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☆ The IRS says its direct file program saved Americans $5.6 million in filing fees. Now they're making it permanent.
▼ + stars: | 2024-05-30 | by ( Juliana Kaplan | ) www.businessinsider.com time to read: +4 min

And so, after a successful pilot run, the tax agency has announced that it's making its new free direct file program permanent. The Direct File program first launched in twelve states for the 2023 filing season following a successful pilot. "Since the direct file pilot was completed in April, we have heard directly from hundreds of organizations across the country, more than a hundred members of Congress, from individual direct file users, and those that are interested in using direct file," Werfel said. The new Direct File program has encountered some pushback from paid tax services. Did you use Direct File and save time or money?

Persons: —, It's, haven't, Janet Yellen, Danny Werfel, Aaron Mok —, Werfel, Rick Heineman, Heineman, filers, Natalie Quillian, Biden's Organizations: Service, IRS, Business, Treasury Department, Intuit TurboTax, Treasury, House Locations: Yellen

☆ You could score a tax break for hiring your own kids this summer — if you follow the rules
▼ + stars: | 2024-05-27 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

"If your child's income falls within the limits, they may not owe any income tax, which can be a win-win," said Lovison, who is also a certified public accountant. If your child's income falls within the limits, they may not owe any income tax, which can be a win-win. What to know before hiring your kidsBefore hiring your children, it's important to know state and federal labor laws, along with tax rules, experts say. "Some states pretty much ban you from hiring children under the age of 14 under any scenario," Lovison said. Payments to children are subject to income tax withholding regardless of the child's age, according to the IRS.

Persons: Sean Lovison, Lovison, Roth, Carol Fabbri Organizations: Social, Advisors, IRS Locations: Philadelphia, , Colorado

☆ This retirement account can be 'triple-tax efficient' for teens this summer, advisor says
▼ + stars: | 2024-05-23 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

If your kids are working summer jobs, it's a prime opportunity to help them open a retirement account and start saving for the future, experts say. Roth individual retirement accounts can be "triple-tax efficient" for teenagers, according to certified financial planner Carol Fabbri, managing partner of Fair Advisors in Conifer, Colorado. Plus, Roth IRAs offer tax-free growth on investments, and withdrawals in retirement are generally tax-free, Fabbri explained. Of course, the power of long-term compound growth, or returns on your returns, only magnifies the sooner you start saving and investing, experts say. More than 8 in 10 teenagers are already thinking about retirement, but most mistakenly think savings is the best long-term strategy, according to a recent survey from Junior Achievement and MissionSquare.

Persons: Roth, Carol Fabbri, Roth IRAs, Fabbri, Gen Zers Organizations: Advisors, Finance, Junior Locations: , Colorado

☆ Trump-era tax cuts set to expire after 2025 — here's what you need to know
▼ + stars: | 2024-05-18 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +4 min

The TCJA reduced federal income tax rates across the board, with the top rate falling to 37% from 39.6%. That would return the federal income tax rates to 10%, 15%, 25%, 28%, 33%, 35% and 39.6%. In the meantime, some higher earners have been leveraging lower income tax rates through 2025 by incurring income now, experts say. The standard deduction could fallWhen filing taxes, you claim the standard deduction or itemized deductions, whichever is greater. Before 2018, about 70% of taxpayers claimed the standard deduction, compared with 90% in tax year 2020, according to the Tax Policy Center.

Persons: Donald Trump, Michael M, Erica York, Roth, it's, Gleckman, Robert Dietz Organizations: Santiago, Getty, Tax, Center, Federal Tax, Senate, Bernstein Private Wealth Management, CNBC Locations: Wildwood Beach, Wildwood , New Jersey, California , New Jersey, New York, Minneapolis

☆ More home sellers are paying capital gains taxes — here’s how to reduce your bill
▼ + stars: | 2024-05-07 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

More Americans are paying capital gains taxes on home sale profits amid soaring property values — but there are ways to reduce your bill, experts say. In 2023, nearly 8% of U.S. home sales yielded profits exceeding $500,000, compared to about 3% in 2019, according to an April report from real estate data firm CoreLogic. It's key for a special tax break for homeowners who make a profit when selling a primary residence. Married couples filing together can make up to $500,000 on the sale without owing capital gains taxes. "With the recent rise in home values, more sellers have been facing a capital gains tax hit," Quinones said.

