income taxes

Tricks to Save Money On Taxes

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save money on taxes tips

If you have fairly simple taxes, that is ones that do not include several complicated schedules or worksheets that have to be filed, then you might not want to pay for TurboTax or TaxCut or other tax preparation software.  But you still don’t really want to go it alone without some sort of double-check. Let’s jump right in with some tricks to save money on taxes. TurboTax For Free TurboTax offers a marketing gimmick where they allow you to do your taxes on the online version of TurboTax for free.  You only have to pay when you print or e-file your return.  But who says you have to print anything? When you have finished inputting all of your information, and TurboTax has finished crunching all of the numbers, switch to the form view where you actually are looking at an electronic version of the tax form.  Copy the numbers down onto Form 1040 that you printed off of the IRS website, and voila.  Your taxes are done, and all for free! Obviously, if you have to generate a bunch of extra paperwork or IRS Schedules, this isn’t the method for you.  But keep in mind that many of the worksheets …

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How Long To Keep Tax Returns

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how long keep tax return records

Tax Day is today. Hope you are ready! If you have already filed, there is one more piece of tax business you can attend to before you run off into your summer. Time to shred some old tax returns and documents. IRS Rule For How Long to Keep Taxes The general rule for how long you have to keep your tax returns and other tax records is three years. HOWEVER, this is the IRS we are talking about, so there are some exceptions, and sub-rules to the general rule. First, you need to know when to count from. The 3-year rule counts three years from the date you FILED them. So, if you filed early, you don’t technically have to wait until April 15 (I always do. Better safe than sorry.) On the other hand, if you filed late, whether with an extension or not, you need to keep them for three years from that date. Also, the IRS says you should keep your returns for two years after you paid the tax, so if you ended up paying late, or on some sort of payment plan, be sure to keep them for two years after that tax bill has been …

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Colorado Income Tax Tips

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colorado taxes

I live in Colorado. Most personal finance and achieving financial independence applies to everyone, nationwide. When it comes to taxes though, there is a great deal of variation among states. I may dig into some other states as time provides, but for now, here are some 2022 Colorado Income Tax Tips for the taxes filing in early 2023. Colorado Income Tax Rate 2022 The best part of writing about 2022 Colorado Income Tax Rates is that the state has a flat tax. In other words, everyone in Colorado pays the same tax rate regardless of how rich or poor you are. Before you get all up in arms, percentages are by their nature, progressive. That is, someone will $500,000 income paying 5% will pay more taxes ($5,000) than someone paying $100,000 ($1,000). The worst part of writing about Colorado income taxes is that unlike the drawn-out battles of doom in the U.S. Congress to change anything in the Federal income taxes, Colorado’s income taxes change all the time, sometimes automatically. Such is the case for 2023 where Colorado’s TABOR law will make the Colorado Income Tax Rate for 2022 down to 4.4% from 4.5% in 2021. In addition, Coloradoans will …

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Colorado Tax Refunds 2022

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colorado tax refund summer tab

This summer, Colorado sales tax refunds are coming via check to everyone who filed Colorado income taxes by June 30, 2022. If you filed after that, you might be out of luck, or some people will get their Colorado Tabor refund 2022 in early 2023. Update: The checks are in the mail! What Is This Colorado Summer Tax Refund? This is the Tabor tax refund that Colorado taxpayers normally get when they file their taxes. If you’re new to Colorado politics and government, taxpayers passed a law back in 1992 called the Taxpayer Bill of Rights, or TABOR. Among other things, it limits the amount of tax revenue the state can collect each year to an increase based upon inflation and population growth. If the state collects too much money, then it must refund the excess to taxpayers. This is often referred to as the TABOR surplus by politicians, and the TABOR refund by Coloradoans. How Colorado TABOR Refunds Usually Work The Colorado government runs on a fiscal year that runs from July to June, not a calendar year from January to December. Normally, when the fiscal year ends in June, the Colorado state government counts all of the tax …

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Can I Pay My Taxes with a Credit Card?

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credit cards

Yes, you can pay your taxes by credit card, but it isn’t free. In order to pay your taxes by credit card, you must use one of three payment processors. They charge slightly different fees to process your credit card tax payment. How Much Will It Cost to Pay My Federal Income Taxes with a Credit Card? Depending upon the credit card processor you use to pay your federal income taxes with, the fee will range from 1.87% to 1.98% with a minimum payment of $2.50. If you owe $3,000 on your federal taxes, your fee will be $56.10 to $59.40. That is a lot of money and probably not worth it unless you are doing it for some special reason. Is It Worth It to Pay My Income Taxes with a Credit Card to Get Credit Card Points or Miles? As a former financial planner, I still get a lot of money questions and have a lot of money conversations with friends and colleagues, like, “Can I pay my taxes with a credit card?” The number one reason people tell me they pay their taxes with a credit card is to earn credit card reward points or credit card …

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Stock Market Trading Sideways

