To ensure your tax return is filed quickly and without error, double-check this list of commonly-overlooked items. These little pesks are among the commonly missed items reported as hold ups to filing individual tax returns:
Missing forms. Using last year’s tax return as a checklist, double check that all your W-2s and 1099s are received and applied to your tax return. Missing items here will be caught by the IRS mismatch program, creating an unwanted correspondence audit. If you are missing a form, contact the company responsible for issuing them as soon as possible.
Dependent information. If you added a new dependent in 2024, provide the name, Social Security number and birth date to have them added to your tax return. If you have a dependent that shares custody with someone else, discuss the plan for who is going to claim this person. Your tax return cannot be filed if there is a conflict in this area.
Cost basis information. If you sold any assets (typically investments or real estate), you need to know how much it cost you to determine your taxable capital gain or loss. Check your investment statements to ensure that your broker includes the required information and that you believe it is accurate. Sometimes it’s difficult to find this information on the Form 1099-B summary, but it might be listed later in the statement details.
Schedule K-1s. As an owner of a partnership or S corporation, you will need to receive a Form K-1 that reports your share of the profit or loss from the business activity. When you receive your K-1, pay special attention to box 17 (code V) for S corporations and box 20 (code Z) for partnerships. This is where information is included for the Qualified Business Income Deduction.
Digital asset transactions. If you are buying or selling cryptocurrency or other digital assets, provide details to support the cost basis and sales price of each transaction.
Forms or documents with no explanation. If you receive a tax form, but have no explanation for the form, questions will arise. For instance, if you receive a retirement account distribution form, it may be deemed income. If it is part of a qualified rollover, no tax is due. An explanation is required to file your information correctly.
Missing signatures. Both you and your spouse need to review and sign the e-file approval forms before the tax return can be filed. The sooner you review and approve your tax return, the sooner it can be filed.
By knowing these commonly missed pieces of information, hopefully your tax filing experience will be a smooth one.
With the changes happening in Washington D.C., there is now some uncertainty about what tax policies we may see in 2025 and beyond. During this time of uncertainty, it is challenging to create a workable tax plan. But not to fear. There are several things that we DO know about tax changes to start 2025. Here are the key highlights as they are currently known.
What we DO know
Tax brackets and rates. The seven tax rates remain unchanged while the income subject to each rate got a slight bump. After a 5.4 percent increase in 2024, there’s an additional 2.8 percent increase in income subject to each tax rate in 2025. This means more of your income will be subject to a lower tax rate.
Higher retirement plan limits. The amount you can contribute to a 401(k) in 2025 is $23,500, up from $23,000 in 2024. The 401(k) catch-up contribution limit in 2025 stays at $7,500 if you’re age 50 to 59, and age 64+. New in 2025, if you are ages 60 to 63, the catch-up contribution limit increases to $11,250. The annual contribution threshold for IRAs remains at $7,000, as does the IRA catch-up contribution limit of $1,000.
New cryptocurrency reporting rules. New reporting rules in effect as of January 1, 2025 means you’ll need to be more vigilant with tracking your cryptocurrency transactions and complying with the IRS’s digital asset rules. Brokers of digital assets, including cryptocurrency exchanges, custodial services, and certain payment processors, must report sales and exchanges of digital assets to the IRS starting in 2025. Your digital asset transactions will be summarized annually on a new Form 1099-DA. This new reporting of digital asset transactions will be similar to existing reporting for traditional securities such as stocks and bonds.
Changes on the horizon
The 1099-K reporting threshold. If you use third party payment processors like Venmo or sell tickets on apps like SeatGeek, you’re more likely to receive a tax form of your activity that will also be sent to the IRS. The limit requiring your activity to be reported was $5,000 in 2024. In 2025, this threshold is scheduled to be lowered to $2,500, and further lowered in 2026 to $600.
Uncertainty over TCJA provisions. There has been discussion about extending and/or making permanent many of the provisions contained in the Tax Cuts and Jobs Act (TCJA) of 2017. Most of the provisions are scheduled to expire at the end of 2025, so we will pay attention to any legislation forthcoming that could change any of this tax landscape.
Proposed decrease in corporate tax rates. There is also discussion about lowering the corporate tax rate from its current level of 21%, in addition to lowering the effective corporate tax rate from 21% to 15% for domestic manufacturers.
