Small Business Financials

Updated for tax years 2021 and 2022.   Surprise — Mom and Dad gave you a nice check! Maybe it’s enough for dinner, or maybe it’s something more substantial. Either way … are there any tax implications for receiving such a gift? How much is the annual gift tax for 2021? First, let us put your mind at ease. The total gift amount must be quite substantial before the IRS even takes notice. For tax year 2021, if the value of the gift is $15,000 or less in a calendar year, it doesn’t even count (increasing to $16,000 in 2022). The IRS calls this amount the annual gift tax exclusion. And if a married couple makes a gift from joint property, they can each gift up to the annual exclusion. This means Mom and Dad could give you $30,000 without worrying about paying any gift tax. This tax exists to prevent people from giving away their money to avoid paying their income taxes. The gift tax rate fluctuates from 18 to 40 percent, depending on the size of the gift. For instance, if you...

Updated for tax year 2021 The  Child Tax Credit  (CTC) underwent some hefty changes in 2021: Max credit amount: The credit’s maximum amount increased from the original $2,000 per child to up to $3,000 per qualifying child age 6-17 and up to $3,600 for children ages 5 and under in 2021. Child’s age: Children ages 17 and under can qualify for the credit in tax year 2021 while previously the qualifying age was capped at 16. Refundability: The CTC is fully refundable in 2021, meaning you can claim the full amount as a tax refund even if you don’t owe any income tax. Advance monthly payments: Parents of qualifying children could receive half of their Child Tax Credit in six advance monthly installments in 2021, then claim the remainder of their credit when filing their 2021 tax return. No minimum income limit: You do not need to have earned income in 2021 to qualify for this tax credit. Income phaseout threshold: The credit amount you qualify for starts decreasing...

Updated for tax year 2021. You have plenty of expenses while your children are young. Fortunately, some of those expenses can directly or indirectly turn into tax credits and exemptions that may mean big savings on your tax bill. Take a look at the following tax benefits to see which ones could be beneficial for your family this tax season. 1. Child and dependent care tax credit A big tax saver for many families is the child and dependent care tax credit. If you paid someone to take care of your child or another eligible dependent while you worked or looked for work, you may qualify for this credit. Qualifying expenses for this tax credit include daycare or babysitter fees, day camp/summer camp fees, and nursery, pre-school, or pre-K fees. In-home care costs for disabled dependents also qualify. This tax break changed significantly for tax year 2021: The maximum credit percentage increased to 50 percent (up from 35 percent), depending on your adjusted gross income (A...

Updated for tax years 2021 and 2022. If you have a story, inspiration, or anything else you want to tell the world, there’s never been a better time to do it. It’s easier than ever before for authors to self-publish their work and get paid. The traditional publishing gatekeepers can’t stop you now! There are so many options, from printing hard copies to sell in bookstores to publishing digital eBooks for use on Kindles and other e-reading devices. It’s exciting when you start making money as a self-publishing author but don’t let that excitement distract you from learning how to report your earnings correctly for tax purposes. Get started with these six tax preparation tips. 1. Find all your income from self-publishing and eBooks. If you sell $600 or more in printed or digital books to a publisher, you should receive Form 1099-NEC or Form 1099-MISC in the mail after the end of the year. If you sell books yourself and accept credit cards or other online services for payment, you...

One of the hardest parts about doing your taxes? Waiting for that refund to hit your bank account. If you’re expecting a tax refund this year, here’s how you can check on the status of your refund — and when you can expect to have that cash in hand. Ways to check the status of your tax refund There are three different ways to easily track the status of your refund. Where’s My Refund? – This is the IRS’s official online tool for tracking the status of your refund. IRS2Go mobile app – This IRS app is an easy way to check the status of your refund from any mobile device. IRS TeleTax System – You can also call the IRS TeleTax System at 1-800-829-4477 and use their automated telephone system to check the status of your refund. For all methods listed above, taxpayers will need to input their Social Security number, filing status, and exact refund amount. All methods are available in both English and Spanish. How soon can I track my refund status? How quickly you can track the ...