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Daily Tax Tips March 2015

The arrival of March means we've got six short weeks until the April 15 filing deadline.Tax_tip_icon_pencil_point

The March 2015 Daily Tax Tips will help you meet that due date regardless of whether you attack your taxes like a lion or put them off because you're the timidest of tax lambs.

Regardless of your traditional March animal persona, you'll also find this month some advice on how to make your 2015 filing less taxing, too.

As with the January and February tax tips, you'll find a new piece of tax advice featured each March weekday in the upper right corner of the the ol' blog.

Also like the last two months, March's daily tips will be collected on this special page in case you miss a daily posting or simply want a filing refresher.

So with the 2015 tax season winding down, let's not waste any more tax filing and/or planning time.

  1. Determining your tax dependents -- Taking care of someone is expensive. But if those folks qualify as tax dependents, they could help save a bit of money on your taxes. Dependents typically are minor children, but they also could be your aging parents or even that deadbeat girl- or boyfriend who's been living with you. (March 2, 2015)
  2. Child and dependent care credit -- Working? Have kids? Uncle Sam can help families cover some child care costs. (March 3, 2015)
  3. Hobby or business? -- If you're earning regular money on your recreational pursuit, you might save some tax money by turning it into a job. (March 4,  2015)
  4. Simpler home office deduction for some workers -- Working from home is great. Getting a tax break for your home office is even better. What's not so good is the hassle of filling out the deduction claim form. But if you don't have a lot of home office expenses, the Internal Revenue Service offers an alternate, simplified way to claim home office costs. (March 5, 2015)
  5. Avoid these 10 common tax mistakes -- Thanks to tax preparation software, we're making fewer filing mistakes. But just one slip up, either via computer submission or a hand-completed 1040, could be costly. So watch out for these 10 common tax errors. (March 6, 2015)
  6. The many capital gains tax rates -- Some tax reformers want to eliminate capital gains taxes. Until that happens, here's a look at the many capital gains taxes that are in the Internal Revenue Code in addition to the popular long-term lower rates of 15 percent and 20 percent enjoyed by most investors. (March 9, 2015)
  7. Tax benefits of capital losses -- When it comes to bad assets, be sure to take tax advantage of capital losses. They can eliminate any taxable capital gains you might have. If you have more losses than gains, you can use up to $3,000 to offset ordinary income. Then be sure to get a new investment manager! (March 10, 2015)
  8. Writing off worthless stock -- Investing in stocks can be good or not so good. But when a holding totally tanks, there is some tax help. You can write off the bad asset as worthless. (March 11, 2015)
  9. Reporting your investment income -- The Internal Revenue Service is copied on your investment earnings. That's why it's critical to properly report and figure your taxes on this unearned income. (March 12, 2015)
  10. Watch out for these 5 terrible tax surprises -- No one likes surprises at tax time, especially when they could cost you money. Don't let these five -- alimony, unemployment payments, forgiven debt, prize winnings some Social Security benefits --sneak up on you. (March 13, 2015)
  11. Alternative Minimum Tax issues -- Inflation indexing has eased a major Alternative Minimum Tax (AMT) problem. But if you're still subject to AMT, here are the rules for this potentially costly parallel tax. (March 16, 2015)
  12. Education tax credits -- College costs go up every year. The American Opportunity and Lifetime Learning credits offer many students and their parents tax help meeting education expenses. (March 17, 2015)
  13. Maximizing medical deductions -- To claim itemized medical deductions your expenses must be more than 10 percent of your adjusted gross income. Age note: if you're 65 or older, the 7.5 percent threshold still applies through 2016. Here are some ways to clear that hurdle. (March 18, 2015)
  14. Tax break bait and switch -- There are lots of tax breaks out there, but some are not quite as easy to claim as they first sound. When you get the full story, you might just find they do you little or no tax-saving good at all. From gambling losses to charitable donations to medical costs, check out some tax breaks that aren't always as advertised. (March 19, 2015)
  15. Obamacare tax forms -- Almost all taxpayers must deal with Affordable Care Act provisions for the first time this filing season. For most filers, it's simply a new line on their 1040, 1040A or 1040EZ form. For others, it means new informational statements, more paperwork to fill out and added calculations. (March 20, 2015)
  16. A dozen small business tax deductions -- If your business is booming, you'll want to check out these 12 deductions that could help reduce what you'll owe the Internal Revenue Service. (March 23, 2015)
  17. Don't you dare deduct these expenses! -- Deductions are a good way to reduce your eventual Internal Revenue Service bill. But while there are lots of thing you can write off on your tax return, don't go overboard. These 10 instances are not good deduction options. (March 24, 2015)
  18. Unemployment and taxes -- If you're out of work, you still could face tax issues. Some tax laws, such as deductible job search expenses, might help ease an out-of-work patch. Others, however, could cost you. (March 25, 2015)
  19. Rich? Watch out for these 5 taxes -- It's not a good time to make big bucks when it comes to taxes. Wealthy taxpayers now face several higher taxes thanks to recent tax law changes. (March 26, 2015)
  20. Retirement plan distribution deadline nears -- Retirement plan distribution deadline nears -- Mandatory withdrawals, known as required minimum distributions or RMDs, must be made from IRAs and other deferred-tax retirement plans by April 1. No joke. This deadline applies to first-year RMD recipients; that's folks who turned 70½ the year before. Another RMD will be due, however, for the current tax year by Dec. 31. (March 27, 2015)
  21. 8 costly tax breaks -- Congress is again wrangling over the federal budget. One way to save Uncle Sam some money is to eliminate costly, but popular, tax expenditures. These are losses to the U.S. Treasury from certain tax deductions, exemptions or credits to specific categories of taxpayers. Some benefit the wealthy; others offer tax help to poorer filers. Regardless, these eight take a big bite out of Uncle Sam's bank balance. (March 30, 2015)
  22. Roth vs. traditional IRA -- Both Roth and traditional IRAs offer some type of tax savings. And you have until April 15 to open and/or contribute to them for the prior tax year. But which type of IRA to choose? Roth IRAs offer a good way to put away money tax-free for retirement. Traditional IRAs could provide some folks with an immediate tax deduction. These additional details, comparisons and IRA picking tips can help you decide. (March 31, 2015)

