Losing a loved one is not an easy thing to go through. When a loved one passes away, it is normal to have questions while handling his or her final affairs. One thing that those who are left to close out estates in the state of Connecticut need to make sure that they consider is estate taxes. If they don't, there can be significant consequences.
There a number of organizations in Connecticut and elsewhere that are considered tax-exempt. This means they do not have to meet the same tax standards as everyone else. While they may not have to pay income tax, this does not mean that they do not have to submit a tax filing every year. They do and failing to declare and disclose tax information can have significant consequences.
For many, federal taxes are a year-round issue, especially if they are behind on paying what they owe. The pressure of owing back taxes to the federal government can affect many areas of a person's life. Unlike most other creditors, the IRS has powers it can use to recover the debt, such as garnishing wages and placing tax liens on property. The agency is now putting into action its new powers granted by a recently-enacted law.
Connecticut residents who make a lot of big purchases throughout the year may wonder if they can use that to their advantage come tax time. The answer is, maybe. It may be possible to deduct sales tax and reduce the amount of taxes one owes. How does that work?