MONEY Ask the Expert

Can I Put My Required Minimum Distribution into a Roth IRA?

Ask the Expert Retirement illustration
Robert A. Di Ieso, Jr.

Q: Can I convert the required minimum distribution from my regular IRA into a new Roth IRA account after paying the income taxes if I am not working? I want to have access to the money in case an emergency comes up. — Richard D’Arezzo, Acworth, GA

A: Sorry, no. According to IRS publication 590-A, the annual required minimum distribution (RMD) from your traditional IRA cannot be converted to a Roth IRA, says Tom Mingone, a financial planner at Capital Management Group of New York. But you do have options that can minimize taxes yet provide access to your money for emergencies.

Before we get to these alternatives, here’s a quick review of RMDs. These distributions are required under IRS rules starting at age 70 ½—after all, you’ve been deferring the taxes that are owed on contributions to your IRAs, and the bill has to come due sometime. If you don’t take the distribution, you’ll pay a 50% tax penalty in addition to the regular income tax on the amount you are required to withdraw.

IRS rules prohibit putting your RMD into another tax-advantaged retirement account. But you can convert the remaining portion of your traditional IRA assets to a Roth IRA, though it will mean paying more taxes. “You just have to satisfy the RMD requirement before you do a Roth conversion,” says Mingone. (If you aren’t working and receiving earned income, you can’t make a contribution to a Roth but once the money is in a traditional IRA, you don’t need to have additional earned income to move the money to a Roth IRA.)

If you make a mistake and roll over or convert your RMD, it will be treated as an excess contribution, and you’ll pay a penalty of 6% per year for each year it remains in the Roth or traditional IRA. You have until October 15 of the year after the excess contribution to correct it.

Is it a smart move to convert a traditional IRA to a Roth? That depends on your goals and your finances, says Mingone. Putting money into a Roth gives you a lot more flexibility because you’ll no longer be subject to the RMD rule—you can choose when and how much you take out. And unlike traditional IRA withdrawals, money pulled from a Roth won’t trigger taxes.

Still, there’s a downside to the conversion: that tax bill on the amount you convert. Depending on the size of the bill and the years you have to invest, the benefit may be small. In any case, consider this move only if you can pay the taxes with money outside your IRA, says Mingone. (To get an idea of the taxes you would owe, try this Vanguard calculator.)

The case for a Roth is generally strongest for younger people who have more time for the money to grow tax-free. Still, even at 70 ½, you could have many years of growth. And if you want to leave money to heirs, a Roth offers the greatest flexibility.

But if you need access to the money for emergencies, a new Roth may prove costly. You can take the principle out, but any earnings on the amount you deposit will be taxed if you withdraw it in the first five years.

If you don’t want to tie your money up in a Roth, you could just invest in a taxable account. Look for tax-efficient options such as index mutual funds. And consider putting some of your RMD in municipal bonds, which are free from federal income tax and often state and local taxes too, Mingone says. Tax-exempt bonds have been a tear recently, which suggests that risks are rising. Still, if you’re willing to hold on through market dips, munis may provide higher after-tax yields than taxable bonds.

Do you have a personal finance question for our experts? Write to AskTheExpert@moneymail.com.

Read next: Why Roth IRA Tax Tricks Won’t Rescue Your Retirement

MONEY Kids and Money

4 Important Lessons to Teach on Take Your Kids to Work Day

Girl on phone in medical lab office
Stanislas Merlin—Getty Images

On the fourth Thursday of April, working parents all across America take their children to work with them so they can see what Mom or Dad do for a living.

April 23, 2015 marks the 22nd year of ‘Take Our Daughters and Sons to Work’ Day.

Some companies have organized activities for their young visitors; others have little or no planning. Regardless of how things work at your office, you can use your workplace to teach kids about the value of money.

Of course, your lessons must be age-appropriate. It’s difficult, if not impossible, to teach your toddler about the stock market, and older children will be bored with simplistic discussions. With that in mind, here are a few ideas that can spur your thinking on appropriate lessons for your kids.

Salary – You can give younger children an analogy of worth and value by equating your work time to money and purchases. Give them a frame of reference by how much of your work time it takes to buy an ice cream cone or a bike.

