The IRS will soon implement a new process that automatically provides penalty relief for taxpayers with a history of filing returns and paying tax dues on time. This new relief system is expected to be phased in this summer.

The new Automatic Exemption from Penalty will replace the long-standing First Time Abate administrative relief and is designed to simplify the process and reduce burden for those with a timely compliance history.

“Automatic Exemption from Penalty reflects the IRS’ commitment to making the payment of taxes owed simpler and more consistent,” said IRS Chief Executive Officer Frank J. Bisignano. “By automatically applying penalty relief, the IRS recognizes that taxpayers who historically pay on time should not have to make a formal request for relief that is routinely granted.”

One of the questions I tend to get every year is, 'How much tax will I have to pay if someone gives me a lot of money as a gift'.   The answer is nothing.  The facts are that the person giving you the money is the one that may be subject to something called the gift tax.  And while there are a lot of exclusions to the tax, filing the paperwork to exclude yourself is really a pain in the....

That said, there is some good news: most people will never come close to exceeding the lifetime estate and gift tax exemption, which, due to the new 2025 Trump/GOP tax law, will remain extraordinarily high for the average household.

Savings bonds for a long time have been a popular investment to add to your portfolio.  They provide some stability to your investments, a guaranteed rate of return, and can help you save on your taxes.  Some investors have owned Series I savings bonds for many years, and the 30-year maturity date might be approaching. Others have bought them in recent years to insulate their portfolios from inflation and the ups and downs in the stock market.  Either way, you should be aware of the federal income tax rules.

It seems that you can find a study about just about anything these days.  I was readying about a study that  was done at the University of Michigan, using data from the U.S. Treasury Department to determine if it matters whose name is listed first on a tax return.

The study - titled "Who''s on (THE 1040) First? Determinants and Consequences of Spouses'' Name Order on Joint Returns" -  suggests the answer could be yes — that the tax return name order may hold some clues about social dynamics and beliefs.

Property tax rates are on the rise nationwide, creating challenges for many homeowners, including retirees. Data shows that last year’s property tax bills increased up to 30% in some places. 

If you own a home, you can''t avoid property taxes altogether without risking penalties. However, some strategies and programs, an lower your property tax bills and help your budget.

Property tax exemptions

Exemptions are a common method for lowering property taxes. Please note that the specific requirements and exemption amounts can vary widely by state and even by county within a state. It''s best to check with your local tax assessor''s office for the most accurate and up-to-date information.

Here are some the more common property tax exemptions that could help your budget.

When the tax laws changed in 2018, most people no longer had to use the itemized deductions (Schedule A), but found it easier and more beneficial to just use the standard deduction.  Generally, I find that there is a small minority that still itemize.  They usually have a lot of property taxes, large amounts mortgage interest and give a generous amount to charities (such as tithing 10% to their church).

What most people don't know about is that you can use your charitable giving to control the amount of taxes you pay in a particular year.  For example, you can bunch donations into a single year that you usually giver over several years.  On the other hand, if you are expecting to have more income next year, then you'd want to defer some charitable donations and instead make them the following year.

One of the biggest tax pains in the last two decades in the tax preparation world has been when two separated or divorced parents both try to claim the same child - regardless of who had the right to.  You see, the IRS doesn't care what a separation or divorce decree says.  They got tired of reading them to make determinations.   So they came us with the custodial parent rules.

Because they don't trust United States persons resident abroad and green card holders to pay their taxes, the IRS has issued final regulations on required income tax withholding for certain types of retirement distributions. These regulations apply to distributions from deferred compensation plans (such as 401(k)s), IRAs, and commercial annuities.

Under the final regulations, mandatory income tax withholding requirements for periodic distributions (§3405(a)) or non-periodic distributions (§3405(b)) depend on the payee’s residence address given to the payor.

Crowdfunding has become a very popular way for individuals to raise capital. It typically involves funding a project or venture by raising contributions from a large number of people, typically through online crowdfunding sites. Crowdfunding campaigns fund a broad range of projects, from producing a product or new technology to supporting a charitable cause.  Those supporting a product using can buy the product at a reduced price.