Tag Archives: IRS

Five Common Tax Myths Explained

Ginita Wall points out 5 tax myths that everyone should know about, especially with the deadline for filing right around the corner.

I would like to address some of those common tax myths that most people have heard about, although don’t really fully understand. Another source of information is TurboTax.com and the easy to use site will explain the tax myths as well as ensure that you get the biggest possible refund.

English: United States Internal Revenue Servic...

English: United States Internal Revenue Service Criminal Investigation Division Badge (Photo credit: Wikipedia)

Myth 1:

Despite popular belief, there is no evidence to suggest that if you file for an extension, you are more likely to be audited. Less than 1 percent of all tax payers are audited by the IRS, and you are also not any more likely to be audited if you file your taxes early.

Myth 2:

Whether or not you have the money to pay the IRS, you must still file your taxes by the April 15th deadline. if you owe money, you can work out a payment plan with the IRS, but you cannot delay filing just because you may owe money.

Myth 3:

Dependents who are not your relatives must be living with you, although parents are the exception to that rule, and if they live in a nursing home you can still claim them as dependents.

Myth 4:

Unless your pet expenses are directly related to your business, such as paying for a guard dog, you cannot claim your pet on your taxes, which is also one of the common tax myths. A seeing eye dog or another medically required dog would also be an allowable exception to this rule.

Myth 5:

Some states impose an inheritance tax (IN, IA, KY, MD, NE, NJ, PE, TN) and unless you live in one of those states, any tax is paid by the estate of the deceased person. Gifts that you give or receive are not taxable when it comes to filing your taxes and you do not have to declare them.

TurboTax.com is the place to look for information on these and other tax myths, and TurboTax.com can help you file your taxes easily and accurately.

VN:F [1.9.22_1171]
Rating: 10.0/10 (2 votes cast)
VN:F [1.9.22_1171]
Rating: +2 (from 2 votes)

Related Posts:

Turbo Tax Services Allow You To File Online

Now that your vacation has ended, it is a good time to begin your year on the right side with your taxes. Being prepared will enable you to get full income compensation through the help of tax volunteers.

The opening date for filing your taxes was Jan 2,2014, you could complete your taxes for filing using Turbo Tax 2014 prior to that date. Thus, this is the right time to start filing. An advantage of filing very early is that you will get your refunds earlier which is very much a logical action to take.

TurboTax: Why ask if you already know?

TurboTax: Why ask if you already know? (Photo credit: stevegarfield)

Using the fastest means of direct deposit, is the ultimate way of getting your refund. Upon e-filing, the IRS approves 90% of its refunds within three weeks or even less. Make sure your return is error free as that will delay the government from accepting your return.

If you are using Turbo Tax 2014 to calculate and prepare your taxes, accuracy, quality work and a good experience is what you expect coupled with accountability in every single eligible deduction.

If you have any hassle with calculating your taxes, you can get assistance from free tax agents to answer your queries. Professional tax agents including IRS persons, accountants and tax lawyers are also there to sort out the issues you are facing.

Are You New to Turbo Tax?

Military Edition: This version was created by the IRS with the military personnel in consideration. Turbo Tax employees working as tax experts in the military helps the other members of the military fraternity based on the situation they are in. The Military edition looks into permanent station charges, uniform deductions, residency, combat pay questions and to some extent, the Earned Income Tax Credit. Special editions for certain ranks like E-1 and E-5 have since become free. until February 14.

Personalized Interview: Turbo Tax 2014 is easy to use since it has options for entering income choices which in turn makes the work safe. It has been customized to deal with major income types and help you know the important things to know on your tax status. It also comes with video or picture tutorials for IRS forms including the 1099 and W-2 forms.

My Turbo Tax: This works for tax payers with a computer and a working network connection. Due to its online nature, you get to have a personal feeling and connection with the e-file process, your tax refund status, settings management, orders and access to your funds before the return wold be received otherwise. It has been customized to meet the situation of handsets like mobile phones and tablets or any other means which can easily get you online and perform this actions.

File With Confidence

You can file confidently because there is a customer support center where you can call Turbo Tax and ask your queries. You can trust the IRS to give you information updates especially when the tax law changes. With the Tax calculator for Turbo Tax 2014, you can know the amount of tax refunds you owe before you complete your return. There are many benefits so you should give it a free try this year instead of going to a local accounting office.

VN:F [1.9.22_1171]
Rating: 10.0/10 (1 vote cast)
VN:F [1.9.22_1171]
Rating: +2 (from 2 votes)

Related Posts:

How An IRS Debt Relief Program Can Get Your Taxes Back On Track Again

IRS Debt Relief Program

The IRS is well known for pulling strong-arm tactics on those who do not pay their taxes, but to be honest, they do have a softer side for those who have a legitimate reason for being late with their payments. To make it easier for you the taxpayer, as well as the IRS, they have developed programs for you to use, to get your tax payments back on track again, and in their good books again, as it were.

