It’s Valentine’s Day so the thoughts of lovers — young, old and in-between — naturally turn to taxes. Oh wait, that’s just me and the ever-patient hubby. We did, after all, push our wedding day into 1982 because that tax year meant we could claim the dual earners’ above-the-line tax deduction. That’s part of the Form 1040 instructions on the new tax break shown below. We (OK, me) did want to get our new life together off to a good tax-saving start. That income adjustment law change was an effort to reduce the marriage tax penalty that many jointly filing…

Yet another tax paperwork hurdle has popped up in this year's filing season path. No, it's not one of the dozens of forms that the Internal Revenue Service is still working to update. It's an oldie but goody document that was updated back in December, the Schedule 8812. Schedule 8812 was used in prior tax years to compute and claim the additional tax credit. Here's how it looked for the 2011 tax year. Click image to see full form. New for the 2012 tax year, this document now is also used in some cases by taxpayers claiming the plain old…

Unless you're a couple of tax professionals, the Internal Revenue Code probably had very little to do with your courtship. But the truth is, taxes can be a big part of every relationship. For most of us (and soon maybe more of us after the Supreme Court hears an estate-tax related same-sex marriage case), our tax laws have an effect on us once our relationships move to the "I do" phase. That's why Santa's romantically-named reindeer Cupid reminds us that our marital status on Dec. 31 determines our filing status for the whole tax year. These wise words are Reindeer…

December is definitely the season for giving. And tax-related gift are the focus of the fourth installment of Reindeer Year-end Tax Tip Games 2012. Vixen, the reindeer who definitely personifies Merriam-Webster's third definition, has received her share of presents over the years. So it's fitting that she's suggesting that folks concerned about possible estate tax implications take advantage of that law's gift tax exemption this year. Right now, the estate tax exclusion (that's the value of an estate that escapes taxation) and unified lifetime gift exemption (that's the amount of your estate you can give away to others while you're still around to get their…

Pardon me for detouring from strict tax topics, but an article in today's New York Times about widows in foreclosure floored me. Homeowners over age 50 are facing the loss of their homes at the fastest pace of any age group. Women are a big part of that statistical segment because, reports the paper, they tend to outlive their spouses and are unable to cope with cuts in their pensions, ballooning medical costs and the fine print on their mortgages.  Elderly women walking by Michael Cohen via Flickr OK, I see not saving enough; that's a problem for every age…

How's your Thanksgiving Day going so far? If you're like most of America, you've got a big crowd at your place or you're one of the crowd at some other relative's or friend's house. Thanksgiving meal photo by surlygirl via Flickr Creative Commons About nine-in-ten adults, officially 89 percent, said they have their Thanksgiving meal with members of their family, according to a Pew Research Center conducted in 2010. Although Pew asked the Turkey Day traditions question a couple of years ago, other anecdotal reports and my own observations indicate that the massive family Thanksgiving meal (attendees in addition to…

Every fall the Internal Revenue Service announces the upcoming inflation-based adjustments to tax provisions millions of taxpayers use. Not this year. Oh, the IRS did issue its annual revenue procedure — Rev. Proc. 2012-41 — last week, setting forth inflation-adjusted items for 2013. But there's a big hole in this year's announcement. Section 2 usually notes some key changes for the coming tax year. This year, however, the IRS takes advantage of the section to tell us what isn't in Rev. Proc. 2012-41. This revenue procedure does not include the following items: the tax rate tables under §1 of the…

If you believe the adage that art reflects life, then today's television programs are giving us a much more wide-ranging view of the American family. OK, maybe equating art and television is not exactly accurate, especially when we're talking about the families represented by Dance Moms and Honey Boo Boo and Duck Dynasty. Then we have the truly fictional families portrayed in Sons of Anarchy, The Middle, Modern Family, How I Met Your Mother (Lily, Marshall and Marvin), Don and Betty "Worst Mother Ever" Draper of Mad Men and my favorites, back soon via Netflix, the Bluths of Arrested Development.…

I do our taxes and the hubby cheers me on, usually by chanting "Deduct! Deduct!" After all these years I've finally convinced him that tax credits are better than tax deductions because they reduce your actual tax liability dollar for dollar. But he reminds me that it's still more fun to yell "deduct" than "claim a credit." So I humor and welcome his tax-time support and then round up tax-saving deductions and credits under the umbrella term of tax breaks. Over the years, I've run into some that folks tend to miss. Today's Countdown to Oct. 15 takes a look…