Beware of two unintended consequences — make sure your children do not think that just because you work a certain amount of time they will get an ice cream cone or a bike, and make sure they understand that your salary is private. You do not want them relaying their newfound information to everybody they meet in the hallway or the elevator.

Profit – If you work in a manufacturing environment, you can show your children the products you make and talk about profit in general — how it takes money to make the products and how your company has to charge more to be able to pay employees and stay in business. Make the discussion age-appropriate and do not use actual company numbers unless you’ve cleared it with your manager (and even then, it’s not a good idea to be specific).

You can extend the profit discussion to retail jobs as well. It may be harder to illustrate in an office environment, but it’s not impossible to do so.

Sales – If you’re in a retail environment, you may be able to show your children how transactions take place. When ringing up a customer’s cash purchase, you can go over basic math skills with younger children by letting them “help” you make change and hand it out to the customer. You can engage your older children with discussions about credit cards and debit cards — how they work, what the difference is between the two, and pros and cons of each.

Taxes – If you can keep out your own biases (and we all have them), you can teach your kids about taxes. For example, in the retail environment, you can explain why the customer pays more than the price on the price tag because of taxes, where the tax money goes, and how it’s spent.

Take Our Daughters and Sons to Work Day isn’t for everybody. If your workplace is hostile to the idea, you don’t think you can pay sufficient attention to your child and still do your job, or you can’t keep them from disrupting the office, then don’t participate. A bad experience at the office is worse than no experience at the office.

However, you should spend extra time with your children later on and talk to them about what you do at work. You can use that time for teachable moments about money. They may not pay close attention or seem to appreciate the effort now, but as they grow up, you’re more likely to see the fruits of your efforts. Take the extra time to teach your kids about money, and they’ll reward you by staying out of trouble (and out of debt) with their good money-management habits.

MONEY IRAs

Why Roth IRA Tax Tricks Won’t Rescue Your Retirement

magician balancing an egg on a paper fan
George Karger—Getty Images/Time & Life Picture Collection

It's a myth that a Roth IRA is a sure way to add wealth. Saving more will make a bigger difference.

Roth IRAs are in fashion. Many people seem to believe that the Roth’s tax-free nature somehow generates more wealth in the end than other retirement savings options. But Roth IRAs have no magical capabilities.

A simple example of putting $5,000 to work in two types of IRAs—Roth and Traditional—shows there is no difference in the ending values of the two accounts, assuming your tax rate is unchanged between the initial contribution and withdrawal.

If your tax rate does change, the story is different. If your rate goes down, a Traditional IRA does better. And if your rate goes up, then the Roth does better. So neither IRA is a slam-dunk for tax savings: It all depends on whether your tax rate changes, and in which direction.

RMDs May Be No Big Deal

Roths are also touted for their ability to sidestep required minimum distributions. RMDs are the government’s way of making sure you pay taxes on Traditional IRAs. They are calculated as your IRA account balance divided by a “distribution period” corresponding to your life expectancy. You must begin RMDs at age 70 1/2, and include those withdrawals as part of your taxable income.

RMDs can be a nuisance to those with significant savings, and the dwindling few who receive pensions, because they can generate unnecessary taxable income. That is money you don’t need for living expenses, which will be taxed anyway. Even worse, in some scenarios, RMDs plus Social Security can force you into a higher tax bracket.

But RMDs may be a moot point. Many of today’s retirees are tapping their portfolios well before 70½ or relying on Social Security. And for many pre-retirees, the problem won’t be having to take out more than they need—it’s not having enough retirement savings in the first place! The government’s RMD rules won’t force much, if any, “extra” income on them.

Because of the threat of RMDs pushing you into a higher tax bracket, the conventional advice is that you should “top-off” your tax bracket in low-income years of early retirement by doing a Roth Conversion. That means transferring money from your Traditional IRA to a Roth, and paying income tax on the converted amount. You would be choosing to pay taxes now, in hopes that will save you on higher taxes in the future.

Consider the Margin for Error

But conventional rules of thumb can be inaccurate. You have to run your own numbers and, even then, the accuracy of the answers will be limited by your ability to predict your income far into the future. RMDs and Roth conversions lead to some very complex financial scenarios.

