Taxes

This post is by Kay Bell at Bankrate.com.

 

U.S. Postal Service delivery bags are overloaded right now with statements from employers, banks, stockbrokers and other institutions and agencies that were involved in taxpayers' financial lives last year. Each of these groups has, by law, until Jan. 31 (or the next business day when that date falls on a holiday or a weekend) to get their annual tax statements in the mail to taxpayers.

 

The one bit of relief for postal workers is that many taxpayers now receive these documents electronically. So be sure to double-check your e-mail, not just the curbside box for these statements that should be on their way.

 

Most taxpayers depend on the same basic data to file returns. If you work for someone else, the Internal Revenue Service expects you, and the agency, to get a statement detailing that income. The data are slightly different, depending on whether you get paid a salary or do contract work, but there's a form for each case.

 

This post is by Deborah L. Jacobs of Forbes.com.

 

Now that the fiscal cliff has been averted -- at least temporarily -- there is widespread confusion about the effect on estate planning of the 11th-hour tax law. Mostly what Congress did in this arena was to make permanent the system that has been in effect for the past two years.

 

That was an important achievement: Without any action on their part, the tax-free amount would have automatically reverted to $1 million per person, and the rate for most estates would have gone up to 55%. But, at the end of the day, the only thing the lawmakers actually changed is the gift- and estate-tax rate, which has gone up to a top rate of 40% from a maximum of 35%.

 

Here are questions and answers on the federal estate tax after the fiscal cliff deal.

 

This post is by Kyle James at U.S. News & World Report.

 

If you’re self-employed, are you getting all the tax write-offs you’re entitled to? With the rising costs of doing business and the high costs of securing your own health insurance, it’s important that you analyze your business expenses to ensure you’re receiving all possible tax deductions. Your hard work and will to overcome the risks accompanying self-employment have earned the right to deduct these expenses. Here

are several that are frequently overlooked:

 

Vehicle deductions

Keep a mileage log for all business-related travel. This can also include travel your spouse does on your behalf. When it comes time to total your annual business miles for the IRS’ pre-determined standard mileage rate, vehicle deductions are often overlooked.

 

Business use of your home

There are a number of missed opportunities for deductions when analyzing your home office space. To avoid them, you’ll first want to map out your home and determine what percentage of your home is used for work-related activities. If, for example, you determine that 20% of the home’s square footage is used for business, you get to write off 20% of your utility bills, Internet costs, mortgage or rent, property tax, homeowners insurance and home maintenance. Many people forget to include the square footage of the bathroom and any areas you consider "break areas."

 

This post is by Laura Saunders of The Wall Street Journal.

 

Here are questions and answers about what the new tax agreement means for millions of Americans. For a plain-language summary of the bill, click here.

 

What happens to individual tax rates for 2013?

 

For most people, individual tax rates will stay the same as last year. However, for the wealthiest there’s a new permanent top rate of 39.6%, up from 35% for 2012.

 

The threshold for the top rate is $450,000 of taxable income for married couples filing jointly and $400,000 for single filers.

 

This post is by Kay Bell at Bankrate.com.

 

Thanks to tax preparation software, more of us are making fewer mistakes on our annual tax returns. But just one slip in entering information on your computer could end up costing you, either in the form of a larger tax bill or a smaller refund.

 

And even if a mistake -- either on your computer or paper forms -- doesn't cost you cash, it could delay the receipt of any refund you're expecting.

 

To get exactly what you should from the Internal Revenue Service as quickly as possible, look out for these tax-filing pitfalls.

 

A few are new, thanks to recent changes in the law. Others are perennial problems taxpayers face each filing season. With a little care, you can avoid them all.

 

This post is by Sharon Epperson at CNBC.

 

You didn't imagine it. Your paycheck shrank. Thanks to an increase in payroll tax, more of your pay is going to fund Social Security. You got a break in 2011 and 2012 when the Social Security payroll tax temporarily dropped from 6.2% to 4.2%. Now it's back where it started.

 

About 160 million workers pay this tax, and this year's two percentage point increase will cost the average worker about $700, according to the Tax Policy Center in Washington. Wealthier taxpayers may actually feel less of an impact, because the 6.2% payroll tax applies to wages only up to $113,700.

 

Still, for a family with a household income of $100,000, the payroll tax hike means a loss in income of about $2,000 a year.

 

This post is by Serena Ng of The Wall Street Journal.

 

American workers are opening their first paychecks of the year and finding an unpleasant surprise: The government's take has gone up.

 

A temporary cut in Social Security withholding gave Americans hundreds of extra dollars to spend over the past two years. But Congress allowed that break to expire during the wrangling over the fiscal cliff, meaning that Social Security taxes have reverted to 6.2% of salary from the temporary 4.2%.

 

The noticeable lightening of paychecks as consumers remain tentative threatens to put a drag on economic growth. The effect for companies is that the hit is likely to cement a frugal attitude that led consumers to cut back on eating out and shift to less-expensive store brands.

 

This post is by Jacqueline Leo of The Fiscal Times.

 

Click the Huffington Post’s “divorce channel” (yes, the site has one) and you’ll see a typical women’s magazine story about the 10 signs you’re headed for a divorce.  You’ve heard it all before:

• Forget being on the same page, you're not even in the same book.
• You’ve outgrown her.
• He doesn’t fulfill your needs.
• You’re staying together because of the kids.
• Blah, blah, blah.

Of all the known reasons for getting a divorce, we bet you've never heard this one before. You both make too much money to stay together! Sounds ridiculous, right? But the new fiscal cliff tax law that saved 99% of the country from massive tax hikes made a beeline for love-struck yuppies.