Stay tuned for continuing updates of any tax changes as events unfold in 2025.
Navigating the tax system can be challenging for everyone, whether you’re an adult who hasn’t paid much attention to paycheck deductions or a young person starting your first job. A crucial first step in managing taxes is knowing when to seek help, which begins with understanding what can be taxed.
Here are some key points to help you or someone you know better understand the basics of our tax system.
Different types of taxes
When you think about taxes, income tax is often the first to come to mind. Income tax is what you pay on the earnings from your job or from selling products and services. However, many other types of taxes exist. Here are some of the most common:
Payroll Taxes. Unlike income taxes, which can fund various government programs, payroll taxes specifically support Social Security and Medicare. This tax amounts to 15.3% of most employees’ paychecks, but half is typically covered by the employer.
Property Taxes. These taxes are applied to property ownership, such as your home or vacation property.
Sales Tax. This tax is levied on goods and services you purchase. While state and local governments primarily collect sales taxes, certain items like gasoline are also subject to federal sales taxes.
Capital Gains Taxes. If you sell an investment or property for a profit, you may owe capital gains taxes. Selling stocks, homes, or rental properties at a profit could trigger these taxes.
Estate Taxes. These are taxes applied to the assets within your estate after you pass away.
Inheritance Taxes. As opposed to estate taxes, inheritance taxes are applied when you inherit money or assets after someone else passes away.
Not all income is taxable
While most of your income is taxable, some forms of income are exempt from taxation:
Interest from municipal bonds is generally tax-free.
Life insurance benefits often aren’t taxed.
Capital gains on the sale of your primary residence may be excluded up to a certain limit.
Estate tax exclusions mean only estates exceeding a set dollar amount are subject to tax.
Many employee benefits, such as health insurance, Health Savings Account (HSA) contributions, commuter benefits, and small employer-provided gifts, are also tax-free.
The tax rules governing these various types of income can be complex. That’s why it’s often helpful to have a professional guide you through your particular situation. Having a basic understanding of how taxes work, though, will help you to ask the right questions.
Inflation isn’t the only reason why your wallet or purse feels lighter these days. Sneaky fees are finding their way into things we buy every day. Here are some common fees you may encounter and what you can do to avoid them altogether.
Common areas with sneaky fees
Checking account fees. Banks love to nickel and dime you with fees if you don’t maintain a minimum balance or have sufficient direct deposits. It creates a gotcha moment at the end of the month.
Dealership fees. Buying a vehicle? Dealers are known for tacking on hidden charges like vehicle prep fees. These can easily inflate the sticker price if you’re not paying attention.
Ticket broker fees. Concert or sports event tickets seem expensive enough, but when ticket brokers add an additional service fee, it’s almost enough to make you stay home. These fees can be up to several hundred dollars!
Vacation rental fees. Dreaming of a vacation getaway? Convenience fees, cleaning fees, and other add-ons can push the cost of your vacation rental sky-high, turning your relaxing trip into a financial drain.
Smart moves to outsmart sneaky fees
Here’s how you can fight back.
Understand the fees before you start. For example, when you are considering a rental, get a breakdown of all the fees before you book. The same holds true for buying a car or a plane ticket. The vendors technique of hiding fees to make a service look cheaper does not need to work when you buy.
Negotiate like a pro. Ask questions or challenge fees you don’t understand. Whether it’s a merchant, a car dealer, or a bank, there’s often room to negotiate. You might be surprised how often they’ll waive the fees just because you ask.
Switch providers. Many companies charge for services that others offer for free. Tired of your bank’s account fees? Look for one with a truly free checking account—because yes, they do exist.
Cut out the middleman. Avoid unnecessary fees by dealing directly with providers. For example, if you’re booking a vacation rental, skip platforms like Airbnb that charge a convenience fee and book directly through the owner when possible.
Say no. Sometimes the best way to save is simply not to buy. If a purchase or service comes with fees that seem outrageous, you can always walk away. By saying no, you send a message to companies that you won’t tolerate being taken advantage of—and you’ll save money in the process.
By knowing how to spot and challenge these fees, you can stop the drain on your wallet and take back control of your finances. After all, it’s not just about cutting costs—it’s about standing up for yourself and your money.
