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After legalization, black people are still arrested at higher rates for marijuana than white people

Both groups saw big drops in marijuana arrests, but large racial disparities remain.

 

Marijuana legalization does a lot of things, but one thing it doesn’t do is stop racial disparities in the criminal justice system — even with marijuana arrests.

In a recent report by the Drug Policy Alliance, the pro-legalization group documented the effects of marijuana legalization in several states. As expected, marijuana arrests are down dramatically in legal pot states. But arrests remain for, say, possession by people who are under the legal age of 21, unlicensed sales, and public consumption.

A chart of marijuana arrests in states that legalized marijuana.

Things get a little more complicated, though, when you break the data down by race. Arrests have declined for all racial groups since legalization. But that hasn’t halted racial disparities.

Alaska legalized marijuana in 2014, although it did not start sales until 2016. In the state, white and black arrest rates fell by nearly 99 percent and more than 93 percent, respectively, between 2012 and 2016. But black people were arrested for marijuana at a rate of 17.7 per 100,000 in 2016, while white people were arrested at a rate of 1.8 per 100,000 — about 10 times less.

 

A chart of marijuana arrests by race in Alaska.

 

Washington, DC, decriminalized marijuana in 2014, then legalized possession and growing but not sales in a voter-approved ballot initiative that same year. For possession, arrest rates between 2010 and 2016 dropped by more than 99 percent for black people and almost 99 percent for white people. But, again, racial disparities remained: Black people were arrested for possession at a rate of 8 per 100,000 people in 2016, while white people were arrested at a rate of 2 per 100,000 — four times less.

A chart of marijuana arrests in Washington, DC.

This is similar to what we saw in Colorado, one of the first two states to legalize pot in 2012. A 2016 report from the Colorado Department of Public Safety found, “The decrease in the number of marijuana arrests by race is the greatest for White arrestees (‐51%) compared to Hispanics (‐33%) and African‐Americans (‐25%). The marijuana arrest rate for Whites and Hispanics is comparable, but the marijuana arrest rate for African‐Americans is almost three times that of Whites (348/100,000 for Blacks and 123/100,000 for Whites).”

This is still progress for marijuana legalization advocates, since fewer people of all races are arrested for cannabis in the end.

But the findings also show the persistence of racial disparities in the criminal justice system.

The disparities are not explained by differences in black and white marijuana use rates. Surveys show black and white Americans use cannabis at similar levels.

Instead, there seems to be some level of bias built into the criminal justice system. Perhaps it’s individual racial biases among police officers. Maybe it’s how police are disproportionately deployed in minority communities, purportedly because they have higher levels of crime.

Then there are socioeconomic disparities

 that may drive some groups to, for example, more frequently use and sell drugs outdoors instead of indoors. All of these factors and others are likely working together to maintain racial disparities in the criminal justice system

Content Share from Vox Media, Drug Policy Alliance and lets not forget German Lopez, GREAT read!

IRS Reminds Employers: Forms W-2, W-3 Some Forms 1099-MISC Due Jan. 31

IRS Reminds Employers: Forms W-2, W-3 Some Forms 1099-MISC Due Jan. 31

 

WASHINGTON ― The Internal Revenue Service is reminding employers that the deadline for filing employee Forms W-2, Wage and Tax Statement, for calendar year 2017 is Jan. 31, 2018. This includes Forms W-3, Transmittal of Wage and Tax Statements.

In addition, reporting payments to contract workers on Form 1099-MISC (box 7, nonemployee compensation) must also be filed by Jan. 31.

Employers must file Form W-2 showing the wages paid and taxes withheld for the year for each employee with the Social Security Administration. The due date applies to both e-filed and paper filed W-2s. The Jan. 31 deadline began last year as part of the Protecting Americans Against Tax Hikes (PATH) Act legislation to combat identity theft and refund fraud.

The Social Security Administration encourages all employers to e-file their Forms W-2 by using its Business Services Online. The online filing checklist provides a step-by-step process for employers to file W-2s quickly and securely. Employers are required to use e-file if they file 250 or more Forms W-2 or W-2c, and failing to do so may incur a penalty. The IRS projects that employers will file more than 250 million Forms W-2 this year and that the vast majority will be e-filed. E-filing can save time and effort and helps ensure accuracy.

Employers that file Forms 1097, 1098, 1099 (except a Form 1099-MISC reporting nonemployee compensation), 3921, 3922 or W-2G electronically, have an extended filing due date with the IRS of April 2, 2018. However, the due date for giving the recipient these forms generally remains Jan. 31.

Trends and Surprises From California’s First 1,000 Cannabis Licenses

We’re not even a month into recreational marijuana sales in California, and already, the state has been issuing 50 marijuana licenses per day. The team at Cannabiz Media has been tracking these licenses closely, and with thousands of licenses still pending in the state’s queue, the team believes this license pace will continue well into the future.