Two pet supply stores opened this week in my area of northwest Austin. It seems like a bit of overkill, but you've got to presume the owners of the new animal-related businesses did their market research. I suspect that my neighborhood supplied much of the data supporting multiple pet care storefronts. It seems like every other house has at least one dog. We are not alone. Sixty-two percent of U.S. households own a pet, according to the latest American Pet Products Association (APPA) National Pet Owners Survey. That's 72.9 million homes. As for the number of pets, APPA says there are…

Are your kids too old, or think they're too old, to go to day camp? Maybe it's time they got jobs. Summer jobs for teenagers is a time-honored tradition, a first step in the passage to young adulthood. Employment typically ranges from the tried-and-true lawn mowing, baby sitting and life guarding to in-office work as clerks and assistants to helping out mom and dad in the family business. And part of that transition to income earner could, as the Weekly Tax Tip notes, include tax responsibilities for the teen employees. Yep, things can quickly go from being a source of pride — I'm…

Today's Supreme Court split ruling on Arizona's immigration law isn't going to do anything to quell the debate on this topic, especially in this presidential election year. What's needed is Congressional action on immigration policy, which isn't going to happen in this presidential election. In the meantime, however, some immigration-related tax regulation and legislation is popping up in Washington, D.C. IRS immigration-related regs: First, let's hear from the Internal Revenue Service. The nation's tax collecting entity last week announced interim changes to strengthen its procedures for issuing Individual Taxpayer Identification Numbers, or ITINs. The IRS began issuing ITINs in 1996…

A couple of weeks ago on my neighborhood walk I found myself wondering if every parent in my suburban community home schooled their kids … and if they were all at early recess! Then I realized that Austin area schools were out for the summer. On today's walk there was nary a child-related sound. Then I realized that school's been out for a while and kids, and their frazzled parents, have discovered day camps. When I was a kid, we didn't have day camps. Of course, that was a while back and I grew up in a small West Texas…

On special family-related days, a lot of attention is given to the traditional unit: mom, dad, kids. But the reality is that the Leave it to Beaver lifestyle is not the norm. The United States, like the rest of the world, is decidedly nontraditional nowadays. And one of the more common family conditions is that a lot of kids live with only one parent. In 2009, an estimated 13.7 million single parents had custody of 22 million children younger than age 21 while the other parent lived somewhere else, according to a U.S. Census Bureau report, based on Internal Revenue data,…

Happy Father's Day! Fatherhood generally doesn't get as much appreciation as motherhood. That's understandable. In most societies, moms are more responsible for the daily well being of offspring. Plus, it's a fairly recent development that dads have embraced a more hands-on approach to parenthood. Father and daughter fun by Pink Sherbet Photography via Flickr That behind-the-parenting-scenes style definitely was the case for my dad. Dealing with my brother and me was mainly my mom's job. But we still knew how important dad was to our lives. All those fond memories make me miss dad a little extra when this June…

Don't panic. Father's Day isn't until Sunday, June 17. But since dads are usually a bit harder to shop for than moms, I thought you could use the head start. It seems, however, that we kids are starting to spend more on our fathers, closing the gift-giving gap somewhat with Mother's Day. The National Retail Foundation's 2012 Father's Day spending survey found that the average person will shell out $117.14 on gifts for pop this year. That's a 10 percent increase from last year and getting closer to the planned spending of $152 per person last month on mom's big…

Today is one of those days that really makes you think twice, or more, about commemorations and the state of today’s world. May 25 is National Missing Children’s Day. It was established in 1983 by President Ronald Reagan. The date was selected because May 25, 1979, was the day that 6-year-old Etan Patz disappeared. Thirty-three years later this week, the New York City police department announced an arrest in this highly-publicized child abduction case. Sadly, Etan’s situation is not an aberration. Thousands of kids go missing every day. Unless you are a parent of a missing son or daughter, there…

