Tax Talk

Tax Talk: The Path to a Bigger Tax Refund for 2025 – Itemized Deductions (Part 3

By: Professor Anthony Rivieccio MBA PFA

While the majority of Americans probably may not be eligible to itemize, I encourage you to give yourself what I call the “Itemized Deductions” test: Add up all the sections below and if that number is higher than your standard deduction then itemize, itemize, itemize, with Form Schedule A.

First, understand all taxpayers, based on filing status, get a no-questions-nor-receipts asked, automatic standard deduction.

So, if you’re single, for example, you can just take an automatic $15,000 deduction ( Married, $30,000) or add up ALL of your itemized deductions. If you are eligible to itemize then that “bigger number” will bring you your “tax bracket percentage” back in your tax refund. For most Americans, that could be up to 40 cents to the dollar deduction, looking at federal and state taxes.

Itemized Deductions
Itemized Deductions consist of mortgage interest, property taxes, mortgage insurance, charitable contributions, medical expenses, state and local taxes, general sales tax, investment interest, casualty losses, gambling losses, and other miscellaneous expenses.

In recent years the IRS is trying to encourage more taxpayers to take the standard deduction versus itemizing. Again, we strongly recommend that you give yourself the itemized deductions test.

Medical Expenses
According to the IRS, “You can include medical expenses and copayments for you, your spouse, and your dependents. You can only deduct the part of your expenses that exceed 7.5 percent of your adjusted gross income.” Some examples of medical expenses with deductibility power include:

Abortions
Acupuncture
Alcoholism treatment
Ambulance costs
Birth control pills
Child birth classes
Chiropractors
Contact lenses
Crutches
Dentist
Dentures
Doctor fees
Drug addiction treatment
Prescription drugs
Dyslexia reading programs and tutors
Eye examination and glasses
Guide dogs
Health insurance
Hearing aids
Hospital bills
Insulin
Laboratory fees
Long-term care insurance
Nursing home if for medical treatment
Optometrist
Osteopath
Physical therapy
Psychiatrist
Psychologist
Travel to medical clinics
Vasectomy
Wheelchair

This list does not contain every medical deduction available. For more information regarding deductible medical expenses, go to the IRS website or Publication 17.

State and Local Income Taxes
Your state and local tax withheld on your W-2 or 1099-R will flow automatically to Schedule A.
State and local income taxes are deductible on Schedule A as itemized deductions for the year the taxes are paid.

So, in simple terms, looks at your W-2. If you live in a high tax state like New York, do not be surprised if you make, let’s say, $60,000 in 2024, that the New York State tax bite would be around $6,000 or more.

Tip: Now notice, that’s $6,000 of the $15,000 threshold (using the same single filer approach), which means if the other deductibles go over $9,000, then bingo, you can itemize and get 40 cents to the dollar back.

Charitable Contributions
A contribution is deductible if it is made to a qualified organization, such as a church or charitable organization like the United Way or Goodwill Industries.

Any unreimbursed out-of-pocket expenses for volunteer work for a qualified organization are deductible. Examples of out-of-pocket expenses include office supplies, uniforms, gasoline, or long-distance phone calls spent while doing volunteer work for a charity. You can either deduct your actual volunteer automobile expenses or you can use a standard mileage rate to calculate your automobile expenses based on miles driven.

If you donate property such as clothing or used appliances to a charity such as Goodwill Industries, you can deduct the fair market value (FMV) of the property donated. FMV is the price you would have received if you had sold the property instead of donating it. If you donated more than $500 of property, you will need to enter information about the donation on Form 8283.

It’s important to keep good records of your donations. For donations below $250, a canceled check, bank record, credit card record, or a receipt from the charity is proof that you made the donation. For donations of $250 or more, you need a receipt from the charity.

Tip: I encourage my clients very simply when they clean their home for seasonal cleaning to simply donate property (from clothing to a car). Remember, as stated above, the FMV method.

Job Expenses
The Tax Cuts and Jobs Act changed the job expenses deduction to only apply to certain types of employees.

