President Trump and Republican leaders have positioned their sweeping tax rewrite as a way to cut taxes on the middle class. But some top officials are now saying the plan may not benefit everyone in that income group.
The IRS announced on Thursday that the limit on elective deferral for contributions to 401(k) plans, 403(b) plans, most 457 plans, and the federal government’s Thrift Savings Plan will increase from $18,000 in 2017 to $18,500 for 2018. However, the catch-up contribution limit for those 50 and older remains $6,000. Most other inflation-adjusted amounts related to pensions increased from 2017 to 2018.
Worker classification remains a priority. The Service continues to seek back taxes and penalties from firms that wrongly treat workers as contractors. Unreported or under reported employment taxes make up a big chunk of the overall federal tax gap. The Labor and Justice departments and the states also have vital roles to play in ensuring that workers are properly classified by the businesses they work for. Continue reading “Worker Classification”
Just released a long-awaited tax reform framework on September 27 that calls for ambitious cuts to tax rates for corporations, passthrough entities, and individuals; a more generous – albeit temporary – expensing regime; significant increases to the individual standard deduction and the child tax credit; and repeal of the estate tax and the individual alternative minimum tax.
Taxpayers who are divorcing or recently divorced need to consider the impact divorce or separation may have on their taxes. Alimony payments paid under a divorce or separation instrument are deductible by the payer, and the recipient must include it in income. Name or address changes and individual retirement account deductions are other items to consider. Continue reading “Divorce or Separation May Affect Taxes”