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Smart Tax Planning

The cost of tax preparation and accounting fees grew 8.3% in November 2023 compared to the previous year.
But if your return is relatively simple, there are several free filing options to consider this season, experts say.

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Filing taxes is more expensive this year as the industry raises prices to combat a growing accountant shortage.
The cost of tax preparation and accounting fees grew 8.3% in November 2023 compared to the previous year, according to the U.S. Bureau of Labor Statistics. Taxpayers typically spend an average of $140 to file taxes every year, the IRS estimates.

But if your return is relatively simple, there are several free filing options to consider this season, experts say.

1. IRS Free File

A public-private partnership between the IRS and Free File Alliance, a nonprofit comprised of tax software companies, IRS Free File offers free guided tax prep software for eligible filers.
The “biggest change” this season is a higher adjusted gross income limit, which is now $79,000 for 2023 filings, up from $73,000 last season, according to Tim Hugo, executive director of the Free File Alliance.
Adjusted gross income is your total income minus “adjustments,” such as certain pretax individual retirement account contributions and student loan interest. Pretax 401(k) contributions also reduce the income reported on your W-2.

More from Smart Tax Planning:

Here’s a look at more tax-planning news.

If you’re comfortable with tax software, Free File has eight partners this season, with varying income eligibility — and some offer free linked state filings. You can find the best option with this tool.

“Free File is not just for simple returns,” Hugo said, pointing to the program’s required forms and schedules, such as Schedule B for interest and dividends or Schedule C for self-employment, contract or gig economy work.

Free File is not just for simple returns.

Executive director of the Free File Alliance

Roughly 70% of taxpayers qualify for Free File, but only 2% used it during the 2022 filing season, according to the National Taxpayer Advocate.
“It’s a product that we’re very proud of,” Hugo said. “We just wish more people knew about it.”

2. Free File Fillable Forms

If your adjusted gross income was higher than $79,000 in 2023, Free File also offers Fillable Forms for any income level, which is the electronic version of a paper return. Roughly 460,000 taxpayers used Fillable Forms through Nov. 3 last season, according to the Free File Alliance.
It may be a good option if you’re comfortable completing the necessary forms and schedules without step-by-step guidance, according to the program. But you can only use Fillable Forms for the current tax year and there is no support for state filings. The system will automatically delete your account after Oct. 20, and you will lose access to your filing.
If you use Fillable Forms, you should save a copy of your return for your records, and in case of a future audit.

3. Volunteer tax prep from IRS programs

If you’re looking for more guidance, you may also qualify for free tax prep from IRS programs with trained volunteers.
The Volunteer Income Tax Assistance, or VITA, program offers free tax prep for taxpayers typically making up to $64,000, in addition to filers with disabilities and limited English proficiency.
Tax Counseling for the Elderly, or TCE, is for filers age 60 or older, with a focus on pension and retirement questions. AARP Foundation Tax-Aide also offers free tax prep for low- to moderate-income older adults. You can see what this program covers here.
While both IRS programs include a range of forms and schedules, there are limitations outlined here. You can use this tool to find a location near you.

4. IRS Direct File

Certain taxpayers may also qualify for the limited Direct File pilot this season, which offers free filing via the IRS. 
While the program starts as invitation only, the agency expects to roll out the service to certain taxpayers in 12 states by mid-March. Eligible states will include Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming.

Internal Revenue Service

“It’s basically for people with very simple tax affairs,” said Steven Hamilton, assistant professor of economics at The George Washington University.
This season, Direct File will only accept Form W-2 wages, Social Security retirement income, unemployment earnings and interest of $1,500 or less. You must claim the standard deduction, and the system only accepts a handful of credits and other tax breaks.

5. Private companies

Certain taxpayers may also find free filing options from private companies. But “if you go with a tax prep company, watch for and expect add-on fees for additional services” said Ed Mierzwinski, consumer advocate at U.S. Public Interest Research Group. “That’s the business model.”
The Federal Trade Commission in January upheld a September ruling that found Intuit, maker of tax filing software TurboTax, violated federal law by marketing free software to filers who were not eligible, and were upgraded to deluxe and premium products. Intuit has appealed the “deeply flawed decision,” according to a spokesperson. More

The Netflix logo is shown on one of the streaming giant’s Hollywood buildings in Los Angeles on July 12, 2023.
Mike Blake | Reuters

The U.S. stock market continues to be volatile due to the uncertainty surrounding when the Federal Reserve will start to lower interest rates, and how many times. Despite the highest level of rates in a generation, and a tough macroeconomic backdrop, several companies have been delivering strong performances, reflecting the resilience of their business models.
To select the stocks of such companies that have attractive growth potential, investors can track the recommendations of Wall Street’s experts.