Some common employee expenses that can be deducted (if you weren’t reimbursed for them) include:

Union dues
Certain job search expenses
Vehicle expenses
Miles driven (other than commuting)
Business meals
Overnight travel
Home office
Uniforms
Business gifts
Small tools
Parking fees
National Guard expenses

You may also be able to deduct:
Professional dues
Safety shoes
Safety glasses
Protective clothing
Business cards
Licenses
Trade magazines and subscriptions
Meals (50 percent is nondeductible)
Briefcase
Office decorations
Office supplies
Expenses related to temporary out-of-town job assignments
Certain education expenses
Malpractice insurance
Any other expense that relates to your job

NOW GET READY FOR THE BAD NEWS (BUT GOOD FOR OTHERS):

What employees qualify for the job expense deduction?

The Tax Cuts and Jobs Act changes: Beginning in 2018, the job expense deduction is only available to certain types of employees. The employees that qualify to deduct unreimbursed job expenses are:

U.S. Armed Forces reservists
Qualified performing artists
Fee-based state or local government officials
Employees with impairment-related work expenses

TAX TIP: BUT THERE IS GOOD NEWS ! DEPENDING ON YOUR STATE , AND REGARDLESS OF YOUR EMPLOYEE STATUS, IT IS TAX DEDUCTIBLE!.

Mortgage Interest
According to the IRS, interest is deductible on a loan(s) of up to $750,000 ($375,000 if married and filing separately) used to acquire, construct, or improve your principal residence and a second residence. The tax deduction is taken on Schedule A as an itemized deduction. Your primary home or second home can be a house, condo, RV, boat, or camper as long as it has cooking, toilet, and sleeping facilities.

To deduct mortgage interest or home equity interest, the loan must be secured by your main home or second home.

If you own a rental home or investment home, you can deduct the mortgage interest for that home as part of the rental home expenses or as investment interest even if it is a third home or more.

Mortgage interest on a home construction loan is deductible from the time construction begins. If construction of your home takes longer than 24 months, then any mortgage interest after 24 months is no longer deductible until your home is completed.

If you are an unmarried co-owner of a residence, the $750,000 ($375,000) limit applies to each taxpayer separately.

Property and Real Estate Taxes

Property and real estate taxes, included as part of your state taxes, are deductible. You will find these numbers on Form 1098.

Next week, under Part 4, we will cover the world of Small Business, Self-Employment & Home office.

If you need specific assistance, from budgeting, to taxes, to investments and retirement, feel free to reach out!. You get easy access to our team of Certified Financial Planners®, who can answer your questions and provide guidance

Professor Anthony Rivieccio, MBA PFA, is the founder of The Financial Advisors Group, celebrating its 30th year as a full service Investment Planning & Management firm . Anthony is also owner of Rivieccio OnlineTax Advisors, a virtual only Income tax preparation & planning firm, opened in 2021.

Mr. Rivieccio pens three financial article called “Money Talk” ” Tax Talk” & ” Financial Focus”. Mr. Rivieccio, a recognized financial expert since 1986, has been featured by many national and local media including: Kiplinger’s Personal Finance, The New York Post, News 12 The Bronx, Bloomberg News Radio, BronxNet Television, the Norwood News, The West Side Manhattan Gazette, Labor Press Magazine, Financial Planning Magazine, WINS 1010 Radio, The Co-Op City News, The New York Parrot, The Bronx News, thisisthebronX.info , The Bronx Chronicle , The Bronx Post & The Parkchester Times.

Professor Rivieccio is also the host of ” Financial Focus University” a financial & personal finance streaming TV Show.

Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University.

Ask The Professor is your new Personal Finance Do It Yourself community found in Facebook Groups.

https://facebook.com/groups/2895516820767852/

For financial assistance, Anthony can be reached at (347) 575-5045. Have Facebook? My email is a_rivieccio@yahoo.com My personal page is www.facebook.com/anthonyfromthebronx

Tax Talk; The Path to a Bigger Tax Refund in 2024 - Children (Part 2 of 7)

By Professor Anthony Rivieccio MBA PFA

If you read part one of our seven-part series on how to get all your tax money back, we will now discuss one of the best, one of the most complicated and one of the most fruitful ways: children.

According to the IRS, children are not your babies but people that are growing fast! What the IRS wants to know is whether they are your dependents. Do they produce income? Do you maintain their support? How old are they? Are you separated or divorced? Do both of you share the burden? Maybe only one? Therefore, what is a dependent?

