NOVA Tax Group

IRS is raising the 401(k) contribution limit by record amount — CBS News The tax agency said it is also boosting the contribution threshold for IRAs due to inflation.

COVID Tax Tip 2022-04: Tax filing step 1: Gather all year-end income documents COVID Tax Tip 2022-04: Tax filing step 1: Gather all year-end income documents Internal Revenue Service (IRS) sent this bulletin at 01/06/2022 10:03 AM EST IRS Tax Tips January 6, 2022 Useful Links: IRS.gov Help For Hurricane Victims News Essentials What's Hot News Releases IRS - The Basics IRS Guid...

Families who got the child tax credit last year need to watch for this letter from the IRS The IRS will be sending Letter 6419, which shows how much families received in advanced child tax credit payments, in January.

This is a good time to think about reviewing your 2022 payroll deductions especially with the recently announced increase to 401k salary deferral amount for 2022.

IRS increases limits for 401(k) plans to $20,500 for 2022, leaves individual retirement accounts unchanged The IRS has announced 2022 retirement contribution limits, with a boost to $20,500 for workers with a 401(k) plan.

Virginia State extends individual income tax filing deadline to May 17th to align with the IRS.

When to File | Virginia Tax File and pay by Monday, May 17. Filing electronically is the fastest, easiest, and most efficient way to file your return. Note: This extension does not apply to estimated payments.

Treasury, IRS extend filing and payment deadline for individuals to May 17th.

Tax Day for individuals extended to May 17: Treasury, IRS extend filing and payment deadline | Internal Revenue Service IR-2021-59, March 17, 2021 — The Treasury Department and Internal Revenue Service announced today that the federal income tax filing due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021, to May 17, 2021.

IRS delays the start of tax season, but the filing deadline is still April 15th.

https://www.cnbc.com/2021/01/15/irs-delays-start-of-tax-filing-season-to-feb-12.html

IRS delays start of tax filing season to Feb. 12 The IRS will begin receiving 2020 income tax returns on Feb. 12.

Another big annual increase in the social security wage base for 2021. This makes the S Corporation tax election even more valuable for a small business if it is the right fit. Remember, your company does not need to be a corporation. An LLC can elect S Corporation status.

https://www.cnbc.com/2021/01/07/social-security-tax-cap-2021-heres-how-much-you-will-pay.html

The Social Security tax cap kicks in at this salary figure in 2021 If you have a traditional job, you pay 6.2% of your salary per year in Social Security taxes, but there's a limit on how much you owe. Here's a breakdown.

https://apple.news/Ap3Xdg6H7Q-O0VHH2JnJ_kg

You Still Have Time To Hit 401(k) Contribution Limits For 2020 — Investor's Business Daily There's still time to meet higher 401(k) contribution limits for 2020. Here's how they compare to last year's caps, and what workers should know about 2021.

https://snip.ly/t4zfzz ://www.collegesavings.org/peace-of-mind-for-parents-as-students-head-back-to-campus-this-fall/

Peace of Mind for Parents as Students Head Back to Campus 529 College Savings Plans to the Rescue in Uncertain Times By Patricia Roberts, Chief Operating Officer at Gift of College July 28, 2020 Tuition and room and board payments are coming due while many colleges and universities have yet to finalize their plans for the upcoming semester. Parents remain....

If you invest in or use virtual currency, then take your time on the new Schedule 1 of your 2019 tax return. There is now the following required YES or NO question regarding Bitcoin and other virtual currency.

“At anytime during 2019, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?”

The IRS treats virtual currency like property and there can be gain/loss each time it is sold/exchanged. So if you check YES and sold/exchanged virtual currency in 2019 then you should be reporting transactions. If you check YES and did not sell/exchange in 2019, be sure to keep records and track the purchase price so you can calculate your gain/loss in future years.

