Since the December 31 year end is quickly approaching, it is the time when some employers think about issuing their employees a holiday or performance bonus. Generally, all payments made to employees MUST be reported on Form W-2.
Let’s look at some of the typical scenarios employers face. [Read more…] about Form 1099-MISC Misuse and Misconceptions
The Social Security Administration has announced its increases to the 2017 maximum amount of earnings subject to the Social Security tax and the monthly benefits to be paid to Social Security beneficiaries.
Earnings: The maximum amount of earnings subject to the Social Security tax would increase 7.3 percent to $127,200 in 2017 from the current $118,500. This is the largest increase in more than three decades, and will generate $1,078 per worker who reaches the contribution plateau. It is estimated that 12 million of the 173 million workers will be affected by this increase.
Benefits: Social Security beneficiaries will receive [Read more…] about 2017 Social Security Changes
There could be an unwelcome surprise for many citizens (age 65 or older) who itemize deductions on their tax return rather than claim the standard deduction. Traditionally, persons were only allowed to deduct medical expenses that exceeded 7.5% of their adjusted gross income (AGI). In 2010, Congress made changes to the amount of medical expenses that Americans can claim on their tax returns as part of the Affordable Care Act (ACA). The 7.5% threshold was increased to 10% of AGI beginning with the 2013 tax year. To avoid the wrath of seniors age 65 or older who vote, Congress grandfathered this 10% threshold until tax year 2017. Thus beginning with the 2017 tax year, all Americans, regardless of age, will need to have medical expenses exceed 10% of their AGI in order to deduct medical expenses as an itemized deduction.
Accordingly, it is very important for taxpayers who are age 65 or older in 2016 [Read more…] about Seniors Need to Plan When to Claim Medical Expenses
Two major changes to the Free Application for Federal Student Aid (FAFSA) will take effect for the 2017-2018 school year that runs from July 1, 2017 through June 30, 2018.
Many persons are aware of the change that will allow the filing of the FAFSA form as early as October 1 of the previous year instead of January 1 of the upcoming school year. However, many are unaware of the new income information requirements.
For a student attending college during the period from July 1, 2016 through June 30, 2017, the rules are the same as in prior years. The FAFSA application can be submitted starting January 1, 2016 through June 30, 2017. The income that will be reported on the FAFSA application will be for the 2015 tax year.
For a student attending college starting July 1, 2017 through June 30, 2018, the income that will be reported on the FAFSA application will also be for the 2015 tax year. Some have referred to this as the “prior prior year” (PPY) income test. The FAFSA application can be submitted starting Oct 1, 2016 through June 30, 2018.
For a student attending college in a school year that begins July 1, 2018 through June 30, 2019, the application can be submitted for the period beginning October 1, 2017 through June 30, 2019, and the income that will be reported will be for the 2016 tax year. The year prior to 2018 is 2017; and the year prior to the prior year of 2017 is 2016.
The new application timelines means [Read more…] about FAFSA Rules Changes You Need to Understand
Although we live in the information age and the world of convenience, there is yet another task that newly-married couples need to address after writing their thank you cards and perhaps the bride changing her maiden surname to her husband’s surname with the Social Security Administration.
The new task to complete is a health insurance review if you are enrolled in coverage through the Health Insurance Marketplace and you receive premium assistance in the form of advance payments of the premium tax credit. Don’t forget that your premiums were based on your family composition and household income. This could all change due to the change in your marital status and household income.
It is important [Read more…] about Married Couples Need to Do What?