Analyzing my own situation using the best retirement calculators shows only modest levels of RMDs into our 90s, with our current 10% to 15% tax bracket unchanged. In theory, I could generate about 2% to 3% more wealth in the end if I did Roth conversions, as long as I paid the conversion tax from non-IRA assets. If I paid the tax from IRA funds, there would be no value in doing a conversion.

However, that 2% to 3% gain is well within the margin of error for retirement calculations. Who knows if I would ever see it? But, in doing Roth conversions, I would see additional complexity and paperwork in my financial life starting right now. Given that, I’m foregoing Roth conversions for the time being.

Roth conversions are unlikely to save you from high taxation of retirement assets. That’s because the total amount you can convert is limited by the number of years you spend in a lower tax bracket and your “headroom” to the next higher bracket.

Still, there are scenarios where Roths can save you money, particularly for those in higher tax brackets. And Roths can be useful to tax diversify your savings. To clarify the issues in your situation, use one or more of my recommended high-fidelity retirement calculators to run your own numbers.

And before you invest too much time in Roth tax tricks, make sure your overall retirement savings rate is on track: that will have a much bigger impact on your long-term financial success!

Darrow Kirkpatrick is a software engineer and author who lived frugally, invested successfully, and retired in 2011 at age 50. He writes regularly about saving, investing and retiring on his blog CanIRetireYet.com.

Read next: Which Wins for Retirement Savings: Roth IRA or Roth 401(k)?

MONEY Taxes

8 Reasons Your Property Taxes Are So Damn High

150420_EM_PropertyTax
Lisa Corson—Gallery Stock Tourism keeps Las Vegas' property taxes low. New Jersey homeowners have no such luck.

Income taxes are probably top of mind right about now. But for many homeowners, high property taxes are an issue year-round. What's to explain why property taxes are such a burden in certain parts of the country?

A Monmouth University survey released last fall showed that more than half of New Jersey residents want to leave at some point, with 26% saying that it’s “very likely” they’ll move away from the Garden State. The most popular reasons cited for were the costs of housing and property taxes—the high cost of property taxes in particular. “The chief culprit among these costs is the New Jersey’s property tax burden,” Patrick Murray, director of the Monmouth University Polling Institute, explained.

New Jersey isn’t the only state at risk of losing residents to Florida, Pennsylvania, or another state with lower taxes. Stories pop up regularly speculating about the likelihood of homeowners jumping ship from high-tax states like New York and Connecticut as well.

Why is it that some states and municipalities have much higher property tax than their neighbors in the first place? Here’s a rundown of a few major factors.

The community has good schools. Or at least extremely well-funded ones. According to Zillow, the median residential property tax bill in New York’s Westchester County is $13,842, highest in the nation. A Westchester Magazine feature focused on why the leafy, desirable county holds this dubious distinction. The piece draws a comparison to Virginia’s Fairfax County, which is similar in many ways to Westchester: They’re both suburbs of big cities (New York and Washington, D.C.), they have similarly high home values, and they educate about the same number of students in public schools, which in both places have a good reputation.

Yet Westchester spends over $1 billion more to fund its schools, and since property taxes cover the lion’s share of that bill, there’s a big disparity in what homeowners pay. The average residential property tax bill is about $5,500 annually, less than half of what Westchester residents pay (people in Fairfax still complain about property taxes being too high).

The average teacher salary in Fairfax was roughly $67,000 in 2014. In Westchester, the average was estimated at $88,000 in 2013. Benefits and administrative costs add up too—Fairfax County has one superintendent, Westchester has 40—and collectively they translate into bigger burdens on Westchester’s property owners. Defenders of high educator salaries always note that they’re necessary given the high cost of living in the area, and it’s a valid point. After all, teachers, principals, and superintendents must pay local property taxes!

State workers make good money too. By most measures, New Jersey homeowners have the country’s highest property taxes. Tax Foundation data shows that the Garden State has the highest effective property tax rate (percentage of home value) and the highest property taxes per capita. The average property tax bill in the state hit $8,161 in 2014, also tops in the U.S. In fact, one study indicates that less than 1% of American homeowners pay more than $8,000 annually in property taxes.