Persons: Jaime Quinones, " Quinones Organizations: Finance, Stockade Wealth Management Locations: U.S, Marlboro , New Jersey

☆ How to save for retirement if your company doesn't offer a 401(k)
▼ + stars: | 2024-04-30 | by ( Mike Winters | ) www.cnbc.com time to read: +4 min

Even if your employer doesn't offer a 401(k) plan, it shouldn't stop you from getting the most out of your retirement savings. You have other tax-advantaged options available to save for the future, including individual retirement accounts, Roth IRAs or health savings accounts — all of which can help your money grow. However, only about 11% of Americans max out their 401(k) contributions. If you don't have an employer retirement plan like a 401(k), all of those contributions are tax deductible. And unlike traditional IRAs, you don't have to take minimum distributions at any point.

Persons: Roth, Justin Rucci, Roth IRAs Roth, Alyson Basso Locations: Newport Beach , California, Middleton , Massachusetts

☆ Over $1 billion in unclaimed tax refunds is set to expire in just over 2 weeks, IRS says—here’s how to claim yours
▼ + stars: | 2024-04-30 | by ( Cheyenne Devon | ) www.cnbc.com time to read: +1 min

The Internal Revenue Service says more than $1 billion in unclaimed tax refunds from the 2020 tax year is sitting in its coffers. Around 940,000 people across the U.S. have until May 17 to submit their 2020 tax returns and claim their portion of the unclaimed funds, according to the IRS. "There's money remaining on the table for hundreds of thousands of people who haven't filed 2020 tax returns," IRS Commissioner Danny Werfel said in March. Typically, tax filers have three years to claim old refunds by the April 15 tax filing deadline. The IRS says that your refund may be withheld if you haven't filed your 2021 and 2022 tax returns.

Persons: haven't, Danny Werfel, Werfel Organizations: Internal Revenue Service, IRS

☆ IRS free tax filing pilot processed more than 140,000 returns, saved consumers $5.6 million in prep fees
▼ + stars: | 2024-04-26 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

IRS Commissioner Danny Werfel testifies during the Senate Finance Committee hearing on the fiscal 2024 IRS budget and the IRS' 2023 filing season, in the Dirksen Building in Washington, D.C., on April 19, 2023. This season, more than 140,000 taxpayers successfully filed returns using IRS Direct File, a free tax filing pilot from the IRS, according to the U.S. Department of the Treasury and the IRS. The program fully opened for certain taxpayers in 12 states in early March and saved filers an estimated $5.6 million in tax preparation fees for federal returns, IRS Commissioner Danny Werfel told reporters on a press call. Direct File surveyed more than 15,000 users and some 90% rated their experience as "excellent," the agencies reported. The IRS plans to release a more detailed report about the Direct File pilot "in the coming days," he added.

Persons: Danny Werfel, Werfel Organizations: Senate, IRS, Washington , D.C, U.S . Department of, Treasury, Finance Locations: Washington ,

☆ Here's what to do if you missed the federal tax deadline
▼ + stars: | 2024-04-23 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

The federal tax deadline was April 15 for most filers — and if you missed it, you should file your return and pay your balance as soon as possible, experts say. The late filing penalty is 5% of your unpaid balance per month or partial month, capped at 25% of your balance. Here's why it may work this timeHowever, that doesn't mean you should rush to file a return if you're still missing key information, like tax forms for your investments or other earnings. With missing information, the IRS could flag your tax return for audit, processing could be delayed or you could receive an agency notice. Of course, some filers in disaster areas automatically have more time to file federal returns and pay taxes owed.

Persons: Mark Steber, Jackson Hewitt, Biden, Steber Organizations: Finance, IRS

☆ What everyday taxpayers can learn from the Biden, Harris 2023 tax returns
▼ + stars: | 2024-04-16 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

President Joe Biden and Vice President Kamala Harris deliver remarks about healthcare in Raleigh, North Carolina on March 26, 2024. While both couples made extra tax payments, they each incurred a small estimated tax penalty, based on underpayments from each quarterly deadline and interest. Tax planning for self-employment incomeOver the years, the Bidens have reduced self-employment taxes by receiving some wages through their companies, which are structured as S corporations. After paying "reasonable compensation" to shareholders, S corporation owners can take distributions without paying 15.3% for Social Security and Medicare taxes. Work with a tax professionalTypically, filers get a tax refund when they overpay levies throughout the year.

Persons: Joe Biden, Kamala Harris, Peter Zay, David, Harris, Catherine Valega, filers Organizations: Anadolu, Getty, Eisner Advisory, Social Security, Boston, Bee Advisory Locations: Raleigh , North Carolina, New York

☆ Some H&R Block customers faced hours of outages on Tax Day
▼ + stars: | 2024-04-15 | by ( Ramishah Maruf | ) edition.cnn.com time to read: +2 min

New York CNN —Some H&R Block customers who waited until the last day to file their taxes faced frustrating outages that began Sunday night, according to the company and Downdetector. The IRS had expected “tens of millions” more returns to be filed in the last few days, and many tax filers rely on online services such as H&R Block. The bad gateway error prevented some desktop software users from filing their returns, H&R Block said on X. H&R Block advised customers to either file again or print, file and mail the form to the IRS. “We have notified our clients via an in-product message and as they reach out to customer service that they can now efile their return,” H&R Block said in a statement to CNN.

Persons: Block, X, ”, CNN’s Jeanne Sahadi Organizations: New, New York CNN, IRS, Block, CNN, Taxpayers, “ Taxpayers, Patriots, District of Columbia Locations: New York, Maine, Massachusetts, District

☆ New York tax preparer charged with causing more than $100 million in losses from fraudulent returns
▼ + stars: | 2024-04-15 | by ( Dan Mangan | ) www.cnbc.com time to read: +2 min

Damian Williams, U.S. Attorney for the Southern District of New York, speaks during a press conference in New York City, Sept. 22, 2023. A New York tax preparer was arrested Monday on charges related to causing "substantially" more than $100 million in tax losses through the filing of false returns — one of the largest tax frauds ever by a preparer, federal prosecutors said. The false information allegedly included bogus itemized deductions, fake capital losses, and phony business expenses and tax credits. ATAX New York grossed more than $15 million from 2016 through 2019, according to Thomas Fattorusso, the IRS special agent in charge of criminal investigations. Alvarez was the CEO, owner and manager of ATAX from 2010 through 2020, and the firm during that time prepared more than 90,000 income tax returns, according to prosecutors.

Persons: Damian Williams, preparer, Rafael Alvarez, Alvarez, Thomas Fattorusso, ATAX Organizations: Attorney, Southern, of, New, Manhattan U.S, ATAX New, IRS, Attorney's Locations: U.S, of New York, New York City, New York, York, Manhattan, ATAX, ATAX New York, United States, disgorgement

☆ Today is Tax Day for most Americans. Here’s what you need to know
▼ + stars: | 2024-04-15 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +5 min

New York CNN —It’s Tax Day in the United States for most Americans, and there are still plenty of people racing to file their 2023 income tax returns up until the clock strikes midnight. “With the April deadline upon us, we’re seeing a flurry of tax returns coming in during the final hours. So if you’re a last-minute filer, you’re in good company — and even more so if you expect a refund. However, they must pay whatever they still owe the IRS for tax year 2023 by April 15. Do all this even if you relied on a tax program or tax professional to prepare your return.

Persons: We’ve, Danny Werfel, Werfel, don’t, you’re, haven’t, ” Werfel Organizations: New, New York CNN, Patriots, IRS, … Locations: New York, United States, Israel, Massachusetts, Maine, Washington, DC

☆ IRS expects ‘a million returns' every hour on Tax Day, commissioner says. What last-minute filers need to know
▼ + stars: | 2024-04-15 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

If you're missing tax forms, the tax deadline is your last chance to file an extension, which pushes the filing deadline to Oct. 15. Sean Lovison Founder of Purpose Built Financial ServicesAccording to the IRS, those who can't pay taxes by the deadline have options. Most Americans qualify for IRS Free File, which offers free guided tax prep software from several partners. "It's a product that we're very proud of," Tim Hugo, executive director of the Free File Alliance previously told CNBC. This season, millions of taxpayers also qualify for IRS Direct File, a free tax filing pilot program from the IRS.

Persons: Sean Lovison, Werfel, Tim Hugo Organizations: IRS, Alliance, CNBC, Treasury Locations: filers, Maine, Massachusetts, Philadelphia, Arizona , California, Florida , Massachusetts, Nevada , New Hampshire , New York, South Dakota , Tennessee , Texas, Washington and Wyoming

☆ Tax Day: What happens if you haven’t filed yet or paid what you owe
▼ + stars: | 2024-04-12 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +5 min

New York CNN —If you haven’t filed your 2023 tax return with the IRS yet and you still owe income tax for last year, the good news is you still have time to rectify those situations before you’re penalized for failing to do so. Some, however, get an extra day or two if they live in Maine, Massachusetts or Washington, DC, due to observed holidays. The IRS has also given an extension to individuals and businesses affected by the October 7 terrorist attacks in Israel. Keep in mind that this is only an extension to file your return and avoid a failure-to-file penalty. If you don’t pay what you owe by your tax-filing deadline you will also be hit with a failure-to-pay penalty.

