Thursday, October 7, 2021

What Is the Capital Gain Tax?

 Capital Gains Tax

Capital gains are the profits realized from the sale of capital assets such as stocks, bonds, and property. The capital gain tax is triggered only when an asset is sold, not while the asset is held by an investor. However, when a mutual fund sells shares of its holdings during the year, mutual fund investors could be charged capital gains. (A fund’s capital gains distribution is not taxable if the fund is held in a tax-deferred account.)

There are two types of capital gains: long term and short term; each is subject to different tax rates. Long-term gains are profits on assets held longer than 12 months before they are sold by the investor. The American Taxpayer Relief Act of 2012 instituted a long-term capital gains tax rate for taxpayers of up to 20%. Short-term gains (on assets held for 12 months or less) are taxed as ordinary income at the seller’s marginal income tax rate.

Social Security’s Uncertain Future: What You Should Know

Social Security is a pay-as-you-go system, which means today’s workers are paying taxes for the benefits received by today’s retirees. However, demographic trends such as lower birth rates, higher retirement rates, and longer life spans are causing long-run fiscal challenges. There are simply not enough U.S. workers to support the growing number of beneficiaries. Social Security is not in danger of collapsing, but the clock is ticking on the program’s ability to pay full benefits.

Photo of Social Security Administration building

Each year, the Trustees of the Social Security Trust Funds provide a detailed report to Congress that tracks the program’s current financial condition and projected financial outlook. In the latest report, released in August 2021, the Trustees estimate that the retirement program will have funds to pay full benefits only until 2033, unless Congress acts to shore up the program. This day of reckoning is expected to come one year sooner than previously projected because of the economic fallout from the COVID-19 pandemic.

Thursday, September 30, 2021

Audit: IRS Needs to Improve How It Wipes Taxpayer Data from Devices

 Computer and laptop hard drives that aren’t properly scrubbed could allow exposure of private taxpayer data.

A report from the U.S. Treasury Inspector General for Tax Administration found flaws regarding how the IRS sanitizes—or gets rid of—taxpayer data contained on agency-owned desktop computers and laptop hard disks.

Read more at NextGov - 2 min. read

IRS: New Contracts Awarded to Private Collection Agencies

WASHINGTON — The Internal Revenue Service has awarded new contracts to three private-sector collection agencies for collection of overdue tax debts. The new contracts begin Thursday following today's expiration of the old contracts.

Beginning Thursday, Sept. 23, 2021, taxpayers with unpaid tax bills may be contacted by one of the following three agencies:

CBE Group, Inc.
PO Box 2217
Waterloo, IA 50704
800-910-5837

Coast Professional, Inc.
PO Box 526
Albion, NY 14411
888-928-0510

ConServe
PO Box 307
Fairport, NY 14450
844-853-4875

The IRS will always notify a taxpayer before transferring their account to a private collection agency (PCA).

Read more at IRS.gov - 5 min. read

Monday, September 27, 2021

How the wealthy are preparing for higher taxes

 As Democrats get closer to raising taxes, financial advisors and their well-off clients are taking steps now to avoid some of those steeper levies later.  “Our clients are concerned,” said Michael Nathanson, CEO and chair of The Colony Group. “This would be among the largest tax increases in history.”

Read more at CNBC - 4 min. read

Many People Left Waiting For Payments From IRS For Tax Refunds, Stimulus Checks, Child Tax Credits

 The IRS is acknowleding the delays for some child tax credit payments, some stimulus checks and some refunds but it essentially says its doing the best it can ...

Read more at KDKA2 CBS Pittsburgh - 2 min. read

Sunday, September 26, 2021

Fourth Stimulus Check: Is Another Relief Payment Coming?

 A fourth stimulus check could help those still struggling to make ends meet. A few places, including California, have recognized that need for additional help and stepped up with additional payments. But will the Internal Revenue Service (IRS) provide another stimulus check in 2021?

Read more at 62CBS Detroit - 6 min. read