An Asbury Park Press op-ed published last summer noted that a big reason for the state’s high property taxes is how much the state pays its workers:

The problem lies less with layers of government and excessive numbers of government workers providing services than with the generous salaries and benefits of those who are on the public payroll. Average state worker salaries: highest in the nation. Average teacher salaries: third highest. Public employee health benefit costs: second highest in the nation.

Your state relies heavily on property taxes. The above-referenced editorial also points out that 48% of state and local revenues collected in N.J. come from property taxes, which is off-the-charts high: “No other state derives more than 41 percent of its revenue from that source; the U.S. average is 33.1 percent.”

This state of affairs would be more acceptable to locals if the tradeoff for high property taxes is low taxation in other areas. Indeed, New Jersey has one of the country’s lowest gas taxes, and it’s in the middle of the pack in terms of taxes on wine, spirits, and beer. Unlike many other states, people in New Jersey don’t pay any vehicle property taxes either. Then again, New Jerseyans do pay the second highest state sales tax rate (7%, only California is higher).

Little or no tourism. A recent WalletHub study named Hawaii as the state with the lowest property taxes. New Jersey property taxes are eight times higher than their counterparts in the Aloha State. And a big reason why homeowners get off (relatively) easy in Hawaii is that the state collects so much from outsiders, thanks to high taxes on hotels and other tourism expenses. Likewise, taxes paid by casinos and tourists in Nevada are often credited as a reason why state property taxes aren’t high.

Little or no industry. The more that industrial and commercial businesses pay in taxes in a state or town, the less it’s necessary for homeowners to cover the government’s tab. According to the Wyoming Taxpayer Association, 69% of property taxes in the state are paid by mineral production businesses. Therefore, residential property taxes can remain low—the state has no income tax either. The city of Marlborough, Mass., recently estimated that it were it not for local commercial taxpayers, the average homeowner would see his property tax bill (now averaging $4,791) shoot up by $1,164 per year.

Your property is worth a bundle. Your property tax bill is based on multiplying the local tax rate times the assessed value of your home. So, generally speaking, the owners of more valuable homes pay more in property taxes. Marin County has the most expensive real estate in California, on average, so it should come as no surprise that it has the highest (or among the highest) average property taxes too. In New Jersey, the 10 towns with the highest property tax bills all averaged over $18,000 per year, and five out of the ten had average residential property values over $1 million.

Or it’s not worth much at all. A recent RealtyTrac report shows that nationwide, the highest property tax rates were for high-end homes, valued between $2 million and $5 million. That’s not surprising. What is somewhat of a shock, however, is that the second highest effective property tax rate—calculated based on a percentage of a home’s value—was for houses at the extreme low end of the value spectrum, assessed at under $50,000 or less. Granted, owners at the low end aren’t paying big bucks, but in terms of the percentage of the home’s value, property tax rates represent a disproportionate burden.

Your assessment was too high. There may not be much you can do to change your local tax rate—other than move, of course. But you can challenge the assessment on your property. If your appeal results in a lower assessment, your tax bill goes down as well. The National Taxpayers Union estimates that somewhere between 30% and 60% of properties are over-assessed. This guide to disputing your property taxes from This Old House has some of the best advice on the topic we could find.

MONEY Health Care

You May Still Have Time To Avoid the Health Law’s Tax Penalties

The tax-filing deadline may have passed, but it's not necessarily too late to get around the penalty for going without health insurance last year.

Even though the April 15 tax filing deadline has passed, you might be eligible for some health law-related changes that may save you money down the road.

•If you owed a penalty for not having health insurance last year and didn’t buy a plan for 2015, you may still be able to sign up for a marketplace plan, even though the open enrollment period ended Feb. 15. Many people who didn’t have insurance and didn’t realize that coverage is required under the law are eligible for a special enrollment period to buy a plan by April 30. If you sign up now, you’ll have coverage and avoid the 2015 penalty, which will be the greater of $325 or 2% of your household income.

