Sports Betting Winnings: What to Do at Tax Time
[ad_1] What your winning bet means for your taxes Key takeaways Sports betting winnings are taxable income, even if you don’t get a tax form. Some wins may trigger a form W-2G, but you still have to report all gambling income. Gambling winnings are taxed as ordinary income, added to your other earnings for the year. My favorite football team didn’t even make the playoffs, so when I placed a longshot parlay during the Big Game, it was mostly just to make things interesting. Things got interesting fast: I won, and it was more than I’d ever made on a single bet before. After the excitement wore off, one question hit me: Did I need to report that money on my taxes? If you’ve ever had that same question after a winning bet, here’s what to know. Your winnings are considered income The IRS considers gambling winnings to be taxable income. Whether you win through a sports betting app, at a casino, on a scratch-off ticket, or somewhere else, that money generally needs to be reported on your tax return. Whether it’s $5 or $5,000, winnings count as taxable income. Depending on the size and type of your win, you may receive Form W-2G. For some gambling winnings, this form is issued when the payout meets IRS reporting thresholds. In some cases, federal taxes may also be withheld from larger winnings. Even if you don’t get a W-2G form, you’re still responsible for reporting all gambling income. How your gambling winnings are taxed Gambling winnings are generally taxed as ordinary income. That means they’re added to your other income for the year, such as wages, self-employment income, or investment income. If you itemize your deductions, you may be able to deduct gambling losses up to the amount of your winnings. But you can’t deduct more in losses than you won, and you’ll need records to support your claim. Report your winnings confidently when you file It may sound complicated at first, but the basics are simple: report your winnings, keep good records, and understand when losses may be deductible. Tools like TurboTax can help guide you through reporting gambling income and losses step by step when you file. Betting regularly? Here’s how to report gambling winnings and losses the right way. [ad_2] Source link
Last-Minute Tax Filing and Extension Guide
[ad_1] Tax day has a way of sneaking up on everyone. Whether you still haven’t started, or just need more time, you have more options than you think, and the worst thing you can do is nothing. Don’t let tax season overwhelm you. We’ve rounded up everything you need to know about tax deadlines and extensions, so you can stop stressing and start taking action. A note about mailing your tax return If you plan to mail your tax return or payment, you should know that a recent processing clarification by the U.S. Postal Service could affect whether the IRS considers your tax return or payment on time, even if you mailed it before the deadline. The IRS uses the postmark date on your envelope and not the date you drop it in the mail to determine if you filed on time (known as the “mailbox rule”). With USPS processing changes, the postmark stamped on your envelope may reflect the date processed at the sorting facility which could be later. To protect yourself, consider requesting a hand-stamped postmark directly at a post office retail counter when you mail anything tax-related. The safest approach is to send payments and tax returns electronically. If you have to use mail, send your payment or tax return well ahead of any deadline. You can also request a certified return with a signature so you have proof that the IRS received your payment or tax return. Ready to file? Go from zero to done, fast The hardest part of filing your taxes is usually just starting. Whether you’ve been putting it off, you’re filing for the first time, or you just want to make sure you’re doing this right, you’re in the right place. These three articles walk you through everything you need before you sit down, answer the questions most filers ask first, and help you move from overwhelmed to done as quickly as possible. “De-Stress Tax Time: The 6 Top Filing Tips Everyone Should Know” Anxiety about taxes is real, and it stops a lot of people from filing on time. This article (with video) cuts through the stress with six practical tips that apply to almost every filer, regardless of your income or how complicated your situation is. First: De-stress “Tax Documents Checklist: How to Win Big This Tax Season” Select the life events that applied to you and we will create a tax document checklist made especially for your unique situation. You can come to TurboTax and fully hand over your documents over to a TurboTax Live tax expert and get your taxes done from start to finish. Use the tax documents checklist “Can You File Taxes on Your Phone?” Yes! Mobile tax filing has become increasingly popular. Mobile tax filing offers convenience, speed, and security, making it easier to prepare and submit your return from anywhere. Read the mobile tax filing tips Learn about tax deadlines Not ready to file by April 15? That’s okay, filing an extension is quick, free, and gives you until October to submit your return. And if you’ve already filed and realized something isn’t right, the IRS has a straightforward process for fixing it. Either way, taking action now is always better than waiting. Here’s what you need to know. “What Day Are Taxes Due? File by the April 15 Deadline or Get an Extension” Not sure when your taxes are actually due? This article covers the federal tax deadline, what to do if you can’t file or pay