Here are three stocks favored by the Street’s top analysts, according to TipRanks, a platform that ranks analysts based on their past performance.  

ServiceNow

First up is the cloud-based workflow management platform ServiceNow (NOW). The company recently announced upbeat results for the fourth quarter of 2023 and raised its 2024 subscription revenue and operating margin guidance.
Following the results, Baird analyst Robert Oliver reiterated a buy rating on NOW stock and boosted his price target to $870 from $780. The analyst noted that all key financial metrics were above expectations in Q4 2023.
ServiceNow’s cRPO (current remaining performance obligations) that will be recognized as revenue over the next 12 months grew 23% on a constant currency basis. The Baird analyst highlighted that while this growth rate marked a slight deceleration from the 24% growth in the previous quarter, it surpassed the firm’s own guidance of more than 21% growth.
Oliver explained that the upside in cRPO was fueled by net new ACV (annual contract value) and higher early renewals. He also noted the strength of ServiceNow’s public sector business and the traction in its generative AI (artificial intelligence) products.

The Baird analyst said that his revised price target for NOW reflects a reasonable valuation of 44x his 2025 FCF (free cash flow) estimate, given its “1) above-average growth profile, 2) strong competitive positioning, 3) large TAM [total addressable market], and 4) top-decile FCF margin.”  
Oliver ranks No. 367 among more than 8,600 analysts tracked by TipRanks. His ratings have been profitable 58% of the time, with each delivering an average return of 11.5%. (See ServiceNow Financial Statements on TipRanks)

Netflix

Streaming giant Netflix (NFLX) impressed investors with stellar fourth-quarter results. The company added 13.1 million subscribers in the final quarter of 2023, helping the stock to a 16% gain so far in 2024.
DBS analyst Sachin Mittal noted that the company’s crackdown on password sharing in more than 100 markets since May 2023 drove the robust subscriber additions in Q4 2023. He added that ad membership increased 70% sequentially in the fourth quarter and now represents 40% of all new sign-ups in the company’s 12 ad markets.
“Overall, we believe that paid sharing and advertising would help re-accelerate subscriber and revenue growth while driving high-margin incremental revenue,” said Mittal.
The analyst also highlighted that while Netflix saw a sixth consecutive quarter of subscriber growth, rival Disney’s (DIS) subscriber base has declined for three straight quarters. Wall Street expects Netflix’s subscriber base to grow at a faster rate than Disney, reflecting a diminished competitive threat from Bob Iger’s theme park operator.
Mittal reaffirmed a buy rating on Netflix and increased the price target to $580 from $540. He believes that NFLX deserves a premium valuation compared to peers due to faster earnings growth, supported by its dominance in streaming, and increased value from its ad-supported tier and paid sharing efforts.
Mittal holds the 334th rank among more than 8,600 analysts tracked by TipRanks. His ratings have been successful 79% of the time, with each generating an average return of 22.8%. (See Netflix Hedge Fund Activity on TipRanks)

Rivian

This week’s third stock pick is electric vehicle maker Rivian (RIVN). In early January, the company reported 13,972 deliveries in the fourth quarter of 2023. Overall, Rivian delivered 50,122 EVs in 2023.
Recently, Tigress Financial analyst Ivan Feinseth reiterated a buy rating on RIVN stock with a price target of $36. Feinseth thinks that the pullback in the stock offers a good opportunity to gain exposure to the emerging EV player. Rivian is down 33.5% in 2024.
Feinseth is bullish on RIVN citing multiple catalysts, including, “ongoing production ramp-up, expanded commercial vehicle opportunities, new lease programs and the upcoming introduction of its R2 platform.”
The analyst noted that the company continues to see solid demand for its pick-up trucks and SUVs, and he also expects Rivian to benefit from increasing demand for its commercial vans, given the company’s expansion an existing partnership with Amazon (AMZN).
In particular, Feinseth highlighted Rivian’s recently announced deal with AT&T (T), under which the telecom provider agreed to purchase commercial vans and R1 electric vehicles to reduce its carbon footprint.   
Feinseth is optimistic about Rivian, saying it has a total addressable market (TAM) of $9 trillion and a service addressable market of more than $1 trillion over the next three years. The analyst believes that Rivian has a significant first-mover advantage as the leading manufacturer of electric pick-up trucks and SUVs.  
Feinseth ranks No. 235 among more than 8,600 analysts tracked by TipRanks. His ratings have been profitable 62% of the time, with each delivering an average return of 11.4%. (See Rivian Insider Trading Activity on TipRanks)  More