Based on research from the Cannabiz Media License Database, let’s take a closer look at some of the most interesting trends developing in California.

Most Early Cannabis Licenses are Going to Cultivators, Dispensaries, Retailers, and Manufacturers

We all know how big the California market is (it’s the sixth largest economy in the world), so it’s not surprising that a large number of marijuana licenses have already been awarded across the value chain. For a bit of background, it helps to understand how the California regulatory structure works when it comes to issuing licenses:

  • Department of Food and Agriculture: Licenses cultivators of both medical and recreational marijuana.
  • Department of Public Health: Licenses manufacturers of cannabis-infused edibles for medical and recreational use.
  • Bureau of Cannabis Control: Licenses retailers, distributors, testing labs, and microbusinesses.

As of January 15, 2018, the Bureau of Cannabis Control (BCC) had issued 622 licenses compared to 349 issued by the Department of Food and Agriculture (DOFA) and 302 by the Department of Public Health (DOH). You can see the breakdown by issuing department in the chart below.

California Cannabis Licenses by Regulator

Diving a bit deeper into the data, the Cannabiz Media License Database reveals that a total of 1,273 cannabis licenses have been issued in California. The breakdown by license type follows:

  • Cultivator = 322 licenses (27% of all licenses)
  • Dispensary/retailer = 322 licenses (25% of all licenses)
  • Manufacturer = 302 licenses (24% of all licenses)
  • Distributor = 176 licenses (14% of all licenses)
  • Microbusiness = 57 licenses (4% of all licenses)
  • Delivery = 52 licenses (4% of all licenses)
  • Testing = 15 licenses (1% of all licenses)

You can see this data in the chart below.

California Cannabis Licenses by Type Issued

15 Companies Hold 10% of All Cannabis Licenses in California

Marijuana was legalized in California long ago, so there are companies doing business in the state that have already established brands and expert management. As a result, some of these companies are early winners of many licenses. In fact, just 15 companies hold nearly 10% of the 1,273 licenses awarded as of January 15, 2018 in California. Here’s the leaderboard to date:

  • Honeydew Farms LLC = 29 licenses
  • Harborside = 12 licenses
  • KindPeoples = 12 licenses
  • CA Systematize = 8 licenses
  • Airfield Supply Co. = 6 licenses
  • CALIVA = 6 licenses
  • ECD, Inc. = 6 licenses
  • P & S Ventures = 6 licenses
  • Purple Lotus Patient Center = 6 licenses
  • The Genezen Project = 6 licenses
  • Theraleaf Relief, Inc. = 6 licenses
  • Canna Culture Collective, Inc. = 5 licenses
  • Event Horizon Technologies = 5 licenses
  • NC3 Systems, INC. = 5 licenses
  • The Apothecarium = 5 licenses

Of particular interest are license holders who are bundling licenses to create larger sites or stacking licenses by obtaining them from different regulators. For example, CA Systematize obtained its eight licenses from all three issuing agencies, including small medical and adult cultivation licenses, adult and medical extraction licenses, and retailer and dispensary licenses. Suffice it to say, this strategy certainly required a highly effective compliance team who had to coordinate multiple licenses from the three different regulators in a very short timeframe.

Another example is Honeydew Farms, which operates in Humboldt County, California. The company pursued a two-step strategy to compete with large grow sites that had permits with other municipalities. First, it secured conditional use permits in Humboldt County. Second, it applied for and received its 29 small/medium outdoor cultivation licenses bringing it to the top of the California license leaderboard at this time.

Seven Cities Account for 40% of Issued Cannabis Licenses in California

The number of jurisdictions that have received cannabis licenses changes on a daily basis. As of January 15, 2018, cities that passed marijuana ordinances and issued local permits have reaped the early rewards. In total, 162 jurisdictions in California have received licenses, and just seven cities account for 40% of those licenses. Here is a license breakdown by city:

  • Oakland = 138 licenses (12% of all licenses)
  • San Jose = 87 licenses (8% of all licenses)
  • Sacramento = 66 licenses (6% of all licenses)
  • San Francisco = 49 licenses (4% of all licenses)
  • Cathedral City = 40 licenses (4% of all licenses)
  • San Diego = 37 licenses (3% of all licenses)
  • Arcata = 33 licenses (3% of all licenses)

What’s Next for Cannabis Licenses in California?

As mentioned earlier in this article, Cannabiz Media believes this fast-paced licensing trend will continue for some time. In fact, if the trend continues. There could be more than 10,000 licensed California marijuana businesses by the end of 2018!

What remains to be seen is how market maturity will affect license distribution and the overall California cannabis license landscape in terms of the types of licenses awarded, who holds those licenses, and where the businesses holding those licenses are operating. Cannabiz Media will be tracking it all in the Cannabiz Media Licensing Database, so stay tuned for updates.

