Financial planning can feel a bit ambiguous at times. There are quite a few assumptions that need to be made about your financial future. What will your income and expenses be in retirement? What growth rate can you assume in your portfolio? How much of your income will social security really replace?
While you may not be able to control everything about your financial situation, there is one area where you can take charge immediately.
Proactive tax planning can instantly elevate your overall financial plan.
Tax Preparation vs. Tax Planning
It is very common for people to
As you likely know, President Joe Biden signed his sweeping $1.9 trillion Covid-19 economic relief package into law on Thursday afternoon March 11, 2021. Included in this package were several tax provisions that increase child tax credits and exempt certain 2020 unemployment benefits from taxation for lower income taxpayers.
Passing retroactive tax legislation just five weeks before the regular 1040 tax deadline of April 15, 2021, is virtually unprecedented, and has left the IRS and tax preparation software vendors scrambling to update calculations, guidance, tax forms, publications and program logic.
Add to the foregoing the IRS’ backlog of taxpayer correspondence …Read More
Michelle Singletary of The Washington Post offered advice for what may be a tumultuous tax season for some people and a “supersize list of some of the issues people will face this year” in “Tax season 2021: A tornado is coming.”
Really, you do not have to fear if you have already been working with a Fee-only financial planner. And there is still time to get help from a financial planning expert for this year and for the years to come. Here are some things to consider:
File electronically if you can: The general advice this …Read More
If you are someone who has received or will receive a stimulus check from the federal government, you may be concerned that you will need to pay taxes on those funds in the future. Kiplinger.com addresses that and a few other related tax issues in “Is Your Stimulus Check Taxable?”
Although we are taxed on income, there are no taxes on the stimulus checks because “As it turns out, your stimulus check isn’t “income” after all, according to the law. Instead, it’s simply an advance payment of a tax credit. And tax credits aren’t taxable income.” This is …Read More