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Tax Deadline 2021 Moved To May

April 12, 2021April 11, 2021 by Finance Gourmet

The IRS is moving the tax-filing deadline to May 17 from April 15. Update: Colorado tax deadline date has officially been moved to May 17. Turns out the new Biden Covid Relief package has pushed the IRS over the edge to moving the tax due date for 2021. Tax day 2021 will now be May 17. There are just enough changes to tax law in the new package that the IRS figures implementing the changes, publishing the updated tax forms and guidance, and then getting filed is going to be too tight for many taxpayers this year. The new tax deadline 2021 on May 17 is basically a one-month extension from the standard April 15th deadline, except May 15 is on a Saturday, so the new tax deadline for 2021 is Monday, May 15, 2021. Tax Deadline 2021 Of course, the IRS is spinning this as them helping taxpaying Americans. It helps the IRS too, but either way, many taxpayers will take it. The new tax deadline for 2021 is forth both filing and paying federal income taxes, unlike a typical tax extension. As always, taxpayers can get a free, no-questions asked, extension to October 15 by filing Form 4688, …

What Is Still Deductible

December 6, 2019November 13, 2019 by Finance Gourmet

Trump’s new tax law has caused a lot of confusion. One of the big areas of confusion is that many of the so-called “itemized-tax deductions,” won’t really count for most American taxpayers anymore. It’s not that those deductions are gone, it’s just that triggering the threshold where itemizing tax deductions saves you more money than taking the standard tax deduction has moved. New “Smaller” Tax Forms Politicians are always lying and claiming victory when they have achieved no such thing. One thing many politicians tried to take credit for with the new Trump tax law was making taxes simpler. They did… kind of… sort of… My favorite part of the new tax law is that you can “file your taxes on a postcard.” <insert super eyeroll> You know, if you use both sides of the postcard… with no space for any sort of address for mailing it… and if anyone still used postcards, which the IRS does not recommend for filing your taxes. The official IRS 1040 form would indeed fit on an non-mailable postcard. If you printed it front and back. Sound dumb? It is. Still, here we go, the official IRS Form 1040. Wait a minute. That IS …

IRS Form 1040 – 2018

January 24, 2019 by Finance Gourmet

The 2018 IRS Form 1040 has been out for a while now. Unfortunately, more than a little bit of the new tax law is on shaky ground while the government is shutdown and the IRS is playing catch up with its remaining staff. That being said, it’s time to take a quick look at the 2018 Form 1040. Check out my look into Credit Karma. IRS Form 1040 Simpler – Sort Of One of the points of the new tax law was to make filing taxes easier. The supposed goal was a tax form so simple it could fit on a postcard. While the main 1040 could indeed fit on a postcard, a lot of taxpayers are going to need to add one or more “schedules” to calculate the values that go on that postcard. But, since when did a bit of reality clog up the pronouncement of politicians The 1040 Schedules The usual schedules from previous years are still here, including Schedule A if you are itemizing your deductions, Schedule C for small business owners and the self-employed, Schedule D for capital gains/losses, and so on. New Schedules making their debut so that the 1040 can be artificially small …

New Section 199A Business Tax Deduction

December 6, 2018 by Finance Gourmet

It’s time to dig into how the new Republican tax law is actually going to affect you and yours this coming tax season. While it has been a while since the law was passed, it takes some time for the IRS to iron out the actual rules. Plus, you have to wait for the year to go by before you file your taxes. So, here we are, heading into 2019, and we’ll be doing our 2018 taxes. There are a lot of changes, but one of the biggies is Section 199A. I’m going to take a quick look at the Section 199A Deduction as it applies to a freelancer, or someone who owns their own side business. Section 199A Tax Deduction As noted at the time, the Republican tax bill of 2017 was passed quickly in order to keep any opposition from building up and stopping its passage. As a result, it wasn’t very well thought through, and chances are that there are more than one or two bugs in the system. The IRS itself tried to iron some of those out as it created definitions, and rules and regulations, but there is still a lot of uncertainty about exactly …

How To Deduct Property Taxes

February 20, 2019February 11, 2018 by Finance Gourmet

Property taxes can be an important tax deduction for many home owners. Real estate taxes, in particular, can be a significant tax deduction.

