How My Tax Preparer Has Benefited Me

The Consequences Of Not Filing Taxes

Posted by on May 3rd, 2016 in Uncategorized | Comments Off on The Consequences Of Not Filing Taxes

Let’s face it: no one likes to file their taxes each year, even if they’re owed a refund. The process can be daunting and it can take a long time to gather information and enter it into tax software or make an appointment with your accountant. But for those who have years of unfiled tax returns, the IRS can hit you with some serious penalties. Here are some of the very real consequences you may face if you have not filed your annual tax return for one year or even many years. Penalties And Interest The IRS expects every citizen to file their taxes each year. If you fail to do so, you’ll be hit with some stiff penalties once you finally do file if the IRS determines that you owe. In most cases, the first step will be to take any income tax refunds due to you as part of repayment towards the balance owed. The IRS will also typically add predetermined, flat penalty fees on top of any interest charges on the balance. This amount will either come out of your refund when you do file, or the IRS can even garnish your wages if you fail to pay. For every year you don’t file, you can also be hit with interest that accumulates over time. The rate of interest owed on back taxes can vary but it’s typically determined based on the current federal interest rate. Forfeitures For people with years of unfiled returns, the IRS can take your refund and apply it to any taxes you owe. This means that even if you’ve finally filed taxes, the money you might be owed will go right back to the IRS to pay for any fees and penalties. Another serious implication of failing to file is a process known as the Federal Payment Levy Program. This means your hard-earned social security or other federal-related income could be partially forfeited in order to repay any money you owe. It’s recommended that you respond to any and all correspondence received from the IRS in a timely manner to avoid having money taken from you directly.  Tax Liens If you have not paid or filed owed taxes and you’re not responding to the IRS, they could impose a federal tax lien. In a nutshell, this means that the IRS now has the right to seize your property including your home or vehicles. In order to avoid this very serious repercussion, you’d have to prove that you’re currently suffering an economic hardship. To do that, you’ll have to provide the IRS with information regarding your current income and expenses so they can determine that you’re unable to pay for the taxes owed and seizing your property would result in an even more serious inability to maintain living expenses. Unfiled and unpaid taxes can also negatively affect your credit report and could even result in a summons. When it comes to filing taxes, it’s imperative that you do so each year to avoid these serious financial headaches....

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Background Checks: 4 Dos And Don’ts To Limit Your Liability

Posted by on Feb 19th, 2016 in Uncategorized | Comments Off on Background Checks: 4 Dos And Don’ts To Limit Your Liability

When it comes to hiring someone new for a position, background checks are critical. While many assume that this is a simple process, it really isn’t that straightforward. This is because one wrong move can open you up to liability, which is the last thing that you want. Here are a few dos and don’ts that will help keep you out of hot water: Do Make Sure That You Get Consent. Liability is always a risk when it comes to job applicants and background checks. Therefore, before trying to access any type of background information on an applicant, it is important to get his or her consent. Some specific types of information, such as credit checks, require that you get the applicant’s consent. Not only do you need the individual’s consent, but you must get it in writing. Usually, the best way to go about this is by having the applicant consent for any necessary checks when they fill out a job application. Do Remain Reasonable and Keep It Related to the Business. When it comes to conducting background checks, there are certain privacy laws that put a limit to just how deep into an applicant’s background you can go. Essentially, you only want to delve deep enough to find information that specifically pertains to the performance of the applicant and that is tied to the job. Otherwise, seeking and viewing the records could be seen as irrational, which could open you up to unnecessary liability. For example, if you are hiring a school bus driver, you will likely want to obtain driving and criminal records of the applicant. However, the same would not be true if you were simply hiring a dog walker. Don’t Discriminate or Fail to Communicate. If you require the background check of one particular applicant in order to help make a hiring decision, then you must require the background check of all applicants in order to make things fair. Otherwise, you could be seen as performing a discriminatory act, which opens you up to a lawsuit. Apart from conducting a check on one applicant and not another, you should also make sure that you check in with the applicant when you receive negative results before making a final decision. There may be a logical reason for the results which they can explain. Communication is key in any business transaction, so it is important that you give the applicant a chance to explain the situation. Don’t Forget to Follow the Laws. Each state varies when it comes to regulations and guidelines for conducting background checks. Therefore, it is important that you know the law. For example, in Texas, arrests and convictions of a criminal nature that are over seven years old cannot be part of a background check for positions that pay an annual salary of $75,000 or less. However, in a state like Vermont, there are no restrictions on how an applicant’s criminal record can be used. If you are unfamiliar with the laws regarding background checks in your state, you can consult with an attorney. Alternatively, you could opt to outsource all employment screening to a professional company like AccuChex who is familiar with all the laws and can handle the grunt work for you, which will leave you more time to actually...

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The Tax Differences Between A Traditional IRA And A Roth IRA

Posted by on Dec 9th, 2015 in Uncategorized | Comments Off on The Tax Differences Between A Traditional IRA And A Roth IRA