Persons: Tom O’Saben, O’Saben, you’ve, ”, you’d, ” O’Saben Organizations: New, New York CNN, IRS, National Association of Tax Locations: New York, Maine , Massachusetts, Washington, DC, Israel

☆ There's another 'tricky' tax deadline on April 15. Here's how to avoid a penalty, experts say
▼ + stars: | 2024-04-11 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

If you are racing to file taxes, you could miss another key deadline: the April 15 due date for first-quarter estimated tax payments. Estimated tax payments typically apply to earnings from gig economy work, freelancing, small business, retirement or investing, which may have no tax withholdings. If you expect to owe at least $1,000 in taxes, you must make your first-quarter estimated payment for 2024 by April 15. That can be "tricky" for certain tax filers with federal taxes due on the same day, according to certified public accountant Tom Wheelwright, CEO of WealthAbility. The 2024 payment due dates are April 15, June 17, Sept. 16 and Jan. 15, 2025.

Persons: Tom Wheelwright, — Organizations: WealthAbility, Finance, Federal, IRS

☆ IRS adds ‘important update’ for free Direct File pilot as federal tax deadline approaches
▼ + stars: | 2024-04-08 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

With one week until the April 15 federal tax deadline, the IRS has released an "important update" for Direct File, the agency's free tax filing program. This key step has been the main issue preventing Direct File returns from being successfully filed, according to a Treasury official. But as of Monday, Direct File users can now import these verification details from the IRS, which could minimize the common error. More from Personal Finance:IRS free tax filing program launches in 12 pilot states19 million people may qualify for free tax prep through the IRSHow to pick the best free tax filing option this season"This important update will allow Direct File users to take advantage of information the IRS already has to simplify the filing process even further," said Bridget Roberts, who leads Direct File at the IRS. Direct File will remain open for rejected returns until April 20, a Treasury official said.

Persons: inputting, Bridget Roberts Organizations: IRS, Treasury, Finance

☆ 2 certified divorce financial advisors share 4 mistakes to avoid when it comes to dividing assets and money planning after marriage
▼ + stars: | 2024-04-05 | by ( William Edwards | ) www.businessinsider.com time to read: +3 min

That's why the duo, who are both certified divorce financial advisors, launched Divorce Friday, a financial education blog for those going through a split. "I know that women need more help when they're going through a divorce. Through the years, Pappas and Chen have seen some common mistakes that divorcees make when divvying up assets. "If they're going to be single now, the tax rate is effectively higher, so they're going to have less income with a higher tax rate, and that is a problem." 2024 federal income tax brackets

Persons: Diane Pappas, Chris Chen, Pappas, there's, it's, Chen Organizations: Census, Centers for Disease Control, Business Locations: State, New York

☆ Don't overlook these 3 tax moves that could save you thousands, experts say
▼ + stars: | 2024-04-04 | by ( Ryan Ermey | ) www.cnbc.com time to read: +4 min

It could also mean taking a few minutes to click around the deductions page on your tax software to make sure you're not leaving money on the table. Here are three tax moves that experts say people tend to overlook. If you didn't hit your maximum contribution for 2023, you can retroactively direct funds to those accounts for the 2023 tax year. If you have children or other dependents, for instance, your tax prep software will likely guide you to the Child Tax Credit and the Child and Dependent Care Credit. "You're not going to enter something in wrong and the program's not going to give you the Child Tax Credit.

Persons: Mark Jaeger, Hunt, Jaeger, Ed deHaan, deHaan, de Haan Organizations: Child Tax, Care, American Opportunity, Tax, Stanford Graduate School of Business, Research Locations: TaxAct

☆ 25% of Gen Zers say they'll need a therapist to deal with tax filing stress—here's the first step to take to make it easier
▼ + stars: | 2024-04-01 | by ( Annie Probert | ) www.cnbc.com time to read: +4 min

You will receive a W-2 form from your employer if you worked for a paycheck or earned at least $600 in 2023. You can find the 1099-INT form by logging into your bank account and following directions to tax documents. But even if you don't get a form from your exchange, "that doesn't mean you don't need to report it," says Pianoforte. The IRS's frequently asked questions on crypto transactions is also helpful for answering more detailed questions about how to report crypto on your taxes. Form 1098-TIf you're paying college tuition, a 1098-T form will help determine which education-related tax credits you're eligible for.

Persons: doesn't, Pianoforte, filers, Read, haven't, you've, Douglas Boneparth Organizations: Internal Revenue Service, NEC, cryptocurrency, CNBC, Bone

☆ US tax returns are due in two weeks, but millions of people have some extra time to file
▼ + stars: | 2024-04-01 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +7 min

New York CNN —If you haven’t sent in your 2023 income tax return yet, you have until April 15 to do so. But keep in mind, that extension only gives you more time to file your federal income tax return. The IRS has already received more than 80 million income tax returns for 2023, according to its most recent figures released Friday. Besides a refund, the IRS further notes low- and moderate-income earners also may be eligible to receive the Earned Income Tax Credit. And if you do file and are owed a refund, it may be withheld if you have yet to file your 2021 or 2022 returns.

Persons: haven’t, you’re, David Hubber, ” Hubber Organizations: New, New York CNN, Taxpayers, Patriots, Washington , D.C, IRS, “ Taxpayers, Department, DOJ, DOJ’s Locations: New York, Maine and Massachusetts, Washington ,, Idaho, Pennsylvania

☆ Why they don't teach you how to do your taxes in school—and how to actually get started
▼ + stars: | 2024-04-01 | by ( Kamaron Mcnair | In Kamaronmcnair | ) www.cnbc.com time to read: +3 min

Personal finance education itself is catching on, but is still pretty sparse in American schools. Just 25 states guarantee a standalone personal finance course for students before graduation, according to Next Gen Personal Finance . And there are a number of reasons taxes may not be a part of the curriculum in those programs. "Because people don't have the background in tax law, some people don't know what ordinary income is," Donnellan says. Common credits include the Child Tax Credit for parents and guardians of qualifying dependents and the Earned Income Tax Credit for low to moderate-income earners.

Persons: Abby Donnellan, Donnellan, You'll Organizations: Finance, CNBC, Revenue, IRS, Child

☆ How to avoid the 'survivor's penalty' before a spouse passes
▼ + stars: | 2024-03-18 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +4 min

Jessie Casson | Digitalvision | Getty ImagesIt's hard to lose a spouse, and a costly surprise makes it even more difficult, especially for older women — higher taxes. watch nowTypically, the surviving spouse inherits the deceased spouse's individual retirement accounts, and so-called required minimum distributions are about the same. But the surviving spouse now faces higher tax brackets, Gagliardi said. Spouses may consider partial Roth IRA conversions, which transfers part of pretax or nondeductible IRA funds to a Roth IRA for future tax-free growth, Jastrem said. Check investment accountsIt's always important to keep account ownership and beneficiaries updated, and failing to plan could be costly for the surviving spouse, Jastrem said.

Persons: Jessie Casson, Digitalvision, Edward Jastrem, —, Donald Trump's, George Gagliardi, Gagliardi, Roth, Jastrem Organizations: Getty, Centers for Disease Control, Heritage Financial Services, CNBC, Coromandel Wealth Management, Wealth Locations: Westwood , Massachusetts, Lexington , Massachusetts

☆ Here are 3 key things to know with one month until the tax deadline
▼ + stars: | 2024-03-15 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

The federal tax deadline is officially one month away for most filers — and experts say there are some key things to know this season. As of March 1, the IRS received roughly 54 million individual returns, which is less than 40% of the 146 million expected this season, according to the agency. What investors need to knowApril 15 is the federal deadline to file and pay taxes owed for most filers. But parts of eight states affected by natural disasters have until June 17, according to IRS spokesperson Eric Smith. Here are three key things to know before the filing deadline:

Persons: —, Biden, Eric Smith Organizations: IRS, Finance, Trump

☆ The average tax refund is over $3,000. Here are 7 ways to put it to good use
▼ + stars: | 2024-03-15 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +7 min

New York CNN —The average federal tax refund is more than $3,000, according to the latest data from the IRS. … They don’t understand how much interest they’re paying,” Russ said. Create or add to an emergency fundYou can use your refund to start or bolster an emergency fund. If you have high-rate debt and you’re lacking emergency savings, Russ suggested you might use a portion of your refund to attack your debt and the other portion to create an emergency fund. If you need the money within three years, you might consider putting your refund in certificates of deposits and US Treasury bonds.

Persons: you’re, ”, Eric Bronnenkant, Keyana Russ, ” Russ, Russ, Bronnenkant, Roth, Bronnenkant, Charles Schwab, ” Bronnenkant Organizations: New, New York CNN, Ponds Financial, Invest, Roth IRA, Treasury Locations: New York, Ponds

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