• The Standard Deduction May Be Costing You – This technique could save you plenty

    The Standard Deduction May Be Costing You – This technique could save you plenty

    The Standard Deduction May Be Costing You – This technique could save you plenty Many taxpayers default to the standard deduction when filing their tax return because of its simplicity. Unfortunately, this often creates a higher tax bill. Here is a tip to ensure it does not happen to you. Only about a third of Americans file income tax returns using itemized deductions. Unfortunately many of those who don’t itemize are overpaying their taxes. Don’t wait until tax time to figure out if itemizing your deductions yields a lower tax bill. Start now to review your situation and plan for

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  • Avoid a Debt Settlement Tax Surprise

    Avoid a Debt Settlement Tax Surprise

    Avoid a Debt Settlement Tax Surprise Reaching a settlement on your debt comes with important tax consequences. The number of Americans struggling with high debt is increasing, according to the U.S. Federal Reserve. U.S. household debt reached a new record this spring, the central bank said, with the average indebted household owing more than $16,000 on their credit cards. Seeking debt forgiveness from lenders is one option to try to deal with the burden of high debt. But there is an important tax consequence: Any amount of cancelled debt is generally taxed as ordinary income. This can come as a

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  • Avoid the 10% Early Withdrawal Penalty – What every Traditional IRA owner should know

    Avoid the 10% Early Withdrawal Penalty – What every Traditional IRA owner should know

    Avoid the 10% Early Withdrawal Penalty – What every Traditional IRA owner should know While it is not a good idea to tap retirement accounts prior to retirement age, sometimes it cannot be avoided. What can often be avoided, however, is the punitive 10% penalty for early fund distributions. Outlined here are exceptions to the 10% penalty rule for Traditional IRAs. It is one thing to be taxed on retirement contributions and their related earnings when you withdraw funds from your Traditional IRA, it is quite another when you pay the tax PLUS a 10% penalty for early withdrawal. Need

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  • Understanding Tax Terms: Basis – Covering the bases on basis

    Understanding Tax Terms: Basis – Covering the bases on basis

    Understanding Tax Terms: Basis – Covering the bases on basis This commonly used tax term is anything but common to most of us. Knowing the basics of basis can serve to lower your tax obligation when you sell property. Basis is a common IRS term, but probably does not enter into your everyday conversation. This IRS term is important because it impacts the taxes you pay when you sell, exchange or give away property. What basis is The IRS describes basis as: The amount of your capital investment in a property for tax purposes. Use your basis to figure depreciation,

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  • Private Agencies Now Collecting for IRS – Your scam alert should be on high

    Private Agencies Now Collecting for IRS – Your scam alert should be on high

    Private Agencies Now Collecting for IRS – Your scam alert should be on high The IRS recently announced its outside collection agencies are now actively collecting past due tax bills. This will impact all of us. Here is what you need to know In a recent announcement, the IRS notified all taxpayers that outside collection of past-due tax bills is now beginning in mid-April 2017. This is a direct result of Congressional action in late 2015 requiring the IRS to turn over to outside companies billions in uncollected taxes it is no longer pursuing. This will impact all of us.

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  • Tax Tips for Those Getting Married – Know someone getting married? Send them this tip now.

    Tax Tips for Those Getting Married – Know someone getting married? Send them this tip now.

    If you recently got married, plan to get married, or know someone taking the matrimonial plunge, here are some important tax tips every new bride and groom should know. Notify Social Security. Notify the Social Security Administration (SSA) of any name changes by filling out Form SS-5. The IRS matches names with the SSA and may reject your joint tax return if the names don’t match what the SSA has on file. Address change notification. If either of you are moving, update your address with your employer as well as the Postal Service. This will ensure your W-2s are correctly stated and

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  • Five Steps to Take if You’re Audited

    Five Steps to Take if You’re Audited

    Five Steps to Take if You’re Audited Getting audited is no one’s idea of a good time, yet you can get through it if you take the right approach. Getting audited is no one’s idea of a good time, yet you can minimize the stress if you take the right approach. Step 1: Understand why and when. While it’s possible you were selected randomly, it’s more likely you were selected for a specific reason. One example might be if your deductions for charitable donations or business expenses were greater than is typical for your income or profession. Before proceeding, make sure

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  • Your next audit may be an “audit lite” – The IRS is handling more reviews with form letters

    Your next audit may be an “audit lite” – The IRS is handling more reviews with form letters

    Your next audit may be an “audit lite” – The IRS is handling more reviews with form letters In-person audits with an IRS agent are becoming more uncommon. The IRS is instead handling their reviews through form letters called correspondence audits. Here is what you need to know. In-person audits with an IRS agent are becoming more uncommon. The IRS is instead handling many routine reviews through form letters called correspondence audits. These IRS letters are a kind of “audit lite” the agency uses to ask for clarification and justification of specific deductions on your tax return. Common issues that

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  • Taxpayers to forfeit more than $1 billion in refunds – Are you one of them?

    Taxpayers to forfeit more than $1 billion in refunds – Are you one of them?

    Taxpayers to forfeit more than $1 billion in refunds – Are you one of them? The IRS disclosed there will be more than $1 billion in federal tax refunds forfeited this year if taxpayers don’t claim them by April 18. The IRS disclosed there will be more than $1 billion in federal tax refunds forfeited this year if taxpayers don’t claim them by April 18. Refunds have to be claimed within three years or they are forfeited to the government. The unclaimed $1 billion comes from about 1 million taxpayers who still haven’t filed returns for the 2013 tax year.

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  • Tax Credits versus Tax Deductions – Which is worth more to you?

    Tax Credits versus Tax Deductions – Which is worth more to you?

    Tax Credits versus Tax Deductions – Which is worth more to you? Deduct this or take a Tax credits? Which is worth more to you? Often the answer is not as simple as you think. Every industry and profession has common terms that are used so often those of us in the business often forget that most people do not have the depth of understanding that a person working within the tax code might have. One of these areas is understanding the differences between the tax terms “deductions” and “credits”. Is one better than the other? If it were simple

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