2011 Taxes to 2024 Taxes

Category: QuickTax

  • Some Useful Tax Software Programs to File your Taxes Easily and Quickly

    Some Useful Tax Software Programs to File your Taxes Easily and Quickly

    If you want to file an income tax return and are wondering how to do your own taxes online then you can opt for e-tax filing which is a simple and easy way to file your taxes. With the convenience and comfort of your home, you can file IRS tax forms. Online tax preparation services bring ease and convenience to the people. Users do not need any prior experience of filing returns and they can complete income tax returns easily and quickly with the help of a tax software program.

    Day 093/365 – Tax Time Phat Cash! (Photo credit: Great Beyond)

    Turbo Tax:
    It is one of the most preferred e-tax filing software programs which is recommended for newbies, small business owners, heavy investors and multi-income filers. If you are a newbie and do not know how to do your taxes online then this software will be best suited for you. Here are some features of Turbo Tax software.

    Clean and intuitive interface.
    Logical flow of processes.
    Easy to comprehend learning resources for the beginners.
    Offers high-level of autonomy.
    Audit risk meter
    Latest military edition for Army officials

    H And R Block:
    It is an elite piece of software to file your taxes online. It has logical workflows and that will simplify the process of tax filing. The software is recommended for heavy investors and newbies. Here are its features.

    Section overviews containing useful information.
    Several pages having embedded links.
    Bookmarking system is well integrated.
    In-person and round the clock support.
    Latest print returns features.
    Useful form finding tool.

    TaxACT:
    This e-filing software is recommended for college students, deal seekers and DIY filers. Following are some of the important features of TaxACT:

    Import tax from the previous year feature.
    Lowest price.
    Stock assistance tools for entering stock information manually.
    Best quality and comprehensive learning resources.
    Mini-alerts.

    TaxSlayer:
    It is a well designed and one among the best e-filing tax software. Given below are its important features.

    Life events guide.
    Previous year comparison.
    Gives you choice to handle processes on the major sections like income tax deductions.
    Movement between sections for convenience of the users.

    So, stop running from pillar to post when you need to file your taxes and stop wondering how to do your own taxes online as you can easily do it with the help of several user-friendly e-filing software. By using this software you can file your tax returns quickly and easily even if you are a newbie and filing your tax for the first time.

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  • Rules for Charitable Contribution Deductions

    Charitable contributions made to qualified organizations through the year may help reduce your tax bill.  Many organizations give donors pertinent details about their tax-deductible donation including the amount that can actually be reported on your tax return.  The following tips may help ensure donation made will be beneficial on your taxes.

    • Make sure you report charitable contributions on the correct form. The IRS states that form 1040 must be used to itemize deductions using Schedule A.
    • Upon reporting the deduction, make sure it was made to a qualifying charitable organization.  Contributions reported shouldn’t be donations made to individual or political organizations.
    • There are rules to review if your contribution included a vehicle.  Clothing and other goods should be fair market value and in good condition in order for it to deductible.
    • Items received for making a contribution such as ball game tickets or services; deduct the amount that exceeds fair market value.
    • When reporting cash contributions, make sure you have proper documentation that proves the amount.  This may include bank statements, a correspondence from the organization or even paystubs if donations were made via payroll deduction.  A phone bill will suffice for text donations as long as it states the name of the organization, date of donation and the amount given.
    • Donations of $250 or more must have proper documentation such as a bank record or written notice from the qualifying organization.  You may need to report if you were given anything in exchange such as any gifts or services. Noncash donations of $500 or more should be reported on IRS Form 8283 (Noncash Charitable Contributions) and attached to your tax return.
    • If you donation was an item that valued over $5,000 an appraisal is required.  Obtain an appraisal from a qualified appraiser and report data on the IRS Form 8283 section B.

    Additional details can be reviewed in the IRS Publication 526: Charitable Contributions.  Information regarding property value can be review in IRS Publication 561: Determining the Value of Donated Property.  It is important to report contributions to the best of your knowledge with honesty.  The IRS may question donations made and contact you for proof.  If you are found to have provided false information on your federal income tax return, you may face penalties.  Contact a tax professional with questions or concerns about charitable contributions made.

    Andrew writes frequently about personal finance as well as issues effecting both consumers and small businesses, covering everything from credit cards to mortgages to how to setup an umbrella company.

