The Social Security Administration has announced that the wage base for computing Social Security tax will rise to $176,100 in 2025. This is up from $168,600 in 2024. (Believe it or not, it was just $3,000 from 1937–1950!) Wages and self-employment income above this amount aren’t subject to Social Security tax. The Federal Insurance Contributions Act imposes two taxes on employers, employees and self-employed workers. One is Social Security and […]
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As year end approaches, you may be thinking about tax strategies. One way to reduce potential estate taxes and show generosity to loved ones is to give cash gifts before Dec. 31. Taxpayers can transfer large amounts using the annual exclusion. In 2024, the exclusion amount is $18,000. It covers gifts you make to each recipient. That means if you have three children, you can transfer $54,000 to them in […]
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Let’s say you have a sideline activity that you consider a business. Perhaps you offer photography services or sell handmade items online. Will the IRS agree that your venture is a business, not a hobby? It’s an essential question for tax purposes. If the expenses from an activity exceed the revenues, you have a net loss. You can’t necessarily deduct that loss on your federal income tax return. The IRS […]
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Divorce entails difficult personal issues, and taxes are probably the farthest thing from your mind. However, they should be considered to keep taxes to a minimum. For example, if you sell your personal residence or one spouse remains there while the other moves out, you want to ensure you’ll be able to avoid tax on up to $500,000 of gain. A spouse’s retirement benefits and business are often part of […]
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Here are some important fourth quarter 2024 tax-filing dates for businesses. OCT 15: If you’re the owner or operator of a calendar-year C corp. which filed an extension, file a 2023 income tax return. OCT 31: Report income tax withholding and FICA taxes for Q3 2024 (unless you’re eligible for a Nov. 12 deadline because you deposited on time, and in full, all the associated taxes due). DEC 16: If […]
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