A general view of the BP logo and petrol station forecourt sign on January 22, 2024 in Southend, United Kingdom.
John Keeble | Getty Images News | Getty Images

Company: BP plc

BP provides energy products and services to its customers. The company’s segments include gas & low-carbon energy, oil production & operations and customers & products. Its gas business includes upstream activities that produce natural gas, integrated gas and power, and gas trading. Its low-carbon business includes solar, offshore and onshore wind, hydrogen and CCS, power trading, and its share in BP Bunge Bioenergia. Its oil production & operations segment comprises upstream activities that produce crude oil, including Bpx Energy. The customers & products segment comprises its customer-focused businesses, which include convenience and retail fuels, electric vehicle charging, as well as Castrol, aviation and business-to-business and midstream. It also includes its products businesses, refining & oil trading, and bioenergy.
Stock Market Value: $98.5 billion ($34.64)

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BP, 5 years

Activist: Bluebell Capital Partners

Percentage Ownership: n/a
Average Cost: n/a
Activist Commentary: 
Bluebell Capital Partners is an activist investor focused on large cap European public equities. The firm, founded in November 2019, is led by founding partners and Co-CIOs Giuseppe Bivona and Marco Taricco. It evolved out of Bluebell Partners, an investment advisory business set up in 2014 by Bivona and Taricco, who together identified shareholder activism – traditionally a predominantly North American phenomenon – as a growing opportunity in Europe.

What’s happening:

Bluebell Capital Partners sent a letter to BP Chairman Helge Lund calling on the company to take several actions, including slowing its commitment to reducing oil and gas production by 25% by 2030 compared to 2019 levels, and challenging the company to reduce its investment in its transition businesses (biofuels, convenience, charging, renewables and hydrogen) by 60% between 2023 and 2030.

Behind the scenes:

