If you’re age 65 and older and have basic Medicare insurance, you may need to pay additional premiums to get the level of coverage you want. The premiums can be costly, especially for married couples with both spouses paying them. But there may be an advantage: You may qualify for a tax break for paying the premiums. However, it can be difficult to qualify to claim medical expenses on your […]
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If you and your employees are traveling for business this summer, there are a number of considerations. Under tax law, in order to claim deductions, you must meet certain requirements for out-of-town business travel within the U.S. The rules apply if the business reasonably requires an overnight stay. The actual costs of travel (plane fare, cabs, etc.) are deductible for out-of-town business trips. You’re also allowed to deduct the cost […]
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High-income taxpayers face a regular income tax rate of 35% or 37%. And they may also have to pay an additional 3.8% net investment income tax (NIIT). The NIIT applies only if modified adjusted gross income (MAGI) exceeds: $250,000 for married taxpayers filing jointly and surviving spouses; $125,000 for married taxpayers filing separately; and $200,000 for unmarried taxpayers and heads of household. The amount subject to the tax is the […]
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Most retirement plan distributions are subject to income tax and may be subject to an additional 10% penalty if you take a withdrawal before age 59½. Fortunately, there are some exceptions to avoid the penalty but there are strict rules. In one case (TC Memo 2023-9), a taxpayer lost his job and took a 401(k) plan distribution before reaching age 59½. He had been diagnosed with diabetes, which he treated […]
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The IRS opened the 2023 individual income tax return filing season on Jan. 23. Even if you usually don’t file until closer to the mid-April deadline (or you file an extension), you may want to file early. It can potentially protect you from tax identity theft. In these scams, a thief uses another person’s personal information to file a fraudulent return early in the filing season and claim a bogus […]
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