TAXES 101: Tax Tips for the Unemployed Amidst the Outbreak
According to the U.S Department of Labor, 26.5 million Americans have marked themselves as unemployed. These numbers don’t account for the other 7.1 million who were unemployed before the greater part of the country would close its shutters in response to the outbreak.
The CARES LAW was enacted on March 27 by the President of the U.S, which included benefits for the jobless, for freelancers, and part-time workers. The amount that each one is paid varies by state; however, it is nearly equal to half of one’s previous salary. The amount will be generally payable for 39 weeks.
Along with these benefits, the government will also help individuals by assisting them with an extra $600 per week. Every state has its guidelines regarding eligibility conditions. Generally, a person is deemed qualified if he is unemployed, not because of his fault, and is suitable for work and meets other requirements as indicated by the state. These numbers account for half of the story.
There is plenty of things to consider, including how to cover the tabs, acquiring a new job, and calculating the benefits related to unemployment. Within all this chaos, the thing you don’t need right now is tax-worries, but this doesn’t mean that you should postpone them till next year, as you have got the upper hand over the tax benefits now. Here are some tips that will help you in sorting things out.
Unemployment benefits are taxable under federal income tax rules. So, don’t spend your benefits without contemplating the results. You also have the right to withhold federal income tax from the assistance you received from the government.
This is just like withholding on your salary check, which in turn means that you’ll owe less at the tax time. In case you are stressed that at tax time, you might owe more, consider assessing your estimated payments for the year to avoid a possible penalty. It is worth mentioning here that IRS has deferred punishment and interest on all kinds of taxes initially payable by April 15, 2020.
If you are not a part of any potential pension plan, for example, IRA, then any withdrawals made from your retirement plan or pension plan will be taxed. According to the CARES Act, the tax won’t be deducted at once, but you’ll have the option to pay it back in three years. Contact a tax professional to get details about how your retirement income and other benefits will be treated at the end.
More in Pocket Change
How to Bolster Sales and Build a Brand Image Through Social Media
As the world is rapidly digitalizing, it is essential to take a step up if you want to stay in business....December 11, 2020
3 Sure-Fire Tips to Find the Perfect Candidate for Your Company
Are you one of those HR people who get excited every time the recruitment and hiring season rolls around- or do...December 11, 2020
Latest to Jump The Property Buying Bandwagon – Alexander Wang
It looks like property selling isn’t the only trend gripping the celeb world. The rich and famous are buying new homes...December 10, 2020
Don’t Knock It Till You Try It- Promoting Your Business Offline
We get it- the world is completely digitalized now, and everything can be done with the help of a gadget and...December 9, 2020
Experts Reveal Secrets to Paying Off Mortgages Faster
Buying your dream house isn’t easy. There are several hurdles to tackle, like taking mortgages, making down payments, handing the paperwork,...December 6, 2020
Interning from Home? Overcome the Challenges with These Tips
In early March, Kendall Camp had to pack and move to his home in Tracy from Atlanta to complete his semester...December 3, 2020
Guide to Remote Learning for Job Seekers Looking to Work from Home
Due to the pandemic, most companies are offering remote jobs. In previous years, remote jobs weren’t exactly trendy, so most people were...December 3, 2020
4 Tips That Will Guide You In Refinancing Your Mortgage Loan
Who doesn’t want his own little place! Frankly speaking, every second person on earth dreams of owning a house. When making financial...December 3, 2020
Work Addiction Can Take its Toll on Your Career- Here’s How
Living in the 21st Century, it is inevitable for one to have fast-paced lives, including striving for the best and putting...December 2, 2020