Children and Dependents

In general, according to the IRS, “If your child was age 18 or younger at the end of the year or if your child is a student and age 23 or younger at the end of the year then you can claim your child as a dependent if your child did not provide over half of his or her own monetary support during the year.

In general, if your child is age 19 or older or age 24 or older and a student at the end of the year, then you can only claim your child as a dependent if the child made less than $4,500 during the year, and you provided over half of their support. This rule also applies to other qualifying relatives who are not children, such as a parent, brother, or aunt. If the qualifying relative made more than $4,500 in income during the year you cannot claim the relative as a dependent, even if you are providing over half of their support.

There are a lot of special rules and detailed definitions for claiming a dependent that are found in the Form 1040 instructions. The above are just the general rules that apply to most people in claiming a dependent. If your situation is not typical, please reference Form 1040 instructions for full details on whether you can claim someone as a dependent.”

Divorce
According to the IRS, “In the cae of divorce or separation, the parent who had custody of a child for the greater part of the year (e.g. the custodial parent) almost always is entitled to claim the child as a dependent, even if the noncustodial parent is providing the money for the child’s support.

However, a noncustodial parent can claim the child as a dependent if the custodial parent signs a document, such as Form 8332, releasing his or her right to claim the child as a dependent for a single year or for multiple years or if the pre-2009 divorce or separation agreement gives the noncustodial parent the right to claim the child as a dependent. If the divorce or separation agreement went into effect after 2008, the custodial parent must sign Form 8332 or a similar document in order for the noncustodial parent to claim the child as a dependent.

If the child lived with each parent for the same amount of time during the year, the IRS will treat the child as the dependent of the parent who had the higher adjusted gross income during the year.

If you’re the parent who had custody of your child for the greater part of the year, then you can claim the Earned Income Credit, Dependent Care Credit, and Head of Household filing status, even if your divorce decree allows your ex-spouse to claim your child as a dependent or if you are allowing your ex-spouse to claim your child as a dependent. The parent who claims the child as a dependent gets the Child Tax Credit, but only the custodial parent can claim the child for the Earned Income Credit, Dependent Care Credit and Head of Household filing status.”

Child Care Credit
According to the IRS, “Child care and dependent care expenses may be eligible for a tax credit. The child care expenses need to be employment-related. The child care expenses must make it possible for you (and your spouse, if married) to go to work or look for work. Babysitting and child care expenses that aren’t related to your job aren’t eligible for the credit. Examples of qualified child care and dependent care expenses include payments to day care centers, work-related babysitting, day camps, after-school programs, nursery school, pre-school, domestic help, and nannies. Examples of expenses that do NOT qualify are overnight camps, transportation costs, and expenses to attend kindergarten or a higher grade.

You are eligible for the credit if you (and your spouse, if married) have earned income and maintain a household for a dependent age 13 or under or for a spouse or other dependent (regardless of age) who is mentally or physically unable to care for himself or herself. If your spouse is a full-time student, you still qualify for the Child Care Credit, even if your spouse has no earned income. If both of you are students with no earned income, you can’t take the credit. The total amount of child care expenses that can be used for the credit is $8,000 for one child or $16,000 for two children. If you are reimbursed for child or dependent care expenses through your employer, the expense ceiling is reduced by the amount of reimbursement or employer assistance. To qualify for the credit, you must pay for more than one-half of the cost of running your household for the year and you and the qualifying child or individual must live in the same residence. In the case of divorce, the parent with custody is entitled to the Child Care Credit, even if the custodial parent has waived the right to take the dependent exemption to the noncustodial parent.

Payments to relatives count for the credit as long as the relative is not your dependent. So grandparents, uncles, aunts, and your adult children (19 or older) qualify as child care providers if you do not claim the relative as a dependent on your tax return. Keep in mind that if you claim the Child Care Credit for payments to a relative as a child care provider, the IRS will expect that relative to report the child care payments received as income on the relative’s tax return.”

Child Tax Credit
According to the IRS, the child tax credit has increased and the income phaseout has increased significantly so a lot more people are eligible to receive the child tax credits. A new $500 credit has been added for qualifying dependents who are older than age 16.

