Federal deficit declines

The federal deficit in fiscal year (FY) 2022 was cut in half, to $1.4 trillion, compared to FY 2021, according to a statement from Treasury Secretary Janet Yellen. It was the largest-ever one-year decrease, she stated. However, receipts were below projections partly due to less-than-estimated collections of individual income tax. Total receipts were nearly $4.9 […]

Check before Donating to Charity

Holiday season is nearly here, and many taxpayers are beginning to think about giving to charity. Meanwhile, thieves are busy setting up charity scams. Before sending money, it’s a good idea to check the legitimacy of a charity using an IRS resource known as the Tax Exempt Organization Search tool. You can use it check […]

What do the 2023 cost-of-living adjustment numbers mean for you?

The IRS recently issued its 2023 cost-of-living adjustments for more than 60 tax provisions. With inflation up significantly this year, many amounts increased considerably over 2022 amounts. As you implement 2022 year-end tax planning strategies, be sure to take these 2023 adjustments into account. Also, keep in mind that, under the Tax Cuts and Jobs Act […]

Retirement Plan contributions updated for 2023

In 2023, individuals will be able to contribute up to $22,500 to their 401(k) plans, the IRS announced. The same is true for 403(b) plans and most 457 plans. This is up from $20,500 in 2022. The increase is part of the cost-of-living adjustments made annually. The catch-up contribution limit for employees age 50 and […]

IRS warns on ERC credits

Employers, beware: The IRS is warning about shady third parties advising businesses to claim the Employee Retention Credit (ERC), even when they don’t qualify. The ERC was introduced in 2020 to help employers who kept employees on the payroll during the COVID-19 lockdown or experienced significant declines in revenues from March 13, 2020, to Dec. […]

Employers: In 2023, the Social Security wage base is going up

The Social Security Administration recently announced that the wage base for computing Social Security tax will increase to $160,200 for 2023 (up from $147,000 for 2022). Wages and self-employment income above this threshold aren’t subject to Social Security tax. Basics about Social Security The Federal Insurance Contributions Act (FICA) imposes two taxes on employers, employees […]

Adoption Tax Credit

If you’re considering adopting a child, you should know there may be financial help available in the form of an adoption tax credit. For 2023, the credit for an adoption of a special needs child is $15,950. The maximum credit allowed for other adoptions in 2023 will be the amount of qualified adoption expenses up […]

recreating tax records after a disaster

If important records are destroyed in a disaster or by some other means, you may need to recreate them. The IRS offers tips for reconstructing various records, some of which may be needed for insurance claims or possibly for federal assistance as you recover. To recreate financial statements, use past credit card and bank statements. […]

You may be liable for “nanny tax” for all types of domestic workers

You’ve probably heard of the “nanny tax.” But even if you don’t employ a nanny, it may apply to you. Hiring a house cleaner, gardener or other household employee (who isn’t an independent contractor) may make you liable for federal income and other taxes. You may also have state tax obligations. If you employ a […]

Time to perform a Withholding Checkup

With the end of the year just several weeks away are you sure you’re having the right amount of tax withheld? The IRS urges taxpayers to check their tax withholding while there’s time left. By making an adjustment now you may avoid a big surprise, such as a balance due when you file your tax […]