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Too Much Paperwork? What You Can Throw Away After Filing

New Twists and Turns Taken by EV Credits

Did you buy an electric vehicle (EV) in 2023? Under the Inflation Reduction Act (IRA), passed late in 2022, you may be eligible for a new-and-improved tax credit, beginning on your 2023 federal income tax return. But the new law also bars certain high-income taxpayers from claiming the credit. What’s more, if you’re looking to […]

IRS makes changes for reporting 1099s, W-2s and other forms

Starting for tax year 2023, if you have 10 or more information returns, they must be filed electronically.  This also includes Forms W-2, e-filed with the Social Security Administration. Final e-file regulation details are linked here:

Itemizing Deductions on Your Federal Income Tax Return

Once the 2023 tax year is over and the numbers are generally set in stone, you can itemize deductions on your federal income tax return if your total allowable itemized write-offs for the year exceeds your standard deduction allowance for the year. Otherwise, for 2023, you will claim the standard deduction, which is relatively high […]

How Municipal Bonds Can Help Investors Manage Tax Exposure

Municipal bonds (often referred to as “munis”) can be attractive to income-seeking investors because they provide an income stream exempt from federal and, in certain cases, state and local income taxes. Like other fixed-income investments, munis involve risk. But as part of a broadly diversified portfolio, they can offer you an effective way to increase […]

Qualified charitable distributions allow eligible IRA owners up to $100,000 in tax-free gifts to charity

WASHINGTON —The Internal Revenue Service today reminded individual retirement arrangement (IRA) owners age 70½ or over that they can transfer up to $100,000 to charity tax-free each year. These transfers, known as qualified charitable distributions or QCDs, offer eligible older Americans a great way to easily give to charity before the end of the year. […]

Year-End Holiday Parties and Gifts: What’s Taxable?

The holidays are just around the corner, and now is the time for employers to start thinking about treating their employees with holidays parties or gifts. Such gestures are always a nice idea. Plus in a tight labor market, they can be a smart way to show appreciation and boost retention. But you need to […]

Will Your Crypto Transactions Be Reported on a Form 1099?

Some taxpayers may be unaware of all the federal tax reporting requirements for cryptocurrency transactions — especially when it comes to issuing and receiving a Form 1099 for 2023. If you buy something with cryptocurrency, you won’t receive one. However, you may receive a Form 1099 if you receive a crypto payment. There are several […]

Update on New Retirement Account Catch-Up Contribution Rules

The Setting Every Community Up for Retirement Enhancement (SECURE) Act brought numerous changes to the retirement and estate planning landscape in late 2019. Congress followed up with the SECURE 2.0 Act in late 2022. This law introduced some additional taxpayer-friendly changes, including an increase in the limits for retirement account catch-up contributions for individuals who […]

How to Curb Automotive Hacking

Automotive hacking is on the rise. The number of cyberattacks into vehicle computer systems increased by a staggering 380% from 2021 to 2022, according to Upstream’s 2023 Global Automotive CyberSecurity Report. Don’t buckle up without taking precautions.  What Is Automotive Hacking? The term “automotive hacking” refers to attempts by outsiders to use technology to invade […]

How the Risk of Detection Reduces Fraud

Do your employees feel like they’re being watched? If they don’t, they may be emboldened to steal. In the same way that putting more police officers on streets tends to reduce crime, making your company’s anti-fraud activities more visible can discourage fraud perpetrators. Good internal controls are critical to preventing fraud. But many companies have […]

6 Types of Payroll Tax Obligations Employers Should Know

There’s more to paying taxes than just federal and state income taxes. Another major tax chore for employers is payroll taxes. These expenditures can be significant, and the reporting requirements can be onerous. So it’s important for small business owners to understand the basics. First off, employers are required to report and deposit payroll taxes […]

Be Careful When Saving for Your Kids’ Education

Here’s a little-known secret for parents planning to send their children to college in the future: Some of the tax-saving moves you make now could hurt your student’s chances for getting financial aid later. That’s because of the way the financial aid system treats different assets. Retirement plans and IRAs don’t count for college aid […]

Do Your Kids Know the Value of a Silver Spoon?

You taught them how to read and how to ride a bike, but have you taught your children how to manage money? Many college students and graduates carry a significant amount of student loan debt. Unfortunately, many of them will either default or be delinquent in repaying those loans, which may affect decisions they make for […]

Delinquent Taxpayers May Experience Passport Issues

Let’s say a person is planning to take a plane trip out of the country. And further suppose that individual owes the federal government a fair amount of back taxes. The person may not be able get a passport if he or she owes the government a significant amount of back taxes. The IRS is […]

Inflation Boosts Federal Gift and Estate Tax Breaks

Inflation is generally bad news. But a favorable side effect is bigger annual inflation adjustments to federal tax breaks. In fact, many federal tax parameters for the 2023 tax year are up about 7% over the amounts for 2022. Here are the details — plus inflation-adjusted estimates for the 2024 tax year to tide you […]