Bluebell is a passionate environmentalist firm that has a track record as an environmental activist investor. But it is also a financial investing firm and realist that understands the power of capital markets. In this simply astonishing, and potentially watershed, letter to BP, Bluebell states that they believe that the company is worth at least 50% more than the value currently expressed by its stock price and that it trades at a substantial 40% discount to best-in-class peers ExxonMobil and Chevron, “primarily due to an ill-conceived strategy aimed at drastically shrinking BP’s core business (oil and gas), on the one hand, and rapidly promoting a risky diversification into sectors with lower targeted returns and where BP has ‘no right to win’.”
Yes, Bluebell is referring to BP’s strategy of aligning its business with the goal set out by the Paris Agreement on Climate Change: net zero emissions by 2050. Bluebell flat out says what many people are thinking – that this is an utterly unrealistic policy that should be declared by governments as unattainable with a more realistic target proposed to replace it.
In the meantime, Bluebell is delivering a wake-up call to BP: end the collective hallucination and realign the company’s climate and production targets with reality, or at least with its peers. Bluebell points out that the International Energy Agency (“IEA”) has recognized that the pathway to net zero by 2050 is increasingly narrow, admitting that 35% of emissions savings needed by 2050 rely on technology not yet commercially viable or available and pointing out that even available solutions (i.e. nuclear) are being underutilized and decommissioned, calling into question global political will towards such an ambitious goal.
Accordingly, as an environmental activist, Bluebell makes the credible argument that BP’s minimization of their core oil and gas production in favor of non-core alternative energy products is unlikely to meaningfully alter the trajectory of the climate crisis. As a financial investor, Bluebell makes the credible argument that this is a losing strategy that harms shareholders.
Bluebell points out that BP’s capex spending to diversify away from its core oil and gas services to transition fuels, renewables, and other projects offers lower returns on capital, reduces value generation for shareholders, and positions the business for failure in sectors where the board and management have no real experience or competitive advantage.
According to BP’s 2023-2030 plan, the company will allocate just over a third of its $130 billion of capex to businesses such as bioenergy, hydrogen, renewable, EV Charging, etc. These projects are expected to generate between 6-8% unlevered internal rate of return (IRR) for renewables and double digits for hydrogen versus 15-20% for oil and gas. This stands in stark contrast to peers Chevron and Exxon targeting 10% of their capex budget over the next five years.
Moreover, BP’s decarbonization strategy, spearheaded in 2020 by former CEO Bernard Looney, is based on a key assumption that is at best questionable and likely false. BP forecasts a 2% cumulative growth demand for oil and gas from 2022-2030. Their peers Shell and ExxonMobil forecast 7% and 6%, respectively; and even the IEA has a significantly larger forecast of 5%. Perhaps recognizing this themselves, BP has already reduced their medium-term targets for reducing oil and gas production, their former goal of -40% established in 2020 was subsequently halved in February 2023 to -20%.  Maybe more tellingly, BP shockingly remains committed to its Scope 3 targets of 10-15% reduction by 2025 and 20-30% reduction by 2030. Scope 3 emissions are third party emissions that a company generally has little control over. Not surprisingly, not only has Exxon and Chevron refused to commit to Scope 3 targets, when a shareholder officially proposed such a commitment, it was rejected by 89.5% of the vote at Exxon and 90.4% at Chevron.
In the period from Mr. Looney’s appointment as CEO (February 13, 2020) to his resignation (September 12, 2023), BP total shareholder return of 32% lagged all its peers (45% for Shell; 72% for Total Energies, 79% for Chevron and 135% for ExxonMobil). As of Bluebell’s October 4, 2023, letter to BP, BP traded on a price-earnings ratio of 6.7 times, a 44% discount to Chevron and ExxonMobil, which on average traded at 12 times. More tellingly, this discount averaged 48% since the new strategy initiated by Mr. Looney, but only averaged 21% in the years 2006 to 2019 and was as small as 15% in the year 2018. To make it even clearer how the market views BP’s strategy, on February 7, 2023, when BP announced its partial retracement from this strategy, BP’s share price rose 8% on the day and 17% on the week.
Bluebell was prepared to ask for the resignation of CEO Looney in October, but that ended up happening anyway in September. Bluebell now calls on the board to revise its 2023-2030 plan and implement the following six corrective actions: (i) remove its medium-term Scope 3 targets and qualify its 2050 target (Net-Zero) as a target to be reached ‘in line with Society’; (ii) realign supply to demand revising upward BP’s oil and gas production target, to ~2.5 mmboed by 2030 versus current target of 2.0 mmboed (millions of barrels of oil equivalent per day); (iii) increase investment in oil and gas by ~$1.5 bn p.a. (2023-2030) and reduce cumulative investment in Bioenergy, Hydrogen and Renewables & Power by ~60% (2023-2030), the majority of which will be financed by halting investment in Renewables & Power; (iv) increase cash to be returned to shareholders by a cumulative ~$16bn (~$2.0bn p.a., 2023-2030) to be sure it is better deployed also in support of the energy transition; (v) enhance disclosure on businesses outside core oil and gas (Convenience and EV Charging, Hydrogen) and more broadly on investment hurdles; and (vi) strengthen the Board of Directors, adding the necessary capabilities to oversee large capital deployment in areas which are not BP’s core business and have BlackRock’s non-independent director Pamela Daley removed from BP’s Board.
Bluebell has a long history of environmental activism – agitating Solvay to end its pollution of the Rosignano Beach, urging Glencore to divest its coal unit, and pressuring BlackRock to clarify its ESG strategy due to a risk of greenwashing – which is why a campaign to rollback BPs climate targets may surprise onlookers.
However, Bluebell is what we refer to as an active ESG (“AESG”) investor – a qualitative and pragmatic investor who looks to responsibly maximize shareholder value. They believe that achieving net-zero emissions is among the greatest necessities (as well as opportunities) facing this planet. But they fundamentally disagree that it is the role of an oil and gas provider to be a renewables company at the expense of shareholders.  Instead, they believe that such a company should concentrate on minimizing or eliminating its own environmental impact (Scope 1 and Scope 2 emissions), meeting demand, and ensuring a smooth energy transition. They are calling on the board to honestly assess what their peers are committed to doing and to be honest about the global reality of decarbonization which even the world’s leading climatologists are willing to recognize. 
We believe this letter to BP is transformative on many levels. Only an environmental activist with the credibility of Bluebell could publicly voice such an opinion. It shows how the ESG pendulum has swung so far one way and now is swinging back to its rightful position. Moreover, European investors and companies have been well ahead of the United States on ESG matters and the fact that this is happening in Europe is a sign of things to come in the U.S. If it can happen there, it can certainly happen here. But finally, it is a refreshing departure from ESG based on hard rules, quantitative metrics and exclusions. This is a credible environmental activist eschewing those non-qualitative measures. For years, Bluebell has been known for pushing companies further into the ESG waters. It is nice to see that they are also there to take out their lasso and rein a company back in when it wanders too far out.
Ken Squire is the founder and president of 13D Monitor, an institutional research service on shareholder activism, and the founder and portfolio manager of the 13D Activist Fund, a mutual fund that invests in a portfolio of activist 13D investments. More

Most adults want to stay in their homes as they age.
But many don’t properly plan to do so.
Here’s how experts say you can fix that.