Can I Use My 529 Plan to Pay For K-12 Expenses

September 13, 2022January 22, 2018 by Finance Gourmet

529 plans are a tax-advantaged account that allows saving and investing for college expenses. Before last year’s new tax law was passed, one got tax-deferred growth in the account, and tax-free withdrawals for qualified college expenses. Even better, there were very few 529 contribution limits on most plans. Now, the recent tax law has opened up another possible way to use 529 funds tax-free. 529 Plan Withdrawals Until 2018, you could not use your 529 plan to pay for anything other than higher education expenses, in other words, college. Withdrawals from a 529 plan for any other purpose were not only taxable, but subject to a 10 percent tax penalty. But, the new tax law passed at the end of 2017 changes the rules. This tax law allows parents to use up to $10,000 per child for elementary, or secondary education. In other words, you can use up to $10,000 from a 529 plan to pay for private school during the K-12 years. This is a big boon for those who send their kids to private schools. Interested in automatically investing for non-college expenses? Check out my Acorns reviews. Using 529 Money To Pay for Private School There is a …

Home Office Tax Deduction

December 6, 2017 by Finance Gourmet

One of the best deductions for self-employed people who work from home is the home office tax deduction. Basically, you take the square footage of your home office and compare it to the total square footage of your home, and then you get to deduct a similar percentage of certain house expenses as a business deduction. It’s one of the ways to take a little bit of the sting out of self-employment taxes. How To Claim Home Office Deduction Like most self-employed small business tax deductions, you take the home office tax deduction on Schedule C. You’ll need Form 8829 Expenses for Business Use of Your Home to calculate and file your deduction. If you use tax prep software like TurboTax, it will do this for you. (You’ll need one of the small business editions to take this deduction, but it’s most likely going to save you a lot more money than you pay for a more expensive version of TurboTax.) To qualify for the home office deduction, you have to use a specific area of your home exclusively, and on a regular basis. In other words, it has to actually be your office where you do your work for …

2017 Finances and Money Issues

January 3, 2017 by Finance Gourmet

Welcome to 2017! Relax. Take a deep breath. There. Feel better? Good. Then let’s jump in. Finances Updated in 2017 With a new year, come some new numbers. There will be updates to the maximum 401k contributions, income limits for Roth IRAs, and others. Plus, there will be adjustments to the 2017 income tax brackets, the 2017 standard tax deduction, and more. And, of course, there is a new IRS mileage rate for 2017 as well. What about 529 plans? There aren’t a lot of updates to those numbers each year, primarily because most facets of 529 college savings plans are administered through the states, who aren’t always as keen on changing and updating everything. You’ll want to re-evaluate your financial plan for the new year, and you’ll want to review how your financial plan did in 2016. Plus, you’ll want to rebalance your portfolio, if you didn’t do it at the end of 2016. Retirement Plans 2017 A big part of most retirement plans are tax-advantaged savings accounts like your 401k plan, IRA accounts, and, for some of you, 457 plans, 403(b) plans, and various differed compensation plans. All of those need adjusted and reviewed for 2017 as well. …

Health Savings Accounts State Taxes

July 6, 2016 by Finance Gourmet

We’ve discussed before how much of a benefit a Health Savings Account, or HSA, can be for saving money on your taxes. Contributions to an HSA are tax deductible for federal income tax purposes, or in the case of pre-tax contributions, they are simply not part of your income for federal income tax purposes. In addition, all interest, or capital gains earned within an HSA are tax-free, assuming all withdrawals are made to pay qualified medical expenses.But, what about state taxes on Health Savings Accounts? State Taxes on HSA Accounts The Federal Government can’t force states to do things, although there are ways around that, such as make your drinking age 21, or you get less federal highway funds. So, the various states don’t necessarily have to go along with the Feds when it comes to what is and is not tax deductible. In some states, however, that just happens by default. For example, in Colorado, the state income tax form is based upon the taxable income that you calculate for your federal income taxes. In other words, if you deducted it on your U.S. income taxes, it is already deducted when you start doing your state income taxes. That …

Which Is Better HSA or FSA?

May 11, 2016 by Finance Gourmet

Which is better a flexible spending account or a health savings account? The answer to which is better between a health savings account or flexible spending account depends, unfortunately, on the specifics in which they are setup. However, it is relatively simple to determine which is better an FSA or an HSA. First, you’ll want to understand what an FSA vs an HSA looks like. When FSA Is Better Than HSA An flexible spending account, or FSA has many advantages over paying for medical expenses out of your own pocket. However, it has only one real advantage over a health savings account, or HSA. The only eligibility requirement for having and using an FSA is that your employer offers one. It doesn’t matter what kind of health insurance plan you choose, or whether that plan has a high deductible. In order to have an HSA, you must have a qualifying high-deductible health insurance plan. The reality is that the deductibles aren’t necessarily that high, and in fact, may be close to the deductibles on other health plans. But, if you don’t qualify for an HSA, then a FSA is better than an HSA. The only other advantage of an FSA …