State taxes

Despite the cooling market, many homeowners made money selling their property in 2022 — and part of that windfall may be taxable.Home sellers made a $112,000 profit on the typical sale in 2022, a 21% increase from 2021, and a 78% jump from two years ago, according to ATTOM, a nationwide property database. While most sellers fall under the thresholds for capital gains taxes, high-dollar home sales or long-term ownership can trigger an unexpected bill, experts say.More from Smart Tax Planning:Here's a look at more…

Scott Olson | Getty ImagesYou may face long odds of hitting the Mega Millions jackpot — now worth $1.35 billion — but the taxman is always guaranteed a slice when there's a winner.The jackpot jumped again after no ticket matched all six numbers drawn Tuesday night to land the grand prize. If won in the next drawing — set for Friday night — it would mark the second-largest Mega Millions jackpot ever and the fourth-largest lottery prize in history.With the odds stacked against a single ticket winning the motherlode — 1 in…

This could be a very good year for one lucky winner of the fourth-largest jackpot in Mega Millions history.And yet, kicking off 2023 with $785 million could have a downside."The curse of the lottery losers is very real," said Andrew Stoltmann, a Chicago-based lawyer who has represented several recent lottery winners.One of the very first decisions a winner must make — whether to accept the jackpot as a lump sum or as an annuity — often ends up being their downfall, Stoltmann said.More from Personal Finance:4 key things to…

Hispanolistic | E+ | Getty ImagesIf you're worried about getting a tax form from payment apps like Venmo or PayPal, you're now less likely to receive one for 2022 — thanks to a change from the IRS.The agency on Friday announced a one-year delay for a new tax reporting rule, requiring payment services to issue Form 1099-K for business transfers over $600, and many tax experts have applauded the change.Before 2022, taxpayers and the IRS received 1099-Ks when payments crossed a threshold of more than 200 transactions worth…

As Americans head to the polls, several key personal finance issues are weighing on voters' minds and wallets.This week, the Federal Reserve enacted its fourth consecutive 0.75 percentage point interest rate increase to fight inflation, triggering further stock market losses.Meanwhile, recession fears are growing, with 84% of Americans worrying how a prolonged economic downturn may affect their finances, according to a MassMutual report released Thursday.  More from Personal Finance:What the Fed's 0.75 percentage point…

Jonathan Alcorn | ReutersIf you manage to beat the odds stacked against hitting the Powerball jackpot, don't forget you'll have a silent partner in the win: the taxman.The jackpot for Saturday night's drawing is now the largest lottery prize ever at an estimated $1.6 billion — pretax — if you were to opt to take your windfall as an annuity spread over three decades. The upfront cash option — which most jackpot winners choose — for this drawing is $782.4 million, also pretax. With the chance of a single ticket hitting the…

How states plan to spend 'millionaire tax' revenueWhile the proposed taxes sound similar, there are differences in how each state plans to use the revenue. In Massachusetts, assuming voters pass the measure, the tax is expected to generate about $1.3 billion of revenue in 2023, according to a Tufts University analysis. The state aims to use the revenue to fund public education, roads, bridges and public transportation.California's tax is projected to bring in $3.5 billion to $5 billion annually should it pass, and the…

If you haven't been sending part of your income to the IRS in recent months, this week is the last chance to avoid a tax penalty.The deadline for third-quarter estimated taxes is Sept. 15, applying to income from self-employment, small businesses, investments, gig economy work and more, according to the agency."It's a pay-as-you-go system," said certified financial planner John Loyd, owner at The Wealth Planner in Fort Worth, Texas. "A lot of folks don't find out until they file their tax return and they get a very nasty…

President Joe Biden's student loan forgiveness plan will soon cancel debt for millions of Americans — and the relief is tax-free on federal returns. However, experts say the cancellation may still trigger a state tax bill.Most borrowers making less than $125,000 per year or $250,000 for married couples filing together will qualify for $10,000 of forgiveness, with up to $20,000 of cancellation for Pell Grant recipients. However, some states may count the canceled debt as income, explained Jared Walczak, vice president of…

Anti-abortion activists demonstrate outside the Supreme Court of the United States in Washington, June 13, 2022.Evelyn Hockstein | ReutersResidents of Georgia may now claim embryos as dependents on their state income tax returns.Any "unborn child with a detectable human heartbeat," may qualify for a $3,000 state income tax deduction for 2022, effective July 20, according to guidance released by the state's Department of Revenue.The announcement follows the U.S. Supreme Court's decision to overturn Roe v. Wade, ending the…