Can't get enough tax tips? Then also check out:

January 2015 Daily Tax Tips

February 2015 Daily Tax Tips

April 2015 Daily Tax Tips

You'll also find more tax news and advice at Bankrate's Tax Guide, as well as here at Don't Mess With Taxes blog posts and ever-growing collection of year-round tax tips and money moves.

Today's Tax Tip

  • IRS getting more audit money. Don't make your 1040 an easy target — The House is expected later this week to pass the Senate-OK'ed Inflation Reduction Act. Among the tax provisions in the $739 billion total bill is $79 million for the Internal Revenue Service, with most of that money going toward enforcement efforts. While the focus will be on wealthier tax evaders, all of us want to avoid undue IRS attention. So with more tax examiners on the way, it's a good time for a refresher on audit red flags none of us want to fly. (Aug. 8, 2022)
  • Tax Tip; click pencil for all tax tip links

  • The 2022 Tax Tips offer ways to file your annual return, along with post-filing advice, important tax news and, of course, ways to cut your current tax year bill. You'll find the monthly assemblages on their own respective pages: January, February, March, April, May, June, July, August, September, October, November and December. Remember, tax tasks and tips don't stop after you file your annual return!

COVID-19 & Taxes

  • COVID-19
    Coronavirus has wreaked havoc
    on the 2020 and 2021 tax seasons.
    These three Coronavirus (COVID-19) and Taxes pages have details:
    March-July 2020,
    August-December 2020,
    January-December 2021, and
    January-… 2022
    You can find medical coronavirus resource links further down this column.

All About Kay

  • OK, some about Kay
    Open sign
    Kay Bell — Native Texan (the blog title totally makes sense now, right?). Professional journalist. Tax geek.

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Tick ... Tick ... Tick

  • Tax Season 2022 continues!

    Tax Day 2022 is finally over … unless you're one of the millions who have more time to file — looking at you taxpayers abroad and those in major disaster areas — or you got an extension to file your 2021 tax year return. That's fine. In fact, the Internal Revenue Service appreciates some of us spreading out our filings, especially when we and the agency still are dealing with all the complications of COVID-19 and taxes.

    That's why the ol' blog's focus now is on all y'all still working on returns. But I haven't forgotten my organized taxpayer readers, who are already looking for ways to reduce their 2022 tax year bills. Yep, that amount is adding up, but there are moves you can make. The monthly tips and reminders a little further down this column can help everyone, regardless of which tax year you're working on.

    Those on extension should keep a keen eye on the countdown clock below. It will help you track the days tick, tick, ticking off toward that absolutely final fall filing due date of Oct. 17. Yep, it's a few days later this year.
    Note: I'm in the Central Time Zone, so adjust accordingly for where you live.


Time for Tax Tasks


  • monthly tax moves


  • The Dog Days of Summer
    are here!

    For many of us, that means taking it easy like the pup below during these hot, sultry August days as summer winds down.

    via GIPHY


    But we can't dog it too much.
    Making some potentially money-saving tax moves this August can really pay off. So let's get to it!


    Aug. 1: School soon will be back in session. That means students need supplies. Good news for them and their parents: this month 15 states are holding back-to-school sales tax holidays. These no- or reduced-tax events are in Arkansas, Connecticut, Illinois, Iowa, Maryland, Massachusetts, Missouri, New Jersey, New Mexico, Ohio, Oklahoma, South Carolina, Texas, Virginia, and West Virginia.

    Aug. 5: The tax holidays will help ease the high cost of school supplies and other qualifying purchases a bit, especially in these inflationary times. But some taxpayers are agetting more help. Sixteen states are issuing inflation relief payments. If you're in one of them, make sure your state tax department has your correct information, since that's how most of the inflation aid money will delivered.

    Aug. 10: Restaurants are still recovering from the challenges of operating during a national health crisis, especially now that new COVID-19 variants are spreading. If your favorite eatery is now seating diners indoors, still take precautions, aka mask on until that meal arrives, please! If you're still doing take-out and deliveries, those business owners appreciate that support, too. And regardless of whether you're eating out or still getting food brought to your house, remember to tip your server or delivery person.

    restaurant check tip iStock
    If a tip isn't included in your food delivery charge, click the image above to calculate how much to tip the person who brought it to you.

    As for servers who now are back on the job, remember that your tips are taxable income. If you worked at least some of July at a job where you got gratuities, you need to account for them today if they came to at least $20 last month. Use Form 4070 to report your tips today to your employer.

    Aug. 17: Did you get an extension back in April to file your tax return this fall? Well, that new due date — Oct. 17 — is now just two months away. But you don't have to wait until that day is, well, just days away. You can get to work on your tax paperwork now and be done with it any time before then.

    Whenever you do get around to finishing your tax return, the IRS recommends you do so electronically. Check out ways to e-file at no cost, including via Free File, which is, as its name says, free. The official electronic filing webpage is Free File on IRS.gov is available to qualifying taxpayers until midnight, Eastern Time, on Oct. 17.

    IRS Free File; click image for details

    Free File this year is available for taxpayers whose adjusted gross income is $73,000 or less. That income level applies to all filing statuses. This year, 8 software programs are available to eligible filers. Spoiler: The two biggies, Intuit's TurboTax and H&R Block, are not among the choices. The two leading tax prep programs decided to end their participation in the program.

    Aug. 22: The early part of the 2022 Atlantic/Gulf of Mexico hurricane season was, thankfully, not that bad. But August is when things tend to literally start heating up. The National Oceanic and Atmospheric Administration's (NOAA) National Hurricane Center says that most tropical storm activity occurs between mid-August and mid-October. If you haven't yet prepared — physically, financially, and tax wise — it's time to do so

    Hurricane satellite image

    Uncle Sam's official forecasters at the NOAA Climate Prediction Center expect 2022 to bring as many as 21 named storms, with six to 10 possibly becoming hurricanes. Three to six of those could reach major status, which is category 3, 4 or 5 with winds of 111 mph or higher. Regardless of the count, it only takes one to wreak havoc. The countdown clock below can help you keep track of how many more days you have to worry about tracking any size or type of tropical storms.



    You also might want to check out the ol' blog's special Storm Warnings.
    These multi-page collections of posts offer tax advice on preparing for, recovering from and helping those who sustain damages from the many ways that that weather goes wild. That includes claiming uninsured losses from a major natural disaster as an itemized tax deduction.

    Aug. 26: The stock market has been up and down, then up and down, then … You get the idea. All the gyrations mean it's time to review your portfolio. Periodic rebalancing to meet your financial goals also could provide a tax break. If some of your taxable holdings have dropped in value, you can sell them and use the loss to offset other assets' gains. Remember, though that this tax loss harvesting strategy should be used only is you really want to sell the asset, not just use it to cut taxes. As the old (and apropos this month) saying goes, never let the tax tail wag the financial dog.

    Aug. 31: If you've already filed your 2020 taxes, were you surprised by either the size of your refund or how much you owed? If so, now's the time to make sure that doesn't happen next year. The IRS' online estimator can help you more accurately adjust your payroll withholding.

    Small Business Tax Calendar: Important filing, deposit and record keeping dates throughout the year that your company needs to know. You can get more tax calendar information at the IRS' online calendar page and view the full year's important business and individual tax dates in IRS Pub. 509.

State Tax Help

  • Don't forget your state taxes!
    Forty-three states and D.C. collect personal income taxes. But even if you live in of the seven states without an income levy, you still face other state (and local) taxes.

    State Tax Departments provides links to your state's Web page. The companion page, Tax Tidbits, is the compilation of blurbs about each state's tax laws. And for more state tax news, check out all our state tax bloggings.

Tax Forms

  • Tax Forms
    Thanks to our increased use of tax preparers and computer software, many of us don't see our tax forms until we sign and file them. But knowing what's on these documents, either in paper or digital form, and why the IRS wants it is key to understanding our tax system. And knowledge definitely is power, especially when it comes to tax savings. Find this valuable information in the ol' blog's special Talking Tax Forms page.

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    The content on Don't Mess With Taxes is my personal opinion based on my study and understanding of tax laws, policies and regulations. It is provided for your private, noncommercial, educational and informational purposes only. It is not a recommendation of any specific tax action(s) you should or should not take. Similarly, mentions of products or services are not endorsements. In other words, my ramblings on the ol' blog are free advice and you know what they say about getting what you pay for. That's why when it comes to filing your taxes, I urge you to get additional, professional, paid-for guidance from an accountant, Enrolled Agent or other qualified tax preparer who is familiar with your individual tax circumstances.

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Tell it to the Hill

  • DMWT Politics Posts
  • While it's easy to rail at the IRS, for the most part we can thank — or blame — our tax laws on Congress and the White House. So if you have an issue with tax legislation or want a tax bill passed, you need to let your federal legislators and the White House occupant know of your concerns. You can find out who in Washington, D.C., to contact (and how), as well as get information on your local lawmakers for matters, tax or otherwise, closer to home, at USA Gov.

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