How Can a Change in Income Have Unexpected Consequences?

Do you feel like you are unique? Don’t follow the crowd? Go your own way? Well, if you went against your norm and followed the pack and were one of the 7.1 million people who signed up for health insurance by the March 31, 2014 deadline, then keep reading. If you receive advance payment of …

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Key Dates & Milestones: Social Security, Pensions, IRAs, Medicare

There are many age-related financial and planning milestones that you need to be aware of in your sixties. Keep this list in mind. 59 ½ – Penalty Goes Away This is the age at which one can withdraw money from traditional IRAs, 401(k)s or similar retirement plans without restrictions and without an added 10% tax …

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Timing Rules for SEPs and SIMPLE-IRAs Part II

For the most part, SEPs (Simplified Employee Pensions) and SIMPLE (Savings Incentive Match Plan for Employees)-IRAs live up to their billing as easy ways to set aside tax-favored retirement funds for employees and employers. However, contribution rules for these plans are not necessarily straight-forward. To read part I of this post dealing with SEPs, click …

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Timing Rules for SEPs and SIMPLE-IRAs Part I

For the most part, SEPs (Simplified Employee Pensions) and SIMPLE (Savings Incentive Match Plan for Employees)-IRAs live up to their billing as easy ways to set aside tax-favored retirement funds for employees and employers. However, contribution rules for these plans are not necessarily straight-forward. SEP plans: Business owners can set up and fund their SEP …

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Supreme Court Decides Severance Pay is Subject to FICA Tax

In a unanimous decision (with Justice Kagan recused), the Supreme Court, reversing the Sixth Circuit Court of Appeals, has held that severance payments that were made to involuntarily terminated employees and that weren’t tied to the receipt of State unemployment insurance, are subject to tax under the Federal Insurance Contributions Act (FICA). The Court easily …

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Key points of the US – Canada Tax Treaty

The U.S. has entered into tax treaties with many countries in an effort to reduce or eliminate double taxation. The U.S. – Canada Income Tax Treaty is of special interest due to the proximity of this neighboring country. This treaty was signed in 1980 and has since been amended by five protocols. Income from personal …

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Valuation Discounts for Gift of Single-Member LLC Interests

In a split decision by the U.S. Tax Court (Suzanne J. Pierre v. Comm., 133 T.C. No. 2), the court dealt with the issue as to whether a single-member LLC is to be disregarded for transfer tax purposes (i.e., gift tax purposes), thus treating the gift as a direct gift of the underlying property of …

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