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☆ Tax season starts with boosted IRS workforce, new technology as agency begins to deploy $80 billion in funding
▼ + stars: | 2023-01-23 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

Tax season kicked off for individual filers Monday with a bigger IRS customer service team and enhanced technology as the agency begins to deploy its nearly $80 billion in funding. Over the past several months, the IRS has hired 5,000 new customer service staff, aiming to "significantly increase" the number of answered calls, Deputy Secretary of the Treasury Wally Adeyemo told reporters Friday. IRS service was flagged as one of the agency's "most serious problems" in the National Taxpayer Advocate's 2022 annual report, with only 13% of callers reaching live assistance during the 2022 filing season. The agency also plans to improve customer service through technology, including the ability for filers to respond to certain IRS notices online and for the IRS to scan paper returns. "These improvements showcase how we are modernizing both technology and customer service to bring the IRS into the 21st century and how the IRS plans to deploy [Inflation Reduction Act] resources in the years to come," Adeyemo said.

☆ Filing your 2022 taxes: Why your refund may be smaller
▼ + stars: | 2023-01-22 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +8 min

Child tax credit: For tax year 2022, parents may claim a maximum child tax credit of $2,000 for each child through age 16 if your modified adjusted gross income is below $200,000 ($400,000 if filing jointly). This year, if you have one child or dependent, you can only get a maximum credit of $1,050 ($2,100 for two or more). So if it happened late in the year, that may bump your 2022 income into a higher bracket, much the way a big one-time bonus might. Ways to potentially increase your refund or reduce your 2022 tax billTax year 2022 is over, but there still may be a few things you can do now to increase the money the IRS sends you or reduces the amount you will owe. Make an IRA contribution: You still may make 2022 contributions to an IRA up until April 18, 2023.

☆ How to cash in on the new wave of electric car tax credits and rebates that could save you thousands on a new ride
▼ + stars: | 2023-01-18 | by ( Alexa St. John | ) www.businessinsider.com time to read: +8 min

Electric vehicles are expensive, but tax credits might be able to help. The Biden Administration's Inflation Reduction Act, passed last August, introduced some new EV credits and extended existing ones, with some changes. Here's what to know about claiming tax credits and rebates on electric car purchases. George Rose/Getty ImagesState creditsDifferent states have different incentives for EVs, in addition to the federal tax credits. Not every state has an electric car tax credit or rebate program, so it's important to check individual state websites for information.

☆ There's still time to avoid a penalty for fourth-quarter estimated taxes — but the clock is ticking
▼ + stars: | 2023-01-17 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

There's still time to avoid a penalty if you didn't pay enough taxes in 2022 — but the clock is ticking. If you are self-employed or receive income from gig economy work, investments and more, the deadline for your 2022 fourth-quarter estimated tax payment is Jan. 17. Your payment may reduce your 2022 tax bill and bypass extra penalties and interest, according to financial experts. You can also make payments through your IRS online account, which provides access to payment history, or digitally through the Electronic Federal Tax Payment System. You can see other options through the IRS payments website.

☆ After 'misery' for tax filers in 2022, IRS to start 2023 tax season stronger, taxpayer advocate says
▼ + stars: | 2023-01-12 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

After another challenging year for the IRS in 2022, the agency may be primed for a better 2023 tax season — but improvements may take time. "The bad news is that taxpayers and tax professionals experienced more misery in 2022," wrote National Taxpayer Advocate Erin Collins. Based on this progress, the report finds the IRS is "poised to start the 2023 filing season in a stronger position." During the past two seasons, the IRS couldn't tackle current-year paper-filed returns until after the filing season ended. But the "significant reduction" of inventory in 2022 will allow the agency to process paper returns during the filing season, the report said.

☆ Tax season opens for individual filers on Jan. 23, says IRS
▼ + stars: | 2023-01-12 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

It's official: The tax season kicks off for individual filers on Jan. 23, the IRS announced on Thursday. For most taxpayers, you must file your federal return and pay your balance by April 18 to avoid racking up penalties and interest. "This filing season is the first to benefit the IRS and our nation's tax system from multi-year funding in the Inflation Reduction Act," said acting IRS Commissioner Doug O'Donnell. "With these new additional resources, taxpayers and tax professionals will see improvements in many areas of the agency this year." What's more, if you're claiming the earned income tax credit — a tax break for low- to moderate-income worker — or an additional child tax credit, the IRS can't issue your refund before mid-February, according to the agency.