At its heart, technology exists to solve problems and enrich our lives, but its journey is rarely straightforward. The rapid integration of Artificial Intelligence (AI) into everyday tools—like search engines, smart speakers, and virtual assistants—perfectly illustrates the challenges that come with disruptive innovation. Here’s a quick look at how AI is improving our lives, but where we also need to take a step back to be more cautious.
The upside of AI: Empowering efficiency
Has instant access. Unlike humans who are prone to distractions, emotions, or getting tired, AI can operate without any such issues. Since it’s powered by algorithms, human-related points of failure such as stress-induced errors are virtually eliminated.
Accelerates data processing. AI can quickly sift through vast amounts of data, pinpointing inconsistencies, outliers, and trends in seconds. Tasks that would take a human hours, if not days, are reduced to mere moments, allowing us to focus on higher-level analysis and decision-making.
Always available for automated tasks. AI automates repetitive tasks, cutting down on administrative busy work and freeing up our time for more complicated tasks. It’s also always available – wherever you have an internet connection.
The downside of AI: Tread carefully
Plagiarism is likely to occur. AI doesn’t care if the information it creates is owned by someone else. This plagiarism can happen when creating music, text, voiceovers, and other forms of creative expression.
AI blends truth AND fiction. While AI excels at many things, fact-checking and proper citations aren’t among them. Like Wikipedia, AI can be a useful starting point but shouldn’t be trusted as a sole authority. AI’s outputs may include inaccuracies, making it unreliable for in-depth research or professional use.
Lacks true creativity. AI may do a great job to organize and repackage information, but it still falls short when it comes to true innovation. Creativity, by nature, is abstract and requires out-of-the-box thinking that AI has yet to master. Its outputs are rooted in existing data, meaning that groundbreaking ideas remain out of reach.
Reduces critical thinking skills. While technology often makes life easier, it can also make us mentally lazier. Think about how difficult navigating a new city would be without GPS! Similarly, if we become overly reliant on AI for decision-making, our critical thinking skills may weaken over time, leading to a decline in actual human intelligence.
Can lead to serious legal and tax issues. Relying on AI for legal, tax, or other professional advice can leave you in hot water. While AI may be appropriate for initial research on a particular issue, remember that AI itself isn’t a registered attorney or tax preparer. You should still rely on the knowledge and experience of professionals when advice is needed.
The verdict: Use AI as a tool, not a crutch
AI has the potential to be a powerful tool to complement our own human ideas and capabilities. It’s far from ready, though, to be the sole source of truth. Like any emerging technology, it should be approached with both curiosity and caution.
MYTH: /miTH/ (noun) – a widely held but false belief or idea
Many myths about the IRS and the tax code have been amplified online in recent years. Here are several myths that if you believe them, could leave you with an expensive tax surprise.
Myth #1: Retirement money is always tax free.
You have retired and withdraw from a 401(k) fully expecting that you won’t owe income taxes. Unfortunately, money withdrawn at any age from a 401(k) – or your traditional IRA – incurs income taxes at your current tax rate.
Lesson Learned: Understand how money in each of your retirement accounts is taxed when withdrawn. Some will have income taxes, some could incur early withdrawal penalties, while some incur no tax at all!
Myth #2: The government won’t find out about a big gambling win.
Gambling winnings are considered taxable income to the feds and most states. The IRS generally wants about a quarter of your winnings from sweepstakes, casinos, bingo, keno, online sports betting, and the like. Casinos and other betting entities also inform the IRS of your winnings over certain thresholds. So it is always best to keep track of your winnings.
Lesson Learned: Gambling winnings fall under tax rules just like other forms of income. Deducting gambling losses is possible, but it has limits that are subject to strict rules. For example, you must itemize deductions on your tax return if you don’t declare yourself a self-employed professional gambler.
Myth #3: Government benefits like unemployment and Social Security aren’t taxable.
Unfortunately, unemployment and Social Security benefits are usually taxable. Unemployment benefits are taxed at your normal tax rate as income at the federal level and in some states. Social Security is taxed, but in a much more confusing way. Supplemental Security Income payments, on the other hand, are not taxable.
Lesson Learned: Plan ahead to mitigate the tax shock. You can have taxes withheld from your unemployment benefits so you don’t have to pay a lump sum when you file your return. With Social Security benefits, understand when and how they can be taxed, since up to 80% of these benefits could be subject to income tax by the federal government.
Myth #4: I work from home and can write off my office expenses.
You can only deduct home office expenses if you operate a business out of your home. If you’re an employee, you’re out of luck. If you do run a business exclusively out of your home, there are still hurdles to clear before you qualify to use the home office deduction.
Lesson Learned: Tax rules can be complicated, even for something that seems as simple as a home office deduction.
If there’s one common theme here, it’s that tax laws can be complex even when they seem simple on the surface. When in doubt ask for help.
SOURCE: 2024 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Disability Insurance Trust Funds, Table II.B1.
2025 Social Security & Medicare Tax Rates
Your employer pays 7.65%
As an employee, you pay 7.65%
If you’re self-employed, you pay 15.3%
NOTE: The above tax rates are a combination of 6.2% for Social Security and 1.45% for Medicare. There is also a 0.9% Medicare wages surtax for those with wages above $200,000 single ($250,000 joint filers) that is not reflected in these figures.
Item 2025 2024 Change
Maximum earning amount subject to Social Security tax $176,100 $168,600 +$7,500
Maximum amount you may pay in Social Security taxes (6.2%) $10,918 $10,453 +$465
• 184+ million people work and pay Social Security taxes
• Social Security has provided financial protection for Americans since 1935
Social Security Payments Explained
• Social Security (SS) retirement benefits are for people who have paid into the Social Security system through taxable income.
• Social Security Disability (SSD or SSDI) benefits are for people who have disabilities but have paid into the Social Security the system through taxable income.
• Supplemental Security Income (SSI) benefits are for adults and children who have disabilities, plus limited income and resources.
Maximum SSI Payments
Filing Status 2025 2024 Change
Individual $967/mo $943/mo + $24
Couple $1,450/mo $1,415/mo + $35
How does Social Security work?
• When you work, you pay taxes into Social Security.
• The Social Security Administration uses your tax money to pay benefits to people right now.
• Any unused money goes into Social Security trust funds and is borrowed by the government to pay for other programs.
• Later on when you retire, you receive benefits.
How to qualify for retirement benefits
When you work and pay Social Security taxes, you earn credits toward benefits. The number of credits you need to earn retirement benefits depends on when you were born.
• If you were born in 1929 or later, you need 40 credits (10 years of work) to receive retirement benefits
• You receive one credit for each $1,810 of earnings in 2025
• 4 credits maximum per year
Did you know you can check your benefits status before you retire?
• You can check online by creating a my Social Security account on the SSA website. If you don’t have an account, you’ll be mailed a paper Social Security statement 3 months
before your 61st birthday.
• It shows your year-by-year earnings, and estimates of retirement, survivors and disability benefits you and your family may be able to receive now and in the future.
• If it doesn’t show earnings from a state or local government employer, contact them. The work may not be covered within Social Security.
As 2024 winds down, here are some ideas to help you prepare your business for filing your upcoming tax return:
Informational returns. Identify all vendors who require a 1099-MISC and a 1099-NEC. Obtain tax identification numbers (TINs) for each of these vendors if you have not already done so.
Shifting income and expenses. Consider accelerating income, or deferring earnings, based on profit projections.
Be prepared to receive a Form 1099-K. You may receive a Form 1099-K from each payment processor from whom you’ve received a payment. In addition to credit card companies and banks, payment processors can include Amazon, Etsy, PayPal, Venmo and Apple Pay. You’ll need to include the 1099-K on your tax return.
Categorize income and expenses. Organize your records by major categories of income, expenses and fixed asset purchases. If your accounting records are accurate, then any tax form should be easy to tie out to your books.
Separation of expenses. Review business accounts to ensure personal expenses are not present. Reimburse the business for any expenses discovered during this review.
Create expense reports. Having expense reports with supporting invoices and business credit card statements with corresponding invoices will help substantiate your deductions in the event of an audit.
Fixed asset planning. Section 179 or bonus depreciation expensing versus traditional depreciation is a great planning tool. If using Section 179, the qualified assets must be placed in service prior to year-end.
