Q: (True or false): Taxpayers who got direct deposits of 2021 child tax credits last year could have lower refunds or higher taxes due than expected on returns they’re preparing now. A: True. Millions of taxpayers received partial prepayments of expanded child credits for 2021 last year via direct deposit. As a result, these amounts…
Category: taxes
Easy way to build an emergency fund
According to the IRS, around 72% of Americans received a refund on their taxes in 2019. This extra cash may be the largest check some people receive all year and can be a perfect opportunity to start—or grow—your emergency savings funds.Learn how your tax return can kickstart your savings. The Consumer Financial Protection Bureau’s guide…
Trump’s tariffs cost US consumers $106 billion per year. Your cost: $831/year
“US tariffs recently imposed on goods from China will cost American households $106 billion annually, according to a report from the Federal Reserve Bank of New York. These tariffs likely will reduce overall tariff revenue collected by the US and will “create large economic distortions,” the report said.” Tariffs are a hidden tax on consumer purchasing…
Big Roth 401(k) Tax Surprise
Thanks to Kim Blanton writing in the Squared Away Blog for explaining the complexities of taxes on withdrawals from Roth 401(k) plans. “Financial experts and writers often tout the Roth 401(k)’s main selling point: when the money is withdrawn in retirement, it won’t be taxed.Well, that’s not entirely true.An employee’s own money saved in his…
Tax time is the time to act on retirement savings!
It’s time to feed your “Financial Freedom Fund.” The federal government (under previous administrations… not sure how long this great deal will last….) offers a tax credit to help workers boost their retirement accounts. “The Retirement Savings Contribution Credit, aka the Saver’s Credit, is a tax credit that may be applied to the first $2,000…
Why You Need to Think About Your Retirement Taxes Long Before You Retire
If you wait until retirement to figure out your tax liability on your retirement accounts… it’s too late to do much to reduce your tax obligation. You need to plan for “tax diversification” while you are investing for retirement. Tax diversification means having some funds in non-taxable accounts like Roth IRAs. To learn more about…