An individual retirement account is an effective vehicle to save for the future while also deferring income tax. The two most widely known types of IRAs are the traditional IRA and the Roth IRA. An individual planning to fund an IRA and defer income tax can benefit from contrasting the differences between a traditional IRA and a Roth IRA. There are a few similarities between the two account types. You must have earned income to fund either type of account. The annual contribution limit for either type of account for 2015 is generally $5,500. A noteworthy aspect of both IRA types is that you can also fund a separate IRA for a non-working spouse. The main differences in the two account types are in the timing of the tax benefits. Traditional IRA In a traditional IRA, you receive a current tax deduction for your contribution, up to the annual limit. The amount contributed to the account grows tax-free until withdrawn. When funds are eventually distributed from the account, the withdrawals are usually fully taxable. As a retiree, you may be in a lower tax bracket at that future time. Your earned income for the current year must be at least as much as the IRA deduction. The annual contribution limit is the full $5,500 if you are not covered by a retirement plan with your employer. If you are covered by an employer’s retirement plan, your deduction for a traditional IRA is reduced at higher income levels. Roth IRA In a Roth IRA, there is no tax deduction up front in the current year. As with a traditional IRA, earnings grow tax-free until eventually distributed. The distinct difference of a Roth IRA is that the entire withdrawal is generally tax-free, including the accumulated interest. Participation in an employer retirement plan has no effect on a Roth IRA, but Roth contributions are limited at higher income levels. If you are age 50 or older, you are allowed to contribute $6,500 to either type of IRA. An additional account of either type can be established for a non-working spouse if the working spouse earns more than the total contributed to both accounts. The IRA for a non-working spouse is a separate account since all IRAs are owned individually. You are not necessarily limited to one account type, but the annual contribution limit applies to IRA contributions in total. Contact a tax services specialist like RJ. Garner CPA & Associates, PLC) for more information about how individual retirement accounts affect your tax...

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Should You File For Bankruptcy To Stop Wage Garnishment?

Posted by on Aug 13th, 2015 in Uncategorized | Comments Off on Should You File For Bankruptcy To Stop Wage Garnishment?

Wage garnishment occurs when a creditor attends a court hearing in order to obtain a judgement against you. This judgement also gives them the right to force your employer to withhold a percentage of your salary to pay the debt that you owe. If you have received an order for wage garnishment, then you may be considering filing for bankruptcy to stop it, but is it a good idea? Here are some questions to ask yourself before making a final decision:      What is the amount of the debt? If the amount of your debt if low, such as around $500 – $1,000, then filing for bankruptcy might be a waste of time. Although having a percentage of your wages garnished can be stressful, if you can afford to pay a bankruptcy attorney, then you might want to simply pay off the debt instead. There is always the option of requesting that the filing fee be waived and choosing to represent yourself in the bankruptcy case, however, with so many new and complicated bankruptcy laws, you could make a mistake that could cause your case to go in the wrong direction. Do you have other debt? If you have a great deal of additional debt, then filing for bankruptcy might be the best option because you could stop the current garnishment, but other creditors might try garnishing your wages in the future. Bankruptcy can wipe out a majority of your debt and give you a fresh start. However, if you only have one or two outstanding bills but your credit report is otherwise blemish-free, then you may want to find another solution to your wage garnishment issue. How much of your salary is being garnished? While some states don’t allow wage garnishment at all, other states regulate the percentage that can be garnished. In some cases, up to 25% of your disposable income could be garnished. If a large percentage is being garnished from your paycheck and you’re unable to buy food or pay rent and utilities, then bankruptcy might be a viable option. It’s a good idea to consult with a bankruptcy attorney before making a final decision.  Wage garnishment can often lead to hardship and severe stress, especially in a person who is already struggling financially. However, there are ways to stop your wages from being garnished, and in some cases filing for bankruptcy is the best solution. In other situations, bankruptcy could cause more harm in the long-run, as it could lower your credit score significantly. In such a case, you might want to contact the creditor and attempt to work out an affordable payment plan. For further assistance, contact professionals, such as those from Horizon Tax...

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What Every Home Caregiver Should Know About Obtaining Tax Credits

Posted by on Jul 7th, 2015 in Uncategorized | Comments Off on What Every Home Caregiver Should Know About Obtaining Tax Credits

If you are an independent home caregiver then you know the importance of filing your own taxes and using the tax credits available through the government. Though there are a few that you may know about it, there are some that you may overlook. Before you decide to handle your taxes the same way as you have before, consider the things that every home caregiver should know about obtaining tax credits and having them processed properly. Discuss Your Career When you use a tax preparing service or an accountant, you likely go in with your paperwork and just have the rest taken care of by them. This can lead to overlooking an important tax credit that your tax preparer may know about, but may not think applies to you because they don’t have a solid understanding of what services you provide. Take a moment and schedule a consultation with your tax professional and discuss what it is you do, what you provide, and if you provide any equipment or supplies. A few minutes of explanation may lead to several credits when you file. Family or Clients There are several tax credits that may apply to you if you are a certified home health care provider and you are providing those services to a family member. If you have several clients, but you also have family members as clients, let your tax professional know. Your state may have some form of tax break for this that can be applied to your next taxes. Keep in mind, you may have to provide some form of supporting documentation in order to receive the proper credit and have it processed on your next tax year. Treatments and Services There are several treatments and services that may receive a break for both you and your client. Treatments that may fall under this include denture and other dental services as well as transportation fees for taking your clients back and forth to their appointment. If you aren’t certain if you will receive a business break for these services and other services you provide, contact your tax professional and discuss your options. If possible, break down your services further to determine everything you offer instead of just a general overview of service options. These are just three of the things every home caregiver should know about tax credit processing. When you have your tax credits worked out with your tax professional, allow them to work through them and process them. They can give you the final outcome, if you owe taxes, and if you have enough credits to break even with your home health business for the year....

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About Me

The wonderful world of taxes - not something anyone wants to have to deal with. Each year, new laws are introduced and old ones can expire. How do you know what you are doing with your taxes if you don't follow the changes being made each year? Do you run a business or are you a self-employed contractor? Everything can really complicate taxes, so you should seriously consider hiring a professional tax preparer to do your taxes each year. To learn how my tax preparer has benefited me over the past few years, visit my website. Hopefully, what you learn there will convince you of how well the money spent to pay for professional preparation is worth it.

August 2016
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