 

Thanks to Ed Keating or Cannabiz Media for content “Original” share

Saver’s Credit — Contribute to your IRA by April 17

You may qualify for the Saver’s Credit for contributions you make to an Individual Retirement Arrangement (IRA) for 2017 on or before April 17, 2018.

Unlike a deduction, a credit is a dollar-for-dollar reduction of your federal income tax liability, and this credit can reduce the amount you owe or increase your refund for taxes already paid.

Are you eligible for the credit?  To claim the Saver’s Credit for 2017:

1. You must be age 18 or older,

2. You cannot be a full-time student,

3. You cannot be claimed as a dependent on another person’s return, and

 

 

4. Your adjusted gross income cannot be more than:

• $62,000 if your filing status is married filing jointly;

• $46,500 if your filing status is head of household; or

• $31,000 if your filing status is single, married filing separately or qualifying widow(er).

Are your 2017 contributions eligible for the credit?  Eligible contributions include:

1. Contributions to a traditional or Roth IRA, and

2. Salary reduction contributions (including voluntary after-tax and designated Roth contributions) to your employer’s 401(k), SIMPLE IRA, SARSEP, 403(b), 501(c)(18) or governmental 457(b) plan.

Rollover contributions aren’t eligible for the Saver’s Credit. Your eligible contributions for the credit may be reduced by any recent distributions you received from an employer-sponsored retirement plan or an IRA. Amount of the credit The amount of the credit you can get is based on the contributions you make and your credit rate. Your credit rate can be as low as 10 percent or as high as 50 percent, depending on your income and your filing status. Use Form 8880, Credit for Qualified Retirement Savings Contributions, to calculate and claim your credit.

You may be able to take a tax credit for making eligible contributions to your IRA or employer-sponsored retirement plan.

Who’s eligible for the credit?

You’re eligible for the credit if you’re:

  1. Age 18 or older;
  2. Not a full-time student; and
  3. Not claimed as a dependent on another person’s return.

See the instructions for Form 8880, Credit for Qualified Retirement Savings Contributions, for the definition of a full-time student.

Amount of the credit

The amount of the credit is 50%, 20% or 10% of your retirement plan or IRA contributions up to $2,000 ($4,000 if married filing jointly), depending on your adjusted gross income (reported on your Form 1040 or 1040A). Use the chart below to calculate your credit.

*Single, married filing separately, or qualifying widow(er)

2018 Saver’s Credit
Credit Rate Married Filing Jointly Head of Household All Other Filers*
50% of your contribution AGI not more than $38,000 AGI not more than $28,500 AGI not more than $19,000
20% of your contribution $38,001 – $41,000 $28,501 – $30,750 $19,001 – $20,500
10% of your contribution $41,001 – $63,000 $30,751 – $47,250 $20,501 – $31,500
0% of your contribution more than $63,000 more than $47,250 more than $31,500
2017 Saver’s Credit
Credit Rate Married Filing Jointly Head of Household All Other Filers*
50% of your contribution AGI not more than $37,000 AGI not more than $27,750 AGI not more than $18,500
20% of your contribution $37,001 – $40,000 $27,751 – $30,000 $18,501 – $20,000
10% of your contribution $40,001 – $62,000 $30,001 – $46,500 $20,001 – $31,000
0% of your contribution more than $62,000 more than $46,500 more than $31,000

 

2016 Saver’s Credit
Credit Rate Married Filing Jointly Head of Household All Other Filers*
50% of your contribution AGI not more than $37,000 AGI not more than $27,750 AGI not more than $18,500
20% of your contribution $37,001 – $40,000 $27,751 – $30,000 $18,501 – $20,000
10% of your contribution $40,001 – $61,500 $30,001 – $46,125 $20,001 – $30,750
0% of your contribution more than $61,500 more than $46,125 more than $30,750

 

2015 Saver’s Credit
Credit Rate Married Filing Jointly Head of Household All Other Filers*
50% of your contribution AGI not more than $36,500 AGI not more than $27,375 AGI not more than $18,250
20% of your contribution $36,501 – $39,500 $27,376 – $29,625 $18,251 – $19,750
10% of your contribution $39,501 – $61,000 $29,626 – $45,750 $19,751 – $30,500
0% of your contribution more than $61,000 more than $45,750 more than $30,500

Retirement savings eligible for the credit

The Saver’s Credit can be taken for your contributions to a traditional or Roth IRA; your 401(k), SIMPLE IRA, SARSEP, 403(b), 501(c)(18) or governmental 457(b) plan; and your voluntary after-tax employee contributions to your qualified retirement and 403(b) plans.

Rollover contributions (money that you moved from another retirement plan or IRA) aren’t eligible for the Saver’s Credit. Also, your eligible contributions may be reduced by any recent distributions you received from a retirement plan or IRA.

