Whenever tax season comes along, one cannot help but think of the line from “Friday the 13th,” when the village’s drunken old man tells the horny teenagers: “Doomed…you’re all doomed…” That’s the best way to describe tax season and the taxman.
Although Christmas is upon us and everyone is thinking of Santa Claus, tax season is right around the corner, and GoBankingRates released a list of the seven biggest federal income tax changes for 2015.
Here is the list:
1. Pell Grants, Living Expenses and Education Credits
Summary: Pell grants can now be used as living expenses in addition to their tuition and fees.
2. Bitcoin
Summary: Payments received in bitcoin, or virtual currency, should be included at market value in tax return. Virtual currency investments will be calculated differently in tax returns.
3. Saving for Health Care
Summary: If Americans maintain Flexible Spending Accounts and have at least $500 carried over into the new year then they cannot maintain a Health Savings Account for the entire year of 2015.
4. Unemployment Benefits
Summary: Unemployment benefits are classified as taxable income, and these people will receive Form W-2 and/or Form 1099-G with the amount of benefits reported.
5. IRA Rollover Limits Starting in 2015
Summary: As of Jan. 1, 2015, individuals can have one rollover from an IRA to another IRA in a 12-month timeline.
6. Foster Care
Summary: The Internal Revenue Service has broadened the term “foster care” to mean more than just taking in a child unrelated to the foster parents. It will now include “if you provide non-skilled medical support services or care for a person, living in your home, who has physical, mental or emotional issues, and you receive payments from the state or certified Medicaid provider.”
7. Keeping up With the Joneses, or Inflation
Summary: Taxpayers will now be placed in the 36 percent tax bracket if they fall into any of these categories:
- $228,800 for married filing separately.
- $406,750 for single.
- $432,200 for head of household.
- $457,600 for married filing jointly.
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