The Netflix and Spotify tax: States are making streaming services more expensive

More American households subscribed to a streaming video service than to traditional pay TV in 2018 — the first time that video streaming eclipsed the traditional model, according to a Deloitte report published in March. “Our current sales tax is designed for a Sears Roebuck economy driven by over-the-counter sales,” Ned Lamont, the governor of Connecticut, said in a budget address last year in support of a streaming tax. State sales taxes have gradually increased over the past few decades, to a


More American households subscribed to a streaming video service than to traditional pay TV in 2018 — the first time that video streaming eclipsed the traditional model, according to a Deloitte report published in March.
“Our current sales tax is designed for a Sears Roebuck economy driven by over-the-counter sales,” Ned Lamont, the governor of Connecticut, said in a budget address last year in support of a streaming tax.
State sales taxes have gradually increased over the past few decades, to a
The Netflix and Spotify tax: States are making streaming services more expensive Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-24  Authors: greg iacurci
Keywords: news, cnbc, companies, digital, expensive, state, sales, policy, spotify, making, states, streaming, video, services, netflix, tax


The Netflix and Spotify tax: States are making streaming services more expensive

Chesnot

Your monthly bill for Netflix and Spotify may be going up. States are trying to capitalize on Americans’ growing fervor for digital consumption of movies, TV, music and other media content by taxing monthly subscriptions for streaming entertainment services. That means that $12.99 bill you just paid for a February full of on-demand shows could rise by dollar or so in the near future. Around half of states in the U.S. have started taxing residents’ subscriptions to Hulu, HBO Now, Amazon Prime and the like within the past few years, primarily by extending sales taxes to these services — and some experts believe most other states aren’t far behind. Lawmakers in Maine, Illinois, Kansas, Massachusetts and Utah, for example, are considering similar measures, and officials in Alabama and Louisiana have also broached the subject in recent years. “It’s a fast-moving policy development,” said Michael Mazerov, a senior fellow at the Center on Budget and Policy Priorities. “Bills are constantly being introduced on this.”

States have had to adapt their tax policies to reflect a shift in consumer behavior. More American households subscribed to a streaming video service than to traditional pay TV in 2018 — the first time that video streaming eclipsed the traditional model, according to a Deloitte report published in March. And while households subscribing to pay TV still outnumbered those with music-streaming subscriptions, the share of households signing up for digital music services grew 58% from the year prior, the Deloitte report found. This migration toward digital entertainment has clipped states’ budgets. State sales taxes — most of which were introduced around the 1930s, decades before the internet’s ascension — have historically only covered tangible goods, according to Richard Auxier, a research associate at the Urban-Brookings Tax Policy Center. As fewer consumers buy physical goods like compact discs and DVDs in favor of intangible streamed content, states have had to update their tax laws accordingly or risk eroding their tax revenue, Auxier said.

Movie theaters charge a tax, and Netflix should be treated the same. Ned Lamont Governor of Connecticut

Only about a third of consumers’ expenses today relate to tangible personal property — about half the share back in 1930, according to Jackson Brainerd, a senior policy specialist at the National Conference of State Legislatures. It’s not just streaming that state tax authorities are eyeing. Some states have also begun taxing other services, such as tanning, landscaping, dry cleaning, interior design work, dating referral services, and pet grooming and boarding. Connecticut has added 20 such services, the most in the country, over the past decade, Brainerd said. “Our current sales tax is designed for a Sears Roebuck economy driven by over-the-counter sales,” Ned Lamont, the governor of Connecticut, said in a budget address last year in support of a streaming tax. “Today we live in an Amazon economy, which is driven by e-commerce, digital downloads and consumer services. “Movie theaters charge a tax, and Netflix should be treated the same,” Lamont added. State sales taxes have gradually increased over the past few decades, to an average of 6% today, according to Brainerd. For some consumers, a 6% sales tax might not seem like much. For example, a subscriber to Netflix’s premium service would pay an extra $0.96 a month, for a grand total of $16.95. However, the costs mount for those subscribing to multiple services. A subscriber who signs up for Netflix, Hulu, Disney Plus, Amazon Prime Video and HBO Now would pay almost $4 extra in tax each month, in addition to roughly $63 in subscription fees. Spokespeople for those streaming services firms did not respond to requests for comment.

Twenty-two states plus the District of Columbia currently tax streamed video or audio media, Michael J. Allen, associate commissioner for tax policy in Maine’s Department of Administrative and Financial Services, testified earlier this month in the state legislature. Chicago has also levied a similar city tax since 2015. This tax play on the state level comes as more providers are starting to offer streamed content. NBCUniversal, parent company of CNBC, is launching a streaming service, Peacock, in April. Maine lawmakers proposed a bill to begin taxing digital goods beginning Oct. 1. Services that aren’t permanently owned — like a Netflix subscription — would be taxed at a 6% rate, while digital purchases, such as an e-book downloaded to an Amazon Kindle e-reader, would see a 5.5% tax. The digital streaming tax would raise an estimated $3.73 million in 2021 and $6 million in 2023 for the state, Allen said. Kansas’ governor, who recommended that a sales tax on digital property be applied beginning July 1, projects the levy would raise $26.7 million in 2021.