Happy Mother's Day! I'm spending this Sunday with my mother. Like most moms, she doesn't want anything extravagant on her special day. Just spending time together is the best gift, or so she says. I'm taking her at her word! Mother's Day gift that keeps giving photo by Katatonic28 / Flickr  Visiting with Mom is much more manageable since she moved closer to the hubby and me about a year and a half ago. Getting together is the easiest it's been since I was in college. For most of the time that Mom's been here in Central Texas, we've been…

This post was updated March 30, 2018. When the end of matrimony leads to the start of alimony, each parting partner can feel the tax effects. If you are the ex-spouse getting alimony payments, the money is taxable to you as income in the year it is received. This added income calls for a couple of additional tax considerations for the recipient. In traditional man and woman marriages, this usually meant that the husband made spousal support payments to his ex-wife. But the changing world — including, but not limited to, things like more women working and the nationwide legalization…

One of the most popular tax questions every filing season is "Can I claim my boyfriend as a dependent?" OK, in the interest of gender fairness and not portraying just boyfriends as layabouts, an Internet search shows that there also are a lot of filers wondering about the possibility of claiming girlfriends as tax dependents, too. The answer to each romantic relationship tax query is "Maybe." Who's a tax dependent? There are two ways a person can be a dependent on your tax return. The individual has to be a qualifying child or a qualifying relative. That relative requirement obviously…

The most romantic day of the year has past. Some folks are very happy today. Others, not so much. If yesterday was a great Valentine's Day and you are now engaged, congratulations! Here's my wedding gift to you: Some tax issues to consider as a married couple. Filing status: The date you choose to exchange your vows will affect your filing status. If you eloped yesterday or are planning to exchange vows soon, then the IRS will likely consider you married for all of 2012. I say "likely" because some of you might find yourself in the same situation as Kim Kardashian,…

NOTE: This post was edited/updated on Feb. 26, 2018, to reflect 2017 tax year numbers and changes coming due to the new tax law's changes for the 2018 through 2025 tax years. Every taxpayer's situation is different, but there are a few tax rules that apply to almost every person who has to file a return. One of the most welcome is the tax exemption. This family will likely jump for joy again when they see how much personal exemptions will save them on their tax return. (Photo by Emergency Brake via Flickr Creative Commons) Like deductions, an exemption helps reduce…

There's a lot of talk about hiring a tax professional during filing season. But you also should get expert help any time of the year when your tax circumstances are a bit tricky. Joe Paterno, the former Penn State head football coach of 46 years, died on January 22, 2012 in State College, Pennsylvania. He was 85. His legacy as the winningest coach in college football was tarnished by his inaction in a sex abuse scandal leading to his dismissal in November, 2011. Shown is a statue of him on the Penn State campus on November 10, 2011. UPI/George Powers…

Those gift packages handed out to the first child born each New Year's Day sure are nice. But if you're hoping your baby might be the recipient of such goodies in early 2012, you might want to change your timing expectations. If your son or daughter enters your life before the ball drops in Times Square, the the new addition will provide you something even better: substantial savings on your 2011 tax return. The full year tax bonus comes because tax law allows parents to claim child-related tax breaks no matter how early or late in the year a child is…

As easy as it might be, I will not comment on Kim Kardashian's sham marriage or her television "reality" show or, now in the news, her filing for divorce just 72 days after extravagantly saying "I do." But since Kim's split from Kris Humphries has so many folks talking, I did want to take the opportunity to note that taxes should be considered any time there's a marital breakup. Rather than reinvent the wheel, I'm recommending you check out these previous posts (yes, some inspired by other celebrity breakups) and articles on divorce and taxes: Divorce tax tips from Tiger…

Every taxpayer knows that filing status makes a difference to your eventual tax bill. You have five choices on how you can file your taxes: single, married filing jointly, married filing separately, surviving spouse with dependent child and head of household. Each option offers certain filing advantages or limits, so selecting the correct one is key. While the choices might seem straightforward, sometimes it's easy to make a status misstep, especially when tax dependents are involved. You did notice that dependents, those folks who rely on you for support, are expressly mentioned in one status, right? That's the surviving spouse…

I love it when real life taxes coincide with my tax scribblings. Take the latest Weekly Tax Tip. It dealt with innocent spouse issues. And what just happens to pop up on the tax radar a few days later? A U.S. Tax Court ruling granting a husband innocent spouse status because he didn't know the full extent of his wife's gambling winnings. Leonard Harbin filed a petition with the Tax Court seeking relief from joint and several liability for his and his now ex-wife's taxes. The Internal Revenue Service disagreed, saying that Harbin didn't qualify for innocent spouse relief because…