Leveraging business meals. Business meals with clients or customers are 50% deductible. Retain the necessary receipts and documentation that note when the meal took place, who attended and the business purpose on each receipt.
Charitable opportunities. Consider any last-minute deductible charitable giving including long-term capital gain stocks.
Cell phone record review. Review your telephone records for qualified business use. While expensing a single landline out of a home office can be difficult to deduct, cell phone use can be documented and deducted for business purposes.
Inventory review. Review your inventory for proper counts and remove obsolete or worthless products. Keep track of the obsolete and worthless amounts for a potential deduction.
Review your receivables. Focus on collection activities and review your uncollectible accounts for possible write-offs.
Review your estimated tax payments. Recap your year-to-date estimated tax payments and compare them to your forecast of full year earnings. Then make your 2024 4th quarter estimated tax payment by January 15, 2025.
Saving money doesn’t have to be a chore. In fact, with a little creativity, it can be both fun and rewarding. Here are some interesting ways to boost your savings without feeling like you’re missing out.
Embrace the 30-Day Rule. If you find yourself wanting to make an impulse purchase, give yourself 30 days to think it over. This rule allows time for the initial excitement to wear off, helping you decide if you truly need or want the item. If you still want it after 30 days, then go for it! If not, you’ve saved yourself from a purchase you may later regret.
Try a No-Spend Challenge. Challenge yourself to a no-spend day, week, or even a month. This means avoiding unnecessary purchases and focusing only on essentials, such as groceries, rent, and utilities. Not only does it help you save, but it also makes you more aware of your spending patterns and helps reset your budget habits.
Have a use-it-up month. Designate a month to use up everything you already have before buying more. This can apply to pantry items, food in the freezer, cleaning supplies, and even beauty products. You’ll be amazed at how much you can save by simply using what you already own instead of restocking.
Create a Fun Jar. Use a clear jar as a visual savings tool. For example, set a goal to fill the jar with loose change or a specific dollar bill, like $5 or $10. This works especially well if you want to save for something fun, like a weekend getaway or a special purchase. Watching the jar fill up can be surprisingly motivating.
Make gifts instead of buying them. Homemade gifts are often more thoughtful and can save you a lot of money compared to store-bought options. You could bake cookies, create a photo album, or craft something unique. DIY gifts don’t just save money, they also add a personal touch that recipients appreciate.
Use a cash envelope system. Using cash instead of debit or credit cards can help control spending. Create envelopes for each budget category (groceries, entertainment, dining out) and place your allotted amount of cash in each. When the cash is gone, you know you’ve hit your limit for that category, which can curb overspending.
NEVER carry a credit card balance. Speaking of credit cards, carrying a balance from one month to another means wasting money on interest expense. Pay yourself – and not your bank! – by paying your credit card off in full every month.
With a little creativity, you can make saving money both fun and rewarding.
Whether you’re a sole proprietor ready to hire your first employee, or you already have employees and think you’re ready to hire your next team member, here’s a two-step process to help make your hiring process a success!
Step #1: Define your needs
Long before you start interviewing, think carefully about why you need an employee and how you’re going to work with the new hire. Do you need someone to bring new skills that the business is lacking? Filling a vacated position? Or are you looking for someone to share your workload and free up your time?
If you’re looking for specific skills, perhaps a fractional hire or a consultant can fill your need.
Remember that hiring an employee will also create new challenges to take up your time – payroll, employment regulations, tax reporting, benefits, and so on.
Other questions to consider:
Will your new employee be part-time or full-time?
Will he or she work under your direct supervision, or will you delegate responsibility to your new hire?
Are you prepared for the challenge of giving up hands-on control over part of your business?
Think hard about these issues until you have a very clear idea of what you want from your new employee.
Step #2: Find the right person
Once you’ve defined the role you want your next employee to fill, the second step in your hiring process is to find the right person.
You and your new employee will be working closely together, so good personal chemistry is essential. Think about possible candidates whose work you know, perhaps employees of your suppliers or other businesses you deal with. Interview thoroughly, check references, and above all, trust your intuition.
Hiring employees is always fraught with uncertainty and challenges. But you can increase your chances for success by defining what you need from this employee, then looking for the right person.
