New year, new taxes.
President Trump said that he wanted the new tax plan on his desk by Christmas. Nonetheless, the Tax Cuts and Jobs Act went through the Senate, House and flew by Congress. Ultimately, the Tax Cuts and Jobs Act tax plan has a goal to reduce the tax rates for individuals and businesses, which will ultimately affect how much you end up receiving your refund and paying in your tax liability. Most changes will expire in 2025 whereas some will remain permanent.
With the media raving about how taxpayers’ pockets will be affected, here are the changes that the new tax plan will lead to starting January 1st, 2019.
What was eliminated in the new tax plan?
Continue reading “Tax Cuts and Jobs Act and How the Tax Plan May Affect You”
2014 Short Term Capital Gains are taxed as “ordinary” income
As of 2013, individuals earning an income of $450,0001 and over saw an increase in the capital gains tax rate. For this group, long term capital gains tax rate jumped from 15% to 20% while the short term 2013 capital gains tax rates increased by 4.6%.
Check out part one of this article, to learn about long term capital gains. Keep reading for more on short term capital gains and how they relate to filing your taxes.
What are short term capital gains?
A Capital gain is a profit made from selling any asset when the sale price exceeds the purchase price.
The capital gains clock begins the day after you acquire the asset until the day you sell it (this includes day you sell it). Depending on how long the capital gain is held for will determine if it falls into the short-term category or long-term.
Continue reading “What is the Tax Rate for Short Term Capital Gains?”
If you don’t qualify for any other filing status you should file as single
Your filing status is one of the first things you enter on your tax return, but it’s also one of the most important. That’s because it has a huge influence on the rest of your return. It determines whether you have to file, what rates you get taxed at, your standard deduction, and eligibility for certain credits and deductions.
There are five different filing statuses:
- Married Filing Jointly
- Married Filing Separately
- Head of Household
- Qualifying Widow(er)
Definition of single
According to the IRS definition:
Your filing status is single if, you are considered unmarried, and you do not qualify for another filing status. Continue reading “Single Filing Status Definition: Who Should File as Single”