Category Archives: Income Tax

Recent Graduates / Early Career Typically in your 20’s Cash Flow:  Allocate at least 20% of your gross income to long-term savings and / or paying off debt.  Now is the time to get money invested so it can compound. Start identifying spending habits and patterns by creating a budget or trying out the WholeWallet30. Tax Planning:  For many during this stage, it makes sense to save to a Roth versus pre-tax retirement vehicle since starting salaries tend to be lower than inRead More

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Every year, I compile a list of the FAQ’s I get during tax season to share in the hopes it answers somebody else’s question.  This is not a substitute for tax advice.  Please check with your tax professional for questions specific to your situation. I have a taxable account, but I did not receive a 1099-INT form for it.  I looked online and I earned $7 of interest in 2015.  Do I need to claim this interest income on myRead More

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  As more and more clients are starting businesses, picking up side consulting gigs or selling crafts online, this post focuses on the tax differences between being an employee vs being self-employed. 1) You are in charge of tracking your income and expenses when you are self-employed. All income is taxable, absent a specific exclusion in the IRS code.  You don’t need to track your income when you are an employee because you receive a W-2 from your employer summarizing your taxable income. WhenRead More

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If you paid for higher education costs in 2013, be sure to speak with your tax preparer to see if you may benefit from this credit. What is it? The American Opportunity Tax Credit (AOTC) modifies the Hope Tax Credit. It allows you to take a tax credit for qualified higher education costs including tuition, certain fees and course materials. See IRS Publication 970 for a complete list. It does not include room & board. How much is it? TheRead More

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Consider a SEP-IRA. A Simplified Employee Pension (SEP) plan is a retirement savings vehicle available to those who are self-employed. This past year, I came across a handful of new clients who were self-employed and not aware of a SEP-IRA and its benefits. The following is a summary focused towards business owners who do not have employees. You can use the SEP-IRA with employees, but I do not go into the details of that below. A SEP-IRA follows the sameRead More

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