Unlike the traditional tax filing deadline of the 15th April every year, there was a slight respite this year with the deadline extended until April 18th. With federal income tax, state income tax, total income tax, earnings. And then there are specific ways to calculate these taxes based on your filing type, locations, and annual earnings to add to the complications. Tax filing with so many calculations, number crunching is never a fun job. A tax professional does it all for you. But, if you can’t afford one and want to save up a few bucks on hiring a professional, there are tax software to give you a breather in filing your 1040EZ or 1040A and state returns easily with simple steps online. Also, the best tax software educate you, leaving you confident about your returns rather than getting you worried about an audit. Taking a cue from user experiences in 2017, we summarize our observations on the best tax software of 2017 available to consumers. While there are a few software that will file your returns free of cost if your earnings are within a certain limit, there are a few of them who are free for beginners. The best tax software in 2017 demonstrated wringer, evaluating facilitation, disbursement options, accuracy tools and deduction discovery making the entire experience of filing the taxes enjoyable.

Taxable income is what you earn from any work: business, rental income, awards, investment income, gambling or other business activities. It does not include educational funds, gifts, inheritances, payments from accidents or worker compensation. Taxable income for 2017 tax brackets is broken down into seven brackets, each is taxed at a different rate. IRS makes adjustments of over 40 taxes for inflation. Each earning individual is then pushed into a bracket/tax slab that affects him/her, it is also called the “bracket creep.” This adjustment pushes the people into higher income tax brackets or reduces the value of their credits/deductions due to inflation, instead of any real increase in income. Choosing 2017 tax brackets The IRS adjusts tax laws based on the Consumer Price Index (CPI). It is a measure of inflation and the cost of living. Consumer Price Index (CPI) is used by the IRS to calculate last year’s inflation and adjust the income threshold, deduction amounts, and credit values. Changes in the CPI influences 2017 tax brackets, deductions, exemptions and credits and income thresholds. When CPI increases, the tax brackets move. If your salary stays the same, you can drop into a lower tax bracket (owe less in tax). 2017 Tax Brackets The income limits are adjusted for inflation for all tax brackets.

You pay the government a certain amount of your income as tax, which is then used to give you better public services. The Internal Revenue Service (IRS) is the agency that is officially responsible for collecting the whole country’s tax. On the IRS website, you can not only file your federal taxes that are collected by the government but also file state tax returns that go to the state you reside in. What are the steps for E-filing taxes on IRS? Today, E-filing (electronically filing) taxes has become the best way to go about it. For E-filing taxes, you need to follow the following simple steps: • Gather the documents – The first step is to gather all the documents you will require for E-filing taxes and keep them ready. Make sure that you have the W-2 form, income statements, health insurance coverage documents, money spent on charity, and interest statements for the same. • Research –  Once you have the documents ready, see if you fall under the free tax return preparation. If you have military men, people with disability, or a senior citizen in your family, you can get certain leeway on the tax returns. • Fill the right form –  Use the IRS E-file website to fill the tax form, as here you can be sure that you are filling the correct tax form.

With President Trump’s ruling on December 22, 2017, the Tax Cuts and Jobs Act of 2017 came into existence, due to which various tax-related provisions for 2018 underwent changes. The Internal Revenue Service (IRS) announced these changes pertaining to taxes, and this includes the changes to the tax rate chart as well. So, an average American taxpayer has to brace themselves for major changes in their tax system; while calculating their taxes for 2018, they need to adhere to the 2018 tax rate chart that has undergone major changes as compared to the previous year’s tax rate chart. On the one hand, you would have to exercise caution while filing taxes for the year 2017–2018 since you have to refer to the previous year’s income tax charts. On the other hand, you will have to observe the 2018 income tax charts while filing taxes for the year 2018–2019. It is common knowledge that your taxable income is the money you earn from work; however, educational funds, inheritances, gifts, and other compensations aren’t included in your taxable income. Therefore, the income tax will be levied on the money you have earned through the year, and you can gauge which tax bracket you fall into by referring to the 2018 income tax charts, where you will find the amount of tax to be paid against the taxable income.

The Internal Revenue Service (IRS) defines gift tax as the tax that is imposed on the ownership of a gifted asset. Here, the term “gift” is defined by the IRS is any transfer made to a recipient with no expectation of reimbursement. The taxable gift can be in the form of cash, real-estate, stocks, or any other tangible or intangible property. The recipient cannot pay the patron or giver full value of something that is considered as a gift. However, the recipient can pay an amount that is less than the value of the gift. The recipient can also offer to pay the gift tax on the patron’s behalf or a percentage of it in case the patron has exceeded their annual gift tax exemption limit. Gift tax reforms for the year 2018 The IRS had earlier announced that they would be increasing the annual gift tax exclusion due to inflation. The annual gift tax exemption is the amount of money or its equal value as a tangible asset that can be transferred in the form of a gift to a recipient without incurring any gift tax that might affect the unified credit. The exemption will be $15,000 per recipient for the year 2018, which has been $14,000 since past five years.

