Starting January 1, 2019, if you rent a vehicle in Massachusetts you might notice a small but unexpected addition to your bill. In July of 2018 Governor Baker signed into law Bill H.4516, “An Act Relative to the Municipal Police Training Fund,” that, in part, adds a two-dollar surcharge to short-term vehicle rentals in the state.
The proceeds from the vehicle rental surcharge will go to support the efforts of the Municipal Police Training Committee, which is responsible for setting standards and conducting trainings for local police, UMass police, and state environmental police.
Vendors are being notified of this new surcharge, which they will be required to add to rentals of passenger cars, trucks, vans, and trailers, but only for contracts with a duration of more than 12 hours, but less than 30 days.
Let’s face it: Taxes are complicated. That’s why so many people hire professionals to assist in the process. Ironically, this year’s tax season headaches started for the IRS shortly after the Tax Cuts and Jobs Act passed last year. While many are anticipating a simpler process moving forward, the sheer amount of documentation that must be updated to comply with new and existing rules is anything but simple for the agency that regulates it.Imagine all the different forms, guides, systems and software the IRS uses that have to be changed and checked before April 15th, 2019. The article linked below discusses how, even though the IRS didn’t waste any time setting up a plan to get the revisions done as quickly as possible, the complex nature of the overall task is pushing deadlines.
Hang up. Or better yet, don’t answer the phone if you don’t recognize the number. Then report the call. We guarantee you it’s not the IRS on the other end of the line.
If you’re like most people these days, you or someone you know has received a call claiming to be from the IRS. Often the caller says there is a warrant out for your arrest and you need to pay back taxes and fines right away to avoid legal action. The script is designed to frighten and intimidate people into giving up sensitive personal information, and sadly, it often works.
Scammers are everywhere, and they continue to become more savvy and creative. The bottom line is that as long as these calls continue to work, the criminals are not going to stop. That is why we want to do our part to help put them out of business. Learning how to spot the signs of a fraudulent call is the key to avoid being scammed, so the IRS has provided the guidelines below.
Remember, the IRS will never:
Call to demand immediate payment, nor call about taxes owed without first having mailed you a bill.
Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe.
Require you to use a specific payment method for your taxes, such as a prepaid debit card.
Ask for your credit or debit card number over the phone.
Threaten to bring in local law enforcement to have you arrested.
According to the IRS, the formula to determine if you will pay taxes on your Social Security income is to take one half of your Social Security benefits and add that amount to all your other income, including tax-exempt interest. This number is known as your combined income (combined income = adjusted gross income + nontaxable interest + half of your Social Security benefits).
If your combined income is above a certain limit (the IRS calls this limit the base amount), you will need to pay at least some tax. The limit is $25,000 if you are a single filer, head of household or qualifying widow or widower with a dependent child. The same applies if you are married filing separately and you lived apart from your spouse for the entire tax year. The limit for joint filers is $32,000. If you are married filing jointly and you lived with your spouse for any part of the tax year, all of your Social Security income is taxable.
When retirees need extra money their first choice is generally taking an additional IRA distribution. What they may not realize is that this is taxable income, and therefore it increases their taxable Social Security amount. For example, an additional $12,000 IRA distribution may increase the taxable Social Security portion by as much as $6,000.
If it’s available to you, the safest bet for an immediate cash need is to use your savings. Though this may seem counterintuitive, you can see how adding any money that is considered taxable income to your base limit could potentially end up costing you money.
For the same reason, if you do need to take an additional distribution from your IRA, make sure you think about how much you really need. For instance, if you only need $5,000, but take $10,000 with the idea that it will give you a rainy day fund, at least some of that money may be eaten up in taxes if it causes your taxable income to exceed the base limit.
Whatever your circumstance, we are here to help. Give us a call if you have questions about the best course of action for your particular situation.
We frequently receive calls from clients requesting their spouse’s, children’s, and/or parents’ social security number. By law, we cannot give clients’ social security numbers over the phone. Even if we know who’s calling. And because these numbers are more valuable than gold to identity thieves, we all need to be extra vigilant about keeping them confidential. We can only provide this information if the request is submitted in writing, via e-mail or letter, or if you visit us in person and provide the proper identification.
You can hardly look at the news these days without hearing about another scam or data breach that has potentially put your personal information at risk. As keepers of sensitive information for our clients, we take our legal responsibility toward protecting that information extremely seriously. Just as your health care providers need to adhere to strict legal guidelines with regard to releasing any information, we are legally bound to follow similar rules. Unfortunately, sometimes this can be frustrating for clients.
We are fortunate to have friendly, often decades-long relationships with most of our clients. We may even recognize your voice when you call. The downside of this is that, even when we are 100% certain that it’s you on the other end of phone, we cannot release any information without properly documented authorization.
When mortgage brokers contact us regarding your finances we are happy to provide them what they need on your behalf, but only if we have heard from you first!In order to disburse any personal financial information we require proper authorization, in writing. So while it’s easy to get caught up in the excitement of buying or refinancing a house, don’t forget to let us know in advance, via e-mail or letter, that you are in the process of applying for a loan.
We can all agree that laws and policies are that in place to keep your information safe are necessary. But they can also cause delays in getting things done. You can rest assured that the last thing we want to do is cause you any inconvenience. On the contrary, the first thing we want to do is to protect your information, and not just because we are required to by law!
Let us know if you have any questions about this subject, or if you have any life events coming up that will require us to release your financial information. We are here to help!