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Taxes

Thursday’s need-to-know money news

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Zemanta Related Posts ThumbnailToday’s top story: Protecting your assets from a car accident. Also in the news: Why having a single credit card just for bills can make fraud less disruptive, big tax breaks for homeowners, and last-minute moves to trim your tax bill.

How to Protect Your Assets in the Event of a Car Accident
Paying the heavy price of someone else’s accident.

Having a Just-for-Bills Credit Card Makes Fraud a Little Less Disruptive
Keeping the chaos contained.

7 big tax breaks for homeowners
The amount of money you can save may surprise you.

Last-Minute Moves That Can Trim Your Tax Bill
The clock is ticking.

Tuesday’s need-to-know money news

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download (1)Today’s top story: What to do if you’ve been blacklisted by ChexSystems. Also in the news: How to avoid early withdrawal fees for CDs, steps to take if you can’t pay your taxes, and the high cost of being poor.

Blacklisted by ChexSystems? Here’s What to Know
That bounced check may have come back to haunt you.

How to Avoid CD Early Withdrawal Fees
Understanding the terms of your CD can save you money.

8 steps to take if you can’t pay your taxes
Don’t ignore the elephant in the room.

The high cost of being poor
How payday loans can become a never ending cycle.

Q&A: Income tax vs. capital gains tax

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Dear Liz: I was wondering about the disabled vet who wanted to sell his home, which had increased in value by about $1 million. You mentioned that “[S]ingle people with incomes over $415,050 in 2016 are subject to the 39.6% marginal tax rate. Most people pay capital gains tax at a 15% rate, but those in the top bracket face a 20% rate.” Would he have to pay federal income tax on the non-exempt portion of the equity as well as paying 20% capital gains on the non-exempt portion?

Answer: You may pay income tax or capital gains tax on a source of income, not both. If an investment has been held less than a year, the gain is considered short term and subject to income tax. Investments held more than a year are considered long-term and qualify for capital gains treatment.

When you’re selling your primary residence, the first $250,000 in profit is typically exempt from tax. The rest of the gain would be taxed as a capital gain.

Friday’s need-to-know money news

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imagesToday’s top story: How life insurance can affect your estate taxes. Also in the news: Money tips for new workers, 401(k) tips for when you quit your job, and important money lessons for kids under 5.

How Life Insurance Can Affect Estate Taxes
Life insurance comes into play if you have a sizeable estate.

4 Money Tips for New Workers
Using your paycheck strategically.

Roll over or not? Smart 401(k) moves when you quit your job
Don’t lose out on your contributions.

3 Important Money Lessons Kids Under 5 Should Know
It’s never too early to start.

Why We No Longer Fear the IRS

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gpbh8nungoaljipue96oOur tax laws are complex and often difficult to understand. Tax professionals warn us of the perils of audits. Penalties for getting our taxes wrong can be stiff — up to and including jail for those who deliberately evade the taxman.

So why don’t we fear the IRS?

Clearly, we have some fears about April 15. A recent NerdWallet survey found seven out of 10 taxpayers have concerns about filing their taxes, such as making a mistake (17%), paying too much (15%) and not getting the biggest possible refund (14%).

But only 11% feared getting audited, NerdWallet found. A recent Rasmussen Reports poll put the number at 14%.

In my latest for NerdWallet, why Americans are less afraid of the IRS than they are of reptiles.