The agency's ruling means investors could benefit, but transactions are subject to stiff record-keeping rules and big taxes.
The announcement in general was expected to be greeted favorably by the fledgling industry, and many had anticipated exactly this result. But the announcement also served as a reminder that new technologies often can't avoid being subject to the old rules for long.
Don't let changes to tax laws or your income ambush you. Be sure you're up to speed on these lurking surprises.
By Alden Wicker, LearnVest
You've already done your taxes, right? Even if you've got them figured out — or have an excellent accountant doing them for you — you still might be in for some expensive surprises this season.
Below, Joseph Boyce, a New York–based CPA, and Gail Rosen, CPA and owner of a New Jersey–based accounting firm, highlight the taxes they'll be warning clients about this season.
Granted, these picks don't apply to everyone, which is exactly why they're so sneaky. From brand-new measures like the NIIT to longstanding gotchas like the AMT, you'll want to be aware of these long before you file.
1. The Medicare tax
Let's start with the shiny new Medicare tax, which was instituted as part of the Affordable Care Act (a.k.a. Obamacare). It only affects people with incomes over a certain threshold, but if you are one of those people, you might be surprised to see a few hundred dollars tacked on your tax bill.
Who may be subject: If you make at least $200,000 individually, $250,000 filing jointly with your spouse or $125,000 filing separately from your spouse, you'll be assessed a .9% tax on any income beyond that.
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More than $1 million has been stolen from victims in a massive IRS phone scam. Here's what you need to know to protect yourself.
This post comes from Krystal Steinmetz at partner site Money Talks News.
Be wary if you answer your phone and the caller says he's an IRS agent. It could be a scam -- the largest the Internal Revenue Service has ever seen.
The U.S. Treasury Department says more than 20,000 taxpayers have alerted the government about the scam, and victims have lost more than $1 million total.
This is how it works: A bogus IRS agent calls and claims the intended victim owes taxes, then demands immediate payment with a prepaid debit card or wire transfer.
The fraudsters often know the last four digits of victims' Social Security numbers.
If victims protest the immediate payment request, the phony agent threatens arrest, deportation, or the loss of a business or driver's license.
A press release from Treasury also made note of these details about the scam, which is being perpetrated across the country:
Haven't started your taxes yet? You're not alone. Here's some advice that will make procrastinating a bit less painful.
This post comes from Stacy Johnson at partner site Money Talks News.
The deadline to file taxes is Tuesday, April 15. That's just over three weeks away.
If you haven't already filed, you're not alone. The IRS says 20 to 25 percent of us are going to wait until the last two weeks.
Those who have already filed are probably the lucky souls getting a refund. Those who haven't probably fall into one of two groups: They owe or they're only able to get motivated by deadlines.
Either way, we're here for you.
If you rely on these tax breaks, which are set to expire at the end of the year, you might want to start planning for April 15, 2015 earlier than usual.
This post comes from Amy Feldman at partner site Reuters.
As you go to do your taxes this year, it may be the last time you get to take advantage of dozens of tax provisions that expired at the end of 2013.
So grab them while you can. And be prepared for some tax-planning difficulties this year if you've come to rely on one of the big ones.
A total of 55 so-called "tax extenders", little bits of the tax code that either fall by the wayside or get automatically renewed, expired at year-end.
The daily pinch on your wallet from sales taxes can vary widely depending on where you live. Where does your state rate?
By Hal M. Bundrick, MainStreet
The government is always in our pocket, whether it's with income, property or sales taxes. We may be especially thinking about income taxes these days with the federal filing deadline looming, but the tax toll is a daily debt we pay.
By taking a population-weighted computation of local sales tax rates and combining it with the prevailing state rate, the Tax Foundation has computed the combined sales tax rate for each U.S. state.
When it comes to paying the most on purchases, Tennessee takes the biggest toll, with the highest average combined rate of 9.45 percent. Southern hospitality takes a back seat to taxes in Arkansas (9.19 percent) and Louisiana (8.89 percent), too. Washington (8.88 percent) and Oklahoma (8.72 percent) round out the top five states with the greatest sales tax burden for consumers.
Don't fall victim to identity theft this tax season. Does your employer have your current address?
This post comes from Christine DiGangi at partner site Credit.com.
Tax fraud is one of the most common forms of identity theft. You don't want tax season to be any more complicated than it has to be, and you also don't want someone messing with your personal information.
Sometimes you have no control over the situation: Perhaps your Social Security number was stolen in a data breach, sold on the black market and used to file a false tax return. Or perhaps your tax documents were sent to the wrong address, and the recipient then had all the info needed to file a fraudulent return in your name.
Update your address
Employers have until the end of January to send your W-2, so if you haven't gotten one by now, it's time to ask questions. If you talk to your employer and find out someone sent your form to the wrong address, have them re-send the W-2 to your correct address immediately. If you don't have time to wait for the new form, you can file Form 4852, Substitute for Form W-2, Wage and Tax Statement.
High earners can’t contribute directly to popular Roth individual retirement accounts. But there’s still a way in. Here's a simple two-step strategy that works for many people.
This post comes from Karen Damato at partner site The Wall Street Journal.
Going through the back door can pay off for high-income retirement savers.
We're talking about the backdoor route into popular Roth individual retirement accounts, which offer tax-free income in later life.
The front door into Roths is shut for many investors. Married couples earning $191,000 or more and singles earning $129,000 or more in 2014 are barred from contributing directly to Roth IRAs.
But there's a simple detour that works for many of them.
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