What do I do if I receive a notice from the IRS about my taxes?
Don't panic! the first thing to do is carefully read the notice - to determine why it was sent, what the IRS is requesting, and what they want you to do. It may be nothing of importance; it may even be a notice in your favor. After reading it you should bring it to our attention. We are open all year 'round, and there is never any additional fees to give you advice on work we prepared for you.
When will the IRS begin processing Income tax returns this year?
The Internal Revenue Service has announced plans to open the 2021 filing season on February 12th. The new opening date for individuals to file their 2020 tax returns will allow the IRS adequate time to program and test its tax processing systems. However, you may bring your taxes in any time, and we can go ahead and E-file them in case the IRS starts at an earlier date. Either way, your return will already be sent.
How do I find out about my refund?
The best way is to use the Check Your Refund link from the Resources pages of our website! To look up the status of your federal or state refund, you will need your social security number, filing status, and exact amount you're expecting back before any fees. If your fees were taken out of your refund, you can check the status by calling 866-730-2274 or visiting www.taxinfonet.com 24 hours a day, and you won't need anything except your social security number.
How long do I keep my records and tax returns?
You should keep your records and tax returns for at least 3 years from the date the return was filed or the date the return was required to be filed, whichever is later. However, although the IRS usually never goes past the 3 years, we recommended that you keep these records for 7 years.
How can I find out if I owe any other government debts besides taxes?
You can call the Financial Management Service (FMS) at 800-304-3107. This automated number will let you if your refund is going to be offset by the Office of Child Support, Department of Education Loans, Attorney General's Office, and all other government debts besides taxes.
Can I deduct expenses for a business run out of my home?
If you use a portion of your home for business purposes, you may be able to take a home office deduction whether you are self-employed or an employee. Expenses you may be able to deduct for business use of your home may include the business portion of real estate taxes, mortgage interest, rent, utilities, insurance, depreciation, painting, and repairs.
You can claim this deduction only if you use a part of your home regularly and exclusively:
Generally, the amount you can deduct depends on the percentage of your home that you used for business. Your deduction will be limited if your gross income from your business is less than your total business expenses.
What is the difference between a C and an S corporation?
A C Corporation and an S Corporation are exactly the same in respect to liability protection. The difference is in how you are taxed. A C Corporation has what is referred to as a double taxation. First the corporation is taxed, and secondly the dividends are taxed on the shareholders' tax returns. An S Corporation is not taxed at the corporate level, only at the shareholder level. Most small businesses are eligible to file as S corporations. But the appropriate election must be made.
What are the consequences of early withdrawals from my retirement plans?
If you withdraw money from a 401(k) or an IRA before age 59 1/2, the distribution is taxable and there is a 10% penalty on the taxable amount. The main exceptions that let you withdraw money early without penalty are as follows:
What do I need to keep for my charitable contributions?
First, is your contribution cash or non-cash?
Remeber all contributions must be made to qualified charitable organizations.
If I donate my vehicle to charity, how much can I deduct on my tax return?
In the past there were a lot of charities asking you to donate your car, and there were a lot overinflated appraisals of the fair market value for these vehicles. But recently the IRS has gotten stricter on the way you determine the value of your car. Now you must claim the actual amount the charity received at an auction to sell the car, and the charity should give you timely acknowledgment to claim the deduction. If the vehicle is actually used by the charity instead of sold at auction, then you may claim the vehicle's fair market value.
What are the differences between a Roth and a conventional IRA?
A traditional IRA lets you deduct contributions in the year you make them, and the distributions are included as income on your return when you withdraw from the IRA after reaching age 59 1/2. A Roth IRA does not let you deduct the contributions, but you also do not report the distributions as income, no matter how much the Roth account has appreciated. With a Roth, you can exclude the income earned in the account from being taxed.