on time, and how to handle everything online. So you have a clear picture of exactly where you stand and what your next move should be. Learn about the tax filing deadline “What Happens if You File Your Taxes Wrong“ Worried about the fallout from filing late or making a mistake? This breakdown explains how the IRS calculates failure-to-file penalties, failure-to-pay penalties, and interest charges, and importantly, how to minimize the damage if you’re already behind. Learn how to minimize the damage “How To File an Extension Online with TurboTax” An extension gives you six extra months to file your return, but it doesn’t give you extra time to pay what you owe. This guide walks you through exactly how to request more time from the IRS, what the extension actually covers, and what you still need to do by April 15. Learn about filing an extension “IRS Form 4868: A Step-by-Step Guide To Filing an IRS Tax Extension“ Form 4868 is the official form you file to request a federal tax extension. If you’ve never done it before, this article makes it straightforward, walking you through each field, the filing deadline for the form itself, and how TurboTax can help you file it in minutes. Get the guide for filing an extension We’ve got you If you need more time, an extension is there for you. If something went wrong, it can be fixed. And if you’re just getting started, the hardest part is already behind you. Taxes don’t have to be overwhelming, and no matter where you are in the process, there’s always a clear next step. TurboTax is here to help you get it done with confidence, whatever that looks like for you. [ad_2] Source link
Get Expert-Backed AI Tax Help with TurboTax on Claude and ChatGPT
[ad_1] Your tax questions deserve expert-backed AI Tax season has always come with one big question: Am I leaving money on the table? This year, with AI rapidly reshaping how people manage their finances, a second question has emerged: Can I trust AI with something this important? Our answer is simple: Yes, you can trust AI with your taxes … when it’s backed by decades of tax expertise and purpose-built, for one of the most consequential financial moments of the year. Nearly 40 million Americans trust TurboTax to do exactly that, we’re bringing that trusted experience to more places, and making it more robust than ever before. Today, we’re proud to announce two milestones that bring TurboTax’s trusted financial intelligence to more customers, wherever they already are. The tax engine behind millions of returns, now live on Claude The TurboTax connector on Claude brings TurboTax capabilities directly into Claude, including personalized and real-time tax estimates, instant refund projections, seamless connection to a live Intuit tax expert, and a personalized tax document checklist with in-app document capture capabilities. This brings TurboTax’s trusted tax engine — the same core framework that powers millions of returns every year — directly into Claude, the AI assistant millions of people already use for work and life. And the data collected by TurboTax stays protected with the same privacy and security practices we apply across all of our products. How to launch the TurboTax Claude Connector In three simple steps, you can add TurboTax to your Claude account: Step 1: Open your Claude.ai account and navigate to the left side tab, “Customize.” Step 2: Click “Connectors,” then click on the search bar and type “TurboTax.” Select the TurboTax app from the results. Step 3: Click “Connect” and start asking your tax questions. The TurboTax app in ChatGPT just got even better Since launching our app in ChatGPT earlier this year, TurboTax has been helping users get personalized tax estimates, instant refund projections, and connect seamlessly with a live, local tax expert. Today, that experience gets even better with help for one of the biggest friction points in filing: getting organized. Based on a few questions about their tax situation — whether they’re a freelancer, a homeowner, a retiree, or all three — users receive a personalized checklist of which forms to gather, can upload documents directly within the TurboTax app in ChatGPT, and can pick up right where they left off in TurboTax to continue filing. How to get a personalized tax checklist in ChatGPT Step 1:In ChatGPT, find Apps in the left side tab. Search for “Intuit TurboTax” and click “Connect Intuit TurboTax.” Step 2: You’ll be prompted to sign into TurboTax or set up an account, if you don’t already have one. You’ll be brought back to ChatGPT after logging in. Step 3: From the Intuit TurboTax App, click “Start chat.” Step 4: Try a prompt like “Help me gather the documents I need for my taxes.” Step 5: Answer a few questions about your tax situation and get your personalized checklist. Review your checklist, gather your documents, and start filing on TurboTax. This is what purpose-built AI actually looks like People are increasingly turning to AI to help manage their most important financial decisions. For the 75% of American households earning under $100,000, the tax refund is often the largest paycheck of the year: The average refund last season topped $3,000, and filers this season expect to see up to a $1,000 increase in their refund or a lower balance due. When this much is on the line, you need accuracy you can count on. TurboTax knows your financial picture, operates on a platform built to protect your data, and has a real expert standing behind every calculation: purpose-built and trained by our network of 15,000 tax experts, leveraging 70,000 financial data points per consumer on a closed, secure platform. What