The likelihood of being audited by the IRS is relatively low, with only 0.63% of individual tax returns selected for audit in 2020, or fewer than one out of every 100 returns. This represents a significant decrease from the spike in audit rates observed in 2010. Factors that Increase the Risk of an Audit While … Read more
Cost-of-Living Adjustment (COLA) Social Security and Supplemental Security Income (SSI) beneficiaries will receive a 1.3% COLA for 2021. This increase is based on the rise in the Consumer Price Index (CPI-W) from the third quarter of 2019 to the third quarter of 2020. Tax Rates The Social Security tax rate remains unchanged at 6.20% for … Read more
Understanding the distinction between taxable and nontaxable income is crucial for optimizing your tax strategy and minimizing your tax liability. This comprehensive guide will delve into the various types of income that are exempt from taxation, empowering you to make informed financial decisions. Nontaxable Income: A Detailed Overview Nontaxable income, as defined by the Internal … Read more
For senior citizens in India, understanding the intricacies of tax deductions can be crucial for optimizing their financial well-being. One such deduction is Section 80TTB, which offers tax relief on interest income earned by senior citizens. This article delves into the details of Section 80TTB, specifically addressing whether it encompasses interest earned from the Senior … Read more
Adjusted gross income (AGI) is a crucial concept in the world of taxation, serving as the foundation for calculating your taxable income. Understanding how AGI is calculated is essential for accurate tax preparation and maximizing your tax savings. This article delves into the intricacies of AGI calculation, providing a comprehensive guide to help you navigate … Read more
Yes, the IRS can take your husband’s tax refund for your student loans if you filed a joint tax return. When you file a joint tax return, you are jointly and severally liable for the tax debt. This means that the IRS can collect the tax debt from either spouse, regardless of who earned the … Read more
Filing taxes can be a daunting task, but it’s essential to ensure that you fulfill your tax obligations and receive any refunds you may be entitled to. The Internal Revenue Service (IRS) has specific guidelines regarding when you can file your taxes, and it’s important to adhere to these timelines to avoid penalties or delays. … Read more
Contrary to popular belief, there is no age limit for paying taxes. Individuals continue to be responsible for fulfilling their tax obligations regardless of their age. However, certain factors, such as income level and sources of income, can impact whether or not a senior citizen is required to file a tax return. Filing Requirements for … Read more
If you’ve earned income from self-employment but haven’t received a 1099-NEC or 1099-MISC, you’re still responsible for reporting that income to the IRS. Fortunately, TurboTax makes it easy to do so. Here’s a step-by-step guide on how to report cash income without a 1099 using TurboTax: Step 1: Gather Your Records Before you begin, gather … Read more
Form 1099-B is used to report proceeds from the sale or exchange of stocks, bonds, and other securities. If you’ve received a 1099-B, you’ll need to enter the information on your tax return to report your capital gains or losses. H&R Block makes it easy to enter Form 1099-B information into your tax return. Here’s … Read more