☆ Tax filing season starts January 23, IRS says
▼ + stars: | 2023-01-12 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +4 min

New York CNN —The IRS will start accepting 2022 federal income tax returns on January 23, the tax agency announced on Thursday. In addition, tax filing and payment deadlines will be extended for anyone living in counties declared federal disaster areas due to recent natural disasters. It also includes tax filers who don’t live in a federally declared disaster area but whose relevant tax records are located there (e.g., with a tax preparer or at a business in the area). In addition, the IRS also offers Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs, which are free basic tax return preparation for those who generally make $60,000 or less. IRS expects customer service to improve this seasonDuring the prior two filing seasons, tax filers experienced an array of customer service problems at the IRS due to staffing shortages and other pandemic-related difficulties at the IRS.

☆ Mega Millions jackpot jumps to $1.35 billion for the next drawing. Here's the tax bill if there's a winner
▼ + stars: | 2023-01-11 | by ( Sarah O'Brien | ) www.cnbc.com time to read: +1 min

You may face long odds of hitting the Mega Millions jackpot — now worth $1.35 billion — but the taxman is always guaranteed a slice when there's a winner. The jackpot jumped again after no ticket matched all six numbers drawn Tuesday night to land the grand prize. If won in the next drawing — set for Friday night — it would mark the second-largest Mega Millions jackpot ever and the fourth-largest lottery prize in history. Most winners, however, choose the lump sum cash option, which for this jackpot is $707.9 million. Yet because the top marginal income tax rate of 37% applies to income above $578,125 for individual tax filers and $693,750 for married couples, you could count on owing more to the IRS at tax time.

☆ The first economic plan the new GOP House proposed would raise the deficit by $100 billion
▼ + stars: | 2023-01-09 | by ( Juliana Kaplan | ) www.businessinsider.com time to read: +3 min

Their first target: $80 billion in IRS funding from the Democrats' Inflation Reduction Act. The IRS funding was meant to relieve an overburdened agency and beef up enforcement on some of the wealthiest Americans. Of the $80 billion, $45.6 billion is directed towards tax enforcement, specifically targeting areas that have been challenging for the IRS, like global high-net-worth filers. The Congressional Budget Office previously found that the enforcement funding would bring in $204 billion over the next 10 years. "With inflation high, interest rates rising, and debt approaching record levels, rescinding IRS enforcement funds would be a big mistake."

☆ A flurry of environmental tax breaks just came into effect thanks to last year's climate bill. From solar to electric vehicles, here's how you could save thousands of dollars.
▼ + stars: | 2023-01-08 | by ( Kelsey Vlamis | ) www.businessinsider.com time to read: +5 min

The bill includes tax credits for electric vehicles, solar panels, and home energy updates. At that price, the claimable tax credit would be $6,000. The tax credit for solar is set to last until 2032, at which point it will lower and then expire in 2035 unless Congress renews it. As of January 1, a household can claim a tax credit of up to $150 for an energy audit conducted by a professional inspector. Buying an electric vehicleIncentives to purchase new or used electric vehicles were also boosted in the new climate bill.

Important: The standard deduction is just one of many tax deductions for which you may be eligible. Standard deduction: 2022 and 2023The amount of the standard deduction is adjusted every year to account for inflation. How the standard deduction worksWhen you file your federal tax return, you can choose to use either the standard deduction or itemize your deductions, whichever amount is highest. Quick tip: If you're not sure whether to take the standard deduction or itemize deductions, talk to a tax professional. If your income is less than the standard deduction then you do not have to file a federal tax return.

☆ Mega Millions jackpot surges to $785 million. If there's a winner, this is the tax bill
▼ + stars: | 2023-01-03 | by ( Sarah O'Brien | ) www.cnbc.com time to read: +2 min

Anadolu Agency | Anadolu Agency | Getty ImagesMega Millions players may be daydreaming about what they'd do with an extra $785 million, the game's current jackpot amount. The lump-sum cash option — which most winners choose — for this jackpot is $403.8 million, as of midday Tuesday. $96.9 million in taxes would be shaved off cash optionAssuming you're like most winners and were to choose the cash option, a mandatory 24% federal tax withholding would reduce the $403.8 million by $96.9 million. The top federal income tax rate is 37% and applies to income above $578,125 for individual tax filers and $693,750 for married couples who file a joint tax return. There also could be state or local taxes depending on where the ticket was purchased and where you live.

☆ 5 tax and investment changes that could boost your finances in 2023 amid economic uncertainty
▼ + stars: | 2022-12-31 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +4 min

Bigger contribution limits on retirement accountsIf you're eager to boost your retirement savings, there's good news for 2023: higher contribution limits for your 401(k) and individual retirement account. The contribution limits have also increased for IRAs, allowing you to save up to $6,500 for 2023, up from $6,000 in 2022. Higher income limit for Roth IRA contributionsThe 2023 inflation adjustments also mean more investors may qualify for Roth IRA contributions, experts say. "But how about Roth [IRA] contributions?" While some investors may seek "complicated" moves, like so-called backdoor Roth conversions, which transfer after-tax 401(k) contributions to a Roth IRA, Pon urges investors to double-check Roth IRA contribution eligibility first.

