Thursday, January 31, 2013

Delay in Processing for Some

Heads Up
For those taxpayers who will be claiming the Education Credits (form 8863)...that's the American Opportunity Tax Credit or the Lifetime Learning Credit, your returns will not be processed until mid February (you can still file, but there will be a delay in processing). Please don't confuse this with the Tuition and Fees deduction...those taxpayers will be processed normally.

Friday, December 30, 2011

How much of my mortgage interest will I be able to deduct ?

The Question
 How can I guesstimate how much mortgage interest I will get back?

The Answer
You are going to receive an official end of year statement probably in two weeks or less. However, you can go to your November statement (if you didn't get a December statement yet), and look at your principal paid and then the interest paid (year to date). It may be on the back of your statement...and then of course, you can always call to get a verbal account. 
Great question Joyce...Thanks

Based on some limitations, not all interest will be 100% deductable.  Please check with your tax professional for a full answer to your tax scenario.

Friday, February 4, 2011

Money is tight for ya, ain't it ?

Have you built a repoir with your tax practitioner ?  Trust , we know that it's tough out there for you.  You want to have your tax return prepared as soon as you receive your W2(s), but you just don't have the funds.  Speak up !  Talk to your tax professional about financing, partial payments, credit card payments, and even a barter agreement....Look, I'll take quarters if that's all that you have. 
The quickest way to get a little money is to prepare your taxes and to get your refund.  Don't miss your filing deadline because you didn't have all the money at one time to prepare your taxes.

Always accurate and affordable tax preparation...always free efile and direct deposit.


Visit my other blog...Los Angeles Daily Photo...


Friday, January 21, 2011

Do you know that you have to report the tips that you receive ?

Do you know that all employees who receive tips have to report their tips to the IRS.  Tips are also considered to be income.  If in any month you receive more than $20 in tips from customers, tips added to credit cards, and any tips you receive under a tip splitting arrangement,  you must report your tips to your employer so your employer can withhold the proper federal income tax, social security tax, and Medicare tax.  Let me clarify something here.  If you make over $20 in tips, you must report it to your employer, however all tips must be reported to the IRS.

You must keep a daily log of all tips received. You employer is automatically going to allot tips received to all employees based on their income received.  If you turn in your figures for tips received, your employer will withhold the taxes and it will be reported on your W2.  When it's time to file your taxes, you will report your figures (in gross income) and not your employer's tip figures.

Keeping a daily log is important.  This shows due diligence in the event of an audit.  

Contact me for clarification on this topic or to ask any tax questions.
Now is the time to start your daily log for tax year 2011, if you haven't already.

Always accurate and affordable tax preparation.
Wanda E Green

Monday, November 29, 2010

Open that letter !

How many of you,  right now, have somewhere in your home, that (those) letter(s) that you received from the IRS (Internal Revenue Service) and have been to afraid to open ?
Open that letter !
Some of you know what that letter pertains to, and some of you have no idea.  Folks, for those of you that know that you have to file a tax return, and your letter is assessing a crazy looking tax bill...what you need to do is file a return for the year in question.  Understand that the IRS just knows that some employer or some entity has reported that they paid you money....and yes, the IRS wants their cut.  The IRS does not take into account any credits, that you are entitled to or any dependents you may have or in the case of the business owner any business expenses you may have a right to claim. This is where your tax practitioner comes into play.  He or she will prepare a tax return that encompasses any taxes paid, any credits, exemptions, write offs and always your standard deduction...this will bring you to your actual tax liability if there is one at all.
Speculating that you are working with past year returns...make sure that you SIGN YOUR RETURN, before you send it in.
Many folks receive letters just because they haven't signed their tax return.
All letters received from the IRS will have the department that it is coming from and a phone number to call.

Here is an important fact; if you have a tax liability after preparing a tax return and you are sending that return in late, you will be assessed a penalty for not sending your return in on time by tax day.

Please look at all correspondence that you receive from the IRS. Receiving a letter from the Internal Revenue Service doesn't always mean that one is in some kind of trouble or that you owe money.

I offer free telephone consultations. call me with your questions.  If you need me to, I can call the IRS for you.
Always affordable and accurate tax preparation....always free e-file and direct deposit.

Wanda E Green

Thursday, March 18, 2010

Avoiding tax errors

The IRS has just sent out a directive (Tip 2010-52) that points out the following errors to avoid during this tax season. Any one of these errors may impede the processing of your tax return and delay the receipt of your refund.

Your tax professional should already be aware of the errors and should have already incorporated steps to ward off such errors. None the less we are human, and sometimes errors happen. If you are doing your taxes yourself, please be aware of the following common errors.

1) Incorrect or missing social security numbers. Because of e-filing, the missing social security number is usually never an issue. Without a ss # the return would never be allowed to be transmitted. With an incorrect ss#, the return can be submitted, but would result in a reject, and an additional fee for re-transmittal.

2) Incorrect or misspelling of dependent’s last name. You must review your tax return (if you can) before it is transmitted. If you are with your preparer at the time of processing, they should be asking you to review your return, before the transmitt, or concluding of your appointment.

3) Filing status. Make sure the correct filing status has been used for your situation. You may fall into more than one status, but your preparer should use the filing staus that results in the best benefit for you.

4) Math errors. This usually happens when a preparer or tax payer are processing taxes by hand and not using a professional electronic system; none the less, a math error can and will delay your receipt of a refund if you are due one.

5) Computation errors. Same deal here. If you are manually processing your tax return, or your tax practitioner is, this could be a costly error. A computation error is when one looks at and uses the wrong figures from the tax table, W2s, EIC tables...or any documents, or tables used where figures need to be entered.

6) Incorrect bank account numbers for Direct Deposit. Make sure you and or your practioner are looking at your check while entering your bank account information (that's if the refund is to be deposited into your checking account). Your refund can be deposited into your savings account or money market as well. Transmitting the incorrect information will cause a reject by your banking institution, which delays the receipt of your refund.

7) Forgetting to sign and date the return. Any paper return must be signed by the taxpayers. In the case of married filing jointly, both spouses must sign.

8) Incorrect Adjusted Gross Income information. When an individual (taxpayer) transmits their own return (files electronically), they need to have a pin # (personal identification number), and inorder to sign electronically, you need to know your exact AGI (Adjusted Gross Income), from the prior tax year. This is done to ensure your identity.

9) Claiming the Making Work Pay Tax Credit.....This is the exact wording of the IRS...Taxpayers with earned income should claim the Making Work Pay Tax Credit by attaching a Schedule M, Making Work Pay and Government Retiree Credits to their 2009 Form 1040 or 1040 A. Taxpayers who file Form 1040-EZ will use the worksheet for Line 8 on the back of the 1040-EZ to figure their Making Work Pay Tax Credit. The credit is worth up to $400 for individuals and $800 for married couples filing jointly. Many people who worked during 2009 are slowing down the processing of their tax return by not properly claiming this credit.

As always....
Always affordable tax preparation, always free efile and direct deposit.
I look forward to being your tax professional.

Your questions are always welcomed.

Blessings Always
Wanda E Green (Uigei)

Tuesday, March 2, 2010

Advanced Earned Income Tax Credit

We've already gone over the "Earned Income Tax Credit" (EIC), but now we are going to go yet a step further. Most of us who qualify for the EIC receive it all at one time when we file our taxes. For many, they can qualify to get a portion of this credit during the year in their paychecks...hence the "advanced" in the name.

The first thing is to determine eligibility. You must be expecting to be eligible for EIC, and you must have a qualifying child*. Your earned income must be less than $35,535 (40,545 if you are married filing jointly). Your wages must be subject to federal income tax, social security tax, and medicare tax withholding.
*Qualifying children must meet age, residency, relationship, and joint return test.

If you are married filing jointly, both you and your spouse can receive the advanced credit with the proper document filing with your employers. All rules must still be met. You each would file a W-5 with your employer (HR), for the respective years that you want to receive the advance. If you have more than one employer, only give the W-5 to one employer. The certificate (W-5) is good for one tax year only. You must re-file a W-5 with your employer for each tax year that you want to receive the advance. you've filed, and you've started to receive a little extra with every paycheck; you must file a tax return to declare that you have received that money for that tax season. Your employer will include the advance amount on your W-2 in box 9. You must file a 1040, or a 1040 A....1040EZ is not allowed.

If at anytime during the year your situation changes in regards to household and children and you are no longer eligible to receive the AEIC (Advanced Earned Income Tax Credit), you must file another W-5 and check the appropriate box 1 and turn it in to your employer (HR).

I know this information will help many, many of you. Call for assistance if you need to.

I look forward to being your tax professional. Always affordable tax preparation, always free efile and direct deposit.

Blessings and Prosperity
Wanda E. Green (Uigei)