For some people, Roth IRAs can offer income and estate tax benefits that are preferable to those offered by traditional IRAs. However, it’s important to take note of just what the distinctive features of Roth IRA are before making the choice. Traditional vs. Roth The biggest difference between traditional and
In today’s competitive employment market, offering an employee an equity interest in your business can be a powerful tool for attracting and retaining top talent. If your company is organized as a partnership, however, beware of the tax traps of doing so. Employees pay half of the Social Security and
Each year, millions of taxpayers claim an income tax refund. To be sure, receiving a payment from the IRS for a few thousand dollars can be a pleasant influx of cash. But it means you were essentially giving the government an interest-free loan for close to a year, which isn’t
It’s not uncommon for adult children to help support their aging parents. If you’re in this position, you might qualify for an adult-dependent exemption to deduct up to $4,050 for each person claimed on your 2017 return. Basic Qualifications For you to qualify for the adult-dependent exemption, in most cases
Like most people, as you age into your 40s and 50s, you may wonder what the future holds for your health and well-being. Will you be as shard mentally and robust physically as you are right now? Could a serious medical condition arise in your future that might prevent you
INDIVIDUAL IS RESPONSIBLE FOR PAYING THE ADDITIONAL 0.9% MEDICARE TAX. Josh and Anna are married. Josh’s salary is $180,000, and Anna’s wages are $150,000. Assume they have no other wage or investment income. Their total combined wage income is $330,000 ($180,000 + $150,000). Since this amount is over the $250,000
ADDITIONAL 0.9% MEDICARE TAX Individuals must pay an additional 0.9% Medicare tax on earned income above certain thresholds. The employee portion of the Medicare tax is increased from 1.45% to 2.35% on wages received in a calendar year in excess of $200,000 ($250,000 for married couples filing jointly; $125,000 for
LIFE INSURANCE AS A SOURCE OF FUNDS FOR THE TERMINALLY ILL An individual who is terminally or chronically ill and lacks funds to cover significant medical (e.g., experimental treatments) and other family expenses may find the solution through his or her life insurance policies. Although insurance policies have historically been
The IRS has a new website that provides information on the Affordable Care Act (www.irs.gov/uac/Affordable-Care-Act-Tax-Provisions). The site explains tax benefits and responsibilities for individuals, employers, and other organizations. In addition, it provides information about tax provisions that are in effect now and those that will go into effect in 2014
There’s a lot for taxpayers to know when it comes to the 3.8% net investment income tax (3.8% NIIT). This new tax is imposed on income from several sources and its impact is far reaching. Analyzing its impact can get complicated fast. Originating as a component of 2010 health care