IRS Form 1040X, 2005 revision

IRS Form 1040X, 2005 revision (Photo credit: Wikipedia)

Installment agreement is an IRS debt relief program aimed at those who owe a large amount of money. Basically, they let you pay off the money in even installments, until the debt is fully paid. Interest will still accumulate on these late payments though, so the bigger the payment you make each month, the better.

Then there is the Penalty Abatement Program which, if you can prove without a doubt, that you have a viable reason for not being in a position to pay your taxes, will have the IRS do away with the penalties to reduce your debt to them.

The Non Collectible Status IRS debt relief program, is for those who are barely existing on their wages and just do not have the money to pay their late taxes. For these people, the taxman will stop taking any action against them, until their circumstances have improved. Again, interest will still accumulate on any money owed to the IRS, so it is a good idea to get it paid off as soon as possible.

Anyone considering using an IRS debt relief program, is can call an Enrolled Agent at IRS Tax Relief who will guide them through the whole process of getting their tax payments back on track again.

VN:F [1.9.22_1171]
Rating: 10.0/10 (3 votes cast)
VN:F [1.9.22_1171]
Rating: +2 (from 2 votes)

Related Posts:

Details On Obtaining Prior Year Tax Information From The IRS

Obtaining Prior Year Tax Information

The ability to get prior year tax information from the IRS is virtually a guarantee due to the fact that the IRS is required to keep tax returns on file for seven years. As with most actions related to the IRS there is a form that is required to fill out in order to obtain prior tax information. This is Form 4506 that can be found by completing a simple form search on the IRS website. The IRS will not provide prior tax information without filling out a hard copy of Form 4506.

Seal of the United States Internal Revenue Ser...

Seal of the United States Internal Revenue Service. The design is the same as the Treasury seal with an IRS inscription. (Photo credit: Wikipedia)

The form is self explanatory and should be filled out to include the exact information from the tax return of the prior year. At the very least, the name and social security number should match as well as the spousal information if the return was filed jointly. Additional information should include the prior year tax form such as Form 1040, 1040A, or 1040EZ. Form 4506 can be completed regardless of a recent divorce without spousal consent.  One of the final requests on the form is to fill out the prior year tax information being requested such as 12/31/2012.

The required fee for Form 4506 as of 2012 is $57 in the form of check or money order payable to the US Treasury that is required when mailing the form to the appropriate IRS office. However, tax filers that used Turbo Tax 2013 have the distinct advantage of obtaining prior year tax information at no cost. This free service is included with the use of Turbo Tax 2013 Basic, Deluxe, Premier, Home & Business, or Freedom Edition. Even greater is the use of the online edition of Turbo Tax 2013 that will automatically look up prior year tax information for a user to view or print.

VN:F [1.9.22_1171]
Rating: 10.0/10 (3 votes cast)
VN:F [1.9.22_1171]
Rating: +3 (from 3 votes)

Related Posts:

How To Organize Your Tax Records

How To Organize Your Tax Records

Learning how to organize your tax records can save you stress and time when it is time to file your taxes.  Start the year with an organization system so you know where all of your records are when it is time to file your taxes.  If you aren’t sure what records you need, here is a general guide that is suitable for most people.

Income

Your employer will issue a W-2 with your income and tax information for the year.  You should also include interest statements from investment accounts and any 1099s that you may receive for work done the previous year.

English: Same as :File:2010 Receipts & Expendi...

English: Same as :File:2010 Receipts & Expenditures.PNG, but slightly improved. Bar chart comparing estimates for United States federal government total receipts and expenditures in fiscal year 2010. (Photo credit: Wikipedia)

Medical Expenses

File receipts for all medical expenses and your out-of-pocket health expenses.

Donations

Keep all receipts for cash donations made from the previous year.  You can also deduct non-cash donations made to a charitable organization.

Real Estate

If you own your home or other real estate, keep all interest statements and tax assessments.

Child Care

If your children are in day care for all or part of the year, keep a copy of your receipts for payment.

Student Loans

The interest you pay monthly on a federal student loans is tax deductible.

Letters from the IRS

If you receive any letters from the IRS, keep these in your file.

Previous Tax Forms

Keep all previous tax forms for future years.

Other Receipts

Keep all receipts that you may need for a deduction.  You may not need them, but it is better to have them in case you do. If you plan on itemizing your deductions, keep all receipts for taxes you paid, medical expenses, interest you paid, charitable donations, loss due to theft, job expenses and other receipts you think may qualify for a deduction.

