In a prior post, we covered over-contributions into a Roth IRA. Now, let’s look at what the fixes are. Fix 1: Withdraw the Over-Contribution This is the fix I see most often, and is usually the best fix. If you catch the over-contribution before you file your tax return, you simply withdraw the over-contribution and […]
The residential energy credit – for things such as purchases of energy efficient appliances, doors and windows – has changed in a big way for 2023 and beyond. Let’s examine. Energy efficient home improvement credit The Way it Used to Be Up through 2022 (including 2022), the credit was a maximum of $500 – and […]
I’ve written about this before but now is a timely time to talk about it again, with tax season underway. I prepare a lot of individual tax returns, and one of the most-common compliance issues I see is: people contributing too much into their Roth IRA. One-hundred percent of the time, the person had no […]
In the tax bill being debated in Congress, one of the provisions is to expand the child tax credit. The proposal would: In this post I wanted to talk about the refundable portion of the child tax credit. Refundable vs. Non-Refundable Tax credits come in 2 varieties: non-refundable and refundable. The child tax credit is […]
I usually try to steer clients away from making contributions to a retirement account after the year ends, even if they might get a deduction in that prior year. Example: an individual has until April 15, 2022, to put money into an IRA and count it (and take a deduction for it) as a 2021 […]
If you convert your home to a rental property, and then sell the property, you might still be able to take a Section 121 exclusion on some of the gain. The Section 121 exclusion is available to homeowners who have owned and lived in the home at least two years out of the five years […]
In my last post I wrote about how to interpret the Iowa Form 8453, and how the math on it won’t tie out. The Iowa Form 8453 is the e-file authorization form a tax pro must get a taxpayer to sign, so the tax pro can e-file the taxpayer’s tax return. Now look at the […]
Two weeks ago I was poking around on Twitter and saw a discussion among tax pros about how, most of the time, the answer to the question posed in the title is: no! In fact, many times the bottom line on your tax return will be WORSE working with a tax pro. I know I […]
Many people are asking what the advance child tax credit payments that start in July will do to their 2021 taxes. The short answer is, it could reduce your refund. Let’s say you have 1 kid. Normally the child tax credit is $2,000. The “enhanced” credit for 2021 is now $3,000 (if the kid is […]
The retirement savers credit is a tax credit available to taxpayers who put money into a retirement account and whose income is below the threshold for qualifying for the credit. For 2019 returns, the thresholds are: $64,000 for married filing jointly; $48,000 for head of household; and $32,000 for single or married filing separately (and […]