“Our new Constitution is now established, and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes.”
– Benjamin Franklin (1789)
Yep, taxes are awful, but they are a part of our [un]natural order. Here are a few things to know about when the Taxman/Taxwoman cometh.
- Do you owe estimated tax?
- If you are self-employed, have other income in addition to your main salaried income, or your tax liability is not adequately covered by withholdings from your regular paycheck, you may need to pay estimated tax. To see if you need to file federal estimated tax, take a look at IRS Estimated Taxes, IRS FAQ on quarterly estimated tax payments, and IRS Publication 505 – Tax Withholding and Estimated Tax.
- Individuals generally use Form 1040-ES. The form also has an Estimated Tax Worksheet to help you figure your estimated tax.
- When are these payments due?
- For estimated tax purposes, the year is divided into 4 payment periods (not quarters), each with a specific due date. See IRS FAQ for information on the 4 estimated tax payment periods. Pay attention to the due dates, because you may be charged a penalty if you don’t pay enough on time (even if you’re ultimately due a refund at the end of the tax year).
- There are also estimated tax obligations at the state level, so make sure to check the specifics for your particular state.
There are many online and in-person tax preparation services. The benefit of all of this is that these solutions get.it.done as painlessly as possible. Some of them have added protections if you are audited later on, so check the features and costs before you decide which way to go. You can always do your own taxes for free, but besides the time and stress of doing that yourself, you may miss out on deductions or other items that could potentially cover the cost of using a service.
Here are some of the online and in-person tax prep options you might want to look into:
Donation of Used Goods
There are many organizations that will gladly take your gently used goods. The win/win is that if you itemize your deductions (which will be less prevalent under the new tax law), the stuff you donate can help offset the amount you’ll owe Uncle Sam. If you want your donation to be tax deductible, make sure the organization you donate to is a qualified 501(c)(3) organization. (See IRS E O Select Check (Exempt Organizations Select Check) mentioned below.)
According to IRS Publication 561 – Determining the Value of Donated Property, household goods and used clothing must be in “good used condition or better” in order for you to take a deduction. Items should also be in good used condition or better just to be accepted by most of these organizations.
See also IRS Publication 526 – Charitable Contributions for other rules on charitable contributions, including what records you need to keep to document your contribution based upon the type and amount of the contribution.
There are many organizations that will accept donations of used clothing, furniture, housewares, and other items in good condition. Here are some that you might want to check out:
- Crossroads (Merged with Bib + Tuck)
- Donate My Dress
- Mitzvah Circle Foundation
- Room to Grow
- St. Vincent de Paul
- The Arc
- The Bridge To Success
- The Salvation Army
- Vietnam Veterans of America
For help on determining the value of the goods you donate, take a look at IRS Publication 561 – Determining the Value of Donated Property. This publication covers different kinds of donated property such as household goods, used clothing, jewelry, paintings, cars, etc.
- Charitable 501(c)(3) organizations such as educational organizations, religious organizations, cultural institutions, medical research foundations, service organizations, and numerous other charitable causes depend upon the generosity of donors to fund their organizations and operations. No amount is too small, as hundreds or thousands of small donations combine to make a large impact on the bottom line.
- When you make a monetary donation to a 501(c)(3) organization, it is better to use a check, credit card, or some other method with a paper or digital record, as opposed to cash.
- Keep all receipts and records of these payments for tax purposes to help you document the deduction you might be able to take on your tax return.
- See also IRS Publication 526 – Charitable Contributions for rules on charitable contributions, including what records you need to keep to document your contribution based upon the type and amount of the contribution.
- See IRS E O Select Check (Exempt Organizations Select Check), an online IRS search tool to check on organizations that are eligible to receive tax-deductible charitable contributions.