A $2,000 per child tax credit is available for each qualifying child under the age of 17. A qualifying child is a child, grandchild, stepchild, or foster child that you claim as a dependent on your tax return. The credit begins to be phased out for taxpayers with adjusted gross income above $400,000 ($200,000 for single and head of household).

If your potential Child Tax Credit is more than your tax, you may be eligible for the Additional Child Tax Credit. As a rule of thumb, most people who qualify for the Additional Child Tax Credit have three or more dependents age 16 or younger, and are not receiving the full $2,000 Child Tax Credit for each dependent since their credit is more than their tax. However, the refundable Additional Child Tax Credit is limited to $1,400 per qualifying child.”

Earned Income Credit (EIC)
According to the IRS, the Earned Income Credit (EIC) is a refundable credit for lower income taxpayers. There are a number of factors that determine if you qualify for the Earned Income Credit. If you qualify, the credit will be added to your refund and be included in your tax return.

In order to qualify for the EIC, you must have earned income, such as wages, tips or self-employment income. Your investment income, such as interest, dividends and capital gains, cannot be over $4,000. If you are younger than age 25 or older than age 64 and you do not have any qualifying children for the EIC, then you are not eligible for the EIC. If you have an ITIN instead of a Social Security number, you aren’t eligible for the EIC. If your home was not in the United States for more than half the year, you aren’t eligible for the EIC. However, if you are a military member on extended duty overseas, you are still considered to have a home in the United States. If the IRS sent you a notice saying you can’t claim the EIC because of having your EIC disallowed on previous tax returns, then you aren’t eligible for the EIC. The IRS can ban taxpayers from claiming the EIC for ten years if the IRS believes an EIC claim was fraudulent, or the IRS can do a two-year ban if the IRS believes an EIC claim was reckless or intentionally disregarded the rules. If you are a nonresident alien (a noncitizen who does not live in the United States) at any point during the year, you aren’t eligible for the EIC. If you are a qualifying child for the EIC for another person, such as your parents, you aren’t eligible for the EIC. If you are claimed as a dependent by your parents or anyone else, you aren’t eligible for the EIC. If your filing status is Married Filing Separately, you aren’t eligible for the EIC.

To claim the EIC, your earned income and your adjusted gross income (AGI) must each be less than:

$54,000 ($60,000 if married filing jointly) with three or more qualifying children

$50,000 ($57,000 if married filing jointly) with two qualifying children

$44,000 ($51,000 if married filing jointly) with one qualifying child

$17,000 ($23,000 if married filing jointly) with no qualifying children

If your ex-spouse claims your child as a dependent, but you are the custodial parent whom your child lives with the majority of the year, you can still claim your child for the EIC. Then you will still be eligible to claim your child for the EIC and Child Care Credit even though your ex-spouse claims your child for the dependent exemption.

A qualifying child for the EIC is a child who meets the following three tests:

Is a son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, or a descendant of any of them (for example, your grandchild, niece, or nephew)

Lived with you in the United States for more than half of 2024. Temporary absences for special circumstances, such as for school, vacation, medical care, military service, or detention in a juvenile facility, count as time lived at home. A child is considered to have lived with you for all of 2024 if the child was born or died in 2024 and your home was this child’s home for the entire time he or she was alive in 2024.

Was under age 19 at the end of 2024, or was under age 24 and a student at the end of 2024, or any age and permanently and totally disabled.”

Join us next week when we cover part three: Itemized Deductions. While this area is now a bit “harder” you should learn the new rules (some good) about medical expenses, city and state taxes, home ownership, charity and job expenses.

Professor Rivieccio is also the host of ” Financial Focus University” a financial & personal finance streaming TV Show.

Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University.

Ask The Professor is your new Personal Finance Do It Yourself community found in Facebook Groups.

https://facebook.com/groups/2895516820767852/

For financial assistance, Anthony can be reached at (347) 575-5045. Have Facebook? My email is a_rivieccio@yahoo.com My personal page is www.facebook.com/anthonyfromthebronx

Tax Talk: The Path to a Bigger Tax Refund for 2025 (Part 1 of 7)

By PROFESSOR ANTHONY RIVIECCIO, MBA PFA

Most people mistakenly think that tax preparation is tax planning time. But by thinking this way, they think they could “erase” or “add” things that happened in 2024 when it will soon be 2025.

