In 2019, individuals saving for retirement in Georgia and throughout the country will be able to contribute more to their accounts. The IRS announced that the maximum annual contribution to an IRA will increase to $6,000 from $5,500. Those who have a 401k or similar plan will be able to contribute up to $19,000 annually starting in 2019. A person who is 50 and older will be able to make additional catch-up contributions of $1,000 into an IRA and $6,000 into a 401k.
Georgia residents who perform services for the government during an election must pay taxes on the income they earned. However, this income will not be subject to income tax withholding unless a worker specifically asks for that to occur. This is done by submitting a W-4 form to the agency employing the election worker.
Georgia residents and others who win a lottery game such as Mega Millions will need to pay taxes on their winnings. Both the IRS and state tax authorities will be looking to collect a portion of any amount received. Those who receive a cash prize will have 24 percent of it withheld to cover federal taxes. Additional taxes may apply depending on the amount of the award and the tax bracket it puts a person in.
Taxpayers in Georgia and throughout the country could owe the IRS money in April 2019 according to the Government Accountability Office, which says that up to 30 million people have not had enough money withheld for taxes by their employers. This is because of changes to the tax code implemented in 2017. Conversely, simulations run by the GAO show that many other taxpayers have had too much withheld and will receive a refund.
Georgians will be using new tax return forms when they file their taxes next year. The new Form 1040 has substantial changes and is now one page long. The IRS recently released a draft of the new form. While the new form might make filing taxes easier for many people, others who have complicated tax situations will have a more difficult time.
Georgia investors who are involved in solar energy development can benefit from a guidance published by the Internal Revenue Service. It said that developers who invest at least 5 percent of the complete cost of a utility-level solar project can receive a 30 percent investment tax credit. This policy applies to all investors until the end of 2019.
Many Georgia residents are trying to figure out how the new tax laws will impact their future returns. Many believe that it will be easier to file their taxes going forward. While there will be fewer people who itemize, those who continue to do so will likely find that their returns are no easier to file than they were in the past.
Georgia residents who can't file their tax return by the April 17 deadline are entitled to ask for an additional six months to do so. In most cases, the extension request is granted automatically. Furthermore, it is generally possible to do so by filing IRS Form 4868 or through a taxpayer's preferred tax filing software program. It is important to point out that this is only an extension to file the return itself.
Georgians who have bank accounts and assets located overseas must report them to the Internal Revenue Service. The IRS has announced that it is ending the Overseas Voluntary Disclosure Program, or OVDP, on Sept. 28, 2018. Taxpayers who have undisclosed foreign assets have until then to voluntarily disclose their overseas accounts and assets without facing possible criminal prosecution.
To avoid delays in receiving tax refunds, Georgia residents should take care to avoid certain common mistakes when completing their returns. While many people may believe that only significant mistakes will cause the Internal Revenue Service to hold on to their refunds, many delays are actually caused by easily preventable mistakes.