Taxes are complex. There is rarely a simple answer to a tax matter. However, one question often does have a simple answer: do I need to file taxes? Millennials are often struggle with this question. The wrong answer to this, and two other common errors, can cause serious problems.
Tax filers beware: scammers are working hard this tax season. Their attempts generally increase this time of year, as tax payers are putting together their filings. However, it is likely that fraudsters will find even more success this year as confusion over the new tax law abounds throughout the country.
The Internal Revenue Service (IRS) rarely makes life easy. This is particularly true for those who are able to negotiate with a credit card company about an outstanding debt. In some cases, a successful negotiation can result in a dismissal of the debt. Although the consumer may no longer need to pay off the bill with the credit card company or other lender, his or her financial woes are far from over.
Ringing bells and shiny red buckets are just one of the many opportunities that may result in an increase in charitable donations over the holidays. Monetary contributions to charities can lead to more than just a warm heart, if done wisely they can also lead to a tax break.
There are pieces of mail that bring joy and others that bring a bit of fear. Likely one of the most common examples of a letter that would result in concern to the recipient is a letter from the Internal Revenue Service (IRS).
The Internal Revenue Service (IRS) cannot closely review every tax filing. As a result, there are a number of ways the agency determines which filings will warrant a closer review. To help filter out allegedly questionable returns, the agency often uses Compliance Programs.
Despite what may be believed in some circles, there is nothing inherently sinister about tax compliance audits. Indeed, being audited can be compared to a root canal or a colonoscopy, but it is supposed to be the federal government's way of ensuring that everyone is playing by the rules and that individuals and businesses are truthfully reporting their income.
Depreciation is one of the most common methods used by businesses to reduce their taxable income. However many do not understand the concept of accelerated depreciation. Additionally, they do not know how much money could be saved by using this method.
The federal income tax filing deadline is not for a few months, so dealing with the IRS may not be at the forefront for you in January, but your actions between now and then could subject you to civil or criminal penalties.
Before reading this post, you may think to yourself, "Who thinks about tax season during the fall?" The answer is that tax attorneys and accountants generally do. But the better answer is that you should think about it as well. Regardless of whether you are starting a new business or a new job, part of your exercises towards financial independence should include steps to reduce your tax obligation and to protect yourself against unexpected tax obligations; not only for the upcoming tax year, but also for future years.