How To Do Your Own Taxes

Filing your taxes each year is like running a race with hurdles and hoops to jump over and through with no clear idea of what prize will await at the end of the race. Sure it may be fun for some, but if you are like most people, it is a dreaded affair. At least there is the hope of a positive lump sum of money when you are done.

Doing your own taxes is much cheaper than going to a CPA and is probably worth the effort on your part should you not have a very complex return. When should you fork out the money and get help from a CPA?

1.      You have inherited a large sum of money. There is a complex set of rules that your CPA will know about when you receive a large gift or amount of money. It’s best to trust their advice in this situation.

2.      You are starting a small business. This is highly recommended when you start; then, if you feel comfortable, you can do your own taxes in the years to come. You want to get as much money as possible and flying solo when starting out is risky.

While getting your taxes done by a professional has gotten cheaper over the years, it still is not fun paying someone before the possibility of paying more back to the state and federal governments. You will find that it may include a little painful stretching as you venture to do your own taxes this year, but it will be cheaper, and you will feel satisfied with the new skills you have learned.

The most common concern with doing your own taxes is that you will not get as much back from Uncle Sam than if you went through someone like H&R Block. TurboTax guarantees you will get the maximum amount by using their software. And they have boiled down the complex federal tax system to simple, easy steps. Pricing on TurboTax software packages range from the simple filer for free to someone that owns a corporation. Even so, it will be cheaper than having a professional do it for you. The good thing about TurboTax is that it makes it simple enough for the amateur.

Even though the price is cheap and the process is simple, there are a couple things outside of TurboTax to remember.

1.      Keep track of all of your employers, investments, retirement accounts, charitable donations, and other income before you start. This will help you not miss out on potential returns and will help you miss out on penalties.

2.      Organize. The better you keep things together, the easier the process will be.  After you have written down a list of all accounts and income, follow up with employers or fund managers that you have not received anything from. Once things are put together it involves following easy steps that TurboTax provides.

About the author: Gunter Jameson writes about minimalism, pell grants, and anything else that interests him.

Taxes: How To Obtain Information You May Need

When filing their 2011 taxes a taxpayer may need to look at their past tax return for a vital piece of information.   This information is available from the Internal Revenue Service.   When attempting to obtain this information there are certain criteria you must know.

  1. The IRS offers three ways to obtain this information.   You may ask for it in a written letter, search for it online or you may call them by phone.  You can also obtain forms to file your 2011 taxes through these options.
  2. This is a free service for a transcript and records are available from the IRS from as far back as the last three previous years.
  3. This transcript will only be for the original tax form filed with any attachments that were included.  If you filed a corrected return this will not show on the transcript.
  4. You can request a tax account transcript that will reflect any changes made after the initial filing.  These transcripts will reflect personal information, schedule of tax return and your adjusted gross income.
  5. This information can be obtained by logging on to www.IRS.gov.  On the left side of the webpage under online services you will find a tool  a link called Order Tax Return or Account Transcript or if you prefer to call the toll free number is 800-908-9946.  You will receive a voice prompt that will guide you to what you need.   These options take about 5-10 business days to receive your transcripts.
  6. If you like doing everything in writing and have time to wait 30 days for this transcript you can request the forms by mail.  You will need to use Forms 4506T or 4506T-EZ to order by mail.
  7. To receive copies of returns older than 3 years old, you will need to complete the Form 4506 and mail it with $57 to the Internal Revenue Service listed or your area.  It is recommended that you allow 60 days to receive these returns.
  8. You can obtain the printable forms you need to request a transcript at the IRS’ website or call and request them from 800-TAX-FORM.

The Internal Revenue Service has made obtaining copies of your tax returns easy by following these suggestions.   If you need a past tax return for information requested on your 2011 taxes, everything you need is available and easily obtainable through three simple options.

Why Everyone Should Use IRS Efile

E-filing the fastest way and easiest way to submit a tax return. Everyone is doing it. 99 million people in 2010 transmitted their tax returns electronically to the Internal Revenue Service. These 70% of the taxpayers know everyone should use this fast, easy service.

Starting in 2011 both the people who pay taxes and those who prepare taxes will see an important change. As of January 1, 2011 people who are paid to process 1040s must be qualified to submit these returns by e-file. Volunteers are exempt. Anyone requiring more information can find it at the IRS website.

Taxpayers should try electronic filing. Fewer people mail their tax returns or prepare paper 1040s every year for a good reason.

Electronic filing is safer and protected. Within two days the IRS notifies the taxpayer the documents had been received. If there is an error, the 1040s returned for corrections.

E-filing= Quicker Money & More Ways To Get It

By combining e-filing and direct deposit, taxpayers can get their refund in as little as 10 days. Almost 75% of the returns have refunds. $2900 was the average amount overpaid.