TurboTax customers get that no one else can offer Your return, nearly done before you start. Our AI in TurboTax automates data entry for 90% of tax forms, including complex 1040s and 1099 composites, by ingesting them directly from financial institutions. For simple filers, we can prepare 80% of your return before you even start. More money back in your pocket. Our Cost Basis Adjustment Assistant alone saved customers an average of 50 clicks and lowered taxable income by a median of $12,000 during its pilot phase. Tax Break Finder identifies missing credits and deductions customers may qualify for. In a pilot, Tax Break Finder found additional deductions or credits for 12% of filers who reported an average savings of $327. Your refund, faster. Getting your refund is important; getting it quickly is just as critical. TurboTax’s 5 Days Early lets eligible filers receive their federal refund up to 5 days earlier in their bank account of choice for a fee, or in a Credit Karma Money Checking account for no additional cost. And with Refund Advance, qualifying customers can access up to $4,000 of their expected refund with no loan fees and 0% APR — in as little as 30 seconds after IRS acceptance of your tax filing. Putting every dollar to work. Getting the refund is just the start. Intuit’s Consumer Platform, which combines TurboTax and Credit Karma, uses AI to help members take control of their finances year-round. Credit Karma’s Refund Assistant provides members with personalized refund allocation plans. AI and human intelligence, working together for you. Our AI and proprietary technologies do the heavy lifting: automating, calculating, and personalizing while our network of 15,000 experts provide the judgment, confidence, and accountability that only a human can bring. Together, these milestones are the latest chapter in Intuit’s long-standing commitment to AI leadership. Backed by decades of investment in data and AI, Intuit has moved quickly and deliberately to bring that expertise into the platforms where people are already getting work done. Partnering with the world’s leading AI companies ensures that when people turn to AI for financial guidance,
A Guide to Taxes on NIL Income
[ad_1] Key takeaways NIL income is usually taxable at both the federal and state level, depending on where you earn it. Non-cash compensation relating to NIL deals, like free merchandise or trips, is also considered taxable income. Where you live, play, and sign deals can all affect your final tax bill. I was talking to a college athlete friend who’d just landed her first NIL deal. It was a huge win for her. Extra money, more visibility. But before she could celebrate, she’d been up Googling taxes at midnight, trying to work out how much money she’d be keeping. It’s a lot to process, especially if you’re new to paying tax. Between different rules and different taxes, the math can get complicated fast. The good news is that understanding how it applies to you will help make it less overwhelming. NIL income and why taxes can reduce how much you keep NIL (name, image, and likeness) income comes from deals and opportunities student athletes get based on their personal brand. Whether it’s an actual payment in dollars or non-cash compensation in the form of merchandise or trips, the IRS treats it as taxable income. That means NIL earnings are likely to be subject to: Federal income tax Self-employment tax Whether they’re subject to state income tax as well depends on the circumstances. To understand how it all works, it’s worth starting with the basics. NIL taxes FAQ Do I have to pay state taxes on NIL income? In most cases, yes. Though there are some places that don’t have state income tax, in most states NIL income is taxed in the same way as wages and freelance income. Do NIL deals count as self-employed income? Yes. The IRS generally considers NIL income as self-employed income, so earnings of at least $400 for the year (after deductions) are subject to federal self-employment tax of 15.3%. States assess income tax on these earnings. If you expect to owe $1,000 or more, the IRS recommends making quarterly estimated payments using Form 1040-ES. Does it depend on where I live and play? Yes. And this is where it can get complicated. Unless you live in a state that doesn’t tax income, you’ll likely be taxed by your home state. If you earn money tied to another state, you may need to file in more than one state and claim credits (or allocate taxes) to avoid being taxed twice. Should I report NIL earnings when I file? Yes. Your NIL income should be reported on Schedule C when you file a Form 1040. You may receive a 1099 form to report the income, but it’s important to report all earnings even if you don’t receive a 1099. What if I’m an international student earning NIL income? If you’re an international student, you may be eligible to receive NIL income, and you’ll have to pay U.S. taxes on that income.Your filing requirements will probably vary, depending on your status. It’s worth checking your specific situation and what it might mean before you start earning to avoid falling foul of the rules. Understanding taxes on NIL income NIL deals can be a big financial step, especially if you’re able to keep more of what you earn. Planning ahead can help you avoid giving more away than necessary, and that money can stay in your pocket as a head start for your future. See what you may be able to claim with the Self-Employment Calculator and get a clearer picture of your NIL taxes before filing your tax return. [ad_2] Source link
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