Also some of these transactions are now being reported to the IRS on 1099 and the IRS has subpoenaed several crypto exchanges to get account information. So be careful this year on this new questions and do not let this get checked as NO if you had any virtual currency transactions during 2019.

https://www.forbes.com/sites/kellyphillipserb/2020/02/06/dont-forget-about-cryptocurrency-like-bitcoin-at-tax-time/

Don’t Forget About Cryptocurrency Like Bitcoin At Tax Time As I reported late last year, early drafts of Form 1040 reflected a new question on the top of Schedule 1, Additional Income and Adjustments to Income (downloads as a PDF).

NOVA Tax Group updated their business hours.

2019 Tax Season is open!

https://www.cbsnews.com/news/2019-taxes-january-27-first-day-to-file-refund/

Tax filing starts today. Here's how long a refund takes About 4 of 5 taxpayers will receive a refund this year. It's often a taxpayer's biggest annual "paycheck."

In addition to the Secure Act reviewed below, the spending bill also revived some popular "extender" tax breaks that were not passed for 2018 tax season. Well they were just extended for 2018 (retroactively), 2019, and 2020. These include:

(1) SCH A Deduction for PMI premiums
(2) Tuition and Fees above the line deduction for qualified education expenses
(3) 7.5% AGI floor for medical expense deductions is extended and will not increase to 10%
(4) Qualified mortgage debt forgiveness income exclusion extended

These are retroactive to 2018 so you need to review you prior tax return and see if an amendment would be worthwhile.

https://www.forbes.com/sites/kellyphillipserb/2019/12/17/tax-extenders-bring-back-somebut-not-allpopular-deductions/

Tax Extenders Bring Back Some - But Not All - Popular Deductions Extenders are the term used to refer to expired or expiring tax provisions, and tend to be short-term.

The new spending bill passed the Secure Act which brings several changes to retirement account rules for 2020 planning. The major changes include:

(1) Delayed RMD withdrawals until age 72 instead of 70 1/2.
(2) Lifts age limits on IRA contributions. Previously IRA contributions were blocked at age 70 1/2.
(3) Eliminate most stretch IRA distributions for beneficiaries of inherited IRA accounts. This stretch IRA estate planning tool allowed decedents to pass on IRAs to young beneficiaries who could then spread out IRA distributions based on their life expectancy. While there are exceptions, this will no longer be the powerful estate planning tool it once was.

We may also see annuity options pop up in employer benefit plans.

https://www.barrons.com/articles/the-secure-act-what-it-will-mean-for-your-401-k-and-ira-51576666801

Congress Passed the Secure Act. Here’s What It Will Mean for Your 401(k) and IRA. The Setting Every Community Up for Retirement Enhancement—better known as the Secure Act—is the first major piece of retirement legislation in a decade.

Big changes to the w4 form for employees to determine their withholdings. It had to be done with the new tax rules. The form can be straight forward if you are single and just one job. However, if are married with two incomes or have more than one job, then it gets a little more complicated. As usual, they don't make it easy. This will also be new information for payroll systems to adjust to as well.

https://nyti.ms/34gPI3Q

Check Out the New W-4 Tax Withholding Form. Really. The first major redesign since 1987 is simpler and reflects tax code changes, the I.R.S. said. Workers should make sure it also reflects what they owe.

Reminder: Open enrollment for federal healthcare begins November 1st in most states and runs to December 15th, 2019.

It's also a great time to review health care options through your employer as well.

https://www.cpapracticeadvisor.com/payroll/news/21112403/health-insurance-open-enrollment-season-5-questions-to-ask

Health Insurance Open Enrollment Season: 5 Questions to Ask The AICPA’s 360 Degrees of Financial Literacy program is urging Americans to take this opportunity to carefully review their family’s financial situation and insurance options to pick out the best coverage plan for their household.

Think you misplaced a tax form?? Not a great feeling.

Good tweet by IRS to promote the online transcript tool. It is really easy to set up account and download several types of transcripts. All the information that is reported in your social security number to the IRS in a given year can be downloaded in a few minutes.