Example: Jill, who works at a retail store, is married and earned $37,000 in 2017. Jill’s husband was unemployed in 2017 and didn’t have any earnings. Jill contributed $1,000 to her IRA in 2017. After deducting her IRA contribution, the adjusted gross income shown on her joint return is $36,000. Jill may claim a 50% credit, $500, for her $1,000 IRA contribution.

Additional resources

California Cannabis Market, Rapid Growth

We are seeing the California Cannabis Market grow rapidly with every month that passes, it is going to be exciting to see the numbers once we release January’s finding here in a couple of weeks.

According to our most recent consumer survey in California, 38% of adults over the age of 21 were NOT current consumers but were open to trying cannabis in 2018. That means that there is now the possibility of 25 million ADDITIONAL Californians walking through your door.

How are you preparing for this new consumer? Do you know what products and brands they are going to prefer? How much they’ll be willing to pay? We can help answer those questions for you, your buyers, your budtenders, your marketers, etc. We like platforms that collect anonymized data (transactions only – we don’t touch patient information) from hundreds of dispensaries and provide them total market sales data in return, allowing them to answer the above questions and more.

Some of the highlights from a recent data (see below). Also, as a freebie, the subcategory breakout for California concentrates in October 2017:

As you can see, vapes (cartridges) dominate the total category, making up 2/3 of concentrate sales in California, double the share of Colorado vapes. This could potentially indicate that California, in some ways, is already behaving like an adult use market. Within the dashboard, I can click on the vape portion of the pie (or any other portion) and drill down into more interesting insights, such as top brands, products, doses, price-point breakout, disposable vs. not, high-CBD, branded vs. in-house, you name it.

Hundreds of retailers are already using this data to make day-to-day and long-term strategic decisions for their businesses and I wanted to make sure you had the opportunity to do the same.

Your Step-by-Step Guide to Uber Tax Filings

We can all agree that tax season can be stressful. Compiling all of your annual earnings, sending money to the IRS, and spending months wondering whether you filed everything correctly is enough to make your head spin.

Tax filings are even more stressful for Uber drivers.

As a rideshare driver, you’re employed as an independent contractor. Independent contractors are required to file additional forms and set aside money from your earnings, rather than having those earnings withheld from your employer.

Tax filings for Uber drivers require more paperwork than other employees. However, the extra time can be worth it when you factor in the exclusive tax deductions that rideshare employees are entitled to. Let’s take a look at how the Uber tax filing process works.

Disclaimer: Please keep in mind this information is provided for general informational purposes only to help you understand Lyft and Uber taxes. It is not intended to be tax advice for any specific individual as all individuals have different tax situations. Ridester advises obtaining tax advice from a Certified Financial Adviser or a Certified Public Accountant who can address your specific situation.

 

The Uber Tax Filing Process

  1. Collect your 1099 Form
    • Rideshare drivers should receive a 1099 form from Uber by January 31st. Your 1099 will show how much money you made and all of the fees that Uber took out of that amount throughout the last year.
    • Your 1099 will also display how many miles you have driven in the past year as a rideshare employee. You can access your 1099 by logging into the Uber partner portal.
  2. Prepare an Expense List
    • Compile all of your expenses to maximize the return you get during the tax filing process. Items on this list should include all of the money you spent on improving your rideshare business, such as providing customers with complimentary bottles of water, tire changes, and much more.
  3. Fill out the Schedule C and Schedule SE Forms
    • Once you have put together your tax deduction list, fill out the Schedule C and Schedule SE forms with all of your expenses.
  4. Calculate Your Total Profit
    • The next step is to use your Uber tax information to calculate your total profit for the past year. To achieve this, take the total amount you made, minus Uber fees and business expenses.
  5. Fill out the Form 1040
    • From here, Uber driver taxes are a bit easier to handle. With the 1099 completed, the last two steps are filling out the regular Form 1040 and paying your applicable taxes online or via mail.

What Tax Documents Do I Need?

1099-K

Banks will often send out a 1099-K to those who have earned over $20,000 or have collected at least 200 payments via Paypal, credit, or debit card. The IRS started issuing the 1099-K in an attempt to improve tax compliance from independent contractors.

1099-MISC

The Form 1099 variant is an essentially a catch-all for contract workers. Citizens may receive a 1099-MISC if they earned royalties or if a business has paid them for services rendered.

For example, any physical cash Uber drivers receive from a passenger who writes off the amount as a tax expense. During such events, Uber drivers will typically receive a 1099-MISC from the business. If not, they are required to report the earnings on their own via this form.

Schedule C Form

As the sole proprietor of your rideshare business, one of your responsibilities is to mark all expenses and income you handle under the label ‘self-employed’. Combine the data that you used in the 1099-K and 1099-MISC. Then, use this data to fill out the Schedule C Form.

Schedule SE

Once you have completed Form Schedule C, the next step is to tackle the Schedule SE. Uber drivers use this form to calculate how much of their income is taxable.

This amount can be found by subtracting Uber fees and business expenses from your income. The remaining amount is your net profit. Plug that number into the Schedule SE form to find out how much self-employment tax is due.

Form 1040

The final document taxpayers need to fill out during the Uber tax filing process is the U.S. Individual Income Tax Return, or Form 1040. This document is used to assess all personal clarifications that determine how your income should be processed.

For example, a Form 1040 provides a way for taxpayers to identify spouses and dependents, which may qualify them for additional deductions.

Tax Deductions for Uber Drivers

All tax deductions must be deemed ordinary and necessary.

Common items that are used in the rideshare industry, such as a universal USB cord for riders to charge their phone, are considered ordinary expenses. Necessary expenses include items or services that are helpful and appropriate for conducting business.

Vehicle Business Expenses

Since rideshare employees use their vehicle to conduct business, all of the expenses required to maintain that four-wheel operation are tax deductible.

Drivers have a choice in how to deduct these expenses during the Uber tax filing process. Options include the Actual Expenses Method or the Standard Mileage rate.

Uber drivers that want to keep track of every penny they spend can file with the Actual Expenses Method. If you are filing in this manner, make sure to keep your receipts for the following items.

  • Carwash
    ● Car Depreciation
    ● Lease Payments
    ● Car Loan Interest Rate
    ● Registration Fees
    ● Licenses
    ● Gas
    ● Rideshare Insurance
    ● Vehicle Repairs
    ● Oil Changes
    ● Garage Rent
    ● Tires
    ● Tolls
    ● Parking Fees
    ● Roadside Assistance

There are several cons to filing with the Actual Expenses Method, such as the time and effort required to file in this manner. Filing your actual expenses may result in the oversight of certain expenses, and often ends up with rideshare drivers deducting less than they are entitled to.

To avoid such a dilemma, rideshare employees may decide to file the with Standard Deduction instead.

With Standard Deduction, rideshare employees multiply the number of miles listed on their 1099 by the Standard Mileage Deduction rate. This rate is an estimate of the expenses that drivers spend in a year.

Since these expenses change from year to year, the Standard Mileage rate fluctuates frequently. As of 2017, the rate is 53.5 cents per mile.

Phone Expenses

Without a smartphone, conducting business as a rideshare employee would be nearly impossible. As a result, most of the expenses an Uber driver spends to maintain the handheld device are tax deductible.

For example, if you bought a cell phone to start your rideshare business this year, you can deduct the price of the device when you file.GET STARTED TODAY

Other expenses include your monthly phone bill and any accessories purchased that are business related. However, using the same phone for work and personal use can make the filing process more complex.

It may be easier to purchase a separate phone for rideshare purposes. If not, you will be required to log data and cellular usage that was specifically used while working to get an accurate deduction rate.

Additional Uber Tax Deductions

There are plenty of additional expenses that are tax deductible that we have not covered yet.

For example, the fees that Uber takes out of your income is tax deductible. Another fee to take note of is any bank fees that are related to the rideshare business. These fees are often overlooked. However, each can be deducted during the tax filing process.

Related: Come see how Trump’s tax plan could impact your taxes as a driver.

Drivers that have started using complimentary items, such as bottled water and snacks, can deduct the expense from their taxes as well. To take advantage of this, be sure to keep itemized receipts or store the data in a spreadsheet.

If you have improved the safety and security of your rideshare service by installing a dashboard camera, keep the receipt! This item is tax deductible too.

Drivers that prefer to file their taxes using the Actual Expense Method may opt to hire an accountant. If you decide to pursue this form of bookkeeping, all of the accounting costs you pay out are tax deductible.

Common Mistakes to Avoid in Taxation

Uber Fees

Driver’s gross income does not include the Uber fees that are instantly removed. Due to this, it is very common for rideshare employees to calculate expenses without taking the Uber fees into account.

Be sure to only work with the income figure that is generated after you have subtracted Uber’s cut. Furthermore, do not shortchange yourself. All Uber fees that you subtracted from your gross income are tax deductible.

Vehicle Expenses

Many rideshare drivers make the mistake of trying to deduct their vehicle expenses twice. You can avoid this by choosing either the Standard Mileage Deduction or Actual Expense Method before filing.

Drivers that prefer to use the Actual Expense Method should start keeping track of their receipts at the beginning of each year. Doing so will maximize the total amount of deductions you qualify for during the Uber tax filing process.

Not Saving Enough

Spending money without paying taxes on it first can leave you owing the IRS a hefty amount come tax season. To avoid this financial nightmare, set aside a portion of your paycheck each week. Save up this money and do not spend it.

The self-employment tax rate is about 15.3%. Additional tax rates added to this, such as local, state, and federal, will vary. To compensate for this, we encourage drivers to set aside 30% of their income for the sole purpose of paying taxes.

Worried you didn’t save enough? Come explore this Uber driving advice to maximize your earnings before tax reason.

Business vs. Personal

As mentioned previously, deducting expenses that border between business and personal use can be tricky. The IRS will audit you if they suspect that you are trying to deduct personal items instead of business expenses. To avoid this, make sure you avoid filing personal cell phone data usage and mileage recorded for non-business purposes.

Recommend Tax Software for Drivers

There are many tax filing services online. Each system offers various features and prices that correlate with the service. Although there are a few free ways to file your taxes digitally, only a couple of these options include all of the forms that independent contractors need to fill-out.

TurboTax

TurboTax uses simple language to guide you through the tax filing process.

The software double checks possible deductions you might have missed and directs you to where to find it. Pricing for the Self-Employed Version is rather expensive, however, with a federal charge of $114.99 and a $39.99 fee for state.

H&R Block

Supporting the most tax form coverage and schedules with very few exceptions, H&R Block is another great option for filing taxes. For starters, they offer several options on how to go about the tax filing process as an Uber driver.

This can be very useful for those who prefer personal, non-automated assistance. Plus, H&R Block costs significantly less for those filing as self-employed. Federal is $74.95 and state is an additional $19.95.

TaxAct

Our last recommendation is TaxAct. Until a few years ago, TaxAct was a free tax filing service that included e-filing service.

TaxAct provides clear, straightforward filing experience at a noteworthy price. Filing your federal tax return as an independent contractor will cost $37. The price for filing your state taxes is $25.

What if I Don’t File Taxes?

Filing taxes is an important task that everyone is required to participate in. Citizens that do not file their taxes are subject to severe fines.

Initially, an interest rate and late fee are tacked onto the amount owed. These fees are compounded daily and can inflate the final amount owed to staggering numbers within two months.

If these penalties are ignored for any longer, the government can enforce devastating effects.

The process begins with the IRS issuing a Federal Tax Lien. When a citizen receives this warning, the IRS is essentially claiming all of your property, such as a car, boat, or house, as theirs. Further measures will be taken if this red flag is simply tossed aside.

In an effort to settle the amount of taxes you owe, the IRS can seize all of your property. Citizens that do not possess enough property to pay off the amount owed will start to notice a steep cut in their paycheck. If this process of paying off a tax debt is evaded, you can be charged with tax evasion and sent to jail.

Additional Tax Resources for Uber Drivers

Hopefully, we have covered all of the questions you may have about the Uber tax filing process. To further assist you with the Uber tax filing process, we have gathered a few useful resources for you to check out.

Uber Partner Tax Reporting Guide

This informative guide was created by H&R Block.

The PDF goes into further detail about how rideshare drivers working for Uber are considered an Uber partner. Other informative data that you may find interesting is also included, sales tax information and rare occurrences when income does not have to be filed.

Self-Employment Tax Calculator

Figuring out exactly how much money you need to set aside for taxes is a bit tricky. We have found that this Uber tax calculator can help with a lot of the guesswork.

CalcXML takes three inputs, your total income, how much of that was either taxed or deducted by Uber, and your filing status. From there, CalcXML generates the approximate amount of taxes you need to pay.

They break down how your self-employment taxes are distributed between Social Security and Medicare, as well as explain how much of that is actually tax deductible.

Guide to Taxation for the Sharing Economy

The IRS has issued their own guide for filing Uber taxes. Throughout the document, in-depth details on what needs to be included on your tax return are discussed at length.

Plenty of relatable examples are given to assist the reader with clarifying what a certain form is asking for. The guide even discloses how rideshare companies go about filing their tax returns, so be sure to check it out if you are curious.

When you started driving for Uber filing taxes was probably the last thing on your mind. Hopefully, taxation hasn’t hurt your enthusiasm.

As an Uber partner, there are many things to consider while running your rideshare business, including your taxes. With the new year steadily creeping towards us, it’s time to start preparing for the upcoming tax season.

 

Special Thanks to Pat @ ridester for reaching out to share content

Taxpayers Can Spread the Word About Tax Credit that Benefits Friends and Family

Taxpayers Can Spread the Word About Tax Credit that Benefits Friends and Family

The earned income tax credit provides a boost to workers, their families and the communities where they live. A tax credit usually means more money in the taxpayer’s pocket. Many qualified taxpayers don’t claim this credit simply because they don’t know about it. In fact, every year millions of people are newly eligible for EITC because their family or financial situation changed. Word of mouth is one way to spread information about this credit.

This credit can not only reduce the amount of taxes someone owes, it can also result in a refund. The amount of EITC taxpayers receive is based on their income, family size and filing status. The maximum amount of credit for Tax Year 2017 is:

  • $6,318 with three or more qualifying children
  • $5,616 with two qualifying children
  • $3,400 with one qualifying child
  • $510 with no qualifying children

The IRS encourages taxpayers who have claimed and benefitted from the EITC to help spread awareness about this important credit. Here are a few ways taxpayers can help their friends, family members and neighbors find out about EITC. Tell them about:

  • IRS.gov: Taxpayers who want to learn more about EITC can go to IRS.gov/eitc. They can find information about who qualifies for the credit and how to claim it.
  • Tax help in Foreign Languages: People can pass along information from IRS.gov about EITC in other languages:
  • EITC Assistant: This tool on IRS.gov, available in English or Spanish, walks people through a series of questions to find out if they qualify.
  • IRS on Social media: Share a link on Facebook or Twitter. People can follow the IRS on social media for the latest news and information about tax credits.
  • Free Tax Help from Volunteers: The IRS works with community organizations around the country to train volunteers who prepare taxes for people with low and moderate income. These volunteers can help determine if a taxpayer is eligible to claim the EITC. There are two IRS-sponsored programs:
    • Volunteer Income Tax Assistance: This program is also known as VITA. It offers free tax return preparation to eligible taxpayers who generally earn $54,000 or less.
    • Tax Counseling for the Elderly: TCE is mainly for people age 60 or older, but offers service to all taxpayers. The program focuses on tax issues unique to seniors. AARP participates in the TCE program through AARP Tax-Aide.

By law, the IRS cannot issue refunds before mid-February for tax returns that claim the EITC or the additional child tax credit. The law requires the IRS to hold the entire refund — even the portion not associated with the EITC or ACTC. The IRS expects the earliest EITC/ACTC related refunds to be available in taxpayer bank accounts or on debit cards starting Feb. 27, 2018, if these taxpayers choose direct deposit and there are no other issues with their tax return.

Washington: Leaf Data Systems to Go Live February 1

Leaf Data Systems to Go Live February 1

Dear Marijuana Licensee:

Leaf Data Systems will be implemented as Washington’s traceability system in less than a week. As we approach the transition, there are some important things to know:

  • The best place to find information about the upcoming changes is at the Getting Started with Leaf Data Systems page on the LCB website. This page will continually be updated with the latest information.
  • To begin using Leaf Data Systems, you will need to upload your current inventory into Leaf Data Systems. This is the only system you should use for traceability reporting activities after your upload is complete. You can learn how to upload your inventory at the Getting Started with Leaf Data Systems page, and will be able to complete this task after the system goes live. If you have a third party software provider, check to see if your inventory uploads will be completed for you.
  • Weekly Contingency Reporting ends when Leaf Data Systems goes live at 12:01 a.m. February 1, 2018, however there will be a 15-day grace period where Contingency Manifest and Destruction reporting forms will be accepted as you shift to the new system.
  • If you use a third party software system, you will need to provide them with an API key. API keys are used as identifying credentials necessary for system integration. More information and directions about initial access to Leaf Data Systems and API key retrieval will come Wednesday, January 31. Be sure to check your email and the LCB website for updates.
  • Once Leaf Data Systems goes live, support will be available seven days a week, between the hours of 6 a.m. and 6 p.m. by calling 888-420-5813. You can also email Leaf Support at any time.

Take Steps Now for Tax Filing Season

Get ready today to file your 2017 federal income tax return.

 

Refunds

What You Need to Know

  • Expecting a refund? Some refunds cannot be issued before mid-February.
  • While the IRS will process your return when it is received, it cannot issue related refunds before mid-February.
  • The IRS expects the earliest EITC/ACTC related refunds to be available in taxpayer bank accounts or on debit cards starting on Feb 27, 2018, if they chose direct deposit and there are no other issues with the tax return.

What You Need to Do

  • Be careful not to count on getting a refund by a certain date, especially when making major purchases or paying other financial obligations.
  • File a complete and accurate return and include all known refundable credits with your original return.
  • File when you’re ready. If you usually file early in the year and you’re ready to file a complete and accurate return, there is no need to wait to file.
  • Check Where’s My Refund on IRS.gov or the IRS mobile app, IRS2Go, for your personalized refund status.

 

Adjusted Gross Income (AGI)

What You Need to Know

  • If you prepare and file your own taxes electronically, you must sign and validate your electronic tax return by entering your prior-year AGI or your prior-year Self-Select PIN.
  • Some taxpayers using a software product for the first time may need to provide their 2016 Adjusted Gross Income, or AGI, to e-file their 2017 tax return.
  • If you are using the same tax software you used last year, you will not need to enter your prior year information to electronically sign your 2017 tax return.
  • Using an electronic filing PIN is no longer an option.

What You Need to Do

  • If you are using a software product for the first time and you have a copy of your 2016 federal income tax return, your AGI is on line 37 of the Form 1040; line 21 on the Form 1040-A or line 4 on the Form 1040-EZ.
  • If you don’t have a copy of your 2016 tax return:
    • Ask your paid preparer, if you used one last year.
    • Log in to IRS.gov/account to access your account information.
    • Log in to IRS.gov to get various Form 1040-series transcript types online here. If you need your prior year Adjusted Gross Income (AGI) to e-file, choose the tax return transcript type when making your request.
    • Ask the IRS to mail a Tax Return Transcript to you by requesting it here or call 800-908-9946. Allow 5 to 10 days for delivery.

 

Individual Taxpayer Identification Number (ITIN)

What You Need to Know

  • If you require an ITIN (required in lieu of a Social Security Number) to file a tax return, you are likely to experience processing delays if you file using an expired ITIN.
  • There are two reasons your ITIN would expire December 31, 2017:
    • If you have not used your ITIN on a U.S. tax return at least once for tax years 2014, 2015 or 2016 or
    • If your ITIN has the middle digits 70, 71, 72 or 80   (9NN-70-NNNN)
  • If your ITIN has middle digits 78 or 79, it expired December 31, 2016, but you can still renew it.

What You Need to Do

  • Renew your ITIN now if it has or will expire and you need to file a U.S. tax return in 2018.
  • You don’t need to take any action to renew your ITIN if you are not required to file a tax return.
  • Understand the new documentation requirements when applying for or renewing an ITIN for some of your dependents. See ITIN FAQs for details.
  • Ensure you submit an accurate W-7 and valid ID documents.
  • Find more information at IRS.gov/ITIN.

 

How To Cook Dinner With Cannabis Without Making Your Guest Really High

The pear recipe was pretty standard, except for the cannabis part, which to the uninitiated sounded like a chemistry class, with terms like terpenes (oils that give marijuana its smell) and infusion machines. Take, for example, the different methods for decarboxylating (baking your weed in the oven to activate THC, necessary to get you high). Cook it too much and everyone you feed will be flat out on the couch, fried before the evening is done.

Phipps walks the audience through a series of mathematical calculations every budding cannabis chef must make to avoid overdosing the company. When it comes time to add the infused oil, always make sure to stir well so no one gets the entire dose, she says. “And make sure you label all treats.”

All this was complicated enough to make some in the crowd long for the good old days when you could smoke a joint and get into a bag of chips for nourishment. But Andrea, who didn’t want to give her last name for fear she would be hassled crossing the U.S. border, found the class valuable and instructive. “I don’t enjoy smoking marijuana, but I enjoy the effects of eating it.”

Andrea, whose hair is long and greying, was a teenager in the late 1960s and uses cannabis both medicinally (for undisclosed conditions) and recreationally. “As it becomes more available, I think my contemporaries will go back to it,” she predicts.

That is precisely what drew upwards of 12,000 people to the expo over two days in mid-January. Many were business people in sport jackets and brogues. Canada’s medical marijuana business is already booming, and with legalization just around the corner, the recreational business is about to explode. In a sign of how corporate things have become, this year’s Vancouver Lift expo was preceded by a sold-out, day-long business conference where a networking breakfast was sponsored by MNP, one of Canada’s largest accounting firms.

Everyone hopes to ride the wave, including Matei Olaru, the affable 28-year-old CEO of this weekend’s event. Olaru became interested in med pot before any producers were licensed in Canada, when most users grew their own. When government licensed growers, and corporate opportunities took shape, he decided to jump in. He studied law, articled at Stikeman Elliott in Toronto, then quit to join Lift the day after his bar admission.

As well as hosting trade shows, Lift operates the Yelp of medicinal marijuana, an online platform where users rate different strains sold by Canada’s licensed producers. Olaru collates user ratings to supply the industry with data about demographics and preferences. With the move from medical to recreational use, he figures the number of legal users will jump from 200,000 to five million, and newcomers will be hungry for product information.

“What we bank on is it will be a restrictive environment just like it is today, where producers can’t advertise their products, can’t make claims about what the product does.” So, his website will be an obvious go-to for the next generation of users, who will be older suburbanites and “regular adults”, Olaru says.

The packaging and marketing of medicinal cannabis producers at the expo already reflect the impending shift in clientele.  The once-ubiquitous head shop imagery found at 4/20 celebrations is largely absent. These products are pitched to a mainstream clientele. Take Omni, which produces a series of oils, creams and salves for pain. Their shiny black containers with gold lettering would be at home on a Holt Renfrew cosmetic shelf. “We don’t want people to have to hide it in a medicine cabinet” says Nicola Hillbrandt, who is working the booth.

One group, however, is not caught up in legalization euphoria; the self-described protesters staffing chilly, illegal outdoor booths with bags of weed and edibles for sale. They resent the corporate incursion into their recreational space and fear legalization will cut them out of the business. “They won’t give me a licence because I have a record for dealing cannabis,” laments Dillon McArdle. Complaints aside, McArdle admits he shifted from his regular location at the Vancouver Art Gallery, about a half-mile away, to the convention centre, where all the action is. For one day, at least, he is happy to capitalize on the corporate success to come.

 

Special thanks to our friends at weedistry.com for “content share”

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