•If you paid the penalty for not having insurance for some or all of last year and didn’t carefully check to see if you might have qualified for an exemption, it’s not too late. You can still apply for an exemption from the requirement by amending your 2014 tax return. It’s worth looking into since the list of exemptions is a long one. For example, if your 2014 income is below the filing threshold of $10,150—or $20,300 for a married couple—you don’t owe a penalty for not having coverage. Likewise if insurance would cost more than 8% of your income or if you’ve suffered financial hardships like eviction or bankruptcy.

•In February, the Centers for Medicare & Medicaid Services announced that 800,000 tax filers who received a federal subsidy to help pay their insurance premium and used the federal health insurance marketplace received incorrect 1095-A tax forms. These forms reported details about the advance premium tax credit amounts that were paid to insurers based on the consumers’ estimates of income. They were then used to reconcile those payments against how much consumers should have received.

If you filed your taxes based on information that was incorrectly reported by the government on the form, you generally don’t have to file an amended tax return even IF you would owe more tax. But you may want to at least recalculate your return, says Tara Straw, a health policy analyst at the Center on Budget and Policy Priorities.

“You have the option to amend if it helps you,” she says. Unfortunately, the only way to figure that out may be to do the math on the tax form 8962 that you use to reconcile your income.

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.

TIME Economy

Low Wage Workers Are Storming the Barricades

Activists Hold Protest In Favor Of Raising Minimum Wage
Alex Wong—Getty Images Activists hold protest In favor of raising minimum wage on April 29, 2014 in Washington, DC.

A few weeks back, when Walmart announced plans to raise its starting pay to $9 per hour, I wrote a column saying this was just the beginning of what would be a growing movement around raising wages in America. Today marks a new high point in this struggle, with tens of thousands of workers set to join walkouts and protests in dozens of cities including New York, Chicago, LA, Oakland, Raleigh, Atlanta, Tampa and Boston, as part of the “Fight for $15” movement to raise the federal minimum wage.

This is big shakes in a country where people don’t take to the streets easily, even when they are toiling full-time for pay so low it forces them to take government subsidies to make ends meet, as is the case with many of the employees from fast food retail outlets like McDonalds and Walmart, as well as the home care aids, child caregivers, launderers, car washers and others who’ll be joining the protests.

It’s always been amazing to me that in a country where 42% of the population makes roughly $15 per hour, that more people weren’t already holding bullhorns, and I don’t mean just low-income workers. There’s something fundamentally off about the fact that corporate profits are at record highs in large part because labor’s share is so low, yet when low-income workers have to then apply for federal benefits, the true cost of those profits gets pushed back not to companies, but onto taxpayers, at a time when state debt levels are at record highs. Talk about an imbalanced economic model.

A higher federal minimum wage is inevitable, given that numerous states have already raised theirs and most economists and even many Right Wing politicos are increasingly in agreement that potential job destruction from a moderate increase in minimum wages is negligible. (See a good New York Times summary of that here.) Indeed, the pressure is now on presidential hopeful Hillary Clinton to come out in favor of a higher wage, given her pronouncement that she wants to be a “champion” for the average Joe.

But how will all this influence the inequality debate that will be front and center in the 2016 elections? And what will any of it really do for overall economic growth?

As much as wage hikes are needed to help people avoid working in poverty, the truth is that they won’t do much to move the needle on inequality, since most of the wealth divide has happened at the top end of the labor spectrum. There’s been a $9 trillion increase in household stock market wealth since 2008, most of which has accrued to the top quarter or so of the population that owns the majority of stocks. C-suite America in particular has benefitted, since executives take home the majority of their pay in stock (and thus have reason to do whatever it takes to manipulate stock price.)

Higher federal minimum wages are a good start, but it’s only one piece of the inequality puzzle. Boosting wages in a bigger way will also requiring changing the corporate model to reflect the fact that companies don’t exist only to enrich shareholders, but also workers and society at large, which is the way capitalism works in many other countries. German style worker councils would help balance things, as would a sliding capital gains tax for long versus short-term stock holdings, limits on corporate share buybacks and fiscal stimulus that boosted demand, and hopefully, wages. (For a fascinating back and forth on that topic between Larry Summers and Ben Bernanke, see Brookings’ website.)

