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Dollars and Sense
5 minutes | Dec 23, 2015
Episode #6 – Fed Tax Hike & You
How does the recent Fed Tax Hike affect you? Listen & learn how! Let us know how we're doing!
7 minutes | Feb 23, 2015
Episode #5 – Filing Your Taxes Separately
Example 1 - Separate Filers Must Both Itemize For example, if one spouse has itemized deductions of $8,000 and the other spouse only has $2,500 worth of itemized deductions, then the second spouse must still itemize and can only claim $2,500 worth of itemized deductions instead of the larger standard deduction. This is only a good idea when the one spouse's deductions are large enough to make up for the second spouse's lost return. Example 2 - Incomes and Deductions Determine When to File Separately For example, consider a case where one spouse is a doctor earning $150,000 a year, while the other spouse is a teacher earning $35,000 a year. The teaching spouse has surgery during the year and pays $10,000 in unreimbursed medical expenses. The IRS rule for deducting unreimbursed medical expenses dictates that only expenses in excess of 7.5% of the filer's AGI can count as a miscellaneous itemized deduction. If the couple files jointly, then only expenses in excess of $13,875 ($185,000 x 7.5%) will be deductible. Therefore, none of the expenses will count, because the total expenses incurred are less than this. However, if the couples were to file separately, this amount would easily exceed the threshold for medical deductions, which in this case would be $2,625, based solely on the teacher's AGI. This would leave an eligible deduction of $7,375 for the teaching spouse to claim on Schedule A of the 1040. Let us know how we're doing!
18 minutes | Feb 2, 2015
Episode #4 – Personal Income Tax Guide Pt. 2
This is your breakdown and guide to handling your personal taxes and making more savvy decisions.Let us know how we're doing!
25 minutes | Jan 12, 2015
Episode #3 – Personal Income Tax Guide Pt. 1
This is your breakdown and guide to handling your personal taxes and making more savvy decisions. Examples mentioned during the episode: Example 1: A taxpayer (whose top tax bracket is 25%) may think that donating $1,000 to charity will save them $250 ($1,000 x 25%) at tax time. However, since only $500 of their income fell in the 25% income tax bracket, only $500 will experience a savings at that bracket. The rest will experience a tax savings at the next lowest bracket of 10% bracket, making the overall deduction only worth $175 [($500 x .25) + ($500 x 10%)]. Example 2: If a taxpayer is in the 25% marginal income tax bracket, a $1,000 deduction would save a maximum of $250 in taxes from their bottom line ($1,000 less in income that will not be taxed at 25%). However, if they were in the 25% marginal income tax, they would receive a $1,000 tax credit, and they will have $1,000 subtracted directly from the amount that he or she will ultimately owe the IRS. Example 3: On December 1, Sara is informed that she will be getting a large promotion at work and will be making $30,000 more annually starting January 1. Upon doing the math, Sara realizes that most of this $30,000 raise will fall in the next highest tax bracket (25%) instead of her current tax bracket (15%). In an effort to maximize her tax savings over the next couple of years, Sara makes a couple of very smart moves. First, she sends out the invoices for a consulting business that she runs on the side sooner than expected. She does this, because any money she receives in the current year will likely be taxed at a lower rate than if she waited to bill her clients in the New Year. Second, she decides to hold off until after January 1 on some of her big year-end expenses such as her charitable donations and non-emergency medical procedures. By doing so she, she is ensuring that these costs are deducted against income that will be taxed at a 25% rate instead of 15%, saving herself more tax dollars in the process. Let us know how we're doing!
17 minutes | Dec 29, 2014
Episode #2 – The Federal Reserve Explained
Listen to a breakdown of the Federal Reserve and the important role that it plays in the US economy.Let us know how we're doing!
16 minutes | Dec 17, 2014
Episode #1 – Inflation Explained
I'm sure that you've heard of the term "inflation." But do you know exactly what it is? How it is measured? Or how it is related to interest rates and your investments? Listen to this episode and I will answer those questions, among others, and you shall have a better understanding of inflation! Let us know how we're doing!
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