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Haiti Donations in Early 2010 OK For Claiming On 2009 Returns

Posted by Administrator on Feb-1-2010

The IRS announced a new tax relief for people who contributed to providing earthquake relief in Haiti. It allows contributors to get the tax advantage of the donation for their 2009 claim rather than waiting a year for the benefit.

According to the irs.gov website, only cash contributions made after January 11, 2010 and before March 1, 2010 will qualify. All cash donations made after March 1, 2010 will only be eligible to be claimed for the 2010 tax year.

To gain the benefit, you must itemize your tax deductions using Schedule A. For more information, please visit the IRS website at irs.gov.

Nov
18

When Do You Need Your Taxes Done Professionally?

Posted by Administrator

The majority of people who file taxes each year can probably figure them out without too much difficulty. It takes some organization, basic math skills and patience, but it can be done. If you have the help of some tax preparation software, it can be made even simpler. However, if you are the nervous type of person, you might be asking yourself if you need to have a tax professional (usually a CPA) take a look at what you’ve done, just to ‘make sure.’  Unless you are related to an accountant, that’s going to cost you some cash.  In order to help you determine this question, the following is a list of situations in which you should ALWAYS have a qualified tax professional either do your taxes for you, or, at the very least, go over your final return before you file.

  • If your income exceeds 60-70,000 dollars a year, it’s a good idea to have a tax professional look at it to see if they can save you some money.  If you are making less than this, your taxes are already comparatively low, and the margin of additional savings you might get is fairly low.
  • If you run your own business, you should always, always, have your taxes done professionally.  Even if your not making money in your business yet, or currently. Even if you fall below the 60-70K guideline, business owners fall into a whole bunch of additional laws and loopholes. To make matters even more complicated, every state has tons of different rules and regulations that have to be followed and authorizations that have to be gained. You want to make sure you are doing this correctly from the get go, not only can it save you money, it can save you from jail-time.
  • If you are self-employed, there are lots of tax laws and tax breaks that could apply to your individual situation.  If you are self-employed and making most of your living that way, having a professional tax preparer on board can really save you money.
  • If you are in a divorce or anticipate divorce proceedings, it is essential to have your finances and taxes spic and span.  You need to have everything documented, ESPECIALLY if the divorce is not amicable.  Even if it is a ‘friendly’ divorce, having things documented and done correctly will simplify the proceedings. Every divorce is going to cost you money, and the more money you have, the more it’s likely to cost you. Having a tax professional on board is a good idea when dealing with all of the various legalities attendant upon a divorce.
  • If a spouse or parent dies and you are dealing with legal issues of their passing, especially when substantial amounts of inherited money (usually anything in excess of $25,000) are involved.
  • If you have an expensive hobby that takes a lot of time and money, (yachting, scuba diving, mountain climbing etc) a certified tax professional can advise you in ways to make that hobby as tax-friendly as possible, ultimately saving you dollars off of your bottom line tax amount
Dec
26

Choosing Someone to Prepare Your Taxes For You

Posted by Administrator

Nowadays, EVERYone wants to prepare your taxes for you. You see temporary kiosks in Wal-Marts, malls and just about any other large area where people shop. There are also Certified Public Accountants or CPAs that want you to hire them to organize your finances and pay your taxes for you. Websites bombard you with ads to buy or use their tax preparation software.

It helps to know what you are getting into and what to avoid. Here are some tips to help you make sure you aren’t a victim this tax season.

  • Check qualifications. Use your smart phone or wait and go home to look up the company name of the tax preparer you may be interested in. