New Rules for 2014 Taxes

While taxes are certain in life, there is no guarantee that the rules that apply to these taxes will remain the same each year. In fact, 2013 saw a number of IRS changes that will affect many taxpayers, especially those in the upper tax brackets.

Here’s what you need to know this tax season, which opens January 31st:

If your income is above $200,000 (or $250,000 as a married couple filing jointly)…

* All or part of your net investment income may be subject to an additional 3.8% Medicare tax.

* If your income is a combination of salary and self-employment income, you will be responsible for an additional 0.9%    Medicare tax (on top of the original 2.9%).

If your income is above $250,000 (or $300,000 as a married couple filing jointly or $275,000 for head of household)…

* Some personal and dependent exemptions might be cut down or eliminated.

* … Read More

IRS Aims to Make FSA more Flexible

If you have ever found yourself frantically digging through old receipts in an attempt to claim the remaining dollars in your Flexible Spending Account (FSA) before the end of the year—or worse, realizing with dismay on January 1st that you still had money in the account—you know how frustrating the IRS’ “Use or Lose” rule for FSAs has been in the past.

That’s right—in the past. Last month the IRS announced a few changes in this rule, which gives employers the opportunity to take some of the stress out of their employees’ end-of-year spending. Got some extra cash sitting in that FSA on December 31st? No problem—the new rule says you may be able to roll it over to next year.

This is good news for the 33 million Americans who use FSAs to funnel pre-tax dollars toward healthcare expenses, including those that might otherwise not … Read More

IRS Announces Late Start to Tax Season

The effects of the recent government shutdown are beginning to appear in various federal offices, including the Internal Revenue Service.

The IRS announced last week that the 2014 tax season, which was scheduled to begin on January 21, will be delayed by at least a week. The service will not be accepting or processing individual returns until at least January 28—though that date could be pushed back as far as February 4.

The delay may affect you as a taxpayer in two main ways—you won’t be able to file your return until possibly the beginning of February, and any communication you tried to make with the IRS during or immediately prior to the shutdown will receive a delayed response.

Nearly 90% of the IRS was closed during the shutdown, creating a 16-day delay that resulted in missed appointments, delayed implementation of installment plans, and a significant backlog of work that will … Read More