IRS set to launch its free tax-filing pilot program for some taxpayers. Here's what to expect

Some taxpayers will soon qualify for Direct File, a free tax-filing option from the IRS.

The pilot will begin as an invitation-only service before rolling out to certain taxpayers in 12 states by mid-March.

In 2023, individual U.S. taxpayers spent an average of $150 to prepare and file returns, according to the IRS.

As the tax season kicks off next week, Americans have several free filing options — and some taxpayers will soon qualify for a new offering from the IRS.

Known as Direct File, the agency's free filing software pilot will begin as an invitation-only service for a group of government workers before rolling out to certain taxpayers in 12 states by mid-March.

The software is "simple, secure and free," Laurel Blatchford, the U.S. Department of the Treasury's chief implementation officer for the Inflation Reduction Act, said in a statement Thursday.

Read more at CNBC

Have a tax law question?

Our #IRS Interactive Tax Assistant has answers.

Watch this short video to learn more:

https://youtu.be/y6HkaBkdKdU

The #IRS began accepting tax returns Tuesday. Taxpayer help has expanded this year with more in-person hours, better service and improved tools. Read: https://ow.ly/bb7k50QvqRN

#IRS has kicked off the 2024 tax filing season. This year, the tax deadline is April 15, 2024, for most people. Gather all information you need to prepare a complete and accurate tax return before you file to reduce errors. See: https://ow.ly/bb7k50QvqRN

The 2024 tax filing season is now underway. #IRS reminds taxpayers the deadline to file a 2023 tax return and pay any tax owed is 4/15/24. Taxpayers living in Maine or Massachusetts have until 4/17/24, due to the Patriot’s Day and Emancipation Day holidays. https://ow.ly/bb7k50QvqRN

Jose L. Santiago

Public Affairs Specialist

Tax Outreach, Partnership and Education

Email: jose.l.santiago@irs.gov

Half of US tenants can’t afford to pay their rent. Here’s what’s ahead

Half of renters in the United States have found themselves paying more than they can afford, following years of surging rents. But an increase in the construction of multiple-unit buildings has boosted the supply of apartments, which is slowly beginning to rein in runaway rents.

Nationally, rents declined annually in December for the eighth straight month, according to Realtor.com’s monthly report. The median asking rent was $1,713, which was down $4 from November and down $63 from the July 2022 peak.

However, median rent is still $309 higher than the same time in 2019, before the pandemic. That’s a 22% increase.

And people have been feeling it. In some places, rents aren’t dropping at all. Rent is just increasing at a slower pace.

Still, even if rents aren’t dropping like a rock, they aren’t expected to be skyrocketing in the same way this year.

Read more at CNN

Cash Advance vs. Payday Loan: What’s the Difference? (2024 Guide)

Payday loans and cash advance apps are common short-term borrowing options that can provide quick financial relief – but often at a high cost. 

In most cases, a more traditional borrowing option like a personal loan will offer you a better deal. But if you’re forced to choose between the two, a cash advance app will generally be the better option. Indeed, some states have banned payday loans or have strict limitations, given their potentially predatory nature.

This comprehensive guide will explore the distinctions between the two loans and give you an idea of how each can impact your financial health so you can make informed decisions.

Cash Advance vs. Payday Loan

Both cash advances and payday loans are designed to address similar financial circumstances. In most cases, they offer you a small amount of money that you pay back the next time you get your paycheck.

Read more at MARKETWATCH

A Day in the Life in RTO (Rent To Own) | Michael Maddaloni

Name: Michael Maddaloni

What’s your current role/title? Co-Owner and Chief Financial Officer for Dream Furnishings and Electronics, LLC.

Years in RTO: I’m actually new to rent-to-own, having recently graduated from Clemson University’s MBA Corporate program.

How did you find your current position? I founded the company, organized an investment campaign, and secured partnerships with people who have more RTO industry knowledge and background than I do.

What did you do before you began working in RTO?

Read more at RTOHQ.ORG

Buy Now, Pay Later Needs to Pay Off in 2024

Growth of BNPL volume in 2023 was spectacular. But 2024 will present challenges to industry players as they seek profitability and diversification — and as consumers accumulate worrisome debt.

Projections for growth for the buy now, pay later business in 2024 are generally optimistic. But things aren’t all upbeat.

Some of the positive items:

• A new study by Juniper Research projects that global buy now, pay later transaction value will more than double in the next four years, from $334 billion in 2024 to $687 billion in 2028. Activity will spread to new markets, and in the U.S. and the U.K. BNPL will expand significantly, the report predicts.

• Insider Intelligence/eMarketer predicts that in the U.S. alone, BNPL transaction value will rise from $80.8 billion in 2024 to $124.8 billion in 2027.

Read more at The Financial Brand

The pros and cons of using multiple banks, according to banking experts

Modern banks are one-stop-shop financial institutions. Many offer the convenience of checking, savings, money market, brokerage, retirement, loan, and credit card accounts all unified under one roof — regardless of whether that roof is real or digital. 

Although modern consumers can handle nearly all their financial needs with one bank, they certainly don't have to. So, does it make sense for most people to consolidate their financial services with the same institution, or would it be wiser to spread their money around to different accounts at different banks? 

The answer is that it depends. No two financial consumers are the same, and both strategies have benefits and drawbacks. GOBankingrates consulted experts in the banking and financial sectors to determine the pros and cons of using more than one bank.

PRO: BRICK-AND-MORTAR SERVICE WITH ONLINE BANK YIELDS Gary Zimmerman is the founder and CEO of MaxMyInterest, a cash-management platform that a

Read more at KansasCity.com

Americans Rack Up $19 Billion in Credit Card Debt in One Month

Americans have amassed $19 billion in credit card debt in a single month, marking an even greater turn toward reliance on borrowing. With a population of 340 million, the figure translates to about $56 per person.

That surge, primarily in revolving credit, came as retail sales data "handily" exceeded expectations. According to Wells Fargo's weekly economic and financial commentary, U.S. households may have propped up retail sales using revolving credit, signaling potential financial strain for many.

November's consumer credit report showed an increase in total consumer credit, exceeding $5 trillion for the first time, according to Wells Fargo. The surge was largely driven by an increase in revolving credit—mainly credit cards—which accounted for $19.1 billion of the rise.

"Consumer credit card balances are at their highest levels ever as consumers have used their available credit to deal with higher-than-expected costs for goods and services," Michele Raneri, vice president of U.S. research and consulting at TransUnion, shared with Newsweek.

Read more at NEWSWEEK

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Bankruptcies Surge Among Gen X and Millennials

An uptick in bankruptcy assistance among Generation X and Millennials signals a burgeoning debt crisis, overshadowing recent economic optimism, legal experts told Newsweek.

In contrast to recently issued positive economic data showing a 29 percent surge in consumer confidence since November, LegalShield's December Consumer Stress Legal Index (CSLI) documents a relentless rise in financial duress, reaching a three-year peak as consumers seek legal help for bankruptcy and other legal assistance. The data, drawn from over 35 million legal service requests, is forecasting a dip in that consumer confidence, and exposes a groundswell of fiscal challenges.

The trend, disproportionately impacting younger generations, points to a latent economic strain that macroeconomic figures may not fully capture, which hints at a potential credit reckoning on the horizon.

Read more at NEWSWEEK