Caution! Do not respond to any emails or email links to get a transcript. Go directly to the IRS website to get your transcripts.

https://www.irs.gov/individuals/get-transcript

https://twitter.com/IRStaxpros/status/1170012236926070784?s=20

IRS on Twitter “ : Your client may need an tax transcript for many reasons, such as applying for a mortgage or a student loan. Help her get started with this : https://t.co/Z1DKVP1BxT”

IRS Introduces New Tax Withholding Estimator To Help Taxpayers Avoid Surprises In 2020 The IRS has launched a new Tax Withholding Estimator that they hope will make it easier for everyone to figure the right amount of tax withheld during the year.

IRS warns taxpayers about new twists on scams
With the arrival of tax bills and refunds in the late spring and early summer, the Internal Revenue Service (IRS) is also warning taxpayers against various tax scams that have begun to crop up.

Click the link to read more:
https://www.foxbusiness.com/features/irs-taxpayers-new-scams

IRS warns taxpayers about new twists on scams With the arrival of tax bills and refunds in the late spring and early summer, the Internal Revenue Service (IRS) is also warning taxpayers against various tax scams that have begun to crop up.

Great article on the free tax software options out there and the risks regarding privacy. Definitely be careful and read the fine print. NOVA Tax Group offers low cost filing fees for basic tax returns and privacy is a number one priority.

Review | When tax prep is free, you may be paying with your privacy “Free” tax software is not all created equal. Some want to upsell you. Others want the data in your tax return.

There are a few tax breaks for Tax Year 2018 that still haven't been approved yet. If you might benefit from these tax extenders: deductions for mortgage insurance and college tuition and fees, you might want to delay filing. Read below.

Congress has yet to approve these valuable tax breaks for 2018 Whether you own a home or you're shelling out for higher-education costs, Congress has yet to approve these breaks known as tax extenders.

Despite the government shutdown, the Internal Revenue Service confirmed that it will process tax returns beginning January 28, 2019 and provide refunds to taxpayers as scheduled. Click on the IRS News Letter below to read more.

IRS Confirms Tax Filing Season to Begin January 28 | Internal Revenue Service IR-2019-01, January 7, 2019 ― Despite the government shutdown, the Internal Revenue Service today confirmed that it will process tax returns beginning January 28, 2019 and provide refunds to taxpayers as scheduled.

Reminder that Open Enrollment for health insurance through Healthcare.gov for 2019 ends on December 15th.

-There is no longer an individual mandate for health insurance coverage for 2019 so uncovered individuals will not face a tax penalty

-There are additional cheaper "short term" plans with less coverage that are being offered for longer terms

Obamacare Open Enrollment Starts Today. Here's What to Know About This Year's Changes Plus what to consider about short-term plan options.

We posted about the increases to retirement plans for 2019. Here is another item to review as many get ready for open enrollment for benefits. If available to you, here is a great idea to think about with medical savings accounts. They can work together to save a lot in taxes. Let us know if you have any questions about pre-tax medical expense accounts.

Advantages of Stacking Limited Health FSA with HSAs Some may think that enrolling in a Health Savings Account (HSA) means that you no longer can or need to participate in a Health Care flexible spending account (FSA) and that is not necessarily true in all circumstances.

IRS Announces 2019 Retirement Contribution Increases

IRA Contributions will increase from $5,500 to $6,000. The additional catch up for 50 and older will remain at $1,000.

401(k)s, 403(b)s, most 457 plans and the federal government's Thrift Savings Plan will increase from $18,500 to $19,000. The catch up for 50 and older will remain at $6,000.

Make those changes early in 2019 to take advantage of these increases and not have to use up more net pay to catch up later in the year.

The IRA and ROTH IRA contribution rules can be tricky.

For more information or to set up a free consultation, visit us at:
https://www.novataxgroup.com/

Retirement contribution limits will rise in 2019 Good news retirement savers: The Internal Revenue Service announced cost of living increases to the contribution limits for retirement-related plans in 2019.