If you plan to itemize your deductions, it will be a lot easier for you if you keep these receipts organized throughout the year.

If you do not have a lot of paperwork each year, you can store them in one file.  However, if you have a lot of receipts or other tax papers, you should organize them by type to make your free tax filing 2012 easier and quicker.

For most people, a simple paper organizer that holds several files is sufficient to organize tax information.  Use a separate file for each type of paperwork, and file receipts and information as soon as you get them.  Keeping paperwork organized and not letting it pile up is important to stay organized, so file your paperwork as soon as your get it or once a month as needed.

VN:F [1.9.22_1171]
Rating: 10.0/10 (3 votes cast)
VN:F [1.9.22_1171]
Rating: +3 (from 3 votes)

Related Posts:

How To Free File Online Using The IRS Website

How To Free File Online Using The IRS Website

Many taxpayers are using free file online programs that are based on popular tax software programs like the TurboTax 2013 programs. The free file online program is offered directly by the IRS on their website. It is available to all taxpayers, but different taxpayers can access different portions of the program based on their income and other factors.

The IRS free file online program connects taxpayers with participating software companies like TurboTax 2013. Taxpayers can choose between a range of software programs including the TurboTax 2013 Freedom edition. Once the taxpayer has selected a software company, they can get started on their returns.

English: YOU ARE FREE TO USE THIS FILE

English: YOU ARE FREE TO USE THIS FILE (Photo credit: Wikipedia)

Taxpayers who have an adjusted gross income of $57,000 or less can file using the free program. Taxpayers who earn more than that amount cannot use the free software programs. However, they can download free file online forms. These forms are primarily for people who enjoy doing their own taxes. Using these forms, these taxpayers can prepare and file their own taxes online. However, these taxpayers do not get the extra assistance that is offered to people who can take advantage of programs like the TurboTax 2013 software programs.

Before they get started with the program, taxpayers need to prepare themselves. They will need to have copies of their last year’s tax return, copies of their W-2s, 1099s, and any other information that they will need for their taxes. For instance, taxpayers who plan to itemize their deductions may want copies of their charitable deductions or information on how much interest they have paid to their mortgage company throughout the year.

Before starting, taxpayers should also estimate their adjusted gross income. If you have not had any significant changes to your income over the last year, you should be able to estimate your adjustable gross income using last year’s tax return. Once you have determined whether or not your adjusted gross income is more or less than $57,000, you will know which program you are allowed to use. About 70% of all taxpayers have adjusted gross incomes of less than $57,000 so the chances are high that you will qualify to file free online.

Once you have completed the tax preparation work, you can submit your return electronically with the click of a few buttons. If you qualify for a tax refund, you can elect to have it mailed to you in a paper check, or you can have it electronically deposited into your bank account. Electronic deposits are typically the fastest way to get your returns, and you may see your refund within three weeks or less of your filing date. If you owe taxes, you can also make your payments electronically.

The free file online program is perfect for many taxpayers. However, taxpayers with unique situations may simply want to use some of the low cost software offered by a company like TurboTax 2013. This is especially true for people who own their own businesses or who need to file an extension.

VN:F [1.9.22_1171]
Rating: 10.0/10 (3 votes cast)
VN:F [1.9.22_1171]
Rating: +3 (from 3 votes)

Related Posts:

Processing of Tax Returns to Begin on January 30

Processing of Tax Returns

Earlier this week, the US Internal Revenue Service (IRS) announced that electronic filing of tax payments for the year 2013 will commence on January 30.  As a result, individual income tax returns will not be processed before then.

Electronic tax filing had been originally scheduled to begin on January 22. The nine-day extension is a result of the changes in tax law which took effect on January 1. The American Taxpayer Relief Act (ATRA) was the result of the “fiscal cliff” tie between the president and the house.

IRS Form W-2

IRS Form W-2 (Photo credit: Wikipedia)

The IRS is getting set for the year’s activities by upgrading its systems to suit the new tax payment procedure. IRS is now updating their forms and setting new programs to make this successful. According to the IRS, the updates should be ready to serve Americans from January 30. Other documents for treating cases such as residential energy credit claims, general business credits and depreciation of property will be available towards the end of February when their updates should be completed.

The acting commissioner of IRS, Steven T. Miller further reassured the public that this year’s tax electronic filing will soon kick off. The shift in date is to make sure that everything is properly done.

This year, IRS hopes to process all tax returns electronically. Last year, they processed more than 80% tax returns electronically. Even the paper type will not begin until after January 29.

Miller concluded by saying that electronic filling of tax returns is the most convenient for tax payers.

VN:F [1.9.22_1171]
Rating: 10.0/10 (4 votes cast)
VN:F [1.9.22_1171]
Rating: +4 (from 4 votes)

Related Posts: