Can't pay your income tax? Didn't pay enough in estimates or had too little withholding? Can't pay at all? Do you feel like you have to choose between the frying pan and the fire? You're not alone, and there are ways to settle up with the IRS.
On Friday, December 18, 2015 President Obama signed the 2016 Consolidated Appropriations Act into law. Among its many provisions it is the permanent extension of the ability for a taxpayer to make qualified charitable distributions (QCDs) from individual retirement accounts (IRAs).
There is still some time left to make some income tax savings moves for 2015.
Make deductible charitable contributions on or before December 31. Taxpayers must be itemizing deductions on IRS Schedule A in order to benefit. Be sure to obtain acknowledgment letters for donations greater than $250. Cancelled checks are insufficient to support a deduction for a gift greater than $250.
President Obama, Nov. 2, signed into law the Bipartisan Budget Act of 2015, a two-year budget deal. The legislation raises the federal debt limit and is paid for in part by provisions eliminating two Social Security retirement benefit claiming strategies, a provision to prevent a significant increase in Medicare Part B premiums for some, and provisions that will make it easier for the Internal Revenue Service to audit large partnerships.
Life insurance and retirement plans compose the largest part of the estate for many people. Insurance death benefits, IRAs, Annuities, and 401(k)s do not pass under your will. They pass under contract law to those persons or organizations who are designated as the beneficiary.
What happens if I divorce my spouse and I don't change the designated beneficiary on my insurance policy?
Every state has its own law governing this, but in Pennsylvania the insured's spouse is considered to have predeceased the insured spouse unless it appears the designation was intended to survive the divorce based on the wording of the designation; a court order a written contract between the individual and the spouse or former spouse, or a designation of a former spouse as a beneficiary after the divorce decree has been issued.