Review Your Paycheck Tax Withholdings for 2018!

The GAO has reported that many of us should review how much tax is being withheld from our paychecks. The new Tax Act brought many fundamental changes including new tax rates. As part of this change, paychecks and withholdings were adjusted in the beginning of the year. You may have noticed an increase in take home pay early in 2018. However, the w4 paycheck withholdings may be withholding too much or more importantly too little.

There is still time to make adjustments for 2018 or at least be well prepared for a potential April bill. And you can adjust for 2019 as well.

We help many clients review their paycheck withholdings for 2018 and be ready for the new tax law.

For more information or to set up a free consultation, visit us at:
https://www.novataxgroup.com/

30 million people are not withholding enough for taxes. How to tell if you’re one of them About 2 in 10 taxpayers will be writing a check to Uncle Sam next spring. Here's how to make sure you don't wind up with a huge tax bill in 2019.

The tax deadline has passed for most taxpayers to file their tax returns. If you haven't filed a 2017 tax return yet, it's not too late, and it may be easier than you think. Filing can reduce penalties and head off much more time-consuming and damaging enforcement actions. Contact us and we can help get you filed.

https://www.novataxgroup.com/newsletter.php #2

IRS Announces 2018 Filing Season Opens January 29, Reminds Taxpayers About Delayed Refunds The Internal Revenue Service (IRS) has announced that tax season will open on Monday, January 29, 2018. The IRS will begin accepting paper and electronic tax returns that day, with more than 155 million individual tax returns expected to be filed in 2018.

Most counties offer real estate tax relief if you are 65 years or older or disabled, Check with your county for more details. Example below: Fairfax County, VA.

Tax Relief - Frequently Asked Questions - Fairfax County, Virginia Tax Relief - Frequently Asked Questions

Don't become a victim of tax-related identity theft. Read these tips from the IRS to help reduce your risk of becoming a victim and steps to take if you do become a victim. Nova Tax Group would also like to recommend filing your return as early as possible to reduce the chances of tax-related identity theft, especially if you are expecting a refund,

Taxpayer Guide to Identity Theft For 2016, the IRS, the states and the tax industry joined together to enact new safeguards and take additional actions to combat tax-related identity theft. Many of these safeguards will be invisible to you, but invaluable to our fight against these criminal syndicates. If you prepare your own retur…

Only a few days remaining to enroll in a Healthcare plan for 2016. The deadline is Sunday, January 31st after which the enrollment period will be closed for the remainder of the year. Follow the link below to read more from CMS and to see the average rate change in premiums.

2015-10-26 - Centers for Medicare & Medicaid Services The page could not be loaded. The CMS.gov Web site currently does not fully support browsers with “JavaScript” disabled. Please enable “JavaScript” and revisit this page or proceed with browsing CMS.gov with “JavaScript” disabled. Instructions for enabling “JavaScript” can be found here. Please note…

The Tax Season has official begun and the Nova Tax Team would like you to stay vigilant against tax scams. Please read the following article from Forbes staff writer, Kelly Phillips Erb:

http://www.forbes.com/sites/kellyphillipserb/2016/01/19/tax-season-opens-today-and-the-scammers-are-ready/

We hope you are having a great start to the New Year!

The NOVA Tax Group team is ready to start the 2016 tax season. We are excited to introduce our updated website, www.novataxgroup.com. The new site has lots of great tips and strategies for individuals and small businesses, but more importantly for the upcoming tax season, the site has 2 options to upload and send your documents easily and securely.

We are excited to introduce a new member of the team, Benny Piccolo. As an experienced CPA, Benny rounds out our team of tax professionals. In addition, we have expanded our offerings to include accounting, payroll, and bookkeeping services for entrepreneurs and small businesses. And as always, we have Pat Kerns to guide us through the tax season.

NOVA Tax Group is geared up and ready. Please feel free to contact us anytime to get your tax returns started!