Estate tax planning can be an overwhelming task in the beginning, especially if you don’t do well with tax jargons. But once you understand the trick of the trade, you are good for life. Read this article to know more about the 10 things that determine your taxable estate amount. Debts and the expenses Debts include everything right from your mortgages, personal loans to the credit card debt that you owe the bank at the time of your death. All these debts are deduced from the gross estate to calculate the net estate tax. Other than the debts, expenses like funeral expense, medical fees, and attorney fees too are to be deducted from the gross estate. Charity and donation Though not many people choose to do this, donating some of your wealth to a charitable organization is a great way to save up on your estate tax. It is observed, that for every dollar that you donate to any charitable organization, a dollar from your taxable estate is reduced. For those wondering what exactly comes under charitable transfer, any kinds of gifts donated, or property set aside for a charitable trust comes under this. Transfer made to your spouse One of the best features of the estate tax calculator is that it allows you to make an unlimited marital deduction.

To get the finances in order, it is necessary to have the tax planning for 2018 in order. It ensures that one makes all the right money moves next year. It is important to know how the federal tax reforms can be benefited. One must know how the new tax bill will impact them as the reforms may lead to some paying more and some paying less tax. Here are five tips for tax planning in 2018 one must consider. Get organized It can be frustrating that one has to stop with everything and start tax planning for 2018 by searching for statements and receipts. Some organization foresight can help reduce the stress. It is a smart idea to have a good record keeping system for filing statements and receipts of the whole year as this will make tax planning for 2018 easier. Make copies of all the returns and keep them in a safe place. Consider taking a back up on thumb drives or other devices that are separate from the computer as it can be stolen or hacked and you may lose the electronic copies. The standard rule is to retain returns and keep the documents for at least three years.

It is a given that the more rich you get, the more taxable you become. That doesn’t mean that you take the entire burden and pay so much of tax, causing harm to your coffers. There are some ways of saving tax in a smart, yet ethical manner, and they are as follows: Make your children work under you Should you happen to have a business that is unincorporated, making your children work under you can give you massive tax advantages. The children not only get to learn the tricks of the trade and be occupied with doing something productive, but you can deduct from what you pay them, with which the taxable income shifts from your tax bracket to theirs. Kiddie tax cannot be applied here since wages are earned income. If the child is aged below 18, no Social Security tax can be levied on their earnings as well. They can rather be of greater use for an IRS contribution. Be innovative when being generous A foundation or a charitable-remainder trust can assist you in not paying taxes on capital gains on appreciated assets, and get you income for lifetime. You can receive a tax deduction now for a charitable donation that will be made after your death.

As a young family ranging from their early 20s to early 40s, there are plenty of expenses that must be taken care of. Once you start a family, the expenses only increase, and you have a lot to plan ahead as well. While investments seem like the need of the hour, there are plenty of other steps which can help you save on additional taxes and use your income to your benefit. Here are the best ways of tax savings for young families: Get your employer to give you a raise, but smartly You need to find out if you had too much of a tax refund given to you this year. If the payout was big, then there is a chance that a lot of money is being cut from your paycheck regularly. Get in touch with the concerned department at your employer’s office and see whether you are eligible for more allowances, which will help you save on the tax and get more money on a monthly basis. Figure out how you can get through a health tax break If a medical allowance is offered to you, ensure you make the most of it. Ask your employer to let you put the highest possible sum in this fund.

As an older family, when you think of saving taxes, you need to consider your investment funds. In fact, taking a good look at all your investments would help you see the ones that are the best in terms of tax savings. Here are a few steps you can take for saving on tax as an older family. Invest in lesser lock-in periods As you approach retirement, the more funds you have at your disposal, the better off you are. When you are looking at building a portfolio in the future, it is better to ensure that you are investing in funds that do not eat up your profits by way of taxation. If you invest in funds with lesser periods, they may yield a lower rate of return, but you will get some yields that can be used. Have a mixed bag of investments to ensure you get great returns as well. Rollover your Retirement Account to a Roth IRA As compared to other retirement accounts, Roth IRA is one of the best accounts to have in your portfolio. With a Roth IRA, withdrawals after 59 and a half years of age are tax free, and the required minimum distributions are not taxable.

After retirement, you may decide to move overseas and settle down in another country. Or you may be required to live outside the country for a long-term as required by the organization you work for. Or maybe you are a digital nomad, who travels from country to country and work remotely. In any of these cases, you are an expatriate living outside the country. Being an expat makes you eligible to receive Social Security benefits. At the same time, you are obliged to pay your taxes as well. Living outside the country does not exempt you from the rules of the IRS. Here are 5 tax myths that may cause problems for many expats. This first point actually clarifies two points. The first is that the US taxation system recognizes a taxpayer-based citizenship as well and not just residency-based citizenship. So, whichever part of the world you live in, your US citizenship means that you still fall under the purview of the US tax authorities. The second thing to note is that it is only mandatory to file tax returns. Expatriates often pay some type of taxes in the adopted country of residence, and the IRS does provide several deductions to expatriates so that their taxable income goes below the minimum amount.