Westend61 | Westend61 | Getty Images

There’s no place like home — especially as you age.
Most adults ages 50 and up — 77% — want to stay in their homes long term, according to AARP.

Yet many are putting off the necessary improvements and upgrades to their homes to make that possible.
“People might say, ‘I want to age in place as the default plan, because that’s what I’m already doing,'” said Carol Chiang, CEO of Evolving Homes, a company providing personalized consulting for individuals and families who want to age in place.
“But they’re not really considering, ‘Well, what does that mean?'” Chiang said.
Chiang’s clients typically fall into three categories — those who have an urgent need after a first-time fall or other emergency, those who have a neurodegenerative condition such as Parkinson’s disease, and those who are proactive adults planning ahead.
“They’re the ones who know that if they ignore something on the front end, they’re going to pay twice as much on the back end,” Chiang said of the latter category. “And I kind of wish everyone was like that.”

More from Personal Finance:How one beach city is helping residents age in placeWhat happens to your Social Security benefits when you die62% of adults 50 and over have not used professional help for retirement
Carolyn McClanahan, a certified financial planner and physician who helps clients prepare financially for retirement, recently took her own advice when she enlisted Chiang’s help for her own home.
“She made us think through what an aging-friendly bathroom would look like,” said McClanahan, noting that because she and her husband do not have children they wanted to get an early jump on planning for their elder years.
“People are usually remodeling their homes every 10, 15, 20 years,” said McClanahan, a member of CNBC’s FA Council. “So making certain — especially when you hit your 50s and 60s — that you remodel it … does make it easier as you get older to stay home.”
The costs of the upgrades necessary to age in place can vary, experts say. Chiang said she has seen the prices of bathroom upgrades vary within Florida, where her practice is based.
Curt Kiriu, an aging-in-place specialist and president of CK Independent Living Builders in Mililani, Hawaii, also said costs can vary based on location. While Kiriu does most of his work on Oahu, neighboring islands may face some challenges finding cost-effective access to materials and contractors.
A home remodel for aging in place may range from $30,000 on the low end to $80,000, according to Chiang, depending on the scope of the project and where you live.
“At a very, very basic level, thinking about a remodel, you should be planning for at least $70,000,” Chiang said.

The upside is that it is a one-time cost to fix up a home, notes Kiriu. In comparison, the annual national median cost for a private room in a nursing home is around $108,000, according to Genworth.
The upgrades can also significantly increase the value of your home, according to Chiang. Some estimates point to universal design features — such as wide doorways and hallways and no-step entry — adding up to 30% to the value of a home, she said.
“That will probably go up as you get more and more boomers getting older,” Chiang said.
To make sure your home upgrades are successful, experts say it’s wise to keep several things in mind.

Start as soon as possible

Home upgrades to support easier mobility can often be thought of as necessary only for older residents.
But certain circumstances — such as babies with strollers or a child who breaks their leg skiing — can spur an immediate demand for easy accessibility in the home, Chiang noted.
“My recommendation is usually that people should start thinking about aging in place when they buy their first house,” Chiang said.
When making upgrades to a home, think about function, not just design, she advised. Having an access into your house that doesn’t require stairs, or a shower that’s easy to get into, can make your life easier, she said.
Even if you don’t stay in the home, those changes can benefit the next residents.
“You’re helping other people who also might need those kinds of spaces,” Chiang said.

Think beyond the bathroom

Sdi Productions | E+ | Getty Images

When people want to make their homes more accessible, the first place they think of is typically the bathroom, according to Kiriu.
“But the truth is, you need an accessible entry first, because if you can’t get in your house, what’s inside doesn’t really matter,” Kiriu said.
To know the specific changes you might need, consider enlisting professional help. That may be from a certified aging-in-place specialist, or CAPS, through the National Association of Home Builders, or an occupational or physical therapist.
Kiriu, who holds the CAPS designation, said he typically conducts an evaluation by watching someone walk in their home to see where they may have difficulty. If there are rub marks where they often touch the wall for support, that is where he may install a grab bar or other support.
“It’s kind of like detective work when you do an assessment on someone’s home, to see where they actually put their hands to stabilize themselves,” Kiriu said.

