The Tax Preparation Blog

Posts Tagged ‘irs’

Q1Medicare.com Provides Answers to the Top Medicare Part D $250 Donut Hole Rebate Questions

Seniors and other Medicare beneficiaries reaching the 2010 Medicare Part D Doughnut Hole will automatically receive a $250 rebate check as part of the Affordable Care Act. The $250 rebate is a one-time, tax-free payment that will be sent to beneficiaries reaching the Coverage Gap phase of their Medicare Part D prescription drug plan. The rebate is not available to anyone who is receiving …

Question: Should I amend my FEDERAL return to report the local income tax refund of $22.00?

My wife and I filed our 2006 Federal income tax returns two months ago. We recently filed our local income tax returns and got a unexpected $22.00 return that we had not reported on our Federal return. The local authority issued us a 1099-G that stated this income is being reported to the IRS for tax year 2006 (not 2007).

Should we go through the hassle of amending our 2006 returns for this small amount, or should we wait to see if the IRS sends us correspondence asking us to pay the tax on the $22.00?

Thanks,
Folks – the $22 says for tax year 2006. This is all for 2006, not 2005 or 2007.
We itemized our Federal returns and got back about $3,200.

Answer: If you just got the money in 2007 when you filed your local return, it sounds like they screwed up b issuing the 1099-G for tax year 2006 – it should have been 2007, and you should have gotten it in early 2008, not now. States are pretty good at understanding the rules, locals are sometimes but can be real confused, especially if it’s a small municipality. Did you ask them about that? Maybe they can correct it.

If they don’t correct it, then you should probably file an amended return itemizing only the net taxes paid, taking out the $22. Frankly at this point, I’d probably just let it go and see if I heard from the IRS. If early next year, you get yet another 1099-G from these same people, then claim it on your 2007 return.

Depending on your tax bracket, you’r talking a couple dollars here, $8 at most, so isn’t worth a lot of trouble to correct what is actually someone ELSE’s mistake.

Note that this answer is based more on practicality than on legality. The worst that would happen, though, is that you pay a few dollars extra in tax.

Legacy for One Billionaire: Death, but No Taxes

Dan L. Duncan, a soft-spoken farm boy who started with $10,000 and two propane trucks, and built a network of natural gas processing plants and pipelines that made him the richest person in Houston, died in late March of a brain hemorrhage at 77.

Tax Tips & Information : How to Revoke a Child Tax Deduction

Question: Does passing the Enrolled Agent Exam helped getting a job as a tax preparer in a CPA firm?

I am an entry level person when it comes to accounting and taxes.
I had only done 60 basic 1040s return with Schedule A, B, C, D, E. for a friend a while back ago.

Answer: The EA designation would help you.

Not sure you’d pass the test, though.

Sometimes hiring a tax preparer is best choice

Is preparing your own taxes getting to be more and more of a challenge? Are you thinking of hiring someone to do it for you? Are you wondering if it will be worth the cost?

Memphis attorney Vincent Perryman discusses Tax Preparation with Gus Wilson Part 1

Question: How do I add previous estimated quarterly payments (1040ez) while filing taxes via Turbo Tax Home & Business?

While I am doing my taxes using Turbo Tax (Home & Business online) how do I get it to factor in my previous estimated quarterly payments? It looks like the Federal Tax Due and MA Tax Due reflect the amount due before taking into account that I paid for previous quarters. Does it do it automatically? If not, where exactly do I input that info? Thanks!

Answer: Just follow the interview and it will ask you.

Senate Democrats plan on using recess to win back seniors

Leaders want members to hold town hall forums at senior centers to promote Wall Street reform and healthcare reform. Read more…

Self Employed Federal Tax Deduction Tips for 2009, 2010.mov

Question: Income Taxes?

I am Canadian so is anyone familiar with canadian rules regarding income taxes.

At my job I am classified as contract worker and am responsible for paying taxes at the end of the year. My commission for last year was over $35,000.00, which I was told 1 month ago that any inclome over that amount I should be charging gst and then paying the government a portion, well I had no idea about that and never collected any gst from my employer. Now when I do my taxes the gov’ will see that and wonder about the gst? Do I send the company a invoice for the gst and apply for the gst number, I’m freaked out and think this may put me in hot water with revenue canada? ANy idea on how all this works

Answer: You need to contact CRA about this. If you only provide labour for one employer, you are NOT a contract worker, you quite likely are an employee. That being the case, they need to deduct and pay tax from your cheques.

If you have other customers, then it is less likely you are an employee. If not, then you may be considered a contractor, a provider of services, and therefore have to register for GST. Contact the GST people (google it), they will explain the process.

Canadian home affordability falls

Owning a home in Canada has become more expensive – unless you live in Alberta – a report released by RBC Economics Research suggests.