In a few days, Halloween will be in the rear view mirror as will the month of October and as we all know the holiday season of Thanksgiving and Christmas will then be on us and then over in a blink of an eye. As Ben Franklin pointed out, there are only two things that are certain in life and if you are alive and reading this blog the other thing is what I am talking about. So as the title has already given away, the inevitable Tax Season is approaching rapidly and here are some tidbits to keep in mind as you prepare for it.
- The Standard Deduction for 2015 rose a little to $6,300.00 per person or $12,600.00 for married couples. If you are single and over 65, then you can claim $7,850. If you are married and only one of you is over 65, then you can claim $13,850.00. If you are both over 65, then you can claim $15,100.
- The 2015 tax brackets are a little wider due to mild inflation, but the actual tax rates did not change. They are still 10%, 15%, 25%, 28%, 33%, 35% and 39.6%.
- Personal exemptions are increasing to $4,000.00 per filer and dependents. If you had a new addition to the family in 2015, congratulations as they count as $4,000.00 off as well.
If you think you might not have paid as much in taxes as you should have for some reason and have a little extra cash available, then you might want to consider one of these options in order to reduce your tax bill,
- Make extra year-end distributions to your 401-K or IRA.
- Realize losses on dead stocks you have been holding that never seem to go up. You can always buy them back if you really want to hold that particular stock in your portfolio and thus acquire a new tax cost basis.
- Postpone income until 2016 or accelerate itemized deductions if at all possible.
If you know you are going to owe a tax debt for 2015 and you are feeling the weight of its financial burden on you and your family or you have past tax debt that you just can’t seem to whittle down, please call one of our Bond & Botes affiliated offices. We offer free initial consultations so feel free to call one of our conveniently located offices to set up a private consultation with one of our experienced attorneys. We will analyze your situation and help you make the best decisions possible to help you eliminate your tax debt.
But remember, one good thing about taxes is as long as you are paying them, you are alive and your family is not dealing with the aftermath of the other certain thing in life.
Grant McNutt is a Managing Attorney at the Bond & Botes Law Offices in Florence and Haleyville, Alabama. He holds a Bachelor of Science from the University of Alabama, and a Juris Doctorate from the Birmingham School of Law. He has been practicing Consumer Bankruptcy Law since 1999.Read his full bio here.