts if you don’t need to distribute the money. If the market has another depressed year like it has twice in the past fifteen years, that particular year could be a really good time to convert your ...

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Are Those Making $200,000 More Likely For An Audit

Nobody wants to get an audit.   About 1 in 150 of us will experience some type of audit in our lifetime.   The good news is that if you follow these six smart money moves, you may be able reduce your chances of getting flagged in the future. You didn’t disclose all of your income– The IRS gets copies of your w-2’s, 1099’s (reporting of your interest and dividends), and capital gains and losses.  Make sure you collect all of your statements from work, investments, etc. “Measure Twice Cut Once” whether you or your accountant does the math. You have a big mouth– Never brag (especially on social media) that you pulled a fast one on the IRS. The IRS does more trolling today than ever before on social websites such as Facebook, Twitter, etc. Whistleblowers can earn some significant rewards (15% to 30% by filing form 211) by turning in cheats.  Be very careful of ex-girlfriends, ex-spouses, etc. The dreaded ...

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What If Someone Stole My Tax Refund?

With the deadline looming for taxpayers, the crunch will be on for people scrambling to get their final documents together and submit their official tax return.   Imagine this scenario.    You submit your tax return only to receive a rejection notice from the IRS several weeks later saying that they have already received a tax return submitted by you already.   How’s that for a situation that is sure to rock your world. Unfortunately, in today’s world all you really need are some social security numbers and the internet to start winning at the tax return identity theft game.  According to the USA Today, a government report in November said the IRS issued $4 billion in fraudulent tax refunds over last year to criminals who were using other people’s personal information.  Attorney General Eric Holder said this week that the “scale, scope, and execution of these fraud schemes” has grown substantially in size. What should you do if someone stole your tax ...

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Can the Government Inherit your Estate?

By: Patrick R. Norris* When a new couple comes to visit me to set up the base of their first estate plan, one of the common questions that I often receive is: “can the government really inherit [or take] my property if I don’t have a Will?”.  This is a question that always make me smile because while the technical answer is “yes”, a much more practical answer is “highly doubtful”. You see when someone does not have a Will, the laws of their State essentially make a Will for them.  State statutes place your relatives in an orderly line for inheriting your estate.  So long as they are living, the first person in line receives your property when it comes time to inherit.  If they are not living, the next person in line just steps up to inherit. If you do have a [valid] Will, the State Statutes are “trumped” and your Will (not State Law) dictates who inherits ...

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How Does The My RA Work?

Trapped in my office by the Snowpocalypse that hit Atlanta on last Tuesday, I had the opportunity to watch the State of the Union (#sotu) Address delivered by President Obama.   There is a whole lot of financial topics we could talk about on Your Smart Money Moves, but I’d like to review the topic around the new proposed investment vehicle called the MyRA.  Since we already have the SEP-IRA, SIMPLE-IRA, Rollover IRA, Roth IRA, Traditional IRA, Beneficial IRA, etc., wouldn’t it have just been easier to call it the My IRA instead of the new urban dictionary word called MyRA? The concept behind the MyRA account would be a new type of bond within a Roth IRA-type umbrella.  Contributions would not be tax-deductible, but earnings would be tax-free when you withdraw it in the future.  It’s unclear about how closely the rules on this account shadow the rules of the current Roth IRA. The investment vehicle would be a new ...

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5 Tax Tips Before You File

It’s the beginning of February and your tax documents will be piling up by the day as a new mail from your mortgage companies, banks, and investment companies are sent out to you.   As you begin to stack up your pile of information to bring to the CPA or accountant, did you ever wonder if there are still ways you can save money on your 2013 income taxes before you hit the SEND button to the IRS?   Here are my 5 smart money moves on tax tips before your file away for another year. Contribute To An IRA- Whether this is a Traditional IRA or for small business owners/freelancers a SEP-IRA, these types of IRA contributions could still potentially be tax deductible for the 2013 calendar year even though the contributions and accounts were opened in 2014.   The biggest mistake individuals make is not investigating how these vehicles work or the adjusted gross income limits that would make things like ...

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The Simplified Home Office Deduction

We have seen a monumental shift to more and more individuals who are freelancers, consultants, or starting some type of home office business over the past five years.  The home office deduction has often been bandied about as the dreaded ‘red flag’ that will surely cause you an audit.   When you file your 2013 taxes here in 2014, the IRS has now offered you a simplified version of the home office deduction so you don’t have to break out your spreadsheets and start doing a set of massive math calculations. The new optional deduction is $5 for each square foot of home office space up to a maximum of 300 square feet.   Instead of filling out the usual 8829 form, you’ll use a new worksheet in the Schedule C instruction book and enter your simplified home office deduction in Schedule C.   Of course, the regular rules around home office deductions will still apply, but here is some guidance the IRS ...

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Score A “GOAL” With A 2014 Georgia State Tax Credit

Today people still don’t understand the different between a tax deduction (we sometimes call this an above the line deduction) and a tax credit (we sometimes call this a below the line deduction) which is impacted by the line on your tax return we call taxable income. The important distinction is that a credit is a ‘true’ dollar for dollar reduction of your total tax. Whenever these types of tax programs are available, you should pay close attention to see if you can qualify and take advantage of the program. In the state of Georgia GOAL Scholarship Program, Inc. is something you need to look at closely as we kick off the new year. In 2008, the Georgia General Assembly passed House Bill 1133 (HB 1133) and Governor Sonny Perdue signed it into law. The legislation was further amended in 2011 (HB 325) and 2013 (HB 283). The law provides for the creation of student scholarship organizations (SSOs) to which ...

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2013: 10 Overlooked Tax Deductions

It’s the most wonderful time of year again as 2013 comes to a close.  So you aren’t fretting at tax time, maybe it will make sense over the next 9 days to put together an effective year tax management strategy to keep as much of your hard earned dollars as possible in your wallet.  Every CPA or accountant seems to have a slightly different slant on the tax code, but here are your smart money moves tips that may be able to help you increase your bottom line.  Remember to talk with a qualified CPA or Financial Advisor before you decide to implement. Charitable Mileage– Most taxpayers are very good at keeping receipts of their cash donations that they make to the organizations they donate to during the course of the year.   One of the deductions few taxpayers pay attention to is the charitable mileage deduction.  For 2013, you can deduct .14 cents per mile driven for rendering gratuitous services ...

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Do You Pay Your Taxes By Credit Card?

Some business owners or people who pay estimated tax payments end up paying their federal income taxes with a credit card. If you pay your income tax (including estimated tax payments) by credit or debit card, you can deduct the convenience fee you are charged by the card processor to pay using your credit or debit card. The deduction is claimed for the year in which the fee was charged to your card as a miscellaneous itemized deduction on line 23 of Schedule A (Form 1040) (and is subject to the 2% of the adjusted gross income floor). (Source: www.irs.gov) However, I always suggest that you look at what it net to you and don’t necessarily let the tax tail wag the dog. The deduction of those fees may sound great, but you really need to analyze what the cost of the convenience fee is relative to the rewards points/frequent flier miles you are earning by using the credit card ...

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