☆ The U.S. passed a historic climate deal this year — here's a recap of what's in the bill
▼ + stars: | 2022-12-30 | by ( Emma Newburger | ) www.cnbc.com time to read: +11 min

The IRA's provisions have major implications for clean energy and manufacturing businesses, climate startups and consumers in the coming years. As 2022 comes to a close, here's a look back at the key elements in the legislation that climate and clean energy advocates will be monitoring in 2023. Taking aim at methane gas emissionsSome pumpjacks operate while others stand idle in the Belridge oil field near McKittrick, California. Mario Tama | Getty ImagesThe package imposes a tax on energy producers that exceed a certain level of methane gas emissions. And the bill has a hydrogen production tax credit, which provides hydrogen producers with a credit based on the climate attributes of their production methods.

☆ Special Report: Boy Scouts, Catholic dioceses find haven from sex abuse suits in bankruptcy
▼ + stars: | 2022-12-30 | by ( Kristina Cooke Mike Spector Benjamin Lesser Dan Levine Disha Raychaudhuri | Kristina Cooke | Mike Spector | ) www.reuters.com time to read: +19 min

The Boy Scouts, for instance, said on a website the group set up for restructuring that it launched a “comprehensive noticing campaign” in the media. He sought compensation in the Boy Scouts bankruptcy in June, long after a deadline of November 16, 2020 for filing claims. The Boy Scouts bankruptcy reorganization plan, approved by a judge in September, halts all lawsuits against the Boy Scouts, local councils, churches and other organizations that chartered scouting activities. His case was halted by the Boy Scouts bankruptcy. Later that year, in August, he filed his lawsuit against defendants including a Boy Scouts local council and DeSandre.

☆ If you buy an electric vehicle by March, you'll have a better chance of getting the maximum $7,500 tax credit
▼ + stars: | 2022-12-28 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

Biden's Inflation Reduction Act included an up-to $7,500 tax credit for electric vehicle purchases. Here's what Americans looking to buy an electric vehicle need to know about the credit. One notable part of that was an incentive for Americans to purchase electric vehicles and play a part in saving the environment. Who qualifies for the tax credit on a new electric vehicle? Can I qualify for a tax credit on a used electric vehicle purchase?

☆ 'Secure 2.0' would provide a limited federal 'match' on contributions for retirement savers with lower income
▼ + stars: | 2022-12-22 | by ( Sarah O'Brien | ) www.cnbc.com time to read: +2 min

Under a provision included in a legislative proposal known as "Secure 2.0" — which is included in an omnibus appropriations bill that cleared the Senate on Thursday and awaited a House vote — a retirement "saver's match" would be implemented, essentially changing how an existing tax credit works. That amount would be a maximum 50% of up to $2,000 in contributions to a qualifying account (so a maximum $1,000 match per individual). The current credit isn't always useful for taxpayersThe move to allow a federal matching contribution is being sought because the current tax credit is nonrefundable, meaning that if you owe no federal income tax, you don't get the credit. The match would be "a direct, substantial way to increase the retirement savings of lower and middle-income workers, and incentivize good retirement planning habits," Carlisle said. More than 108 million people would be eligible for the saver's match, according to the American Retirement Association.

☆ Top government ethics officer was late disclosing his personal finances on multiple occasions
▼ + stars: | 2022-12-20 | by ( Kimberly Leonard | ) www.businessinsider.com time to read: +9 min

The attorney, Office of Government Ethics General Counsel David Apol, missed deadlines to report at least 12 different bond transactions since 2015. Improperly reporting purchases and sales of bonds or stocks is a violation of the 2012 Stop Trading on Congressional Knowledge Act, or STOCK Act. Officials are only required to report transactions in broad ranges. Democratic Rep. Abigail Spanberger of Virginia has been one of the lead proponents in Congress of reforming the STOCK Act. Congress this year discussed changes to the STOCK Act and the US House even held a hearing following the publication of "Conflicted Congress."

