Everyday Law & Life

Should Married Couples File Taxes Jointly or Separately in the U.S.? Pros and Cons If you’re married, you have a choice each tax season: file jointly or separately . While most couples file jointly , there are some situations where separate filing might save money — or protect you legally. Let’s explore the pros and cons of each method to help you decide what’s right for you. 👩‍❤️‍👨 Filing Jointly: The Default Option Pros: Lower tax rates and higher standard deduction ($29,200 in 2024) Eligible for key credits: Earned Income Tax Credit (EITC) Child Tax Credit (CTC) Education credits (Lifetime Learning, American Opportunity) Easier and cheaper to file one return Cons: Joint liability : You’re both fully responsible for the full tax due May not be ideal if one spouse has tax issues, debt, or legal problems 👥 Filing Separately: When It Might Help Pros: Protects one spouse from the other's tax or legal problems Might reduce income...

If you're paying off student loans, there's a bit of good news: You may be able to deduct up to $2,500 in student loan interest on your federal tax return. Here’s how the deduction works, who qualifies, and what to watch for. 🎓 What Is the Student Loan Interest Deduction? It’s an “above-the-line” deduction , meaning you can claim it even if you don’t itemize . You can deduct: Up to $2,500 per year in interest From qualified student loans used for education expenses ✅ Who Qualifies? You must: Have paid interest on a qualified student loan in the tax year Have a Modified Adjusted Gross Income (MAGI) under certain limits: Full deduction if MAGI < $75,000 (single) or $155,000 (joint) Phases out above that You cannot be: Claimed as a dependent Married filing separately 🧾 What Is a Qualified Loan? Loans taken out solely for qualified education expenses Borrowed for you, your spouse, or a dependent From a legitimate l...

Do You Have to Pay Taxes on Cryptocurrency in the U.S.? IRS Rules Explained Cryptocurrency is exciting, volatile, and — yes — taxable. If you bought, sold, staked, or even received crypto as a gift, you might owe taxes to the IRS. Let’s break down when and how crypto is taxed in the United States. 💸 Is Crypto Considered Income or Property? The IRS classifies cryptocurrency as property , not currency. This means crypto transactions are generally subject to capital gains tax , not income tax — unless you're paid in crypto. 📊 Taxable Events You may owe taxes if you: Sell crypto for fiat (USD, etc.) Exchange one crypto for another Use crypto to buy goods or services Receive crypto as payment for work Earn rewards via staking or mining 📝 These events must be reported on IRS Form 8949 and Schedule D 🧮 How Is It Taxed? Short-term gains (held <1 year): taxed at ordinary income rate (10%–37%) Long-term gains (held >1 year): taxed at ca...

Who Qualifies as a Dependent on Your Tax Return in the U.S.? Claiming a dependent on your tax return can lead to major savings — including credits, deductions, and even lower tax brackets. But who actually qualifies? Let’s walk through the IRS rules and common scenarios to determine who you can legally claim as a dependent. 👶 Two Types of Dependents The IRS defines two main types: Qualifying Child Qualifying Relative Each has different rules. 🧒 1. Qualifying Child Requirements: Relationship : Your child, stepchild, sibling, or their descendant Age : Under 19 (or under 24 if a full-time student) Residency : Must live with you more than half the year Support : Cannot have provided more than half of their own support Joint return : Cannot file jointly with a spouse (unless only to claim refund) 👴 2. Qualifying Relative Requirements: Doesn’t have to live with you (if a listed relative) Gross income < $4,700 (2023 limit, adjusted annua...