Tax Planning for Life's Major Events
As your life changes, so does the set of tax rules that affect you.
Benjamin Franklin was ruminating on the future of our fledgling democracy — not griping about the IRS — when he wrote the oft-quoted phrase that nothing is certain except death and taxes. As wise as he was, though, there's no way Franklin could have foreseen how thoroughly, as well as certainly, the federal income tax would affect future generations of citizens.
The voluminous Internal Revenue Code now reaches into nearly every nook and cranny of our lives, from cradle to grave. A newborn brings tax breaks to his or her parents; death brings a series of tax repercussions; and the IRS has something to say about almost everything in between. The tax bill you owe each spring is based on the working, saving, investing, spending, business and other personal decisions you make during the year.
As your life changes, so does the set of tax rules that affect you. That's why this compendium of life events is so important — to alert you to new opportunities to embrace and pitfalls to avoid as your life as a taxpayer evolves.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The fact that federal income taxes are among most families' biggest annual expenditures hammers home the importance of tax planning. Shake off any notion that this is a game for the wealthy. Instead, draw your inspiration for this comment from a high-priced tax attorney: "The best and finest tax planning is done by people who have more money than they'll ever spend or be able to give away. The worst tax planning is done by nice middle-class people who have middle-class virtues, those who have to work hard and save and sacrifice." Tax planning will save you money.
Choose the life stage that pertains to you and so you can start making tax-saving moves that will pay off:
- Graduating from college
- Getting your first job
- Getting married
- Getting married as a same-sex couple
- Birth of a child
- Changing jobs
- Sending your child to college
- Working at home
- Selling your home
- Owning a second home
- Getting hit with a major illness or injury
- Getting divorced
- Retiring
- Death of a spouse
To continue reading this article
please register for free
This is different from signing in to your print subscription
Why am I seeing this? Find out more here
-
GM Stock Accelerates After Earnings Beat
General Motors beat expectations for the first quarter and raised its outlook for the year. Here's what you need to know.
By Joey Solitro Published
-
Georgia Has a New Income Tax Rate for 2024
Tax Cuts Georgians now have a tax package containing income tax cuts, childcare relief, and potential property tax caps.
By Kelley R. Taylor Published
-
IRS Announces Florida Tax Relief Following Hurricane Idalia
Tax Deadline In response to the severe damage caused by Hurricane Idalia, the IRS has extended tax deadlines for affected Floridians.
By Kiana Curtis Published
-
Warning: Watch Out for New IRS Refund Mail Scam
Tax Scams If you receive a cardboard envelope appearing to be from the IRS about an unclaimed tax refund, be cautious. It’s a new scam.
By Kelley R. Taylor Last updated
-
Your Frequently Asked Tax Questions Answered: Kiplinger Tax Letter
Kiplinger Tax Letter The Kiplinger Tax Letter receives a lot of reader tax questions and its editor, Joy Taylor answers a selection of them.
By Joy Taylor Published
-
Supreme Court: Yes, the IRS Can Secretly Obtain Your Bank Records
The Supreme Court has sided with the IRS in a case that involves owing the IRS money, taxpayer privacy, and notice.
By Kelley R. Taylor Published
-
IRS Processing Improvements Could Bring Faster Tax Refunds
IRS An IRS paperless processing initiative and other service and technology improvements mean taxpayers could see faster tax refunds next year and beyond.
By Katelyn Washington Last updated
-
Supreme Court to Decide if IRS Can Secretly Obtain Bank Records
Among other high-profile issues, the Supreme Court is considering a case involving taxpayer privacy and the IRS.
By Kelley R. Taylor Last updated
-
IRS Says File By July 17 for $1.5 Billion in Unclaimed Tax Refunds
Unclaimed tax refunds from 2019 are waiting for millions of people who might not know it – but only if they file the pandemic-era tax return soon. Are you one of them?
By Kelley R. Taylor Published
-
IRS $80 Billion Plan Targets Taxpayer Compliance, Improved Service
The IRS unveiled its much-anticipated strategic operating plan detailing how the agency will spend $80 billion in funding allocated over 10 years under the Inflation Reduction Act.
By Kelley R. Taylor Published