Many people lost their jobs last year due to pandemic shutdowns. Generally, unemployment compensation is included in gross income for federal tax purposes. But thanks to the American Rescue Plan Act (ARPA), enacted on March 11, 2021, up to $10,200 of unemployment compensation can be excluded from federal gross income on 2020 federal returns for […]
Tag Archives | Taxable Estate
Home Sales: How to Determine Your “Basis”
If you’re buying or selling a home, you should know how to determine your basis. The law allows an exclusion from income for all or part of the gain realized on your home sale. The general exclusion limit is $250,000 ($500,000 for married taxpayers). You want your basis to be as high as possible in […]
Who Qualifies for “Head of Household” Tax Filing Status?
When you file your tax return, you must check one of the following filing statuses: Single, married filing jointly, married filing separately, head of household or qualifying widow(er). Who qualifies to file as a head of household, which is more favorable than single? To qualify, you must maintain a household, which for more than half […]
How to ensure life insurance isn’t part of your taxable estate
If you have a life insurance policy, you may want to ensure that the benefits your family will receive after your death won’t be included in your estate. That way, the benefits won’t be subject to federal estate tax. For 2021, the federal estate and gift tax exemption is $11.7 million ($23.4 million for married […]