Most married taxpayers do a lot of things together, including filing taxes. That's usually a good idea, since more tax breaks are available to the couple filing a single 1040. But if one spouse takes some tax shortcuts, the other spouse ends up in just as much tax trouble. That's why sometimes it pays to file separately. In the cases where a spouse can't or doesn't take such tax preemptive measures, there's also the possibility of getting some relief from the Internal Revenue Service via its injured and innocent spouse programs. These opportunities to ease the unexpected tax costs caused…

Kids factor into taxes in a lot of ways, both good and bad. First, the positives. There are many child-related tax breaks. A dependent youngster is an added exemption. For several years, the youth's parents can claim the child tax credit. Families with lots of kids might be able to get even more money back from the Internal Revenue Service via the refundable additional child tax credit. If your family grows via adoption, there's a tax credit for that, too. Who looks after all those kids when mom and dad head to work? Check out the child care credit. And…

Today is a somber anniversary. But it also coincides this year with a much happier celebration, Grandparents Day. So while we remember those who died on Sept. 11, 2011, today's tax focus is on the country's older filers. There are, of course, many young grandfathers and grandmothers. But the more senior Maw-maws and Grampas get today's attention. The reason? Readily available Internal Revenue Service data breaks out taxable retirement income. Specifically, for the 2008 tax year, the latest complete tax filing info, slightly more than 15 million taxpayers reported taxable Social Security income. And that precise number of filers is…

I'm heading up the road today to visit my mother and my furry half-brother Willie. Willie, as I'm sure all animal lovers immediately surmised, is my mom's pet, specifically her dog. She says he's a rat terrier, but to me he looks more like a long-haired chihuahua or a Papillion. But what do I know of dogs? I'm a cat person, like the neighborhood kids who chalked the oversized cat pictured at left (I snapped the photo on one of my walks) on the sidewalk outside their house. I do know, though, that regardless of what kind of pet you…

Many of you are at the same point in your lives as I am. As you're joining the "of a certain age" club, you also have an older parent whom you're helping out in any way you can. That's what New Jersey resident Anthony Olivo was doing. He provided nearly full-time care to his mother from 1994 to 2003, basically giving up his legal practice during those years. Following his mother's death, Olivo became administrator of her estate. He filed a tax return for the estate and claimed a deduction of $1.24 million as a debt he said the estate…

The hubby and I are child-free, but our neighborhood is full of kids. It's also full of moms and dads who both work outside the home. So what do our working parent neighbors do when school is out for the summer and their youngsters have hours and hours free? No, they don't drop the kids off at our house. We are definitely not that good of neighbors. They send them to summer camp. And if it's a day camp, all the better. You don't have to mess with young Joni's or Jimmy's homesickness. You don't have to deal with your own…

How serendipitous that New York's decision to sanction same-sax marriages came in June, the most popular month for weddings. OK, it takes 30 days for the law to go into effect, pushing the first exchanging of vows to July 24, but every couple needs time to plan their big day. And it's still is a nice gesture. Photo by Kathryn8/iStock Not to take any glow off the new-found relationship option, but like their heterosexual counterparts, New York's same-sex couples also will now be able to officially divorce. "One of the so-called benefits to marriage is actually divorce," Ruthann Robson, professor of…

June is the month when lots of couples are saying "I do." But when it comes to filing a joint return, many opt to say "I don't." True, opting to fill out your Form 1040 as married filing jointly is the preferred filing status for wedded couples. That's because in most cases, it produces the best tax results for husbands and wives. The IRS notes in its Publication 501 that "if you and your spouse decide to file a joint return, your tax may be lower than your combined tax for the other filing statuses. Also, your standard deduction (if…

I got a bit of a head start on Father's Day last Wednesday with the Weekly Tax Tip about tax help in taking care of dad as he gets older. Those of us lending a hand to aging parents will need all the financial assistance we can get, according to a new report that says Americans who take time from work to look after (or even just look in on) an older dad or mom lose an estimated $3 trillion in wages, pension and Social Security benefits. The MetLife Study of Caregiving Costs to Working Caregivers: Double Jeopardy for Baby Boomers…

