The Tax Factor was created to educate individuals and small-business owners about taxes. Let’s face it, nothing in life is guaranteed except death and taxes. Okay, maybe that sounded pretty depressing but the goal of this blog is to help you find the information to learn how to make taxes work for you. Taxes can be extremely complicated but knowing about deductions and credits can save you thousands of dollars per year.
Showing posts with label tax preparation. Show all posts
Showing posts with label tax preparation. Show all posts
The IRS has launched a new Affordable Care Act Tax Provisions website at IRS.gov/aca to educate individuals and businesses on how the health care law may affect them. The new home page has three sections, which explain the tax benefits and responsibilities for individuals and families, employers, and other organizations, with links and information for each group. The site provides information about tax provisions that are in effect now and those that will go into effect in 2014 and beyond.
Topics include premium tax credits for individuals, new benefits and responsibilities for employers, and tax provisions for insurers, tax-exempt organizations and certain other business types.
Visitors to the new site will find information about the law and its provisions, legal guidance, the latest news, frequently asked questions and links to additional resources.
Several other federal agencies have a role in implementing the health care law, including the Department of Health and Human Services, which has primary responsibility. To help locate additional online resources from the Department of Health and Human Services, the Department of Labor and the Small Business Administration, the IRS has issued a new Web-based flyer - Healthcare Law Online Resources (Publication 5093).
Visit IRS.gov/aca for more information regarding the tax provisions of the Affordable Care Act.
"Every client you keep, is one less that you need to find." -Nigel Sanders
I agree with Mr. Sanders' quote but only to a certain point. Some clients are just not worth the headache.
My parents taught me that "hate" is a strong word. I rarely use the word "hate" because hating is bad for your health. Therefore, when I say that I hate bum clients, it's a real feeling. Luckily, most of the clients that I dealt with in the past and present are great individuals. However, it is always that rare one percent of clients that were bums. As an entrepreneur, there is nothing worst than dealing with a disrespectful clients. These bum clients can ruin a nice summer day. I will only give "bum" clients two chances to prove that I should keep them as clients. In some cases, two chances may be too much. Here are some reasons a "bum" client won't make it to the second chance:
I can't keep clients that wanted everything done yesterday but you have to chase them down for your fees. I have no problem dealing with urgent situations but it is so disrespectful when the client decides to disappear when it is time to pay. All of sudden, your calls are not being returned like you are a ex-boyfriend!
I can't keep clients that want a deep discount but you have to do double the amount of work. Even worse, they won't even give you referrals for your great service! I have performed deep discount services and almost always get burnt in the end. I don't know how I always fall for it. The clients comes to me very humble and appreciative. However when the work is done, it is almost like they forget how I helped them in a tight situation. Some bum clients even try to repeat the same action like nothing happened in the past. This can only happen to me once then it is "good bye!"
I can't keep clients that think taxes are easy. These clients come into your office with an arrogant attitude. It is almost like they think that they are doing you a favor by coming to your office. Telling me that "taxes are easy" is a big slap in my face and my fellow tax professionals. I will not allow someone to disrespect my profession. If taxes are so easy then the client should save their money and complete their own taxes.
I can't keep clients that will disregard the law because their friend got away with the proposed scam. These type of clients will only help you lose your professional license. When they get into trouble, they will blame everything on you. Don't fall victim to these bum clients.
I can't keep clients that get mad at me for owing the government money. It is not my fault that they withheld too little taxes from their paycheck. I'm not dumb, most of these type of clients know exactly why they owe money. How can you claim six exemptions on your paycheck when you are single with no kids?
There is nothing wrong with firing bum clients. Life is too and complex to deal with them! Firing bum clients will give you more time to concentrate on your valuable clients.
IRS Tax Tip 2013-09
While each individual tax return is unique, there are some tax rules that affect every person who files a federal income tax return. These rules involve dependents and exemptions. The IRS has six important facts about dependents and exemptions that will help you file your 2012 tax return.
1. Exemptions reduce taxable income. There are two types of exemptions: personal exemptions and exemptions for dependents. You can deduct $3,800 for each exemption you claim on your 2012 tax return.
2. Personal exemptions. You usually may claim one exemption for yourself on your tax return. You also can claim one for your spouse if you are married and file a joint return. If you and your spouse file separate returns, you may claim the exemption for your spouse only if he or she had no gross income, is not filing a joint return and was not the dependent of another taxpayer.
3. Exemptions for dependents. Generally, you can claim an exemption for each of your dependents. A dependent is either your qualifying child or qualifying relative. If you are married, you may not claim your spouse as your dependent. You must list the Social Security Number of each dependent you claim on your return. See Publication 501, Exemptions, Standard Deduction, and Filing Information, for information about dependents who do not have Social Security numbers.
4. Some people do not qualify as dependents. While there are some exceptions, you generally may not claim a married person as a dependent if they file a joint return with their spouse.
5. Dependents may have to file. If you can claim someone else as your dependent on your tax return, that person may still be required to file his or her own tax return. Whether they must file a return depends on several factors, including the amount of their gross income (both earned and unearned income), their marital status and any special taxes they owe.
6. Dependents can’t claim a personal exemption. If you can claim another person as a dependent on your tax return, that person may not claim a personal exemption on his or her own tax return. This is true even if you do not actually claim that person as your dependent on your tax return. The fact that you could claim that person disqualifies them from claiming a personal exemption.
Remember that a person must meet several tests in order for you to claim them as your dependent. See Publication 501 for the tests you will use to determine if you can claim a person as your dependent.
You can view or download Publication 501 at IRS.gov or order it by calling 800-TAX-FORM (800-829-3676). You can also use the Interactive Tax Assistant at IRS.gov to find out if a person qualifies as your dependent. The ITA is a helpful tool that can answer many of your tax law questions.
Yep, it's tax season. I will posting IRS tips all tax season.
Here is a word from the Goodfellas at the IRS:
IRS Tax Tip 2013-08
When you’re looking for tax information, you want to find it as quickly and easily as possible. That’s why the IRS redesigned its website. It’s now even more user friendly. Here are the top 10 reasons to visit IRS.gov:
1. Get 24/7 Access. Whether you do your taxes during the day or burn the midnight oil, IRS.gov has the tax forms and answers you need when you need them. It's accessible all day, every day. The Interactive Tax Assistant is a helpful tool that will answer many of your tax law questions. Several tax forms, publications and information are also available in Spanish.
2. Use Free File. Anyone can prepare and e-file their taxes for free with IRS Free File. Offered exclusively at IRS.gov, Free File’s brand name software or fillable forms do the work for you. If you made $57,000 or less, you qualify to use free tax software. If your income is more than $57,000 or you feel comfortable preparing your own tax return, use Free File Fillable Forms. This option provides the electronic versions of IRS paper forms.
3. Try IRS e-file. Whether you do your own taxes or hire a preparer, IRS e-file is the safest, easiest and most popular way to file a complete and accurate tax return. Since 1990, taxpayers have e-filed more than one billion returns. If you owe taxes, e-file gives you options to file early and pay by the tax deadline. If you are due a refund, you should receive it in less than 21 days.
4. Check Your Refund Status. You can track your refund using the enhanced “Where’s My Refund?” tool. It’s quick, easy and secure and has a new look this year. You can start checking on the status of your refund within 24 hours after the IRS has received your e-filed return. You can check your refund status four weeks after you mail a paper return. The tool includes a tracker that displays the progress of your return in three stages while it is processed. Once IRS approves your refund, “Where’s My Refund?” will give a date to expect your refund.
5. Make Payments Electronically. E-payment options are a convenient, safe and secure way to pay taxes. You can authorize an electronic funds withdrawal, use a credit or debit card or enroll in the U.S. Treasury’s Electronic Federal Tax Payment System.
6. Use the EITC Assistant. The Earned Income Tax Credit is a tax credit for working people who earned less than $50,270 in 2012. The credit can be worth as much as $5,891. Check your eligibility using the EITC Assistant tool. You may be among the millions of eligible workers who get the EITC this year.
7. Get Tax Forms and Publications. You can view and download tax forms and publications any time. It’s the easiest way to get IRS forms and publications.
8. Figure the Right Withholding. The IRS Withholding Calculator will help to ensure you don’t have too much or too little income tax withheld from your pay.
9. Request a Payment Agreement. Paying all your taxes on time avoids penalties and interest. However, if you cannot pay your taxes in full you may be eligible to use the Online Payment Agreement Application to request an installment agreement.
10. Get the Latest Tax Law Changes. Learn about tax law changes that may affect your tax return. Special sections of the website highlight changes that affect individual and business taxpayers.
The address of the official IRS website is www.irs.gov. Don’t be misled by sites that claim to be the IRS but end in .com, .net, .org. Some thieves use phony websites to gain your personal and financial information. They then use this information to commit identity theft or steal your money.
Expenses of traveling away fro
“home” overnight for job-related reasons are deductible. Your “home” is
generally considered to be the entire city or general area where your principal
place of employment is located. Out-of-town expenses include transportation,
meals, lodging, tips, and miscellaneous items like laundry, valet, etc.
Document your away-from-home
expenses by nothing the date, destination, and business purpose of your trip.
In addition, keep a detailed record of your expenses-lodging, public
transportation, meals, etc. Always list meals and lodging separately in your
record. Receipts must be retained for each lodging expense. However if any
other business expense is less than $75, a receipt is not necessary if you
record all the information in a timely diary. Keep track of the full amount of
meal and entertainment expenses even though only a portion of the amount may be
deductible.
B)OFFICE EXPENSES:
Use this section to record miscellaneous
expenses of supplies and services you are responsible for when you are on the
road. For example, you may be required to fax or mail an important document
back to your home office; such expensive is deductible if it is not reimbursed
by your employer.
C)SUPPLIES:
Generally to be deductible, items
must be ordinary and necessary to your job. If you are an employee, only
amounts not reimbursable by your employer are deductible. Record separately
from other supplies, items costing over $100 and having a useful life of more
than one year. These items must be recovered differently on you tax return than
recurring everyday business expenses like maps, etc.
If you are required to wear a
uniform, the cost and upkeep may be deductible. IRS rules specify that expense
for work clothing and its maintenance is deductible if: (1) the uniforms are
required by your employer (if you are an employee); and (2) the clothes are not
adaptable to ordinary street wear.
D)COMMUNICATION EQUIPMENT:
Since special rules apply to
deductions for cellular and similar items (called “listed property” in the tax
rules), it is important to track their business and personal use carefully.
Such property potentially qualifies for larger current deductions when it’s
used more than 50% for business. Keep your bills for cellular phone use and
mark all business calls.
E)FEES & DUES:
Union or other professional dues
are deductible. Amounts paid to a union which are mean to go toward defraying
your personal expenses are not deductible. However, any part of union payments
which go into a strike fund is deductible.
G)MISCELLANEOUS EXPENSES:
Use this section to record
expenses that don’t easily fit to other categories. For example, if you look
for a job in the same line of work, you may deduct the expenses. Such expenses
could include mileage to interviews, resume preparation, etc.
