The Tax Preparation Blog

Question: Is there somewhere I can go online to see how much my tax refund will be (Canada)?

I am not sure if I want to go to H&R block to get my income taxes done- or if I should do them myself… I am wondering how much money I am looking to get back so I can figure what H&R would deduct and if its even worth it for me…
I’m sure theres a place to go that does them for you free but doesnt let you print or file online… cant remember!!

Answer: Go to www.genutax.ca

From there you can download a free trial version and plug in all your numbers and get your results. But, you’re right, you can’t netfile or print it unless you buy the program.

I have been using this program for a few years now. I like it. It’s really easy to use and the best part is that they send me free updates each year.

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Some innocent advice

Innocent but not naive.

Canada Tax Free Savings Account

Question: I contracted as a limited company in the UK, now I have to file a personal tax return – help!!?

I contracted for 5 months (March 07 – July 07) and set myself up as a limited company to pay less tax. I used an accounting firm to sort this out for me. Now I have to file a tax return for the tax year 06/07 and I’m completely clueless as to how to do it. Do I include the limited company earnings? I assume it’s relatively straightforward for the months up to March when I started contracting, as I was in ‘normal’ employment up to then and have a P60 for the job I finished in February 06.

How do I disclose the income I earned from March 1 (date I started contracting) – April 5 (end of tax year)?

Answer: Hi,
The tax year in the uk runs from the 6th April to the 5th April the year after.

Therefore, for your 06-07 return, you will only be required to declare your earnings from when you started in March up until the 5th of April 2007.

Any income you earnt after that date would be declared in your tax return for 07-08 in a years time – and as you rightly said, your PAYE earnings will not be affected, the inland revenue will already have it on record that you were employed up until March.

If you use an accounting firm, they should be doing all the necessaries for you – all you will need to do is submit your receipts for any work-related expenses you have incurred.

Hope that helped – don’t forget that tax returns have to be filed by the end of January to avoid being fined!

Updated: Myanmar’s junta leaders “stupid” and “dumb”

In a latest diplomatic cables leaked by whistle-blowing site WikiLeaks, Singapore’s Minister Mentor Lee Kuan Yew was cited as calling Myanmar’s junta leaders “stupid and dense” and Taiwan’s former President Chen Shui Bian a “gambler” who was ready to “go for broke” on independence. The classified document relates to a confidential briefing on a 2007 conversation between Minister Mentor Lee Kuan …

Can I Claim A UK Tax Refund?

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I had just left our Scarsdale, N.Y., headquarters on a business trip a couple of years ago when an Internal Revenue Service collections officer named Celeste Green stormed in, waving a “Notice of Intent to Levy” and demanding that we pay the IRS $25,000 by the end of that month.

Question: If you are self employed and filing your taxes, how do you deduct one half of the self employment tax?

I have done a lot of research on self employment taxes, and have the following information from ehow.com: Instructions
STEP 1: Figure out your net income from self-employment. Net income is typically your total business receipts minus your total business deductions. STEP 2: Multiply your net income from self-employment by 0.9235 (or 92.35 percent). STEP 3: Multiply the amount of your net earnings that is $76,200 or less by 0.153 Add your two answers together. This is your self-employment tax. STEP 4: Report your self-employment tax on Schedule SE of the 1040. Tips & Warnings
You can deduct half of your self-employment tax in determining your adjusted gross income. Do this in the Adjustments section of the 1040.

My question is WHERE do I deduct the 1/2 of the self employment tax?

I will be working 40 hours a week at 8$ an hour. How can I figure out how much tax to take out of each pay check?

Answer: On the first page of the Form 1040 you enter 1/2 of the SE Tax computed from Schedule SE. For 2006 this is Line 27.

Here is the 2006 Form 1040:

http://www.irs.gov/pub/irs-pdf/f1040.pdf

I don’t understand the second question about working 40 hrs/week for $8/hr. That doesn’t sound like self-employment. If you are employed, fill out a W-4 at work. If you are self-employed, at this level of income, I would just settle up what you owe when you file your taxes and not send in estimated tax the first year you are in business.

The second year, if you anticipate owing tax in excess of $1,000 mail in quarterly estimated tax payments. You can print the vouchers at irs.gov.

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Instructions for schedule A, itemized deductions (SuDoc T 22.51:1040/SCH.A-B/INST./) …

Instructions for household employers (SuDoc T 22.51:1040/SCH.H/W-2/W-3/INST./) …

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Taxes can squeeze you financially, but these tips for 2011 will put some money in your pocket.

US Income Tax Form 1040 Overview

Question: Any advice on becoming a seasonal tax preparer by taking Liberty’s or HR Block’s classes?

Do you learn enough in the tax prep course to be offered a seasonal position? Is being a tax preparer stressful? Any helpful comments/advice would be appreciated from experienced tax preparers.

Answer: Block’s classes are great and Jackson Hewitt is not bad too. I would consider them before Liberty. Make sure you take the standard delivery course where there is an instructor to teach the class. Do not take the online course.

The most stressful time would be the first few weeks of the tax season because of the volume. After that, it’s slower so you have more time for each customer.

For me, Jackson Hewitt works better for me because they offered more hours than when I worked at Block. And the location is closer to my house.

Liberty Tax Service Faces Class Action Lawsuit

Columbia, SC (WLTX) – A widely used tax filing company is the being sued for allegedly falsifying documents and ripping of the Internal Revenue Service, as well as their clients along the way.

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