Payroll Tax Deferment is a temporary suspension of collecting social security tax from employee paychecks. This means employees will have more money available in their paychecks. However, the taxes are not forgiven; they will need to be paid back between January 1, 2021, and April 30, 2021. Payroll Tax Deferment is an attempt to help … Read more
Employers are required to withhold various types of taxes from employees’ paychecks. These taxes include federal income tax, Social Security tax, Medicare tax, and state income tax (if applicable). Federal income tax is based on the employee’s taxable income and is used to fund government programs and services. Social Security tax and Medicare tax are … Read more
California follows the residence-based taxation principle, meaning it only taxes income earned within the state. As municipal bonds are considered income, California residents are not subject to taxation on out-of-state municipal bonds they own. This is because the interest earned on these bonds is not considered California-sourced income. However, if a non-resident invests in California … Read more
Peconic Bay Tax is a regional tax imposed on properties within the Peconic Bay watershed on Long Island, New York. It is paid by property owners in the towns of Southold, Riverhead, Southampton, East Hampton, and Shelter Island. The tax is used to fund water quality improvement projects in the Peconic Bay estuary. The amount … Read more
A gift card, like a cash gift, is not considered taxable income for the recipient. The reason is that a gift card is a form of payment, similar to cash or a check. When you receive a gift card, you are not receiving income, but rather a means to purchase goods or services. Therefore, the … Read more
If you took a coronavirus-related distribution from your retirement account, be aware that you have a short window to repay the funds or you’ll owe taxes on the distribution. For 2020 distributions, you have until August 31, 2023 to return the funds to your retirement account. For 2021 distributions, you have until October 15, 2024 … Read more
When you fail to make an estimated tax payment for a particular quarter, you may be subject to penalties. The penalty is calculated based on the amount of tax you owed for the quarter and the length of time you’ve gone without making the payment. If you miss a payment, you should make it as … Read more
Honorariums are payments made for services or contributions, but they are not considered salary or wages. They are typically given to individuals who are not employees of the organization or institution providing the honorarium. The tax treatment of honorariums depends on whether the payment is considered a gift or income. If the payment is considered … Read more
Capital gains are profits made from investments that are sold for more than their original purchase price. In general, you will need to pay income tax on capital gains, but there are some exceptions. For example, you may not have to pay taxes on capital gains if the asset was held for more than a … Read more
Determining whether spousal support is taxable depends on whether the payments are considered alimony or property settlement. Alimony, intended to support a former spouse, is generally taxable for the recipient and deductible for the payer. Property settlement, dividing jointly-owned property, is not taxable but may affect the capital gains if the recipient later sells the … Read more