Politicians are going to have to grapple with this in the election cycle, because as the latest round of wage protests makes clear, the issue isn’t going away anytime soon.

Read next: Target, Gap and Other Major Retailers Face Staffing Probe

Listen to the most important stories of the day.

MONEY Taxes

How the Sharing Economy Makes Tax Filing Tougher

Lyft driver
Lyft Being a Lyft driver may not feel too fun at tax time.

When you make money working for a business like Uber, Task Rabbit, or Airbnb, doing your taxes can a pain.

Before Jane LeBoeuf started driving for Uber and Lyft, doing her taxes was cheap and easy.

LeBoeuf would swing by the local H&R Block office, pay $150 and end up with a refund. But now, that is not the case.

The 32-year-old from Providence, R.I. paid $470 this year to a professional tax preparer, and her refund got eaten up by the taxes on her side gig income.

As it is with so many other millennials—whether they are driving for a car service, renting property through Airbnb.com, or picking up jobs through TaskRabbit.com—LeBoeuf needed help sorting out the complexities of freelance income that comes with a host of possible deductions.

“There are a lot of people out there who are starting to realize they don’t have it all together,” says Robert Wheeler, who runs an accounting firm in Santa Monica, Calif. “Things are just getting more complicated. People don’t know what to do.”

Accountants point out that one of the biggest problems they see with those earning a sharing-economy income is a lack of record-keeping.

Freelancers like LeBoeuf agree: “I just find it to be too much for me on a daily basis,” she says.

Sometimes all it takes is asking for record-keeping help during the first year. But others need constant attention. Here are some tips on how to get started:

1. Get the right help

Some accountants are starting to specialize in sharing economy tax strategies, like Derek Davis, 28, who is based in Culver City, Calif.

Davis says he had his eureka moment after a ride home from work one night with an Uber driver who had no idea what expenses he was allowed to deduct, like repairs and gas.

Otherwise, tax preparers who specialize in freelance or small businesses would know their way around a Schedule C, which is where freelancers report income.

Since just about anyone can hang out a shingle that says they do taxes, consider looking for a preparer with certified credentials, which you can find by searching the databases of the National Association of Tax Professionals or the National Association of Enrolled Agents.

2. Develop a record-keeping system

Independent contractors are responsible for recording all their income—not just what is sent to them on a Form 1099. Equally, they are responsible for tracking their own expenses. But this can get very complicated for those tracking mileage—when you can count more than just the actual Uber trips you drive, for instance.

And it can be dizzying for those renting out spaces in their homes. For starters, those renting for fewer than 14 days get a break—they do not owe taxes on the income. Go past that, however, and you can deduct any expense directly related to your rental.

Solutions range from traditional spreadsheets to new apps. Intuit, the parent company of TurboTax, partnered this year with the freelance marketplaces Fiverr.com, UpCounsel.com, and TaskRabbit to offer for free its new QuickBooks Online Self-Employed, which can be directly transferred to TurboTax.

Among independent efforts, Derek Davis developed his own free app—Tabby Tax—to help sharing economy workers keep track of expenses.

Drivers can use any number of tools such as MileIQ, EasyBiz Mileage Tracker, and Easy Mile Log to keep track of car expenses.

3. Know what you owe

LeBoeuf was surprised how much her extra income boosted her tax liability and lowered her usual refund. But some people are caught by an even greater surprise—owing money to the Internal Revenue Service.

Many new contractors learn the hard way that you have to pay taxes on freelance income quarterly rather than rely on an employer to deduct enough taxes from a paycheck. Most tax software programs, and any tax professional, should be able to generate an estimate of what you will have to pay based on your projected earnings. Then you can adjust as you go so you do not end up with a penalty for underpayment.

TIME Taxes

Is Your Tax Rate Higher Than Walmart’s?

Use this calculator to find out

It’s April 15, Tax Day. And while dubious business expenses and home offices might help you save a few dollars, most people pay something near what the government sets as the tax rate for their income.