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  • The Reverse Mortgage Disadvantages Are Whoppers

    There are many retirees out there who are in a world of hurt.  The economy has all but killed the American dream of retirement.  Trying to work until they are forced out, many seniors find that they just cannot survive on the pittance of a pension that they receive and social security is little more than a stipend.  For this reason, many of them are telling their heirs that there is no such thing as Santa Clause.  It is starve or sell the home.  There is another option, however, that many are considering, the reverse mortgage.

    Standing Toe To Toe

    The reverse mortgages pros and cons, when stood toe to toe, look at first to be quite lopsided.  It really appears that the pros far outweigh the reverse mortgage disadvantages… at first glance, that is.  When you really get a good look at the reverse mortgage disadvantages, however, you begin to realize that the pros are fluffed up to look bigger by agents and companies that want the business.

    A Bunch of Whoppers

    The reverse mortgages disadvantages are whoppers, even if there are only a few of them.  You have to have reached the age of 62 to receive the loan.  The interest is really big and there are huge up front fees involved.  The reverse mortgages pros and cons have to be scrutinized with a magnifying glass to see the details, but they are right there in black and white.  On the pros side of the coin, however, you do no have to repay the loan as long as you live in the house that you cherish so much.

    Better Than the Alternative

    The worst of the reverse mortgage disadvantages is that your children will never get to live in the home or benefit from its equity.  This is really sad if any of the children wanted to move into the place once you were gone.  The reverse mortgages pros and cons are hard to digest, but it is better than the hardships that are its alternative.

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  • Self Employment Tax Issues

    People often get so swept up in the first exciting year of starting their own business, going freelance or contracting that they forget some of the more mundane, but nevertheless important changes that self-employment will bring. Along with a renewed passion for your career and control over your own destiny and potentially far greater financial rewards, there are also a number of downsides and financial hurdles to setting out on your own.

    Self Employment Tax will be one of those hurdles. Self-Employment Tax is a tax that you were never required to pay as an employee, but essentially it is the self-employment version of the FICA (Federal Insurance Contributions Act) tax that is used to pay for social security and medicare and it comes out of your net earnings from your self employment. Back when you were employed by a company you probably never gave a moment’s thought to this payment because your employer would have been paying half of it, approximately 7.65% each. But now you are classified as self-employed, whether you are a sole proprietor or an independent contractor, you have to pay the full 15.3% levy yourself on your tax return. As long as you earn over $433 per annum, you must pay 15.3%. And once you reach $106,800 you then pay 2.9% for every dollar after that. The tax itself is split into two parts. Social Security receive 12.4% and Medicare receive 2.9%.

    So how do you know if you need to pay it? Basically, if you’re self-employed in any way, you pay the tax. It is levied on net earnings from your business. Whether you file a Schedule C (Profit or Loss from Business), a Schedule F or a Schedule E with income from a partnership then you’re required to file a Schedule SE and pay the tax. However, it relates to income from your job and earnings, not from investments so investment income is not subject to Self-Employment Tax. Rents and royalties, dividends, interest and capital gains are therefore not taxed.

    The next thing you need to consider is that when you were employed your employer would take care of paying this. Now the responsibility lies with you. Unfortunately going freelance means more paperwork and more responsibility. You need to calculate your Self-Employment tax on Schedule SE and enter this figure into the “Other Taxes” section of the 1040 form. This is so the IRS can differentiate between income tax and the SE tax. You will need to make estimates quarterly on your tax obligation in April June, September and January and if you don’t pay or they aren’t enough you could face penalties and interest.

    There are, however, some ways to reduce Self – Employment tax. Firstly, you can charge your own business a rental charge for using your property. This income that you get from rent is not part of your self-employment and therefore is free from Self-Employment tax. Secondly, when calculating Self Employment tax you are permitted to reduce your income by 7.65% before you have to apply the tax rate. So if your net self-employed income is $100,ooo this is what you write on your 1040 for income tax. But on your Schedule SE the taxable amount is $100,000 less $7650 which comes to 92,350. This saves paying 15.3% tax on $7650, making a saving of $1170.

    Author Byline:

    Alex Simmonds is a journalist and copywriter living in the UK. He can currently be found writing a daily blog on contracting and  home-working for The Bedouin Group., a contractor portal.

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