So in short, if you did not plan in advance, that’s why it’s called tax planning, folks! Your refund for 2024 is now complete!

But what about your refund for January 2025? Soon, we will be in January; don’t you think you should start planning now?

Well, if you’re smart enough to plan now for a higher tax refund next year ( in 2025) , then remember this: The Trump administration’s tax law in 2017, has dramatically changed the landscape when it comes to both individual and business tax deductions and credits. Today, if I had to put one word to it, I would say it’s based on your lifestyle, and how can readjust and enhance it now.

We believe, briefly, that if one wants to start readjusting their tax liability and life tax style, then they should be looking into the areas of: children, self-employed and small business, itemized deductions, retirement, education, rental income deductions, and w-4 re-adjustment.

If you have a lifestyle that fits any of the categories above then you might have eligible deductions and credits.

So, for the next seven weeks we will discuss in detail, tips and strategies, in each of the above areas, to find you areas of deductibility- that will bring you a bigger tax refund in the future.

Next week: Children.

Professor Anthony Rivieccio, MBA PFA, is the founder of The Financial Advisors Group, celebrating its 25th year as a full service investment planning & management firm . Anthony is also owner of Rivieccio Rivieccio OnlineTax Advisors, a virtual only Income tax preparation & planning firm, opened in 2021.

Tax Talk: No City Tax starting in 2025?

By Professor Anthony Rivieccio MBA PFA

A proposal by Mayor Eric Adams would abolish New York City’s personal income tax for nearly half a million qualifying residents.

He has recently unveiled a plan to eliminate New York City’s personal income tax for filers with dependents living at or below 150% of the federal poverty line.

The tax proposal would require approval from Albany before it can become law. Gov. Kathy Hochul is supportive of the plan.

“The Governor would be supportive of efforts to lower the City’s personal income tax rate, and commends Mayor Adams for continuing to focus on affordability,” spokesperson Kristin Devoe said.

Based on the proposal above:

Family size	Maximum annual income
One adult, one child	$31,503
One adult, two children	$36,824
Two adults, one child	$36,789
Two adults, two children	$46,350

(Credit: Office of the Mayor of New York City)

Currently, New York City’s income tax system is also progressive and rates regarding this are about 3.3%.

Good idea? Yes! Good idea? No!

Yes the publicity will sound good, especially for Eric. Economically it’s not a good idea because a great majority of them currently don’t and won’t pay any taxes anyway.

Between the low tax rates, coupled with ” standard deduction ” ” child care & earned income credits”, the effect on taxes should be minimal or nothing

So, why is he doing it? Re- election, anyone?

Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University.

Ask The Professor is your new Personal Finance Do It Yourself community found in Facebook Groups.

https://facebook.com/groups/2895516820767852/

For financial assistance, Anthony can be reached at (347) 575-5045. Have Facebook? My email is a_rivieccio@yahoo.com My personal page is www.facebook.com/anthonyfromthebronx

Tax Talk: 2024 Trump wins BIG, 2026 you could lose BIG!

By Professor Anthony Rivieccio MBA PFA

Are you aware that ” Tax Law” will be heavily discussed in 2025. Why? Because many of the old Trump 2017 Tax Laws expires at the end of 2025.

In 2024, NOW, the 2017 law starts to ” transition”. Many ” business credits” start to go down while ” consumer and family credits” start to go up

AGAIN , UNTIL DECEMBER 31,2025 AND THEN— THE LAW IS SUPPOSED TO GO BACK TO 2016.

How dangerous is that?

Here’s an example:

Standard deductions!

According to current law;

For single taxpayers and married individuals filing separately for tax year 2025, the standard deduction rises to $15,000 for 2025, an increase of $400 from 2024. For married couples filing jointly, the standard deduction rises to $30,000, an increase of $800 from tax year 2024. For heads of households, the standard deduction will be $22,500 for tax year 2025, an increase of $600 from the amount for tax year 2024.

Sounds good! If your single, for example, my standard deduction went up and I save an additional $400 next year when taxes are filed .

