Giving Tuesday and Charitable Donations - Did You Know?

Giving Tuesday is an annual event that highlights charitable giving after Thanksgiving.

If you are considering charitable donations, you may be able to donate to a Donor-Advised Fund (DAF) every two or three years instead of every year. This may qualify you to receive tax benefits now, allow the amount to grow tax-free, and the decision on which qualified charity to fund can be made later.

If you are 70.5 years or older, you may also be able to make a qualified charitable distribution (QCD) directly from your IRA this year. QCDs may allow the donation to be deducted from your income. A tax advisor can help you structure your charitable giving.

The IRS has released a tool to make it easier to get information about qualified charitable organizations. The Exempt Organizations Select Check tool can be found at: www.irs.gov/charities-non-profits/tax-exempt-organization-search. ... See MoreSee Less

Tax Credit for Businesses That Provide Childcare for Employees – Did You Know?

Businesses that offer childcare services to employees may qualify for the Employer-Provided Childcare Tax Credit for some of the expenses involved. Eligible costs may include acquisition or construction of a childcare facility, ongoing expenses to run an in-house daycare center, and/or referral costs like contracting with an outside childcare facility or service.

This nonrefundable credit may cover up to 25% of qualifying workplace childcare facility costs, or 10% of costs for an outside service, up to a maximum of $150,000. Eligible businesses may claim the credit as part of the General Business Credit, meaning that any excess credit amount may be carried back one year or forward up to 20 years. A business tax professional can help you determine whether your enterprise qualifies for the Employer-Provided Childcare Tax Credit, and if so, help you get the maximum benefit from the credit. ... See MoreSee Less

Use Savings Bonds to Pay for College and Get a Tax Advantage – Did You Know?

Ordinarily, interest earned on U.S. savings bonds is taxable income. However, if you pay higher education costs, then you may qualify to cash in federal series EE or I bonds tax-free. The IRS Education Savings Bond program allows eligible people to exclude some or all of their U.S. bond interest from their gross income, provided that they use the bonds to pay tuition and certain required fees at a qualifying higher education institution.

To be eligible for this program, you must pay the education expenses for yourself, your spouse or a dependent. The program is subject to income limits, which the IRS adjusts annually for inflation. Other eligibility restrictions may apply, such as limitations on the expenses you may pay using the bonds if the student also receives tax-free scholarship funds. A tax professional can help you determine whether you qualify for the Education Savings Bond program, and if so, how much of the interest on your bonds could be exempt from tax. ... See MoreSee Less

Helpful Resources to Replace Records Lost in a Disaster

Disasters like hurricanes, tornadoes, floods and wildfires may destroy people's tax and financial records, making it difficult for them to apply for the assistance they deserve. Fortunately, a number of resources exist to help reconstruct lost records and begin the rebuilding process.

Those affected by federally declared disasters can request free transcripts of their past tax returns by using the IRS Get Transcript webpage (link below), or calling 800-908-9946. Banks and credit card issuers can provide copies of account statements and other financial documents, either online or on paper forms. Meanwhile, records documenting the value of a home and surrounding property can typically be obtained from a title company, mortgage lender or county assessor's office.

People who completed home improvements that affected their home's value or qualified for tax credits can usually get needed records from the contractors who performed the work. In some cases, the IRS will also accept written statements from friends or relatives who saw the home before and after improvements were made. For lost or damaged vehicles, a variety of sources can provide information on their fair market value. You can find these sources online, or seek assistance at a public library.

Get a Tax Return Transcript: www.irs.gov/individuals/get-transcript ... See MoreSee Less

New Requirements for Energy Efficiency Credits Take Effect in 2025 – Did You Know?

The IRS offers a variety of tax credits to people who invest in home improvements that significantly reduce energy usage. These nonrefundable credits may total up to $3,200 for a particular year. A maximum credit of $2,000 is available for water heaters, heat pumps, boilers or biomass stoves that meet specific design and efficiency requirements. Meanwhile, qualifying homeowners may claim up to $1,200 in credits for other energy improvements like installing highly efficient exterior doors, windows or skylights.

Beginning January 1, 2025, only officially certified products will be eligible for these tax credits. The products must come from an IRS-approved manufacturer, and the manufacturer must label each product with a unique product identification number (PIN). Save these labels, because in order to claim a home efficiency credit, you will need to include the PIN of each eligible product on your 2025 tax return. If a contractor or retailer cannot show you a clearly displayed PIN on a particular product, then the product likely will not qualify for tax credits for energy efficiency. ... See MoreSee Less

2025 Healthcare Open Enrollment - Did You Know?

The 2025 open enrollment period for Marketplace health insurance starts on November 1, 2024, and ends December 15, 2024. Plans will start January 1, 2025. During this period, you will be able to enroll in, renew, or change health plans for the coming year.

Once the Open Enrollment period is over, you will only be able to enroll if there's a qualifying life event for the Special Enrollment Period.

Enrollment can be done at healthcare.gov, and a simple checklist of documents you'll need can be found here: marketplace.cms.gov/outreach-and-education/marketplace-application-checklist.pdf. ... See MoreSee Less

Hurricane Relief Charity Scams

Natural disasters like Hurricanes Helene and Milton bring out the best in American generosity, as millions of people seek to help those affected by the storms. Unfortunately, these tragedies also attract scammers looking to steal the money and identities of people who wish to donate to relief efforts.

If you get a phone call, text message or email from someone claiming to represent a hurricane relief charity, verify the legitimacy of the organization before providing any personal information. Request the organization's official name, mailing address and website address, and keep in mind that scammers use fake organization names that sound similar to real charities. You can use the IRS Tax Exempt Organization Search tool (TEOS, link below) to verify that you are dealing with an authentic charity, authorized to receive tax-deductible donations. If you cannot find the organization in the database or the person who contacted you refuses to answer your questions, do not donate or share sensitive information like your Social Security number (SSN) or credit card number. Instead, hang up immediately or delete the message.

TEOS tool: www.irs.gov/charities-non-profits/search-for-tax-exempt-organizations ... See MoreSee Less

Clean Energy Tax Credit Scam – Did You Know?

The Inflation Reduction Act 2022 made it possible for people to sell certain clean energy tax credits. In these credit transfers, both the seller and purchaser must meet strict eligibility requirements and file required paperwork with the IRS. Unfortunately, dishonest tax return preparers are actively encouraging people to ignore the rules and improperly claim purchased clean energy credits. These scammers lure people in with false claims that the credits may be used to reduce tax on a wide variety of income types.

In reality, purchased credits may generally only be used to offset tax on passive activity income, which most people do not have. Regardless of what a scammer tells them, anyone who attempts to use purchased tax credits inappropriately, or claims credits they did not actually purchase, may face additional tax assessments and IRS penalties. Meanwhile, the scammer disappears with the fees they collected to file an inaccurate return on the person's behalf.

A trusted tax professional can help you determine whether purchasing clean energy credits would actually reduce your tax, and if so, help you complete and file all the required forms. ... See MoreSee Less

IRS Online Account – Did You Know?

Setting up a free IRS online account (link below) makes it possible to handle many tax-related tasks conveniently and securely. With an online account, you can readily check your tax balance, whether your payments have been processed, and the status of your tax return or refund. You can also submit electronic tax payments for fast, safe processing.

In addition, you can use your online account to request transcripts of past returns, or official letters verifying that you were not required to file. These records may come in handy for a variety of purposes, such as securing college financial aid, completing rental applications or claiming the Clean Vehicle Credit when purchasing a car or truck. The IRS may charge a service fee for transcript requests made by phone, mail or email, but with an online account, you can obtain these documents for free.

Link to access or set up your online IRS account:
www.irs.gov/payments/online-account-for-individuals. ... See MoreSee Less