WASHINGTON (AP) - Congressional auditors say about 30 million people - 21 percent of U.S. taxpayers - will have to come up with more money to pay their 2018 taxes next year because their employers withheld too little from their paychecks under government tables keyed to the new tax law. New tax withholding tables for employers were put together by the government early this year. About 30 million workers received pay that was "under-withheld" - making their paychecks bigger this year but bringing a larger bill at tax time next spring, according to the Government Accountability Office's report. About 27 million taxpayers would have been affected even if the new law hadn't been enacted. The changes, however, added an estimated 3 million to that number. Millions of American workers started getting fatter paychecks early this year, as employers withheld less money in anticipation of lower income taxes under the law. According to the nonpartisan Tax Policy Center, a middle-income household … [Read more...] about Why taxpayers could owe more money next year
Sunday August 5, 2018 12:01 AM Changes are aimed at home-schooled children. U.S. Sen. Ted Cruz is making a second run at expanding 529 college savings plan benefits, especially for home-schooled families.In late June, the Texas Republican introduced what he calls the Student Empowerment Act, which aims to expand the current legal definition of qualified higher education expenses that can be covered through the popular 529 accounts.Notably, the bill also would provide opportunities for 529 proceeds to cover more expenses for the approximately 4-5 million home-schooled children.This is familiar territory for Cruz. He pushed through his Student Opportunity Amendment in December that allowed more families to use 529 plans to pay for K-12 tuition in addition to college expenses.However, one aspect of that legislation - a provision to allow 529s to cover homeschooling expenses - was dropped at the last minute following challenges led by Vermont Sen. Bernie Sanders.Now, Cruz is … [Read more...] about Kids and Money: Second run at expanding benefits from 529 plans
Sunday August 5, 2018 12:01 AM Double-check your withholdings. Every tax season, a lot of people feel like they've hit the lottery - except it's their own money they are collecting.Millions of workers calculate their withholdings so that they get money back at tax time. They know their employer is sending too much to Uncle Sam, and they like it that way. They don't trust themselves to save. They count on the tax refund for any number of things, such as paying off debt or taking a vacation.But Congress passed major tax legislation at the end of last year that could affect your refund if you are one of these folks, according to a recent report by the Government Accountability Office. Under the Tax Cuts and Jobs Act, the Department of the Treasury had to establish new federal tax-withholding tables. The IRS publishes the withholding tables and employers use them to determine how much tax to withhold from an employee's paycheck. Each year, employers withhold more than $1 trillion … [Read more...] about Color of Money: Counting on a tax return next year?
Sunday August 12, 2018 12:01 AM Some should know, others shouldn't. I was filling out my daughter's Free Application for Federal Student Aid when she asked a question that for years I've avoided answering."Mom, how much do you make?"I froze. She's the last of our three children to head off to college. The other two weren't as curious. But this one, she's the kid who wants to know everything.My husband and I had made the decision not to share our income with the children when they were young. Initially, because we thought they might tell their friends or family members. Besides, at a young age, they don't really have a good grasp of money. To them, $20 is a lot of cash. As they got older, we continued to keep the information secret, because we didn't want them to think we had so much that they could pressure us to buy them things. Your salary alone can seem enormous, but it is meaningless without the context of all your financial obligations.But as we were going over the FAFSA … [Read more...] about Color of Money: Should you keep your salary a secret from family and friends?
Friday August 17, 2018 03:45 PM Make sure you hit delete. Delete. Delete. Delete.How many times has that voice gone off in your head after a suspicious-looking email landed in your inbox?Typically, the email includes a demand to cover a bill or seeks personal information to resolve a technology problem with your computer.While your knee-jerk reaction is to delete the file immediately or hang up the phone, do your kids have the same instincts?College-age kids are prime targets for many scam artists. Yes, they're computer savvy, but they are on their own, perhaps for the first time, have disposable income and have little experience in dealing with financial ruses or phishing expeditions seeking personal information.Here are a few scams making the rounds lately that could pose troubles for your kids if they let their guard down:Phishing expedition: This scammer left so many red flags that I couldn't believe the young college-age student who forwarded it to me asked if she should … [Read more...] about Kids and Money: Scams that often snare college students