Father's Day is Sunday. Cards will be mailed, special dinners prepared and a variety of gifts presented to the men who mean so much to us. Many of us also will be dealing with things that go beyond one special day. Some folks with an aging dad are helping him out on a more regular, and in some cases daily, basis. Others soon will be providing that extra attention. If you are or expect to be caring for an elderly dad (or mom), the tax code offers some help. And that's this week's (#8) Weekly Tax Tip. Some things you'll…

It's been a crazy June 14. But I couldn't let the day pass without a nod to the Stars and Stripes, and especially to my little brother. As long-time readers of the ol' blog know, this day is special to me not for the Red, White and Blue reasons, but because it was my younger brother's birthday. We lost him at a much too young age. But I often remember his good heart, disarming smile and the time when he was a preschooler who thought the all the flags flying on this mid-June day were in celebration of his birthday. They…

So that's why former California Gov. Arnold Schwarzenegger and Maria Shriver have separated after 25 years of marriage and are likely headed to divorce court. Right now Shriver is probably trying to decide which is worse, that her philandering husband fathered a child with another woman or the fact that he kept it secret for a decade. Former California Governor Arnold Schwarzenegger speaks after accepting an award during the 63rd Israel Independence Day Celebration at the Skirball Center in Los Angeles in this May 10, 2011 file photo. Schwarzenegger has acknowledged that he fathered a child more than ten years…

Divorce talk is in the news again with the separation of Maria Shriver and Arnold Schwarzenegger. California Governor Arnold Schwarzenegger is joined by his wife Maria Shriver while being sworn into office for a second term by Supreme Court Chief Justice Ronald George during his inauguration ceremony at the Memorial Auditorium in Sacramento, California in this January 5, 2007 file photo. The former California first lady has moved out after 25 years of marriage, reported Los Angeles Times. The couple confirmed their separation in a joint statement released on May 9, 2011 after questions were raised by The Times. REUTERS/Rich…

Our love for our mothers is boundless. And we all got our Moms the perfect gift this Mother's Day to show her just how much she's worth to us. But as I like to tell folks, "Say it with cash!" OK, giving Mom a handful of dollars might undercut some of today's sentimentality, but the bottom line is that time is money. So all that time Mom spends or spent taking care of us is worth actual fiscal compensation. How much? The folks at Salary.com say they've figured it out. Salary.com broke out the "mom job" for both those with…

OK. I'm slow (again) in reminding y'all about the weekly tax tip. So what else is new? But here it is, in honor of Mother's Day, which will be celebrated this Sunday, May 8: The tax joys of parenthood. You have gotten Mom a gift, right? Uncle Sam also has some tax gifts for her. Sure, an added tax exemption or two, some credits simply for putting up with you and your siblings or tax breaks to help send you to college aren't as sentimental as what you've picked out for the woman who gave you life, but tax breaks for parents…

Anyone with a mom knows that they usually get their way. The IRS now has learned that lesson, too. Last fall, the IRS issued rules on what is and isn't deductible as a medical expense. That compilation also set the rules on what expenses can be reimbursed by medical flexible spending account, or FSA, money. Breast pumps and other lactation devices were not on either list. That oversight riled up moms nationwide, especially since the new health care reform law specifically requires workplaces provide accommodations for breast-feeding employees. Then last month, another government official, Surgeon General Regina M. Benjamin, issued…

Now there's a contraception method I bet you never considered. But Washington Post columnist Robert Samuelson says that if taxes are raised to help keep the federal deficit from increasing, then policymakers need to be careful to structure any hikes so that they are more parent-friendly. If they don't, says Samuelson, "more Americans may choose not to have children or to have fewer children. Down that path lies economic decline." Samuelson's core argument in his "America's Parent Trap" column today is that the United States' current fiscal and tax policies "punish parents, who are taxed heavily to support the elderly.…

  Time. An artificial construct. A futile attempt by humans to control yet another immutable piece of the universe. What is a second, a minute, an hour, a year? Purely random segmentations that have no real meaning. At least that’s what I tell myself when my birthday rolls around. We have a clock that also has issues with time measurement. It’s a lovely handmade German timepiece that belonged to my grandmother. When I was young and living in the same small West Texas town as my grandparents, I was at their house often. And each time I was there, I…