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nothing to see here

Update: It’s been 15 days of breathless up and down headlines from the financial media since I first wrote this article, and the stock market is STILL trading sideways. Take a look at three months of the Dow. The stock market often trades “sideways” as it consolidates after moves up or down. This is very common after big run-ups or drops, as well as when the economy is sort of waiting to see what happens. Of course, the stock market doesn’t literally trade sideways with the S&P 500 chart moving to the right as some sort of straight line. Instead, the market goes up and down, sometimes daily, sometimes over a period of a few days, all with the eventually outcome of having not moved up or down much at all. However, that doesn’t make for a clickable headline for financial reporters and financial news sites. So instead, we see things like this from Marketwatch. U.S. stocks fell Tuesday, with the Nasdaq Composite leading the way down after the previous session’s technology sector gains, as investors kept a close eye on plans for more sanctions on Russia and remarks by Federal Reserve policy makers. Nasdaq leads stocks lower as investors …

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Free TurboTax Software Online – Deals on Tax Programs

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Free TurboTax Software Online - Deals on Tax Programs 1

Here comes tax time for that huge group of Americans who wait until the proverbial last minute to file their income taxes. For them, crunch time is approaching, and they need to find all those tax receipts and records that they will need to file Federal Income Taxes. Fortunately, one of the best tax tricks for 2022 is getting tax preparation software. The best part is that there is no real downside if you are smart and keep an eye out for optional add-ons, upgrades, and online tax filing options that might shatter your free tax software deals. Many of the deals websites out there (check out Slickdeals.net and Gottadeal.com as well as Dealnews.com for starters) will notify you when companies like Intuit offer cheap online TurboTax applications for users who show up within a certain time frame. The HR Block guys similarly offer free TaxCut software signups from time to time. If you are wondering what the catch is, because obviously these companies can’t make money by giving their programs away online, then good for you. The first step to avoid being a sucker who gets scammed is to be aware of what makes sense, what motivates people and …

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How To File Colorado Income Tax

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colorado income tax forms

Colorado Income Tax Is Easy These days, the major tax preparation software companies, like Turbo Tax and Tax Cut offer people with easier federal income taxes a way to file for free. They do this for two reasons. First, and foremost, despite the millions of dollars they spend lobbying to keep the IRS itself from providing a free, easy way to file basic income taxes, people are starting to expect such things in the internet age. By getting ahead of the IRS and offering free(ish) tax filing, they can keep a damper on any move to making tax filing without them easier. The other reason is that most people with very easy taxes probably won’t bother with their software anyway. Filing income taxes isn’t hard when you work a single job and just deduct a couple of kids and a mortgage. But there are ways to upsell, or otherwise encourage people to buy, or pay for other services like audit defense. The most common upsell is filing your state income taxes. Colorado State Income Tax Is it worth paying TurboTax to file state returns in Colorado? Probably, not. Colorado State Tax is not that complicated for most Colorado taxpayers. While …

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Is Patreon Taxable Income?

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taxes 2020 personal deduction

Patreon is a website that allows people to contribute funds to support the work of artists and creators. When you get money, do you have to pay taxes on Patreon? If so, what are the Patreon taxes for creators? Is Patreon tax deductible? Let’s start from the beginning. Is Patreon taxable? What Is Patreon Income? Patreon is deliberately misspelled, likely because patron.com was already taken and whoever owned it wanted too much money for it. A patron, as in patron of the arts, is (or was) a person who supports artists or art causes. The most famous patrons of all time were the Medici family, who supported numerous artists, including Leonardo da Vinci. The idea behind the website is arguably similar. The Patreon website allows people to support “creators” by pledging a certain payment per month. In exchange, the creator may (but is not obligated to) offer various “rewards” for said contributions. The question is are Patreon payments considered taxable income for income tax filing purposes. Is Patreon Tax Deductible? Most Patreon Contributions Not Tax Deductible Let’s start with the easier question. No matter how much you like artists, and no matter how much supporting them feels like a charitable donation, …

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How To Qualify for the Earned Income Credit – The Easy Version

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claim eic

OK. Let me start by saying that if your adjusted gross income is going to end up in the six figures, you’re out. Go read this article about investing with Acorns, or this one about Credit Karma reviews, or this one about maximizing cash back with Rakuten. Also, there are some “special situations” that we won’t be covering here. This is the easy version. You have kids, you might qualify for the earned income credit. Then, here is how to qualify for the earned income credit, or EIC. Qualifications for EIC So how, do you qualify for the EIC? Basically, have a low enough income, and have some kids, while working. Your Income Has to Be Low Enough You need kids that are your dependents You have to have earned income (most earned income come from a job or home business) You have to have a valid Social Security Number, and so does the child or children you are using to claim the credit Or certain special situations. Since this is short version we are covering it here. Check out the IRS page. Your income needs to be under $57,414. Your investment income has to be below $10,000. Earned income …

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