Removing a bathtub and installing a curbless shower can help provide full access into and out of the shower, he said.
Exactly how much a bathroom or other home upgrade will cost can vary, Kiriu said. For example, when gutting an entire bathroom, you may find water rot or termite damage that can make the work needed more extensive. That also goes for older homes that may need additional work to bring plumbing or electrical wiring up to code.
Even before enlisting professional help, there’s another step homeowners can take to make their homes more accessible and safer: Get rid of excess clutter, said Thomas West, senior partner at Signature Estate and Investment Advisors in Tysons Corner, Virginia.
“Somebody’s going to have to get rid of it sooner or later anyway,” West said.

Have a contingency plan

Halfpoint Images | Moment | Getty Images

Home upgrades are not the only adjustment you need to age in place. You also need a financial plan, experts say.
“I tell people, as soon as you think of it, start planning for it,” said McClanahan. “Make sure you understand the logistics and costs.”
Much of the care expenses and adjustments to your home you will need will depend on your condition.
Because your physical circumstances can change, it also helps to have a contingency plan for when it no longer makes sense to stay in your home, McClanahan said.
There can be break-even points to use as a guide. For example, if you need more than six hours a day in-home care, transferring to an assisted living facility will probably be cheaper, she said.
The costs of care may also vary by location.
Chiang said she advises creating a back-up plan by visiting local care communities in your area and coming up with a list of several you like in the event you need additional care.
“I always tell people you don’t have to have an answer,” Chiang said. “But you have to have a general idea of a plan.” More

Smart Tax Planning

In 2022, roughly 23 million filers received $57 billion from the earned income tax credit, a tax break for low- to moderate-income workers.
But nearly 1 in 5 eligible taxpayers don’t claim the credit, which averaged $2,541 last year, according to the IRS.
For tax year 2023, the EITC is worth up to $7,430 for a family with three or more children, up from $6,935 in 2022.

Laylabird | E+ | Getty Images

Tens of millions of Americans file tax returns every year — and many are missing a “valuable credit,” according to the IRS.
In 2022, roughly 23 million filers received $57 billion from the earned income tax credit, or EITC, a tax break for low- to moderate-income workers.

But nearly 1 in 5 eligible taxpayers don’t claim the EITC, which averaged $2,541 in 2022, IRS Commissioner Danny Werfel told reporters during a press call last week.
“This is a lot of money” that millions of Americans are eligible for “and some simply overlook it,” he said.

More from Smart Tax Planning:

Here’s a look at more tax-planning news.

For tax year 2023, the EITC is worth up to $7,430 for a family with three or more children, up from $6,935 in 2022, according to the IRS. Eligible workers between ages 25 and 64 without a qualifying child can receive up to $600.
By law, if you claim the EITC, you should receive a refund no earlier than Feb. 27, assuming you’ve filed an error-free return and picked direct deposit for payment.

How the earned income tax credit works

“The credit is reasonably complex,” said Steven Hamilton, assistant professor of economics at The George Washington University. “It has a lot of eligibility requirements.” 

For tax year 2023, you may qualify with wages from employment below $56,838 — $63,398 if married filing jointly — and investment income under $11,000, according to the IRS. The income limits decrease, depending on the number of qualifying children.
These thresholds use adjusted gross income, which is your total income after subtracting pretax 401(k) contributions minus “adjustments,” such as certain pretax individual retirement account contributions and student loan interest.
The EITC is refundable, meaning you can still get a refund even without taxes owed. You can use this tool to check EITC eligibility. 

There are also “qualifying child” guidelines, which can be complicated, including relationship, age and residency tests, Hamilton said.
However, the IRS encourages filers to use resources such as Free File, a tax professional or the agency’s free tax prep programs to claim the credit.

There’s a ‘high improper payments rate’

“Millions of eligible taxpayers fail to claim the EITC, while other taxpayers claim amounts for which they are not eligible, leading to a high improper payments rate,” National Taxpayer Advocate Erin Collins wrote in the 2023 Purple Book of legislative recommendations.
While higher earners are more likely to face an audit, EITC claimants see audits at a 5.5 times higher rate than the rest of U.S. filers, partially due to improper payments, according to a December report from the Bipartisan Policy Center.
This has contributed to racial disparities in audit rates, with Black Americans about three to five times more likely to see an audit, according to a 2023 Stanford University study. The IRS confirmed these findings in May 2023 and said the agency has dedicated “significant resources” to address the issue.

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New government data shows a surprisingly strong job market for January.
However, there are signs of weakness in the labor market, based on tens of thousands of workers who have been laid off since 2024 started.
If you’re one of them, here’s what you can do to find new work faster.

Skynesher | E+ | Getty Images

New government data shows a surprisingly strong job market for the month of January.
But there are signs of weakness in the labor market, based on tens of thousands of workers who have been laid off since 2024 started.

U.S. employers announced 82,307 job cuts in January, up from 34,817 in December, a 136% increase, according to outplacement firm Challenger, Gray & Christmas.
Still, that is down 20% from the 102,943 cuts announced in January 2023 and the all-time high for that month in 2009, with 241,749 job losses.
At the same time, the latest data shows the U.S. job market is still strong, with the unemployment rate holding at 3.7%.
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Moreover, the number of job openings stands at nine million, which is still elevated compared to prior to the Covid-19 pandemic, yet down from a 12 million peak, noted Mark Hamrick, senior economic analyst at Bankrate.

“On the one hand, Americans should have a sense that their job security is generally speaking in a good place,” Hamrick said. “At the same time, we have to understand that certain sectors of the economy may be experiencing more disruption or innovation.”
With that innovation comes a higher risk that workers may suffer from an income loss as the economy adjusts, he said.
For example, retail brands may be shedding positions as they continue to transition from brick-and-mortar stores to online sales. Sectors tied to the mortgage industry are repositioning in the wake of higher interest rates. Areas such as entertainment and media are adjusting to new online streaming and subscription models.

“There’s still the benefit of the elevated number of job openings,” despite the anecdotal evidence that job cuts are happening, Hamrick said.
Companies that have open positions are scrambling to fill them.
“There are still companies that are hiring, and they can’t find talent fast enough,” said Vicki Salemi, career expert at Monster.
If you’re newly out of work, taking these steps may help you get hired faster.

1. Take a moment to grieve

Losing a job typically prompts a feeling of rejection, Salemi said, while getting a job offer instead prompts acceptance and optimism about the future.
To get to that latter phase faster, it helps to take a moment to acknowledge your feelings and shift into a better mindset.
Salemi recalls working as a corporate recruiter to help two candidates who had just been let go to prepare for their job search.
The first candidate who was excited about potential opportunities landed a new job in six weeks. The other who was shell-shocked from the layoff took longer than six months to find a new position.
Mindset and attitude make all the difference, according to Salemi. “Navigating this journey can be challenging, but it can definitely be overcome,” Salemi said.

2. Refine your search strategy

Update your resume with your latest accomplishments based on recent performance reviews, Salemi said.
To refresh your interviewing skills, try practicing with a friend, setting up informational interviews or getting tips from a career coach.
When you see a relevant position advertised, be sure to apply quickly. “Don’t wait more than 24 hours — the job may be gone,” Salemi said.
Also, be sure to include keywords that will help put your applications to the top of a recruiter’s results, she said.

3. Identify the ideal position for you

Start thinking about the ideal job and what that looks like for you by asking yourself some key questions, Salemi advised.
Where is your ideal position based: in office, hybrid or remote? What industry is it in? What tasks does it require? Are there strengths or items you absolutely loved doing in your last position that you want to continue doing?

4. Keep your skills sharp

Use your time away from a full-time role to continue advancing your skills. That may include taking on a part-time role, volunteer work or online class.
When interviewing, be sure to highlight how those experiences have kept your skills fresh and enhanced what you can offer, Salemi said.

5. Know your worth

Just because you’re out of work doesn’t necessarily mean you need to take a lower salary for your next role. Even if you are coming to a new position without a job, do not discount your worth because you’re unemployed, Salemi said.
Employers are more surprised when you don’t negotiate than when you do, according to Salemi.
“Don’t be shy about negotiating that offer,” Salemi said.Don’t miss these stories from CNBC PRO: More

Quiet luxury is out, and the “mob wife” era is in, according to a recent viral TikTok video.
The “mob wife” aesthetic can be achieved with bold accessories such as gold hoop earrings, a leopard print jacket or vintage fur — items that can often be found by shopping secondhand. 

James Gandolfini as Tony Soprano and Edie Falco as Carmela Soprano seek counseling in HBO’s hit television series, “The Sopranos.”
HBO | Hulton Archive | Getty Images

Quiet luxury is out, and the “mob wife” era is in, according to Kayla Trivieri’s viral TikTok video.
“Bold glamour is making a comeback,” she says. Think: Carmela Soprano in HBO’s “Sopranos,” cheetah print and lots of eye liner.