The same is not always true of corporations. While the United States has the highest statutory corporate tax among industrialized nations (39.1 percent), corporations have a greater number of ways to bring that tax bill down. Use the calculator below to see how your tax rate compares to the average effective federal rates paid by 10 major corporates between 2008 to 2012, according to Citizens for Tax Justice, a non-profit organization that advocates for corporate tax reform. The group’s board of directors includes a number of top labor leaders.

Calculations on how much companies pay in taxes vary considerably. A recent report by Citizens for Tax Justice found that profitable Fortune 500 companies paid an average effective federal tax rate of 19.4 percent from 2008 to 2012. The Tax Foundation, a think tank that studies the effect of taxation on the private sector and advocates for decreasing tax burdens, estimates that the nationwide rate is considerably higher–between 26.7 percent and 39.3 depending on the industry. The organization’s board members include two former Republican House members and Douglas Holtz-Eakin, the chief economic adviser to Republican Sen. John McCain’s 2008 presidential campaign.

While different researchers and organizations typically find different numbers for the exact amount individual companies pay in taxes, Citizens for Tax Justice maintains one of the most comprehensive comparisons of individual businesses.

Multinational corporations leverage tax exemptions to lower their tax bill and return value to shareholders. Tech companies like Apple and Microsoft were criticized after a 2013 Senate investigation into a tax arrangement known as the Double Irish, which allocates profits of intellectual property to tax-haven countries like Ireland.

A new report from the Citizens for Tax Justice highlighted 15 Fortune 500 companies, including JetBlue and General Electric, that the group said either received a rebate or were taxed less than 1 percent of their income in 2014. GE has said that its decision last week to cut loose its financial business GE Capital could lead the company’s effective tax rate to rise to 20 percent in the future, the Wall Street Journal reports.

A February Pew Research survey found that 82 percent of respondents expressed at least some concern that “corporations didn’t pay their fair share,” compared with 53 percent who expressed concern over their own tax burden.

Methodology

The effective federal tax rates are drawn from the Center for Tax Justice’s analysis of top Fortune 500 companies, taken from the research group’s corporate tax explorer.

State and local taxes are not included in these calculations.

Read next: How April 15 Became Tax Day

Listen to the most important stories of the day.

TIME Economy

How April 15 Became Tax Day

Final Day For Filing Taxes
Erik S. Lesser—Getty Images A man deposits his tax return into a mailbox on the final day for filing taxes in 2001 in Atlanta

The April date has been "T-day" for 60 years

Founding Father Benjamin Franklin famously said that the only things certain in this world were death and taxes, but he wasn’t necessarily talking about federal income taxes. The U.S. didn’t institute such a tax until the time of the Civil War, as a temporary measure. The Sixteenth Amendment, ratified in 1913, made it possible for the federal government to tax individuals directly.

But the story of tax day doesn’t end there. In 1954, Congress passed nearly 1,000 pages of revision to the Internal Revenue Code. Though TIME noted back then that the bill didn’t really change the overall structure of the tax code, and that many taxpayers wouldn’t be included in the categories of Americans who would see a decrease in their tax bill due to the change, it did mean one big difference that every single taxpayer would feel: “T-day” would be moved to April 15:

The lawmakers rewrote and in some places tightened many provisions concerning gifts, trusts, partnerships and reorganized or liquidated corporations. They plugged a clutch of minor loopholes that some taxpayers had found profitable. They switched income-tax day from March 15 to April 15, thus giving the taxpayer an extra month to recover from Christmas expenses and sparing him the yearly ordeal of hearing and reading clichés about the ides of March.

But when 1955’s tax day rolled around, it became clear that — even if the extra month did help Americans’ wallets — the new date didn’t mean an end to tired date-based jokes. The Ides of March were no longer financially deadly but April, TIME noted with no hint of irony, is the cruelest month.

Read the full 1954 story, here in the TIME Vault: The New Tax Law

MONEY Taxes

These Are the People Who Are Most Likely to Get Audited

woman on balcony of modern house
Getty Images The uber-rich have the most to fear when it comes to tax audits.

As tax season draws to a close, you may be wondering if you're at risk. (Hint: Probably not.)