☆ Retirement savings changes may soon take effect. Here's what it would mean for you
▼ + stars: | 2022-12-20 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +5 min

The retirement savings provisions – known as Secure 2.0 – were drawn from a House-passed bill and bills that were passed by two Senate committees. Require auto enrollment in 401(k) plansMost employers starting new workplace retirement savings plans could be required to automatically enroll employees in the plan. Secure 2.0 would let employers make a matching contribution to an employee’s retirement plan based on their qualified student loan payments. That way, it would ensure that the employee is building retirement savings no matter what. Under the Secure 2.0 package, it would move up to 73 starting in 2023 and then to 75 a decade later.

☆ Op-ed: Here are 5 questions to ask your financial advisor before the end of the year
▼ + stars: | 2022-12-19 | by ( Ivory Johnson | ) www.cnbc.com time to read: +3 min

Delpixart | Istock | Getty ImagesThe end of the year is a time to give thanks and celebrate the holidays with our families. It's also an opportunity to reevaluate the previous 12 months and ask your financial advisor some very productive questions. Instead, you should be just as interested in what method your advisor uses to build a portfolio as you are in the result. Ask your advisor to review the holdings and transactions throughout the year to determine if it make sense to capture capital gains and match it against a loss. A financial planner does more than invest your hard-earned money; we also provide estate, long-term-care and education planning.

☆ Tax pros ‘expecting the worst' with Venmo, PayPal tax reporting change. How to handle a 1099-K for personal payments
▼ + stars: | 2022-12-16 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

As the tax season approaches, many Americans are bracing for a new reporting change for third-party payment networks like Venmo or PayPal. Starting in 2022, you'll receive Form 1099-K, which reports income to the IRS, for business payments over $600. But experts say it's possible you'll receive 1099-Ks for personal transfers by mistake. "As tax preparers, we are more or less expecting the worst," said Albert Campo, a certified public accountant and president of AJC Accounting Services in Manalapan, New Jersey. But the American Rescue Plan Act of 2021 dropped the threshold to just $600.

☆ This 529 savings plan myth is making college pricier for families, consultant says: 'It's candidly, blatantly not true'
▼ + stars: | 2022-12-14 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

SEATTLE — For many families, paying for college is a financial burden, and experts say education-funding myths may be adding to the student loan debt crisis. "There's often this perception that somehow people are being penalized for saving for college," said Cozy Wittman, national education and partnerships speaker with College Inside Track. Parent-owned 529 college savings plans are assessed at 5.64% when filing the Free Application for Federal Student Aid, known as the FAFSA, she said, speaking at the Financial Planning Association's annual conference on Tuesday. That means for every $10,000 of 529 plan savings, roughly $564 counts toward the parents' expected family contribution, potentially reducing financial aid by roughly the same amount, according to the College Savings Plans Network. The average 529 account value was $30,287 in 2021, the College Savings Plans Network reported.

The first Social Security checks and bank deposits featuring the largest cost-of-living-adjustment in 40 years will start arriving in January. Social Security recipients will have benefited from timing, as well. So, anyone with a birthdate in this initial range can expect the first payment to land Jan. 11, according to the Social Security Administration. Except for SSI payments, Social Security benefits remain taxable and tax brackets are also changing as a result of inflation. A Social Security recipient filing as an individual with total earnings — including anything received outside Social Security — between $25,000 and $34,000 may have to pay income tax on up to 50% of their Social Security benefits.

☆ 'It could be a blessing and a curse.' Here are 3 unexpected financial pitfalls unmarried couples need to know
▼ + stars: | 2022-12-13 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

SEATTLE — If you're living together before marriage or committed long-term without plans to tie the knot, you'll need to prepare for the future — or you may face challenges later, experts say. There are "rising rates of cohabitation," with many couples skipping marriage because "they don't see the benefit," said Michelle Petrowski, a certified financial planner at the Phoenix-based financial firm Being in Abundance. Financially speaking, "it can be a blessing and a curse," she said, speaking at the Financial Planning Association's annual conference on Monday. While some couples opt out of marriage for financial reasons, they may not understand the pitfalls, Petrowski said. Here are some unexpected financial issues unmarried couples need to consider.

☆ Making these 5 money moves now can set you up for financial success in the new year
▼ + stars: | 2022-12-12 | by ( Sharon Epperson | In Sharoneppersoncnbc | ) www.cnbc.com time to read: +4 min

Increase your 401(k) plan contributionsA 401(k) retirement savings plan is one of the most highly sought-after workplace benefits. You can contribute up to $20,500 to a 401(k) plan in 2022 — or up to $27,000 if you're 50 or older. Boosting contributions to a traditional 401(k) plan can lower your adjusted gross income while padding your retirement savings. By paying cash, you could in some cases, wind up paying 3% less than the purchase price. You can no longer automatically tax an above-the-line deduction for cash donations; you must itemize deductions on your 2022 tax return.

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