Company: cnbc, Activity: cnbc, Date: 2020-02-24  Authors: greg iacurci
Keywords: news, cnbc, companies, digital, expensive, state, sales, policy, spotify, making, states, streaming, video, services, netflix, tax


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post

Billionaire investor Howard Marks says investors are ‘not discriminating’ between stocks as market sells off

Billionaire investor Howard Marks said he is unsure about the risk of the coronavirus to the markets but that Monday’s sharp fall for stocks was a product of a change in sentiment and not pessimism about individual companies. The pullback was widely spread, with decliners at the New York Stock Exchange outnumbering advancers nine to one, according to FactSet. Marks, the co-chairman of Oaktree Capital Management, said investors tend to be too optimistic or too pessimistic about economic condition


Billionaire investor Howard Marks said he is unsure about the risk of the coronavirus to the markets but that Monday’s sharp fall for stocks was a product of a change in sentiment and not pessimism about individual companies.
The pullback was widely spread, with decliners at the New York Stock Exchange outnumbering advancers nine to one, according to FactSet.
Marks, the co-chairman of Oaktree Capital Management, said investors tend to be too optimistic or too pessimistic about economic condition
Billionaire investor Howard Marks says investors are ‘not discriminating’ between stocks as market sells off Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-24  Authors: jesse pound
Keywords: news, cnbc, companies, sells, investors, coronavirus, billionaire, york, stock, saidmarks, marks, stocks, discriminating, market, investor, howard, today, tax, unsure, thought


Billionaire investor Howard Marks says investors are 'not discriminating' between stocks as market sells off

Billionaire investor Howard Marks said he is unsure about the risk of the coronavirus to the markets but that Monday’s sharp fall for stocks was a product of a change in sentiment and not pessimism about individual companies.

“On a day like today, people, for the most part, are making market-wide reactions. They’re not discriminating,” Marks said on CNBC’s “Halftime Report.” “When things are placid, people make distinctions. When there’s panic, they take them out and shoot them all.”

The major U.S. stock indexes were down more than 3% around midday on Monday, with the Dow Jones Industrial Average down more than 1,000 points. The pullback was widely spread, with decliners at the New York Stock Exchange outnumbering advancers nine to one, according to FactSet.

Marks, the co-chairman of Oaktree Capital Management, said investors tend to be too optimistic or too pessimistic about economic conditions.

“A week or two ago, people thought it was flawless. And now today they think it’s hopeless,” Marks said.

The market has sold off amid rising fears about the impact of the coronavirus outbreak on economic growth. There were more 79,000 confirmed cases of the virus around the world, with new cases in Italy and South Korea accelerating over the weekend.

Marks said that the market is slightly expensive compared with historical levels and that he is unsure what the impact of the coronavirus outbreak will be.

“What I’ve been saying for months is that I’m afraid to be in the market today. I’m also afraid to be out,” Marks said.

Marks, whose firm has about $125 billion in assets under management and is mostly invested in the credit market, said there was not one specific area that he thought offered a great buying opportunity.

“They’re are no screaming bargains today. It’s all a matter of finding the examples within each asset class that are a little more attractive than the others,” Marks said.

Marks also said that he would support former New York Mayor Mike Bloomberg’s presidential run and would be open to a higher personal income tax rate and a financial transactions tax.


Company: cnbc, Activity: cnbc, Date: 2020-02-24  Authors: jesse pound
Keywords: news, cnbc, companies, sells, investors, coronavirus, billionaire, york, stock, saidmarks, marks, stocks, discriminating, market, investor, howard, today, tax, unsure, thought


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post

Buffett says it’s ‘almost certain’ stocks will beat bonds over long term if rates, taxes stay low

Warren Buffett says stocks are the place to be invested in for the long haul if interest rates and corporate taxes remain near current levels. Stocks got off to a hot start in 2020, with the S&P 500 and other major U.S. averages reaching all-time highs. Last year, the S&P 500 surged more than 28% to keep the longest bull market in U.S. history going. The market got another jolt at the end of 2017, when the Trump administration slashed the U.S. corporate tax rate to 21% from 35%. He noted that oc


Warren Buffett says stocks are the place to be invested in for the long haul if interest rates and corporate taxes remain near current levels.
Stocks got off to a hot start in 2020, with the S&P 500 and other major U.S. averages reaching all-time highs.
Last year, the S&P 500 surged more than 28% to keep the longest bull market in U.S. history going.
The market got another jolt at the end of 2017, when the Trump administration slashed the U.S. corporate tax rate to 21% from 35%.
He noted that oc
Buffett says it’s ‘almost certain’ stocks will beat bonds over long term if rates, taxes stay low Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-22  Authors: fred imbert
Keywords: news, cnbc, companies, certain, rates, equities, stocks, major, remain, buffett, term, stay, long, bonds, low, tax, market, corporate, taxes, near


Buffett says it's 'almost certain' stocks will beat bonds over long term if rates, taxes stay low

Warren Buffett says stocks are the place to be invested in for the long haul if interest rates and corporate taxes remain near current levels.

“If something close to current rates should prevail over the coming decades and if corporate tax rates also remain near the low level businesses now enjoy, it is almost certain that equities will over time perform far better than long-term, fixed-rate debt instruments,” Buffett wrote in his annual letter to Berkshire Hathaway shareholders, which was released Saturday morning.

The letter also pointed to more exposure for two of his potential successors and addressed the company’s inability to find an attractive, monster-sized acquisition target, which the ‘Oracle of Omaha’ has been known for.

Stocks got off to a hot start in 2020, with the S&P 500 and other major U.S. averages reaching all-time highs. Last year, the S&P 500 surged more than 28% to keep the longest bull market in U.S. history going.

The market got a boost from low interest rates from the Federal Reserve during this bull run, pushing bond yields lower and making equities a more attractive investment. The market got another jolt at the end of 2017, when the Trump administration slashed the U.S. corporate tax rate to 21% from 35%.

These elements, coupled with the “American Tailwind,” will make “equities the much better long-term choice for the individual who does not use borrowed money and who can control his or her emotions,” Buffett said.

