It is said, and according to this article, President Trump has proposed the most significant tax cuts since the Reagan administration.
The proposal calls for reducing personal income tax rates from 7 to 3 brackets, at 12%, 25% and 33%. It would increase the standard deduction to $15k, which is currently at a little over $6k for single filers, and $30k for married couples, which is currently a smidge over $12k.
I suggest checking out the graph in the article. It portrays the estimated savings taxpayers would have annually, based on their income. As if the estate tax really applies to the majority of Americans, the plan also calls for its repeal.
At the same time, the plan calls for repealing personal exemptions and for dependents, as well as the head of household filing status. Which would mean that single parents with dependent children and most married households with at least three dependents would pay more in income taxes.
The Plan also caps itemized deductions at $100k for single, and $200k for joint filers.
So, what does the article say to taxpayers who may have to prepare for a possible tax reform?
"Whenever possible, defer any realized gains to down the road because we may have lower tax brackets during the Trump administration," said James Gambaccini, a certified financial planner and managing partner at Acorn Financial Services in Reston, Virginia.
In my opinion, the plan proposes both negative and positive changes. If implemented, it may help a great deal of taxpayers, and possibly, stimulate the economy, at the same time, it may prompt taxpayers to clutch tighter on the purse strings. How would these possible changes affect you?
It's sad that there is such a monopoly on higher education, that people spend most of their lives paying off their loans. My uncle went back to school in his early 30's and didn't pay off his debt until his mid 50's.
It's both good and bad, in my opinion. The public school systems are a gamble of district and neighborhood. The other types of schooling is just as much of one, I think. When comes to charter schools, you have your fly-by-night, pop up schools with low budgets, and poor building conditions. It all depends on how much the parents pump into the schools. Private schools seem to be the best way to go in order to obtain a decent education these days. They are able to hire better teachers... etc... etc. I hear boarding school is very similar, in that respect. I think home school is just flat out wrong. The kids hardly get a chance to obtain the social skills that one gets in other schools.
You've heard it right, folks. The Fed is actually going to help some people with their student debt. This Wall Street Journal article, laid it all out pretty well. Which such a growing problem in loan debt, it is a relief to see something like this happening in the next few years. It may actually have a positive impact on the economy, less debt would have to equal more consumption, right? At the same time, I'm afraid that those who don't necessarily deserve it will take advantage of the program. The article said it best:
Growing evidence suggests many of the most hard-pressed borrowers—college dropouts who owe less than $10,000—aren’t taking advantage of the programs, while workers with graduate degrees, such as doctors and lawyers who don’t necessarily need help, are.
What pros and cons have I not thought of?
Doesn't that sound like a lot of work, just to make the educational puzzle pieces fit? I still argue that it was more viable to do that 10 years ago, but with the gauntlet of registration that most colleges put prospective students through, you're better off going to a 4 year and calling it a day.
I hate to rain on the parade, but I still don't see this taking off. I recall some of my professors detesting the idea. Most, are old school, they prefer face-to-face lectures. Not to mention, it gives the students more ability to slack off. I've taken a few online classes. They're very convenient, yes, but they never made as much of an impact on me. They just felt more like easy credit opportunities.
I've gone to two before. One, was to get my basics out of the way, and two was for extended education in a hobby of mine, after I got my degree from a university. I remember my first days at a community college, it really reminds me of the show "Community" which takes place in a community college. The school I was in was reportedly the best one in its district, but it always felt... off. Compared to the university I went to later, even the teachers seemed to not take their jobs as seriously. It felt like the continuation of high school.
All that aside, when I tried to transfer my credits to a 4 year university, hardly any transferred. It was seemingly a waste of time and money. So the question is, is it still a good move to go for your "basics" at a 2 year school and then try to squeeze them in at a 4 year? Back in my day, it was the smart option, but with the cost of education increasing every year, it seems more a like a literal gamble than a smart move. From where I'm sitting, I don't think I'd advise anyone to go that route anymore. One is better off just sticking with a 4 year university. Perhaps, it's cheaper in the long run... Thoughts?
I can't agree more with you. There should be no question when it comes to supporting our vets, plain and simple. Not to mention, there shouldn't be so much red tape for them to have to go through in order for them to receive their benefits.
It looks like U.S Veterans may be getting another kick in the pants. This small, but telling article, states that the Veterans Aid and Attendance Pension program, is saying that benefits will be more difficult to qualify for. The pension is to provide financial support for low income veterans and their families.
The new standard: the veteran and spouse must posses $80,000 in assets, excluding home and vehicle. They also must have been discharged honorably and served 90 consecutive days, at least one of those days during an approved period of war.
This will certainly make it harder, and like the article says, it will affect veterans who are already eligible for pension, possibly disqualifying those who were previously entitled.
The debate of change has been on everyone's lips, it seems. One topic I would like to focus on today is Taxes. Ah, everyone's favorite subject, I know. I found a good break down on Forbes earlier today. Here's the skinny.
1. Everything is still income - It doesn't matter if it is the lottery, gambling, it's going to be taxed, just like every other type of income.
2. Paying Taxes Later - If you have the legal right to money, and wished to be paid later, you are still taxed at that moment.
3. Forms 1099 are important - The tax forms you get in the mail are very important, so keep track of them.
4. Keep track of your foreign accounts - Even though you won't receive a 1099 Form, you still need to report them.
5. Pay small tax bills - If you receive a small tax bill, pay it anyway, if it's not correct.
6. Reply to every IRS letter, unless told not to - That one pretty much speaks for itself.
7. Don't talk to the IRS if they visit, and never lie - Decline to speak to them and refer them to your lawyer.
8. The IRS can audit 3 years, but keep records for 7, and returns forever - It's the usual IRS statute of limitations, after you file a return.
9. Avoid amending returns - Amended returns have a high audit rate, especially if they request a refund.
10. File returns even if you can't pay - Payment can come later, and could be subject to an IRS installment agreement.
11. Don't explain or attach too much - Tax returns should be concise, never attach extra documents, unless they are requested.
12. Be cautious with big refunds - You might consider applying it to the next year's tax payments, instead of asking for the money upfront. This way helps to lower your profile.
13. Seek professional advice - If you find yourself in a tax case, you may consider asking a professional in tax matters.
Did the article miss something important? If so, chime in. :)