Independent Contractors Offer Advantages — and One Major Risk

Hiring someone as an independent contractor can have many advantages for employers. Among them are that independent contractors: Perhaps the biggest risk of engaging an independent contractor is that the IRS will eventually determine that the person is actually an employee. In such an event, you could be held liable for back taxes, penalties and […]

Update on Deducting Business Meal and Entertainment Expenses

The federal income tax treatment of business-related meal and entertainment expenses has been a moving target the last few years. If you’re confused about what rules currently apply, you’re not alone. Here’s a refresher on what’s currently deductible — and what’s not. TCJA Impact Before the Tax Cuts and Jobs Act (TCJA) went into effect, […]

New Tax Law Improves QCD Benefits

Seniors who must take withdrawals from their IRAs may be able to benefit from a special tax provision for qualified charitable distributions (QCDs). Briefly stated, this provision allows people in their 70s and older to transfer funds directly from an IRA to a charity without any adverse tax consequences. The new SECURE 2.0 law enhances […]

Federal Tax News for Individuals

Crypto Investors: Loss Deductions, Regulation and Oversight There have been three recent developments in the cryptocurrency arena: 1. Loss tax deductions for FTX investors. Investors with inaccessible assets tied up in cryptocurrency exchange FTX Trading Ltd. will need to wait until court proceedings conclude before learning if loss tax deductions will be available. FTX filed […]

Important Tax Figures for 2023

Every year, the amounts allowed for various federal tax benefits are subject to change based on inflation adjustments and legislation. Here are some tax figures for 2023, compared with 2022, including the estate tax exemption, Social Security wage base, qualified retirement plan and IRA contribution limits, driving deductions and more. Good news: Many increases are […]

Guidance on CT’S New Mandatory Retirement Savings Program

Dear Clients, Business Associates and Friends, The State of Connecticut enacted legislation in 2016 to address the lack of retirement planning options available to private sector employees. This legislation created the Connecticut Retirement Security Authority (CRSA), which implemented MyCTSavings, a state-sponsored retirement savings program for employees whose employers do not offer a retirement savings plan. The […]

Critical IRS Update: Retain These Two Letters

A critical update from IRS Senior Stakeholder Liaison Joe McCarthy: With preparations for the next tax season starting there is something important you should be aware of. The IRS will be sending out two letters to taxpayers in January: Letter 6419 – Advance Child Tax Credit Payments Letter 6475 – Economic Impact (stimulus) Payment It is […]

Beware of Fraudulent Letters About Unpaid Tax Debt

Attorney General William Tong and Department of Revenue Services Commissioner Mark D. Boughton today are warning Connecticut consumers of a scam in which they receive a threatening letter about unpaid federal tax debts. The fraudulent letter claims to be from a “Tax Processing Unit” in a Connecticut county and threatens legal action for unpaid taxes […]

Eligible Parents Will Begin Receiving Advance Child Tax Credits July 15th

Dear Clients, Business Associates and Friends, The 2021 advance child tax credit (CTC) payments, which were established under a recent law, will begin being made on July 15, 2021, the IRS announced. The tax agency also stated that “roughly 39 million households – covering 88% of children in the United States – are slated to begin […]

A More Valuable Employee Retention Credit for 2021

Have you evaluated whether your business qualifies for the Employee Retention Credit?  The Federal program has been modified twice in the past six months, so if you have not kept up with the changes you may find that you qualify for payroll tax credits based on continuing wage payments. The threshold for qualifying in 2021 […]

Which States Are Opting Out of Federal Unemployment Benefits?

In recent weeks, many employers have complained about how difficult it is to fill job openings. The country is returning to normalcy, with COVID-19 cases drastically falling, yet some businesses can’t get all their workers to come back. Maryland recently joined 24 other states in ending the $300 per week federal unemployment benefits in a […]

Maximize Social Security Benefits When You Retire

Get the most from Social Security. Younger retirees face a harsh penalty for working part-time. For every $2 earned over $18,960 in 2021 (up from $18,240 in 2020), you lose $1 in Social Security benefits. In the year you reach full retirement age, a higher earnings threshold applies. Your benefits will be reduced by $1 […]

Coronavirus Stimulus Package Update

On December 21, Congress passed the Consolidated Appropriations Act of 2021 (CAA), which provides pandemic relief, as well as other tax and health-related provisions. White House aides had indicated that President Trump would sign the massive 5,500-plus page bill. However, late on December 22, President Trump indicated that he might not sign the bill because of […]

Overtime Pay Rules for Fluctuating Workweeks

If you pay employees who are nonexempt and who have fluctuating workweeks, there’s a formula you can use to calculate their overtime pay. The formula is laid out in newly revised U.S. Department of Labor (DOL) regulations, and it adheres to the Fair Labor Standards Act (FLSA) overtime pay framework. However, you don’t need to […]

Employee or Independent Contractor? The Rules May Be Getting Simpler

From an employer perspective, using independent contractors provides greater flexibility in managing variable demands for particular services. And, frequently, those services can be obtained more economically because independent contractors don’t receive employee benefits, nor are the companies that use them subject to the employer share of those workers’ FICA taxes.  And yet, depending on market […]