Alpha’s Tax Tips

Study the New Breaks for Student Loans

The tax law provides a limited deduction for interest paid on student loans. But some borrowers may get special treatment this year. The Coronavirus Aid, Relief and Economic Security (CARES) Act grants more leeway to certain taxpayers. They don’t even have to make any payments on qualified student loans until October 1, 2020. Generally, the […]

Pay the Tax Piper on Unemployment

A reader writes in: “I lost my job due to COVID-19 and I’m applying for unemployment. Is this subject to tax?” Answer: Unfortunately, yes. Unemployment benefits are generally subject to federal income tax and maybe state income tax too. It’s not a free lunch. Currently there is no special federal income tax exemption for unemployment […]

Find the Higher ‘Power’

Find the Higher ‘Power’ What will happen if you are suddenly unable to handle your financial affairs? It can cause a big mess if you have not made any provisions for this possibility. Include a Power of Attorney in your estate plan. This legal document appoints someone – called the “attorney-in-fact” or “agent” – to […]

Does Refinancing Make Sense?

Mortgage interest rates are at historic lows. According to Nerd Wallet, the average rate on a 30-year loan on June 12 was 3.271%; 2.810% for a 15-year loan.  Look into refinancing your mortgage. When you do, remember to take all the relevant factors into account – including taxes.  After you weigh the tax implications, refinancing […]

Examine Health Savings Account Perks

If you weren’t already concerned about paying for healthcare expenses – and most people were concerned – the COVID-19 pandemic should certainly have your attention now. Strategy: Investigate the merits of health savings accounts (HSAs). This could be a tax-smart way for you to handle your medical expenses in the current environment. Although these tax-favored […]

Required Minimum Distributions for 2020

IRS provides welcome relief on required minimum distributions for 2020. Since we wrote that the stimulus law enacted on March 27 waived RMDs from IRAs and workplace retirement plans for 2020, we have received many questions. The most common query involves IRA and plan distributions already taken out in 2020. People have until August 31 […]

Remy Would Like You to Know

A client asked him this question: Can I deduct my dog’s veterinarian expenses as medical expenses? The answer is a resounding “no.” But that does not mean that you cannot derive some tax benefits from costs associated with your pooch. Scour your records to find pet-related expenses that may qualify for tax breaks. It might […]

Did You File a Paper Tax Return?

Checking on the status of a paper return you filed? You need lots of patience. Because of limited IRS staffing, there are significant delays in the processing of paper returns requesting refunds that were filed in March or later, the Service says. IRS is advising taxpayers not to call about the status of filed return […]

529 College Savings Plans

It’s summer, the weather’s getting hotter. And many families are thinking about college. Some have kids or grandkids who just graduated from high school and are on their way to college in August or September. Others have younger children or grandchildren and want to stash away a nest egg to help fund their future higher […]

Work Out a Deal with the IRS

If you’re having trouble paying taxes – including the 2019 tax bill now due on July 15 – the IRS may be willing to cut you some slack. Strategy: Make the IRS an offer it can’t refuse. Specifically, ensure that you meet the guidelines established under the IRS “Offer in Compromise” (OIC) program. The IRS […]