“Innocent spouses” may get relief from tax liabilityWhen a married couple files a joint tax return, each spouse is “jointly and severally” liable for the full amount of tax on the couple’s combined income. Therefore, the IRS can come after either spouse to collect the entire tax — not just the part that’s attributed to […]

The tax implications of being a winnerIf you’re lucky enough to be a winner at gambling or the lottery, congratulations! After you celebrate, be ready to deal with the tax consequences of your good fortune.Winning at gamblingWhether you win at the casino, a bingo hall, or elsewhere, you must report 100% of your winnings as […]

The “nanny tax” must be paid for more than just nanniesYou may have heard of the “nanny tax.” But even if you don’t employ a nanny, it may apply to you. Hiring a housekeeper, gardener or other household employee (who isn’t an independent contractor) may make you liable for federal income and other taxes. You […]

You may have heard about a proposal in Washington to cut the taxes paid on investments by indexing capital gains to inflation. Under the proposal, the purchase price of assets would be adjusted so that no tax is paid on the appreciation due to inflation.While the fate of such a proposal is unknown, the long-term […]

If you’re a volunteer who works for charity, you may be entitled to some tax breaks if you itemize deductions on your tax return. Unfortunately, they may not amount to as much as you think your generosity is worth.Because donations to charity of cash or property generally are tax deductible for itemizers, it may seem […]

During your working days, you pay Social Security tax in the form of withholding from your salary or self-employment tax. And when you start receiving Social Security benefits, you may be surprised to learn that some of the payments may be taxed.If you’re getting close to retirement age, you may be wondering if your benefits […]

Now that most schools are out for the summer, you might be sending your children to day camp. It’s often a significant expense. The good news: You might be eligible for a tax break for the cost.The value of a creditDay camp is a qualified expense under the child and dependent care credit, which is […]

To help defray health care costs, many people now contribute to, or are thinking about setting up, Health Savings Accounts (HSAs). With these accounts, individuals can pay for certain medical expenses on a tax advantaged basis.The basicsWith HSAs, you take more responsibility for your health care costs. If you’re covered by a qualified high-deductible health […]

 You’ve probably seen or heard ads urging you to donate your car to charity. “Make a difference and receive tax savings,” one organization states. But donating a vehicle may not result in a big tax deduction — or any deduction at all.Trade in, sell or donate?Let’s say you’re buying a new car and want to […]

When you retire, you may consider moving to another state — say, for the weather or to be closer to your loved ones. Don’t forget to factor state and local taxes into the equation. Establishing residency for state tax purposes may be more complicated than it initially appears to be.Identify all applicable taxesIt may seem […]