Campfire Wisdom Blog

Food! I love food. In fact, some could say, “Food is my best friend! It’s there when I’m down to console me. It’s there to help me celebrate stuff. And when there is nothing to do, it’s there.” First time I heard the term “Cafeteria Plan” years ago, I immediately thought it was about companies that offered a food service option on site as part of working there. Its about offering a “menu” of fringe benefits for employees to pick and choose from. (Disability Insuranc

Well, thanks to the One Big Beautiful Bill Act (OBBBA), there are provisions for deducting certain Tip and Overtime pay from taxable income. The maximum deduction for Tip income is $25,000 with a MAGI phase-out starting at $150,000 single or $300,000 for marrieds. Maximum Overtime deduction is $12,500 single and $25,000 for marrieds with the same MAGI phase-out rules. The challenge, is how to compute the correct amounts. For the 2025 tax year, some employers took the tro

Yippy Kai Yai Yay! (That’s cowboy for hooray! One of my dad’s favorite sayings.) Taxpayers across the fruited plains are celebrating this fantastic news. Turns out that Congress reduced the IRS budget recently by 9% compared to the prior year. The House is already making noise to slash the IRS budget further in 2027. The IRS has lost over 20% of its workers since Trump took office, through voluntary deferred resignations and layoffs with more departures expected later

Hidden inside the One Big Beautiful Bill Act (OBBBA for short) that passed a year ago, is a quirky little thing called the Federal Scholarship Tax Credit (FSTC). Nobody has talked much about it since it doesn’t kick in until the 2027 tax year. (That’s tax returns filed in 2028.) It is a non-refundable federal tax credit of up to $1,700 for individuals who donate cash (not property) to qualifying organizations that are created to provide scholarships to K-12 students. It

Congress created it. Their intent was to prevent folks from letting their retirement savings continue to accumulate when somebody reaches retirement age. Once again, Congress seems to know definitively when everyone should retire. RMD stands for Required Minimum Distribution. The Internal Revenue Code (written by Congress) requires a taxpayer to begin taking withdrawals from their traditional IRA, SIMPLE IRA, SEP IRA or retirement plan account when they reach 73 years ol

What comes to your mind when you think of Independence Day 1776 and Taxes? The Boston Tea Party right? Well, you need to know the background story. The British Empire was quite far reaching and expensive to maintain back then. After a painfully costly war with France in 1763, King George was literally bankrupt, so Parliament passed a bunch of tax acts, levied against outlying colonies, including America. Most were rejected rather quickly, like the Stamp Act, the Townshe

Do you own a business? Is your spouse currently unemployed? Do you need another employee? Why not hire your spouse? One last question. Would having your spouse work with you cause stress and trouble in your marriage? If so, then forget the rest of this article, don’t hire your spouse. It’s not worth ruining your marriage over. There are some tax and financial benefits when you hire your spouse. First benefit is having your spouse salt away the maximum contribution

Just about everybody makes donations to charity. Rounding up on a fast-food purchase, giving old stuff to The Salvation Army (or other similar charities like Goodwill, FISH, Classy Seconds, etc.). Buying Girl Scout cookies. Dropping a few bucks at the request of various charities standing outside Wal-Mart. Etc. Americans are quite generous people. It used to be a given that they could also deduct that generosity on their tax return. Way back in 2018, most folks lost t

One of my favorite magazines is called “Nevada Business.” It does originate in Southern Nevada, but they do a great job of giving great information on businesses in all of Nevada. Every year, they do a poll of decision makers – executives and business owners – across the entire state of Nevada. Most of the respondents are long termers…having been in business in Nevada for 20 or more years. I wanted to share just a few interesting observations. If you want to read the e

Now the title of this article might get some folks riled up. There is a process called “eminent domain” where the government can end up taking some or all your land. Usually for roads, but sometimes for utility access, conservation, wildlife habitat, etc. When the government condemns your land under the eminent domain process, you get paid the fair market value of the land. Then, you might end up having to pay capital gains tax depending on your cost basis. There is a

Surprise! Surprise! (Famous quote from Gomer Pile) When it comes to understanding the ins and outs of education tax credits, most folks get it all wrong American Opportunity Tax Credit (AOTC) is a maximum annual $2,500 credit to be used for up to four years of study for every student in the family. (That includes mom and dad.) That is potentially $10,000 spread out over at least the first 4 years. Not bad! To qualify, a student must be enrolled in pursuing a degree in

Every election season, this issue gets trotted out to smear an opponent. Having household help but not paying them correctly. There are a wide variety of potential “employees.” Babysitters, private nurses, other caretakers, cleaning folks, yard workers, and of course, nannies. The tax law requires you to pay employment taxes if the wages paid to certain household employees exceed a specified annual threshold. The annual threshold in 2026 is $3,000. Notice I keep using

One of the better ideas that Congress actually made into tax law many years ago, was the Health Savings Account (HSA for short). It basically allows you to deduct much of your normal medical expenses that are limited out when you use actual Itemized Deductions. If you take the Standard Deduction (most folks do these days), then getting to deduct your medical expenses over and above the Standard Deduction is a sweet deal! How it actually works is, contributions are tax-ded

There is a tax return filing that doesn’t involve paying any taxes, but the penalties for not filing could be devastating. This is about a report called an FBAR (Foreign Bank and Financial Accounts Report) form 114 that must be filed at the same time as your Federal Income Tax Return every year that you qualify. The penalty for non-willful failure to file an FBAR is currently $16,538, indexed for inflation. (So, the penalty goes up every year, unlike the limit on taxable

I bet you’re wondering, “What does a goofy bean counter know about economics?” Have you noticed, leading economists are making all kinds of predictions. Some very negative, some very positive, and most kinda in the middle. I’ve been in the business world for 48 years. I’ve seen inflation go up and down; lived through one of the most incredible economic booms (1980s); seen top tax rates go from 70% to now almost exactly half that…37%, watched the fed rate climb and fall

As we approach the final stretch on tax filing, there seems to be a lot of confusion about new provisions for older folks in the One Big Beautiful Bill Act (OBBA for short). I heard somebody say they thought this new bill was Greek. You know, think of the Greek dancer chanting “OBBA!” Because of the new OBBA, senior folks may see as much as $46,700 as their total standard deduction for married folks instead of the original planned $33,200. Here’s the story. President Trump wa

Ever heard of the Net Investment Income Tax or NIIT for short? You can thank President Obama for this one. It’s a part of Obamacare. ...

Recently, the US Supreme Court made a ruling about the wrong way to use Life Insurance when buying out the other owner’s family interest...

For all of you who’ve been to my office, you know we have an office dog named Chip, and occasionally, his “little brother” the cat, named...

Thanks to the 44th President, we have been stuck with a most unwieldy and poorly written tax called Net Investment Income Tax or NIIT for...