While keeping up with the latest fashion fads may feel increasingly difficult, young adults like it that way, explained Thomaï Serdari, professor of marketing and director of the fashion and luxury program at New York University’s Stern School of Business. 
“The fact that we have such an accelerated transition from one trend to another has to do with Gen Z because they want to put their name on everything,” she said.

How we got to the ‘mob wife’ era

On the heels of the financial crisis, “people who had money wanted to be a little bit more subdued,” Serdari said. In the decade and a half since, fashion has become bigger and bolder, she added.
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The stealth-wealth style was born after the Covid-19 pandemic, as Americans’ economic circumstances became increasingly divided during the so-called K-shaped recovery, which left the wealthiest Americans even better off than before.

Now, if young adults have money to spend, they are putting it on display, Serdari said, regardless of whether they picked up a side gig to help make ends meet.
“That shows that younger people have not lost their taste for opulence,” she said.
But “I also see a little bit of irony in it,” she added. “You can show off that you have money, even if it came from an untraditional route.”

How to achieve the ‘mob wife’ look

Although the character Carmela Soprano wasn’t necessarily frugal, appropriating her style costs a lot less than the quiet luxury looks that emerged after Gwyneth Paltrow’s ski accident trial last March.
In her daily courtroom appearances, Paltrow wore high-end brands such as Celine and The Row along with $1,450 black Prada boots.

Today’s “mob wife” aesthetic is less about cashmere sweaters and camel-hued coats and more about bold accessories such as gold hoop earrings, a leopard print jacket or vintage fur. 
While some of these items can still come with a hefty price tag, much of the look can be achieved through thrifting at local or online resale shops.
Still, “trends come and go and if you are constantly updating your wardrobe based on the trends, that can get expensive,” said Carolyn McClanahan, a certified financial planner and founder of Life Planning Partners in Jacksonville, Florida.

McClanahan, who also is a member of CNBC’s Advisor Council, suggests buying a few well-made items, such as a black silk blouse, which you can work into your wardrobe and update for future fashion trends.
Additionally, tap vintage pieces to achieve the look of “bold glamour,” McClanahan also advised. Shopping secondhand is not only economical, but increasingly in style.
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In 2023, recently unemployed full-time workers applied to an average of 30 jobs, only to receive an average of four callbacks or responses, according to a survey by staffing agency Insight Global.
The same survey found that 55% of unemployed adults are burned out from searching for a new job.
Experts suggest it might be due to the cooling labor market combined with high expectations from job seekers.

The job market looks solid on paper.
Over the course of 2023, U.S. employers added 2.7 million people to their payrolls, according to government data. Unemployment hit a 54-year low at 3.4% in January 2023 and ticked up just slightly to 3.7% by December.

“The labor market has been fairly strong and surprisingly resilient,” said Daniel Zhao, lead economist at Glassdoor. “Especially after 2023 when we had headlines about layoffs and forecasts of recession.”
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But active job seekers say the labor market feels more difficult than ever.
A 2023 survey from staffing agency Insight Global found that recently unemployed full-time workers had applied to an average of 30 jobs, only to receive an average of four callbacks or responses.
“Between the news, the radio, and politicians just talking about how the economy is so great because unemployment is low and just hearing all that, I just want to scream from the rooftops: Then how come no one can find a job?” said Jenna Jackson, a 28-year-old former management consultant from Ardmore, Pennsylvania. She has been actively looking for a job since her layoff four months ago.

“I haven’t quantified how many applications I’ve applied to but it’s definitely in the hundreds at least,” Jackson said.
More than half, 55%, of unemployed adults are burned out from searching for a new job, Insight Global found. Younger generations were affected the most, with 66% complaining of burnout stemming from job search.

A major reason could be the fact that the labor market is cooling.
“There’s less of a frenzy on the part of the employers,” according to Peter Cappelli, a management professor at the University of Pennsylvania. “If you’re somebody who wants a job, you would like a frenzy on the part of the employers because you would like to have lots of people trying to hire you.”
Some experts suggest it might also be due to the expectations of job seekers.
“How people feel about the job market is informed by their recent experiences with the job market,” Zhao said. “In 2021 and 2022, there were labor shortages, so [employers] were offering all kinds of perks and benefits to try to get people in the door. So even if 2024 is shaping up to be a relatively healthy labor market by recent comparison, it doesn’t feel quite as strong.”
Watch the video above to find out why getting a job feels harder than ever. More