Taxpayers can choose the option they want with e-filed returns. Those who file early can pick a withdrawal date up to April 15. Taxpayers can pay by a mailing a check with a voucher or by credit card.

E-file Gets It Done

There are three ways to e-file. Tax preparers can do it for their clients. Commercial software for preparing tax returns can automatically send it. A free tax preparation and filing service called Free File is available online. Or at the IRS website.

As the number of people preparing taxes on their own computers is growing, there are a number of software programs designed to assist. One of these is Free File which asks simple, clear questions and helps people navigate through complex issues by the answers provided. However the return is prepared, E-file is the way to go.

Tax Tips for Consultants

Finding the right tax tips for consultants can sometimes be the difference between success and failure. Taxes can be a painful and expensive part of doing business as an entrepreneur. The government will always get its portion, but knowing the rules and making the most of them can help reduce the amount that has to be paid when April rolls around.

Becoming aware of certain tax benefits can give consultants and other entrepreneurs the needed boost to finances. It is always a good idea to take some time to talk to a tax professional to be sure that all possible angles have been covered and all regulations have been meet when it comes to dealing with the tax code.

Top Tax Tips for Consultants

1. Working from home means a wide range of things to entrepreneurs. To make the most of tax deductions, it is important to set aside a space that is used for the business. Having a designated office space will allow the entrepreneur to deduct a portion of household expenses (including mortgage payments, electric bills, and even housekeeping) that is equal to the portion of the house dedicated to the business. Measure out the office space and get that figure, along with the total square footage of the home, to the accountant.

2. Technology can do more than help run a business. The cost of doing things in this day and age can also serve as major tax deductions for consultants. Internet service, cell phone connections and even television may all be candidates for tax deductions for consultants. The major issue is always whether or not the service, space or product is used mainly or in its entirety for the business. Personal use of an item or space will decrease the amount of the value that can be used towards a tax deduction.

3. Many work from home consultants choose the path in order to care for their children in the home. It can still be a benefit to deduct some expenses that might be associated with childcare. When a business person hires someone to work in the home to help care for the children in order to free up time to work, that employment can usually be deducted as a business expense. Even day camps, that go on while the parent is working, can be deducted in the same percentage as traditional childcare.

4. Equipment deductions and credits are still available for many businesses. Special exemptions have been made to allow small businesses to expand. The cost of expansion can be calculated into a tax credit when taxes are filed in the New Year. Equipment can also be deducted in full, or may have to be deducted over the life of the equipment (usually five to ten years). Keep in mind that the income from sales of equipment that has been used for deductions will count into the gross income of the business for the year that it sold.

5. Mileage costs can add up for consultants. Driving to meeting or even just to the post office can drive up the cost of doing business. Investing in a log that helps keep track of ever trip and any additional costs associated with the trip (like meals) will make it possible to use the mileage on tax forms that could result in large deductions for the business.

The more funding that a business can save through credits and deductions then the more potential earnings that may be discovered. Changing a few techniques can save big money for entrepreneurs. The right tax tips for consultants can be the difference between financial success and monetary ruin for a business.

Mark has been in personal finance for 4 years, he currently blogs about the best places to find an online insurance quotes.

Debt Write Off Services from Attorneys

turbotax

Debt is something that most consumers are familiar with.  If you have existing credit cards and loans, you are more than likely in more debt that you would prefer to be in.  When debt begins to grow and pile up, the need for debt write off services becomes more prevalent.  Many borrowers are finding themselves deeper in debt than they ever expected to be.  With piling interest an the ability to pay only the minimum payment on credit card bills, the thought of being debt-free seems impossible.  While debt relief will take time, money management and planning, it can be achieve with the help of debt settlement attorneys.  Understand the benefits of hiring an attorney before retaining services and committing to one specific firm.

Settlement attorneys specialize in working with creditors and negotiating debt for borrowers.  While they will work hand and hand with creditors and communicate on your behalf to lower balances and settle debt, these attorneys have your best interest in mind.  Creditors are more likely to settle debts when professional settlement representation is hired as the borrower is more likely to pay the settlement amount back.  Because the creditor can at least receive a percentage of the debt back in return for lowering the amount owed, they will agree on an amount that is reasonable.

Aside from lowering the balances of loans and credit cards in default, the attorney will also stop fees from accruing while you are settling debt.  The biggest reason borrowers are in debt is because it continues to pile monthly for over limit and late fees.  By eliminating these fees, you can target the principal rather than just the interest.  If you are serious about rebuilding your credit for a positive financial future, consult experienced attorneys and find one with a proven track record in the field of debt reduction.

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