The investing legend, however, offered a big caveat to his prediction: “Anything can happen to stock prices tomorrow.” He noted that occasionally, “there will be major drops in the market, perhaps of 50% magnitude or even greater.”


Company: cnbc, Activity: cnbc, Date: 2020-02-22  Authors: fred imbert
Keywords: news, cnbc, companies, certain, rates, equities, stocks, major, remain, buffett, term, stay, long, bonds, low, tax, market, corporate, taxes, near


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post

US and Europe divided at G-20 summit on how to tax tech giants like Facebook

German Finance Minister Olaf Scholz speaks to the media on February 21, 2020 in Riyadh, Saudi Arabia. The G20 summit of the Finance Ministers and the central bank governors takes place in Riyadh under the G20 presidency of Saudi Arabia. RIYADH — G-20 leaders in Saudi Arabia are using a summit in Riyadh to find an “urgent solution” to international digital taxation, exposing global divisions over how to tax big technology firms. That is bad for the individual countries, bad for the multinationals


German Finance Minister Olaf Scholz speaks to the media on February 21, 2020 in Riyadh, Saudi Arabia.
The G20 summit of the Finance Ministers and the central bank governors takes place in Riyadh under the G20 presidency of Saudi Arabia.
RIYADH — G-20 leaders in Saudi Arabia are using a summit in Riyadh to find an “urgent solution” to international digital taxation, exposing global divisions over how to tax big technology firms.
That is bad for the individual countries, bad for the multinationals
US and Europe divided at G-20 summit on how to tax tech giants like Facebook Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-22  Authors: dan murphy
Keywords: news, cnbc, companies, riyadh, g20, giants, taxation, europe, divided, global, facebook, tax, arabia, world, tech, taxes, saudi, summit, finance


US and Europe divided at G-20 summit on how to tax tech giants like Facebook

German Finance Minister Olaf Scholz speaks to the media on February 21, 2020 in Riyadh, Saudi Arabia. The G20 summit of the Finance Ministers and the central bank governors takes place in Riyadh under the G20 presidency of Saudi Arabia.

RIYADH — G-20 leaders in Saudi Arabia are using a summit in Riyadh to find an “urgent solution” to international digital taxation, exposing global divisions over how to tax big technology firms.

“You need to have an international tax system,” U.S. Treasury Secretary Steven Mnuchin told an audience of high-level dignitaries on Saturday.

“You cannot have, in a global economy, different national tax systems that conflict with each other. That is bad for the individual countries, bad for the multinationals, and it just doesn’t work,” he said, flanked by finance ministers from Saudi Arabia, India, Germany and France.

The EU, which doesn’t have a tech industry of note, is spearheading a global effort to regulate the major tech firms. America’s Silicon Valley titans, who dominate the landscape, fear that new taxes and increased regulation could stifle innovation or hurt company profits.

“This is a key political question for the 21st century,” said Bruno Le Maire, France’s minister of economy and finance. “The biggest companies of the world, without any physical presence, are making important profits in some states without paying the due level of taxes,” he said.

Le Maire welcomed progress on talks with the United States and urged the group to reach a consensus on minimum taxation and digital taxation before the end of the year.

“Our citizens can no longer accept paying their due level of taxes, while the most important companies in the world are escaping taxes,” he said.


Company: cnbc, Activity: cnbc, Date: 2020-02-22  Authors: dan murphy
Keywords: news, cnbc, companies, riyadh, g20, giants, taxation, europe, divided, global, facebook, tax, arabia, world, tech, taxes, saudi, summit, finance


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post

Can You Pay Taxes with a Credit Card?

Below, CNBC Select reviews if you can pay taxes with a credit card and the benefits and drawbacks of using a credit card to pay taxes. Yes, you can pay taxes with a credit card, but the real question is, should you? High credit utilization rate Paying taxes with a credit card can have a negative impact on your credit score. Limitations on taxes eligible for credit card payments While many tax payments can be made with a credit card, such as your annual tax return, not all IRS tax forms are eligi


Below, CNBC Select reviews if you can pay taxes with a credit card and the benefits and drawbacks of using a credit card to pay taxes.
Yes, you can pay taxes with a credit card, but the real question is, should you?
High credit utilization rate Paying taxes with a credit card can have a negative impact on your credit score.
Limitations on taxes eligible for credit card payments While many tax payments can be made with a credit card, such as your annual tax return, not all IRS tax forms are eligi
Can You Pay Taxes with a Credit Card? Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: alexandria white
Keywords: news, cnbc, companies, rewards, taxes, credit, pay, minimum, fee, card, payments, tax, payment


Can You Pay Taxes with a Credit Card?

It’s that time of year again when taxes are on the top of everyone’s mind. With less than two months until taxes are due, you may be wondering how you’ll pay for any required state or federal payments. One payment option that may have crossed your mind is a credit card. It can seem enticing to pay taxes with a credit card. After all, you can enjoy at least a 21-day grace period on your payment and may even earn rewards. But that’s not considering any processing fees associated with credit card payments that may outweigh the benefits. So if you can pay taxes with a credit card, will it even be worthwhile? Below, CNBC Select reviews if you can pay taxes with a credit card and the benefits and drawbacks of using a credit card to pay taxes.

Can you pay taxes with a credit card?

Yes, you can pay taxes with a credit card, but the real question is, should you? Unlike paying your taxes with a bank account transfer, credit card payments aren’t free. You’ll wind up incurring a fee that’s a percentage of your tax payment. The fee you’re charged varies by the payment processor you choose.

What it costs to pay taxes with a credit card

The IRS breaks down the fees for each payment processor: PayUSAtax.com : 1.96% fee, minimum $2.69

1.96% fee, minimum $2.69 Pay1040.com : 1.87% fee, minimum $2.59

1.87% fee, minimum $2.59 OfficialPayments.com/fed: 1.99% fee, minimum $2.50 And if you decide to pay with an integrated IRS e-file and e-pay service provider, the fees are higher: PAY1040.com/SpecialOffers/TurboTax : 2.49%, minimum $3.95

2.49%, minimum $3.95 Fileonline.1040.com : 2.35% fee, minimum $3.95

2.35% fee, minimum $3.95 FileYourTaxes.com: 3.93% fee, minimum $2

Benefits of paying taxes with a credit card

Earn credit card rewards If you use a rewards credit card to pay your taxes, you can earn cash back, points or miles. Rewards cards earn you a flat rate of 2X points/miles or 2% cash back on your taxes, but recall the processing fee. For instance, if you owe $1,000 in taxes and choose to pay it with a credit card using the cheapest payment processor Pay1040.com, you’ll incur a 1.87% fee. In order to recoup the fee and earn extra rewards, you’ll need a card with at least a 1.87% rewards return — which rounds up to a 2% or 2X rewards card. So, the Citi® Double Cash Card would be a good choice, offering 2% cash back: 1% on all purchases and an additional 1% after you pay your credit card bill. After subtracting the 1.87% fee, you’d be on track to earn .13% cash back on your $1,000 tax payment — which works out to $1.30. That’s a minor number, but it can be greater if you have large tax payments. Benefit from special financing If you’re looking to buy some time on tax payments, you may consider paying with a credit card to benefit from an intro 0% APR period. Cards like the Discover it® Cash Back can provide over a year of special financing on new purchases, but you need to be OK with forking over the processing fee. The Discover it® Cash Back offers 0% for the first 14 months on purchases and balance transfers (then 13.49% to 24.49% variable APR). Meet spending requirements for welcome bonus offers If you open a new credit card with a welcome bonus, charging taxes to your card can help you meet the spending requirement. Before using a credit card, do the math to see if the bonus reaps a higher reward than the processing fee. For example, the Chase Sapphire Reserve® has a welcome bonus offer of 50,000 bonus points after you spend $4,000 on purchases in the first three months from account opening. If you charge $4,000 in taxes to the Chase Sapphire Reserve® using the cheapest payment processor Pay1040.com, you’ll incur a $74.80 fee. But considering the bonus is worth up to $750 toward travel when you redeem through Chase Ultimate Rewards®, the processing fee is negligible. Convenience factor Completing an online credit card payment is quick, and you receive instant confirmation that your payment went through. However, you’ll have to pay the applicable fee. As an alternative, if you pay with an online bank transfer, you can receive instant confirmation and get the added convenience of no fee.

Drawbacks of paying taxes with a credit card

Processing fees Credit card tax payments incur a fee from the payment processor. The fee varies by processor and is currently 1.87% to 3.93% of the payment with a $2.50 to $3.95 minimum, according to the IRS. If you pay with a credit card that offers a lower percentage of rewards than the fee, it doesn’t really make sense to use a credit card. Interest charges on unpaid balances If you use a credit card to pay taxes, it’s key to pay your balance in full by the due date to avoid interest charges. Otherwise, you can risk debt and high interest charges if you only make the minimum payment and carry a balance month-to-month. For example, if you charge $1,000 in taxes to a credit card with the average 16.88% APR and only make minimum $35 payments, it’d take you roughly 37 months to pay it off and cost you $287 in interest charges. And if you pay with a credit card, you won’t be able to take advantage of any payment plans offered by the IRS. High credit utilization rate Paying taxes with a credit card can have a negative impact on your credit score. Charging high tax payments to a credit card can cause a spike in your credit utilization rate, which is the total percentage of your credit you use. To calculate your utilization rate, simply divide your total credit card balance by your total available credit. So if you have two credit cards with a combined $3,000 balance and a total $10,000 credit limit, your utilization would be 30%. Adding a $2,000 tax payment to that would increase your utilization rate to 50%, which is high. Credit score calculations weigh your credit utilization rate and it’s ideal to keep it as low as possible. FICO found that “high-achievers” (consumers with credit scores 750 and above) maintain utilization rates below 15%. Limitations on taxes eligible for credit card payments While many tax payments can be made with a credit card, such as your annual tax return, not all IRS tax forms are eligible.

Bottom line

Now that you know the pros and cons of paying taxes with a credit card, you can decide if it’s a worthwhile payment option. If your credit card rewards or welcome bonus offer outweigh the processing fee, a credit card payment can be an option. But if you’re uncertain that you can pay your credit card balance in full by the due date and/or the fees are greater than any rewards, you should stick to free tax payment options, such as a bank transfer. Learn more: Are credit card points taxable? Here’s when you may have to pay taxes on your rewards

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the CNBC Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.


Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: alexandria white
Keywords: news, cnbc, companies, rewards, taxes, credit, pay, minimum, fee, card, payments, tax, payment


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post

Tax refunds are going to be delayed for these filers. Here’s why

MaskotMillions of households that hustled to get their tax returns to the IRS early could be waiting until March for their refunds. If you’re claiming the additional child tax credit or the earned income tax credit, the IRS cannot issue your refund before mid-February. Last year, more than 19.2 million tax returns claimed the additional child tax credit, while nearly 25 million returns took the earned income tax credit, according to IRS data through July 25, 2019. Indeed, taxpayers claiming the


MaskotMillions of households that hustled to get their tax returns to the IRS early could be waiting until March for their refunds.
If you’re claiming the additional child tax credit or the earned income tax credit, the IRS cannot issue your refund before mid-February.
Last year, more than 19.2 million tax returns claimed the additional child tax credit, while nearly 25 million returns took the earned income tax credit, according to IRS data through July 25, 2019.
Indeed, taxpayers claiming the
Tax refunds are going to be delayed for these filers. Here’s why Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: darla mercado
Keywords: news, cnbc, companies, earned, additional, heres, income, returns, delayed, tax, irs, credit, child, filers, million, refunds, going


Tax refunds are going to be delayed for these filers. Here's why

Maskot

Millions of households that hustled to get their tax returns to the IRS early could be waiting until March for their refunds. If you’re claiming the additional child tax credit or the earned income tax credit, the IRS cannot issue your refund before mid-February. An anti-fraud law requires the agency to use that additional time to review those returns in an effort to prevent refunds from being issued to scammers. That means these families could be waiting until the first week of March before their refund hits their bank accounts. Last year, more than 19.2 million tax returns claimed the additional child tax credit, while nearly 25 million returns took the earned income tax credit, according to IRS data through July 25, 2019.

Heading off fraud can come at a steep cost. Last year, the IRS debuted a new fraud algorithm — Filter X — which suspended about 1.1 million returns through Sept. 26 because they claimed the earned income tax credit, the additional child tax credit or had incomplete wage and withholding information. Approximately 275,000 of these returns were held for more than 40 days, according to a report from the Taxpayer Advocate Service, an internal watchdog for the IRS. “The tension between preventing fraud and expediting refunds has been a constant, especially in the earned income tax credit program, for many years,” said Pete Sepp, president of the National Taxpayers Union.

Low income hit hardest

Maskot

Delayed refunds may keep cash out of the hands of people who need it most. Indeed, taxpayers claiming the earned income and the additional child tax credits tend to be lower income. For example, in 2020, a married couple with two kids must have an adjusted gross income of no more than $53,330 in order to claim the earned income tax credit. Meanwhile, the additional child tax credit is the refundable portion of the $2,000 child tax credit. It’s worth up to $1,400. Filers who got money back from Uncle Sam last year received an average of $2,860, the IRS found. Refunds often go toward paying surprise medical bills and lowering credit card balances. “If refunds for lower-income people are being held up as an enforcement matter, that’s not even where the revenue savings are,” said Steve Wamhoff, director of federal tax policy at the Institute on Taxation and Policy.

Gearing up

FreezeFrameStudio | E+ | Getty Images


Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: darla mercado
Keywords: news, cnbc, companies, earned, additional, heres, income, returns, delayed, tax, irs, credit, child, filers, million, refunds, going


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post

From a few hundred dollars to $10,000 a month, entrepreneurs share the tips that helped them succeed

Along with the increased revenue, though, came more questions and more decisions about business structure, how to pay herself and whether to use a CPA. She registered the business as a limited liability company, or LLC, to separate her personal assets from those of her site. Eventually, though, “it can really affect your business,” Allec said. “I’m busy running a business,” Weir said. In the planning stages of starting his agency, he was wondering which business structure to use, so he scouted t


Along with the increased revenue, though, came more questions and more decisions about business structure, how to pay herself and whether to use a CPA.
She registered the business as a limited liability company, or LLC, to separate her personal assets from those of her site.
Eventually, though, “it can really affect your business,” Allec said.
“I’m busy running a business,” Weir said.
In the planning stages of starting his agency, he was wondering which business structure to use, so he scouted t
From a few hundred dollars to $10,000 a month, entrepreneurs share the tips that helped them succeed Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: jill cornfield
Keywords: news, cnbc, companies, 10000, allec, personal, entrepreneurs, month, cpa, share, tax, dollars, wiegert, succeed, things, helped, weir, tips, structure, separate, business


From a few hundred dollars to $10,000 a month, entrepreneurs share the tips that helped them succeed

Maskot Bildbyrå | Getty Images

Suddenly your side hustle is more than just pocket change. You could be looking at a new phase of your business, says Kurt Wiegert, a certified financial planner and president of Towson Wealth Management in Towson, Maryland. The trees are everywhere, yet sometimes you can’t see the big-picture forest. For that, you might need an expert — someone who can help you figure out a plan, even when you are foggy on everything but the broadest goals. With years of experience in digital marketing and content creation, Boulder, Colorado, resident Vee Weir realized she could work for herself. She took the leap and started her own digital marketing business in January 2019. In just about a year, Weir, 27, went from invoicing under $100 at a time to thousands of dollars in monthly retainers. “As an entrepreneur, I made $3,000 less [in a year] than I made at my full-time job,” said Weir. “My mind is blown, how I broke even.”

Along with the increased revenue, though, came more questions and more decisions about business structure, how to pay herself and whether to use a CPA. In every kind of business, people fail to think about risk, said Wiegert at Towson Wealth Management, “whether it’s insurance, investments [or] what is an exit strategy.” A onetime consultation with a CFP can put you on the right path in terms of protecting yourself. If your insurance is inadequate, the CFP can help you uncover that. Wiegert recommends considering liability insurance and errors and omissions coverage. You might want to see if some areas can be added to your homeowner’s policy. A good scenario would be a business owner working with both a CPA and a CFP. “It’s a mistake to put everything back into the business,” said Logan Allec, 31, a CPA with a personal finance blog called Money Done Right. “You have to think about retirement options, and a CFP can give a holistic picture.” Here are seven more things you can do to expand your business, from side-hustlers who took it to the next level.

1.) Protect yourself

Vee Weir Source: Vee Weir

Weir, who says she is very risk-averse, immediately took steps to protect herself. She registered the business as a limited liability company, or LLC, to separate her personal assets from those of her site. She got a separate bank account. “It makes tax time easier, and it’s way easier to record your profit, your net, your gross,” Weir said. Weir felt she might be especially vulnerable because of the nature of her work. “In digital marketing, if you say the wrong thing or present inaccurate information” you could be looking at a lawsuit, she says. “You don’t necessarily need to make a lot of money to cause financial harm or be sued,” said Wiegert. Take the person who starts a YouTube channel. Two things to be wary of: copyright or legal issues. “Maybe they’re saying things against a celebrity, and they don’t know what they’re doing,” Wiegert said.

2.) Separate checks

Logan Allec, 31, says neglecting work-life balance is a common mistake for new business-owners. Source: Logan Allec

If your revenue is growing, keep separate accounts. It’s pretty basic, Allec says, but a lot of new business owners make the mistake of not setting up a business account. Aside from the legal implications, “just from a tax and accounting perspective, it’s an absolute nightmare,” said Allec, who lives in Los Angeles. “They’re doing great but running everything through one bank account: holiday gifts, dentist bills, receivables, payables.” Paying someone else to straighten this out is time-consuming and expensive. “I’ve had to bill clients more to clean this up than for tax returns,” Allec said.

3.) An easy finances hack

With a side hustle that’s not a formal business entity, you can just establish another personal account for all your business transactions, Allec says. Another way to keep your personal finances distinct from your business: “If you have an EIN [employer identification number], set up a business credit card,” Allec said. This can simplify sorting expenses later on.

4.) Seek balance

Allec says many fledgling owners neglect their personal finances and well-being. Eventually, though, “it can really affect your business,” Allec said. Entrepreneur types can be workaholics, so overdoing it is understandable. But if you ignore your health and your family and friends, a few years down the road it all collapses. Your support system — those family members and friends, as well as people on your team — is critical, Weir says. “It’s thrilling and risky and scary, and you need people there for your highs and lows, which can happen in one day.” More from Invest in You:

3 questions to ask before launching a new business

How to teach your kid to think like an entrepreneur

Dream of being your own boss? Take this quiz

5.) Build a team

Working with professionals is a way to protect yourself, Weir says. At first, she tried to do things on her own. There’s no rule book, she points out, and she doesn’t have a business degree. When her banker recommended Weir buy a payroll system, she reluctantly agreed, though she thought it was expensive. He said it would be a huge mistake not to use it. But then a CPA she consulted after moving to a new state told her the system was unnecessary after all. “I’m busy running a business,” Weir said. The CPA pointed out that Weir lacks personal expertise as an accountant, so it made sense to outsource some of the money and tax work to a professional. As a single-person company, Weir keeps accurate records of everything she brings in, based on the CPA’s advice. She canceled the payroll system.

6.) What’s everyone else doing?

Anthony Martin chose an S-Corp structure for his agency after conversations with other business-owners. Source: Anthony Martin

Anthony Martin, 37, owns an insurance agency in Reno, Nevada. In the planning stages of starting his agency, he was wondering which business structure to use, so he scouted the competition. “I knew people who had developed large, successful agencies,” he said. “So I asked them what they selected, and why.” Each agency had established itself as an S-corporation for the tax benefits. Martin spoke with a CPA for more insight. While there are more reporting requirements associated with an S-corporation, the tax advantages make it worthwhile, he says. “Everyone seemed to say it comes down to your [revenue] projections and whether the numbers make sense,” Martin said. He began to clear over $50,000 beyond the salary he was taking, and the structure actually worked in his favor. Don’t be afraid to look at your competitors and even ask for advice. “You’ll find most people are happy to share their knowledge,” blogger Allec said. In most cases, you can build a network of people in your field. “Be a resource to them, too,” he said.

7.) You can’t do it all


Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: jill cornfield
Keywords: news, cnbc, companies, 10000, allec, personal, entrepreneurs, month, cpa, share, tax, dollars, wiegert, succeed, things, helped, weir, tips, structure, separate, business


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post

Washington state moves to drop Boeing tax break to head off possible EU tariffs

A Boeing 777X airliner lifts off for its first flight at Paine Field on January 25, 2020 in Everett, Washington. Washington state lawmakers moved on Wednesday to remove a key tax break for Boeing and other aerospace firms in a bid to head off possible European tariffs on U.S. goods and ease a transatlantic trade dispute over aircraft subsidies. Washington state lawmakers in Olympia said they had introduced companion bills in the Senate and House that would remove the aerospace tax break, which s


A Boeing 777X airliner lifts off for its first flight at Paine Field on January 25, 2020 in Everett, Washington.
Washington state lawmakers moved on Wednesday to remove a key tax break for Boeing and other aerospace firms in a bid to head off possible European tariffs on U.S. goods and ease a transatlantic trade dispute over aircraft subsidies.
Washington state lawmakers in Olympia said they had introduced companion bills in the Senate and House that would remove the aerospace tax break, which s
Washington state moves to drop Boeing tax break to head off possible EU tariffs Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-20
Keywords: news, cnbc, companies, break, boeing, state, trade, tax, states, goods, possible, washington, drop, aerospace, union, tariffs, moves, european, united, head


Washington state moves to drop Boeing tax break to head off possible EU tariffs

A Boeing 777X airliner lifts off for its first flight at Paine Field on January 25, 2020 in Everett, Washington.

Washington state lawmakers moved on Wednesday to remove a key tax break for Boeing and other aerospace firms in a bid to head off possible European tariffs on U.S. goods and ease a transatlantic trade dispute over aircraft subsidies.

The United States last week toughened its own tariffs on aircraft built by Boeing’s arch-rival, Europe’s Airbus, after winning approval last year from the World Trade Organization to penalize European goods over Airbus subsidies.

The European Union is widely expected to win approval to impose similar tariffs on U.S. goods when a parallel case over U.S. support for Boeing comes to a head during the spring.

The WTO has found that the world’s two largest planemakers received billions of dollars of unfair subsidies in cases dating back to 2004. The global trade body has faulted both sides for failing to comply with its previous rulings, opening the door to a tariff war.

After years of debate, the main focus of the European case against the United States involves a system of preferential state tax rates for aerospace introduced 16 years ago and renewed in 2013 to help attract production work for Boeing’s 777X.

Washington state lawmakers in Olympia said they had introduced companion bills in the Senate and House that would remove the aerospace tax break, which saved Boeing more than $200 million in 2018.

“There is broad agreement in Olympia that we need to act this session to address the WTO issue in order to avoid retaliatory tariffs that would damage not just our commercial aircraft industry, but other important Washington exports,” Governor Jay Inslee said in a statement.

He said Boeing — which was widely reported to have lobbied for the tax breaks to be extended to include the new 777X program in 2013 — had now asked for them to be removed.

“Boeing has said it would like that tax incentive at least suspended, until the issue is fully settled with the European Union,” Inslee said in a statement.

The 777X, the largest twin-engined jetliner, staged a maiden flight last month.

Boeing said in a statement that it fully supports legislation to reverse the tax breaks.

“This legislation demonstrates the commitment of Washington — and of the United States — to fair and rules-based trade, and to compliance with the WTO’s rulings,” Boeing said.

But, it said, Airbus and the European Union must “finally come into compliance by ending illegal launch aid subsidies once and for all and addressing the harm they have caused the United States aerospace industry and its workers.”

The United States says the European Union has failed to address subsidies for Airbus’ A380 and A350 airliners.

The European Union says it has fallen into line with the WTO’s rulings and accused the Trump administration of dragging its feet on removing aid for Boeing.

Both sides have called for negotiations while accusing the other of failing to cooperate. Meanwhile, makers of products ranging from luxury goods to whisky have raised concerns over the impact of a tit-for-tat tariff war spreading beyond the aerospace industry.


Company: cnbc, Activity: cnbc, Date: 2020-02-20
Keywords: news, cnbc, companies, break, boeing, state, trade, tax, states, goods, possible, washington, drop, aerospace, union, tariffs, moves, european, united, head


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post

The biggest things you probably don’t know about Roth IRAs

“Roth IRAs, Roth conversions, are sometimes seen as really benefiting just wealthy taxpayers,” said Christine Russell, senior manager of retirement and annuities at TD Ameritrade. Here are the biggest things that investors typically do not know about Roth IRAs. But these savings are separate, which means you can make Roth 401(k) contributions and save in a Roth IRA at the same time. Roth IRA conversions can mitigate tax billsJust the term “Roth IRA conversion” alone tends to confuse people, Russ


“Roth IRAs, Roth conversions, are sometimes seen as really benefiting just wealthy taxpayers,” said Christine Russell, senior manager of retirement and annuities at TD Ameritrade.
Here are the biggest things that investors typically do not know about Roth IRAs.
But these savings are separate, which means you can make Roth 401(k) contributions and save in a Roth IRA at the same time.
Roth IRA conversions can mitigate tax billsJust the term “Roth IRA conversion” alone tends to confuse people, Russ
The biggest things you probably don’t know about Roth IRAs Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: lorie konish
Keywords: news, cnbc, companies, iras, money, individuals, conversions, things, know, probably, russell, roth, retirement, dont, 401k, tax, biggest, ira


The biggest things you probably don't know about Roth IRAs

Thanagon Karaket / EyeEm | EyeEm | Getty Images

You may be overlooking one retirement investment choice. That’s the ability to put away post-tax money through a Roth individual retirement account. Recent research from TD Ameritrade finds that many individuals are confused when it comes to Roth IRAs. And that means many people are leaving cash on the table when it comes to maximizing this savings strategy. “Roth IRAs, Roth conversions, are sometimes seen as really benefiting just wealthy taxpayers,” said Christine Russell, senior manager of retirement and annuities at TD Ameritrade. “In fact, the Roth has benefits for many different taxpayers and many different tax brackets.” Here are the biggest things that investors typically do not know about Roth IRAs.

Roth IRA and 401(k) contributions are not the same

Many 401(k) plans now offer savers the ability to contribute post-tax money. But these savings are separate, which means you can make Roth 401(k) contributions and save in a Roth IRA at the same time. The accounts are also subject to different rules. Roth savings options in 401(k) plans are subject to maximum limits for those accounts. In 2020, that will be $19,500, or $26,000 for individuals age 50 and over. Roth IRAs are subject to earnings limits. For many individuals, that is less than $124,000 in modified adjusted gross income, or $196,000 if you are married and filing jointly.

A Roth IRA is OK before hitting 401(k) max

Many workers get their retirement savings education from their employer. Often, those employer-provided plans are 401(k) plans. And you generally want to contribute enough to that account to get the employer match. But what many investors — 6 in 10 — erroneously believe is that you can only contribute to a Roth once you hit your 401(k) maximum, according to TD Ameritrade’s research. “You can certainly be contributing to both a Roth IRA and a 401(k) at the same time,” Russell said. “You don’t have to reach that 401(k) maximum in order to contribute to a Roth IRA.”

Contributions can be made after 70½

Just 22% of individuals surveyed by TD Ameritrade said they know it’s still possible to contribute to a Roth IRA after they reach age 70½. Russell attributes that misconception to the fact that traditional pretax IRAs have prohibited individuals from making contributions after that age. But that changed this year. A new law, the Secure Act, will now let individuals put away retirement savings in all types of IRA accounts beyond age 70½, provided you have earned income. More from Personal Finance:

How to get your tax refund sooner

Four ways to invest your tax refund wisely

How your state measures up as a retirement spot There are advantages to saving in a Roth IRA, however, that investors should know about. With Roth IRAs, the money you contributed can be taken out tax-free, because the money you invested was post-tax in the first place. When it comes to the earnings on the money you invested in a Roth IRA, there’s a five-year rule before you can take that out penalty-free (as long as you’re older than 59½). The good news is that the five-year rule on earnings is dependent on when you first open the account, Russell said. That’s why it’s a good idea to open a Roth IRA as soon as possible, even if it’s just with a small amount of money, to get that five-year clock ticking, Russell said.

Roth IRA conversions can mitigate tax bills

Just the term “Roth IRA conversion” alone tends to confuse people, Russell said. But the strategy can be very valuable in helping savers manage their taxable income in retirement. A Roth IRA conversion is when you move money from a pretax traditional IRA to a post-tax Roth. This technique enables the after-tax money to grow and eventually become tax-free so that account holders don’t have to pay taxes on it later on, Russell said.

You can do multiple Roth IRA conversions in one year. It’s a good idea to keep in mind what tax bracket you were in last year so that you don’t push yourself into a higher tax bracket with this transaction, Russell said. It’s also wise to break up your conversions into pieces. If you want to convert $20,000 this year, for example, you could do it in two days to try to sell on market lows. You may also want to break your conversions up over a few tax years, Russell said. One caveat: Since the Tax Cuts and Jobs Act was passed in 2017, you can no longer reverse those conversions. “Being a little bit more strategic when doing your conversion is important, because you can’t undo it,” Russell said.

Roth IRAs can help control Medicare costs


Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: lorie konish
Keywords: news, cnbc, companies, iras, money, individuals, conversions, things, know, probably, russell, roth, retirement, dont, 401k, tax, biggest, ira


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post

Elizabeth Warren buys full-page ad slamming Sheldon Adelson in his own newspaper day after debate

Democratic presidential candidate Sen. Elizabeth Warren (D-MA) is interviewed on MSNBC inside the spin room at Bally’s Las Vegas Hotel & Casino after the Democratic presidential primary debate on February 19, 2020 in Las Vegas, Nevada. In a bold move, the Massachusetts lawmaker took out a full-page ad Thursday revealing how much billionaire Sheldon Adelson would pay under her wealth tax — in his own newspaper. The figure represents “less than 6% of his wealth,” the ad reads. “With that small wea


Democratic presidential candidate Sen. Elizabeth Warren (D-MA) is interviewed on MSNBC inside the spin room at Bally’s Las Vegas Hotel & Casino after the Democratic presidential primary debate on February 19, 2020 in Las Vegas, Nevada.
In a bold move, the Massachusetts lawmaker took out a full-page ad Thursday revealing how much billionaire Sheldon Adelson would pay under her wealth tax — in his own newspaper.
The figure represents “less than 6% of his wealth,” the ad reads.
“With that small wea
Elizabeth Warren buys full-page ad slamming Sheldon Adelson in his own newspaper day after debate Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: yelena dzhanova
Keywords: news, cnbc, companies, trumps, wealth, took, fullpage, newspaper, day, adelson, elizabeth, warren, tax, sheldon, debate, las, presidential, slamming, vegas, spent, buys


Elizabeth Warren buys full-page ad slamming Sheldon Adelson in his own newspaper day after debate

Democratic presidential candidate Sen. Elizabeth Warren (D-MA) is interviewed on MSNBC inside the spin room at Bally’s Las Vegas Hotel & Casino after the Democratic presidential primary debate on February 19, 2020 in Las Vegas, Nevada.

Sen. Elizabeth Warren is not letting up on billionaires.

In a bold move, the Massachusetts lawmaker took out a full-page ad Thursday revealing how much billionaire Sheldon Adelson would pay under her wealth tax — in his own newspaper.

Adelson, who has a net worth of $39.6 billion, according to the ad, would pay $2.3 billion in taxes in the first year under her plan.

The figure represents “less than 6% of his wealth,” the ad reads.

“With that small wealth tax, we can invest in Nevada families,” the ad in the Las Vegas Review-Journal reads in bold print.

The ad lists four potential areas in which the money can be spent: cancellation of student debt in the state, 91,000 more families eligible for free childcare, additional funding for nearly 500,000 school students, and the elimination of tuition in public universities and colleges in Nevada.

The ad is not the first time Warren has singled out Adelson. In October, Warren in a tweet called him “a casino tycoon & 1 of Trump’s billionaire buddies.”

Adelson is a top Republican donor who’s been a full-throated defender of President Donald Trump. He was a top financier for Trump’s 2016 presidential campaign.

Warren’s campaign did not immediately respond to a request for comment.

The ad buy comes a day after Warren took on former New York Mayor Mike Bloomberg on a debate stage, during which she pressed him on his record with women and female employees and slammed him for trying to buy the election. Bloomberg has spent more than $400 million of his personal fortune on campaign advertising.


Company: cnbc, Activity: cnbc, Date: 2020-02-20  Authors: yelena dzhanova
Keywords: news, cnbc, companies, trumps, wealth, took, fullpage, newspaper, day, adelson, elizabeth, warren, tax, sheldon, debate, las, presidential, slamming, vegas, spent, buys


Home Forums

    • Forum
    • Topics
    • Posts
    • Last Post