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Choosing to retire is one of the biggest financial decisions you’ll ever make. Giving up your salary means having to live from other sources of income, and if you haven’t planned extensively, then you might not even be aware of the resources at your disposal, let alone how much money they might provide toward your support. By considering the following questions, you’ll be in a much better...

Beneficiaries of a trust typically pay taxes on distributions they receive from the trust’s income. However, they are not subject to taxes on distributions from the trust’s principal. When a trust makes a distribution, it deducts the income distributed on its own tax return and issues the beneficiary a tax form called a K-1. The K-1 indicates how much of the beneficiary’s distribution is interest...

Americans living abroad are still required to file US taxes. The US is the only country that requires its expats to file. It is because the US taxes based on citizenship rather than on residence. This leaves the millions of Americans who work abroad at risk of double taxation, paying taxes in both the country where they live, and to the US, on the same income, as the US requires all its citizens...

The Internal Revenue Service has released a revenue procedure that offers an easier way to get an extension of time to file a return to opt for portability of the deceased spousal unused exclusion amount. Revenue Procedure 2017-34 applies to estates that aren’t typically required to file an estate tax return because the value of the gross estate and adjusted taxable gifts is under the filing...

The Internal Revenue Service today warned people to beware of a new scam linked to the Electronic Federal Tax Payment System (EFTPS), where fraudsters call to demand an immediate tax payment through a prepaid debit card. This scam is being reported across the country, so taxpayers should be alert to the details. In the latest twist, the scammer claims to be from the IRS and tells the victim about...

Before you interview the next group of job candidates for your small business, whether it’s to fill a full-time position or just for the summer, keep in mind that long-term unemployment recipients and other workers certified by a state agency may qualify for the Work Opportunity Tax Credit (WOTC). This isn’t just chicken feed: The credit is generally equal to 40 percent of the worker’s first-year...

Millions of people enjoy hobbies that also provide a source of income. From catering to cupcake baking, crafting homemade jewelry to glass blowing – no matter what your passion is, there will likely be tax repercussions. Some taxpayers are surprised to learn that they must report income earned from hobbies on their tax return. The exact rules for reporting income, as well as deducting expenses,...

Will your legacy be a benefit or a burden to your loved ones? It depends on how well you’ve planned. There are some things we just don’t like to think about, much less speak about. The universal truth is we are all going to pass away one day. The legacy you leave can either simplify the process of dealing with your personal and financial property, or it can be a worrisome burden for those you...

In some cases, you can hold a stock for less than a year and avoid short-term capital-gains rates The current federal income-tax rates on long-term capital gains recognized by individual taxpayers are still low by historical standards. The rates range from a minimum of 0% to a maximum of 20% depending on your tax bracket. But the rates on short-term gains aren’t so low. They currently range from...

A trusteed IRA offers provisions beyond a custodial plan, but is it a good strategy for clients? That answer depends on several factors, including how much control — or not — the client wants their beneficiaries to have. Under the tax code, an IRA can be established as a trust or custodial account. With a trusteed IRA, a financial organization adds trust terms and language to the plan. Thus, the...