If Tax Day has you worrying about an IRS audit, you probably have little reason to be nervous. Last year, the IRS audited less than 1% of all taxpayers—and the federal agency is on track to audit even fewer people this year.

“The math is pretty simple. There are fewer audits because we have fewer auditors,” IRS commissioner John A. Koskinen told the New York State Bar Association in February. “The IRS lost more than 2,200 revenue agents since 2010. Last year alone, there were 600 fewer auditors, with the total falling to 11,600—the lowest level in more than a decade.”

Still, some Americans are subject to more scrutiny than others. The IRS doesn’t spell out why auditors single out some returns for special treatment, but a look at the agency’s track record provides some clues. Here are the groups that are more likely to get the government’s attention:

1. People who report more than $10 million in income—or none at all

It’s like the old saying about why the bank robber robbed the bank: “Because that’s where the money is.” With limited resources, the IRS takes a harder look at people with the most money (and the most to hide). In 2010, then-commissioner Doug Shulman told the New York State Bar Association targeting the rich was part of a new strategy to “work smarter.”

“This is a game-changing strategy for the IRS,” Shulman said. “Initially, we will be focusing on individuals with tens of millions of dollars of assets or income. Going forward, we will take a unified look at the entire complex web of business entities controlled by a high wealth individual, which will enable us to better assess the risk such arrangements pose to tax compliance.”

In 2014, the IRS audited more than 16% of returns reporting more than $10 million in income. But, as you can see in the table below, single-digit millionaires should take care with their tax returns as well.

Another group with a high-than-average chance of getting audited? People who report no income. If you’re reporting an operating loss on your business, the IRS might double check that you’re being honest. In 2014, the IRS audited 5.3% of the taxpayers who reported no income.

Otherwise, if you—like the majority of American taxpayers—earn between $25,000 and $200,000, you have a better-than-average shot of dodging an IRS audit. Here’s the breakdown:

Returns by Income

Percent of total returns

Percent audited in 2014

All returns 100% 0.86%
No adjusted gross income 1.83% 5.26%
$1 – $24,999 39.08% 0.93%
$25,000 – $49,999 23.32% 0.54%
$50,000 – $74,999 13.12% 0.53%
$75,000 – $99,999 8.33% 0.52%
$100,000 – $199,999 10.70% 0.65%
$200,000 – $499,999 2.87% 1.75%
$500,000 – $1 million 0.48% 3.62%
$1 million – $5 million 0.24% 6.21%
$5 million – $10 million 0.02% 10.53%
Over $10 million 0.01% 16.22%

Source: Internal Revenue Service Data Book, 2014

2. People who file estate tax returns for assets worth more than $5 million

Likewise, a huge estate tax return could raise some eyebrows at the IRS. Overall, 8.5% of estate tax returns were singled out for special scrutiny in 2014, way more than the 0.9% of individual tax returns.

And the bigger the estate, the more likely the IRS flagged the return for an audit. More than 21% of estate tax returns with assets between $5 million and $10 million were audited in 2014, and 27% of returns with assets worth over $10 million were audited.

However, estate tax returns are pretty rare: The IRS received 33,719 in 2013, and only 3,359 of those were for estates worth $10 million or more.

3. People who file international returns

If you’re mailing your return from the Cayman Islands, you can bet that the IRS is onto you. Over the past several years, the IRS has increased scrutiny of international returns.

“On the individual front, we have made putting a big dent in offshore tax evasion a major priority,” Shulman told the American Institute of Certified Public Accountants in 2012. “We view offshore tax evasion as an issue of fundamental fairness. Wealthy people who unlawfully hide their money offshore aren’t paying the taxes they owe, while schoolteachers, firefighters and other ordinary citizens who play by the rules are forced to pick up the slack and foot the bill.”

In 2014, the IRS audited 4.8% of international returns.

But there’s a cost to fewer audits

Law-abiding citizens have little reason to celebrate the limited number of tax audits. Koskinen expects that, thanks to federal budget cuts, the IRS will lose out on at least $2 billion in revenue that auditors would otherwise be able to collect. Plus, sometimes when the government takes a second look at your return, you get more money back: In 2014, the IRS decided 38,029 individual filers had paid too much in taxes and sent them additional refunds.

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