It's the season for filing your 2014 tax return - and time to know how the tax laws have changed for 2015. Knowing what's new now can save you lots of money, and possibly a lot grief, in the long run.
Here's a one-stop shop for tax-code changes to be aware of. Forbes.com lays out some easy-to-read tables showing the 2015 tax rates on incomes for individuals, married couples, trusts, and so forth. The page is one of the handiest out there, with summaries of changes such as new higher personal exemptions and standard deductions, and limits on itemized deductions for high earners. Also find updates on education credits, student-loan deductions, flexible spending accounts.
If you are age 50 or over and can contribute to a 401(k) plan at work, the amount of money you can sock away in that retirement account has jumped to a whopping $24,000 - assuming you can spare that kind of dough. That's $6,000 more than the limit for workers under age 50, the difference being considered a "catch-up contribution," notes this post at Investopedia.com. It says income limits have risen in 2015 for those who contribute to IRA accounts, but a strict rule is now in force to limit rollovers among IRA accounts.
The IRS keeps up a stream of announcements meant to steer taxpayers in the right direction through the year, as well as during the tax season. The agency's "Latest News" page warns us "to be on the lookout for unscrupulous tax return preparers pushing inflated tax refund claims. Taxpayers should be wary of anyone who asks them to sign a blank return, promises a big refund before looking at their records, or charges fees based on a percentage of the refund." The IRS continues to urge vigilance on identity theft, and other scams, and issues reminders about changes for the 2015 tax year.
Find a list of the "weirdest deductions" under the tax code at the Christian Science Monitor, as part of an article on the current tax season. For example, some indigenous Alaskans can deduct whale-hunting expenses. And the post reports this surprise: "A clarinet and lessons can be considered tax deductible if a doctor has recommended playing the instrument as a method of correcting an overbite." The Monitor also notes that as of now the Treasury Department considers cryptocurrencies such as bitcoin as a tradable good, not a currency. That means the IRS wants you to declare its market value for tax purposes.
Obamacare (the Affordable Care Act) is a 2014 and 2015 wild card in tax calculations for many people. Read up on those tax changes in this Reuters article: