IRS Letters: Tax Scam or Something You Need to Address

IRS Letters: Tax Scam or Something You Need to Address?

Your taxes contain an array of sensitive information, from financial data to your Social Security number or tax ID number. Because of this, there are many scams that unsavory characters attempt to perpetrate by impersonating the IRS or another tax authority. It can be difficult to tell when the IRS is really seeking information versus when you may be the target of a scam.

To help you determine whether the letter you received is a scam or something you need to address, consider the following tips and information.

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The Best Approach to Paying off Your Debt Quickly? It’s Unique to You

The Best Approach to Paying off Your Debt Quickly? It’s Unique to You

If you asked 10 different people how they were able to get out from under their debts as quickly as possible, you’d probably get 10 different answers.

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Congress Removes IRA Contribution Age Restriction

Congress Removes IRA Contribution Age Restriction

On December 20, 2019, President Trump signed into law the Appropriations Act of 2020, which included a number of tax law changes, including retroactively extending certain tax provisions that expired after 2017 or were about to expire, a number of retirement and IRA plan modifications, and other changes that will impact a large portion of U.S. taxpayers as a whole. This article is one of a series of articles dealing with those changes and how they may affect you.

In the past, unlike Roth IRAs, which have no age restriction associated with making a contribution, taxpayers were unable to make a traditional IRA contribution in and after the year they reached the age of 70½. This is primarily because a Roth IRA contribution is not tax deductible, while a traditional IRA is, unless it is phased out for higher income taxpayers.

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5 Things You Need to Know About Sales Taxes in QuickBooks Online

5 Things You Need to Know About Sales Taxes in QuickBooks Online

The most important thing you need to know about sales tax is that administering it correctly can be challenging.

If you sold only one type of product to customers in one city, collecting and paying sales tax would be easy. But most businesses have a wider reach than that.

QuickBooks Online offers tools that allow you to set up sales tax rates and include sales tax on sales forms. Further, it calculates how much you must pay to state and local taxing agencies.

This is one of the most complicated areas in QuickBooks Online because you may have to deal with numerous taxing agencies. If you’re not already working with sales taxes, we strongly recommend you let us help you get everything set up correctly from the start. Taxing agencies can audit your recordkeeping and you want to make sure it is set up correctly.

That said, here are five things we think you should know.

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New Twist for Kiddie Tax with a Refund Opportunity

New Twist for Kiddie Tax with a Refund Opportunity

On December 20, 2019, President Trump signed into law the Appropriations Act of 2020, which included a number of tax law changes, including retroactively extending certain tax provisions that expired after 2017 or were about to expire, a number of retirement and IRA plan modifications, and other changes that will, as a whole, impact a large portion of U.S. taxpayers. This article is one of a series of articles dealing with those changes and how they may affect you.

Your dependent child who worked during the year or had investment income, such as interest or dividends, may be required to file a tax return, depending upon the type and amount of the income. Years ago, to prevent parents from putting their investments in their children’s names to avoid or significantly reduce the tax on their investment income, Congress passed what is commonly referred to as the kiddie tax. The kiddie tax taxes children’s income in excess of a small allowance at the parent’s top tax rate.

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Childbirth and Adoption Penalty Exception Added

Childbirth and Adoption Penalty Exception Added

On December 20, 2019, President Trump signed into law the Appropriations Act of 2020, which included a number of tax law changes, including retroactively extending certain tax provisions that expired after 2017 or were about to expire, a number of retirement and IRA plan modifications, and other changes that will impact a large portion of U.S. taxpayers as a whole. This article is one of a series of articles dealing with those changes and how they may affect you.

If you are looking for cash for a specific purpose, your retirement savings may be a tempting source. However, if you are under age 59½ and plan to withdraw money from a traditional IRA or qualified retirement account, then you will likely pay both income tax and a 10% early-distribution tax (also referred to as a penalty) on any previously untaxed money that you take out. Withdrawals you make from a SIMPLE IRA before age 59½ and during the two-year rollover-restriction period after establishing the SIMPLE IRA may be subject to a 25% additional early-distribution tax, instead of the normal 10%. The two-year period is measured from the first day when contributions are deposited. These penalties are just what you’d pay on your federal return; your state may also charge an early-withdrawal penalty in addition to the regular state income tax.

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Did You Pay Tax on Home Mortgage Debt Relief in 2018? You May Be Entitled to a Refund

Did You Pay Tax on Home Mortgage Debt Relief in 2018? You May Be Entitled to a Refund

On December 20, 2019, President Trump signed into law the Appropriations Act of 2020, which included a number of tax law changes, including retroactively extending certain tax provisions that expired after 2017 or were about to expire, a number of retirement and IRA plan modifications, and other changes that will impact a large portion of U.S. taxpayers as a whole. This article is one of a series of articles dealing with those changes and how they may affect you.

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February 2020 Individual Due Dates

Don’t miss these February due dates!

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Mortgage Insurance Premium Deduction Retroactively Extended

Mortgage Insurance Premium Deduction Retroactively Extended

On December 20, 2019, President Trump signed into law the Appropriations Act of 2020, which included a number of tax law changes, including retroactively extending certain tax provisions that expired after 2017 or were about to expire, a number of retirement and IRA plan modifications, and other changes that will impact a large portion of U.S. taxpayers as a whole. This article is one of a series of articles dealing with those changes and how they may affect you.

For tax years 2007 through 2017, when taxpayers itemized deductions, they could deduct the cost of premiums for mortgage insurance on a qualified personal residence as home mortgage interest.

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Will Independent Contractors Become Extinct?

Will Independent Contractors Become Extinct?

The California legislature recently passed landmark labor legislation that essentially makes it very difficult, if not impossible, for a worker to be classified as an independent contractor (self-employed). Governor Newsom was quick to sign it into law, and it generally became effective on January 1, 2020. Many believe this legislation will suppress entrepreneurship and innovation.

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