Combat-Zone Contract Workers Qualify for Foreign Earned Income Exclusion

The following article was published by the IRS.

tank-203496_1280Certain U.S. citizens or resident aliens, specifically contractors or employees of contractors supporting the U.S. Armed Forces in designated combat zones, may now qualify for the foreign earned income exclusion.

The Bipartisan Budget Act of 2018, enacted in February, changed the tax home requirement for eligible taxpayers, enabling them to claim the foreign earned income exclusion even if their “abode” is in the United States. The new law applies for tax year 2018 and subsequent years.

This means that these taxpayers, if eligible, will be able to claim the foreign earned income exclusion on their income tax return for 2018 when they file. Under the exclusion, taxpayers can choose to exclude their foreign earned income from gross income, up to a certain dollar amount. For tax year 2018, that dollar amount limit is $103,900. Continue reading

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How to Find a Job When You’re Retired

Looking for a job is a job in and of itself. But as we age, it is often assumed that finding a job gets even harder. This may be true if you are trying to complete with a younger demographic looking for a job with the same criteria.

But what if retirees, or those close to retirement, looked at a segment of the market that actually benefited them more than those who are younger. In reality, sometimes being older can give you a distinct advantage when it comes to finding a job.

Here is an example. Retirees can take a part time, temporary, or project-based job that doesn’t come with benefits. These jobs may be readily available since younger workers need to find a job with a full benefits package in order to care for their family. Continue reading

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Taxpayers who Support Dependents Should Check Their Withholding Now

The following article was published by the IRS.

read-515531_1280Taxpayers who support older dependents should head over to the Withholding Calculator on IRS.gov and do a “paycheck checkup” ASAP. They can use the calculator to make sure they are having their employers are withhold the right amount of tax from their paychecks this year.

The Tax Cuts and Jobs Act, which was passed last year, added a new tax credit: the credit for other dependents. This new credit is just one law change that can affect a family’s tax situation this year. So, checking and adjusting withholding now is important to do because it can prevent an unexpected tax bill and even penalties next year at tax time.

The Credit for Other Dependents is available for dependents for whom taxpayers cannot claim the newly expanded Child Tax Credit. These dependents may include dependent children who are age 17 or older at the end of 2018, or parents or other qualifying relatives supported by the taxpayer. Families with qualifying children under the age of 17 should first review their eligibility for the expanded Child Tax Credit, which is larger. Continue reading

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IdentityTheft.gov Helps You Report and Recover from Identity Theft

Today’s world is more connected than ever. While this is generally a good thing, it also increases the likelihood that your personal information can end up in someone else’s hands, which can lead to identity theft.

The first signs of identity theft can be subtle, or they can be blatantly obvious. You may notice an unfamiliar charge on your statement, or a business may not accept a check that you write. Even worse, a debt collector may call you about a bill that isn’t yours.

Identity theft can happen to anyone. If it happens to you, it is important to remember to stay calm. Then visit identitytheft.gov to report it and receive a personal recovery plan. This government website, sponsored by the Federal Trade Commission, helps you create a report that you can use to prove to businesses that someone stole your identity, making it easier to fix problems caused by this theft. Continue reading

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Retirees with Pension Income Should Do a Paycheck Checkup ASAP

The following article was published by the IRS.

seniors-1505943_1280Retirees should do a Paycheck Checkup to make sure they are paying enough tax during the year by using the Withholding Calculator, available on IRS.gov. The Tax Cuts and Jobs Act, enacted in December 2017, changed the way tax is calculated for most taxpayers, including retirees.

Because of this law change, retirees who receive a monthly pension or annuity check may need to raise or lower the amount of tax they pay in during the year. The easiest way to do that is to use the Withholding Calculator or read Publication 505, Tax Withholding and Estimated Tax. Though primarily designed for employees who receive wages, this online tool can also help those who receive pension or annuity payments on a regular schedule, usually monthly or quarterly.

Taxpayers who do not choose to have taxes withheld from their income should make estimated tax payments. This income includes pension and annuity income, and the taxable part of social security benefits. Estimated tax payments are due quarterly. The remaining due dates for 2018 payments are Sept. 17, 2018 and Jan. 15, 2019. Taxpayers can pay their taxes anytime throughout the year as long as they indicate the tax year and where to apply the payment. They can visit IRS.gov/payments to explore all IRS payment options. Continue reading

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Credit Card Tips for Retirees

The golden years might mark the end of working for a paycheck, but it doesn’t eliminate the importance of keeping a solid credit score. Credit scores affect more than just your ability to borrow; even things such as your car insurance rate are determined in part by your credit score.

The way you use your credit cards, in particular, has a huge impact on your credit score. So whether or not you need the use of credit cards in your life, it is important to use them anyway to help build and maintain a solid score. Continue reading

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Taxpayers Can Monitor Their IRS Information Online

success-2917048_1280Taxpayers can access their federal tax information through a secure login at IRS.gov/account. After logging in, the user can view:

  • The amount they owe
  • Their payment history
  • Tax records
  • Key information from their most recent tax return as originally filed

A taxpayer can monitor their personal tax account by keeping track of payments and taxes owed. This online information is the same as what’s provided by IRS representatives. Continue reading

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