ON JANUARY 1 2026, ACCORDING TO LAW, THE STANDARD DEDUCTION GOES BACK TO 2016. FOR DINGLE PEOPLE , USING THIS SAME EXAMPLE THAT WOULD BE $6,250

YES,you heard me right! It goes from a $15,000 to $6,250. In layman’s terms, a loss of deductibility of $8,750.

And many areas; from small business deductibilities, to standard deductions, to child care, retirement & education credits — which will be scheduled to go down 50%, unless Congress changes the law

And I believe they will. And this is why you’ll probably hear more about tax policy in 2025 than you have in 30 years.

But even more importantly, with this much uncertainty, NOW would be a great time to talk to a Tax Advisor about your tax file .

I have a feeling , not next year, but the year after ( 2026) many people, by not preparing or planning their tax situation will be in Church , in April of 2026! Yes it’s Easter Time but they’ll be there crying – after getting their bill tax bill that they will OWE !

Professor Anthony Rivieccio, MBA PFA, is the founder of The Financial Advisors Group, celebrating its 25th year as a full service investment planning & management firm . Anthony is also owner of Rivieccio Financial Advisors, a virtual only financial planning & advisory firm, opened in 2021.

Mr. Rivieccio pens a financial article called “Money Talk” along with ” Financial Focus”. Mr. Rivieccio, a recognized financial expert since 1986, has been featured by many national and local media including: Kiplinger’s Personal Finance, The New York Post, News 12 The Bronx, Bloomberg News Radio, BronxNet Television, the Norwood News, The West Side Manhattan Gazette, Labor Press Magazine, Financial Planning Magazine, WINS 1010 Radio, The Co-Op City News, The New York Parrot, The Bronx News, thisisthebronX.info , The Bronx Chronicle & The Parkchester Times.

Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University.

Ask The Professor is your new Personal Finance Do It Yourself community found in Facebook Groups.

https://facebook.com/groups/2895516820767852/

For financial assistance, Anthony can be reached at (347) 575-5045. Have Facebook? My email is a_rivieccio@yahoo.com My personal page is www.facebook.com/anthonyfromthebronx

Tax Talk: After Election Income Tax Thoughts

By Professor Anthony Rivieccio MBA PFA

So, it looks like Donald Trump won the US Election. And with a slim majority in Congress it’s safe to assume that some of his tax policies might get passed

Without getting too specific in this article , my immediate thoughts after the election

* Renewal of the 2017 Tax Laws

From a standpoint of the economy , it looks solid that Trump will renew his 2017 tax game plan . The tax cuts , like 2017, could spur , consumer , business & economic growth

* State & Local Tax Deductions ( SALT ) deduction

Since 2017, I think Trump realizes that his cap on this deduction hurts ” high tax” States. I think he realizes property taxes are not deductible currently under this method and I believe he will revisit this and take off the cap , like it was , prior to 2017.

* Child Tax Credits

It seems whether your Democrat or Republican — the children win!. More children Tax Deductions and credits are promised and expected

* No Tax on Tips

Do you believe it ? I’m not sure but I think most economists will agree, it’s more hype than substance.

* Tariffs

Is importing goods at a high price and is it a good idea? Well , for foreign economies, it could be a hurtful idea but for the US, the hurt could be minimal. Yes, higher prices could be transferred to the consumer but note that ” trade” only represents about 10% of our economy. And yes the extra money ” could be ” used to pay for tax cuts.

So, 2025, will bring in the Trump continuation of an Income Tax revolution. Trump & Congress must remember that all this economic growth, through lower taxation must be balanced by additional revenue or lower spending. Tariffs alone will not do it. And The Children win! .

Professor Anthony Rivieccio, MBA PFA, is the founder of The Financial Advisors Group, celebrating its 25th year as a full service investment planning & management firm . Anthony is also owner of Rivieccio Financial Advisors, a virtual only financial planning & advisory firm, opened in 2021.

Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University.

Ask The Professor is your new Personal Finance Do It Yourself community found in Facebook Groups.

https://facebook.com/groups/2895516820767852/

For financial assistance, Anthony can be reached at (347) 575-5045. Have Facebook? My email is a_rivieccio@yahoo.com My personal page is www.facebook.com/anthonyfromthebronx

Can Hurricanes Helene & Milton be tax deductible?

By Professor Anthony Rivieccio MBA PFA

In late September, Hurricane Helene ravaged parts of Florida, Georgia, North Carolina, South Carolina, Virginia and Tennessee. Two weeks later, Hurricane Milton brought high winds, tornadoes and flooding through the middle of Florida.

Affecting both insured and uninsured homes, the losses from both storms could amount to tens of billions of dollars.

Certain victims can amend 2023 tax returns to claim a tax break for recent losses, known as the “casualty loss tax deduction,” according to the IRS. But the calculation is complicated.

The 2017 Tax Laws temporarily restricted eligibility. Only losses in federally declared disaster areas will qualify through 2025.

When there’s a qualified disaster loss, there is no 10% AGI limit, and victims can add their loss on top of the standard deduction.

That means they can claim the deduction even if they don’t itemize tax breaks.

However, we haven’t had any qualified disasters, as designated as such by Congress, since late 2020.

So what’s deductible ?

Professor Anthony Rivieccio, MBA PFA, is the founder of The Financial Advisors Group, celebrating its 25th year as a full service investment planning & management firm . Anthony is also owner of Rivieccio Financial Advisors, a virtual only financial planning & advisory firm, opened in 2021.

Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University.

Ask The Professor is your new Personal Finance Do It Yourself community found in Facebook Groups.

https://facebook.com/groups/2895516820767852/

For financial assistance, Anthony can be reached at (347) 575-5045. Have Facebook? My email is a_rivieccio@yahoo.com My personal page is www.facebook.com/anthonyfromthebronx

The SALT Tax Deduction By Professor Anthony Rivieccio MBA PFA

By Professor Anthony Rivieccio MBA PFA

State & Local Taxes deduction (SALT)!

It’s in the tax code. Prior to 2017, you could have deducted any amount of State, Local & Property taxes . From today, to 2025, those amounts have been capped to $10,000. If your over that amount, in short, your screwed!.

Who’s fault is that? Congress, under the leadership of Donald Trump. He decided at that time to ” simplify” the tax code ( into a postcard ) and hense, eliminate many personal tax deductions .What was the trade-off? Personal tax cuts.

Congress briefly weighed doing away with the SALT deduction cap earlier this year, but the effort never made it off the ground. The cap is poised to sunset at the end of 2025.

Many organizations, including The Tax Foundation estimates that it will cost the US Budget $10 billion, per year .

In my opinion the problem is ” Property Taxes”. Because of this, property taxes, in high tax related States, easily will get them over the $10,000 limit and will therefore lose a portion of tax deductibility.

So is it worth getting rid of SALT? Keep the SALT? Or maybe we need Pepper?

Make sure you vote correctly in November.

Professor Anthony Rivieccio, MBA PFA, is the founder of The Financial Advisors Group, celebrating its 25th year as a full service investment planning & management firm . Anthony is also owner of Rivieccio Financial Advisors, a virtual only financial planning & advisory firm, opened in 2021.

Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University.

Ask The Professor is your new Personal Finance Do It Yourself community found in Facebook Groups.

https://facebook.com/groups/2895516820767852/

For financial assistance, Anthony can be reached at (347) 575-5045. Have Facebook? My email is a_rivieccio@yahoo.com My personal page is www.facebook.com/anthonyfromthebronx

Tax Talk: Taxes, Retirement & The 2024 Election

By Professor Anthony Rivieccio MBA PFA

Guess what?

You can’t control the election outcomes or what the market may or may not do based on election outcomes. You can however, build your own retirement economy and your own desired market experience that revolves around your lifestyle and what you want.

In times of great change, it is only natural for people to wonder and worry, even more so, as we head into what appears to be the most contentious election in modern history.

Predictions are being made based on history — the months and quarters that are most likely to be positive and negative, as well as the likelihood of a positive market. Some are showing likely upside and downside based on which party is elected in each branch of government.

Now do we currently have economic problems: We have plenty !

The economy and markets are still responding to the highest inflation numbers since 1981. Interest rates have risen faster than any period in our modern history. The U.S. is also involved in at least two wars, depending on how you count the U.S. military engagement at the border and abroad. U.S. debt by household is as high as it’s been in decades.

But this article is about taxes, right? Raising taxes, in theory , increases Government revenue and vice versa

So what do they do when they need to raise revenues? Increase taxes and reduce deductions. The lie is this is only on “the rich.” This approach to increasing taxes — introduce a tax “targeted at the rich,” then after it gains acceptance, roll it out on the masses — has a long history. The federal income tax — made possible in 1913 with ratification of the 16th Amendment — was originally introduced as a way to make the wealthy pay their fair share.

So let’s get to the BOTTOM line: Your Taxes & Retirement

If you have at least $500,000 or more, and your retirement requires $100,000 a year to maintain your lifestyle, $65,000 to $80,000 of your retirement is under attack. The good news is that there is a preferential tax code now. Investment assets are near all-time highs, and inflation has been tamed somewhat for the moment.

Here are some tips for election year 2024

Now’s the time to make tax minimization moves on your retirement money while tax rates are at all-time lows
Insulate your investments from market crashes, before they come, whether it happens this year or a later year
Set up retirement income layers that are protected from economic and market volatility so your lifestyle doesn’t go on a stock market roller coaster ride
And certainly don’t wait in the hopes the market will be higher just before or after the election in November, or that your chosen party will all of a sudden start lowering taxes to benefit you

The Good news is that both candidates are favorable to lower taxes and seniors. The Bad news , we don’t know what really is going to happen, regardless of person or party

Make your moves, NOW!

Professor Anthony Rivieccio, MBA PFA, is the founder of The Financial Advisors Group, celebrating its 25th year as a full service investment planning & management firm . Anthony is also owner of Rivieccio Financial Advisors, a virtual only financial planning & advisory firm, opened in 2021.

Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University.

Ask The Professor is your new Personal Finance Do It Yourself community found in Facebook Groups.

https://facebook.com/groups/2895516820767852/

For financial assistance, Anthony can be reached at (347) 575-5045. Have Facebook? My email is a_rivieccio@yahoo.com My personal page is www.facebook.com/anthonyfromthebronx

Taxing Unrealized Capital Gains: We have it now!

By Professor Anthony Rivieccio MBA PFA

So, what is a unrealized capital gain? You hear the Kamala Harris campaign talk about it all the time. You hear people, like Donald Trump, say it will kill the economy. So, what is it?

A simple definition:

Unrealized capital gain/loss. An increase/decrease in the value of a security that is not “real” because the security has not been sold.

An example:

If, say, you bought 100 shares of stock “XYZ” for $20 per share and they rose to $40 per share, you’d have an unrealized gain of $2,000. If you were to sell this position, you’d have a realized gain of $2,000, and owe taxes on it.

So in simple terms, unrealized is when you do NOT receive the monies and a realized gain is when you do.

So recently while teaching an income tax class, one of my students brought it up in conversation. They wanted me to explain it further.

I told them that I would give them my definition in non political economic terms.

So, is it bad for our economy ? My answer: I said, ” we have it now “!. Yes , confusion on my students faces appared.

So I gave the example; let’s say you have extra money you wanted to put away long term. So you go to the bank and open a 5 year CD, with interest.

Every year, you make interest. Every year, you decide to leave the interest in the account. Every year you get a 1099 form from the bank because the interest must be declared on your taxes– even though you left your interest in the account ( sounds like your savings account too, right ?) .

How much tax are you paying on ” interest income “? Basically, it’s your tax bracket!. For most, it will be 25%.

Did the economy die? No!

Now, I’m not advocating to tax unrealized gains! I’m just saying we have it already ! My own opinion; it’s a tax (bs) expense to the consumer and businesses

More importantly, tax policy is indeed very important to our economy, so please do your research before going to the polls later this year

Professor Anthony Rivieccio, MBA PFA, is the founder of The Financial Advisors Group, celebrating its 25th year as a full service investment planning & management firm . Anthony is also owner of Rivieccio Financial Advisors, a virtual only financial planning & advisory firm, opened in 2021.

Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University.

Ask The Professor is your new Personal Finance Do It Yourself community found in Facebook Groups.

https://facebook.com/groups/2895516820767852/

For financial assistance, Anthony can be reached at (347) 575-5045. Have Facebook? My email is a_rivieccio@yahoo.com My personal page is www.facebook.com/anthonyfromthebronx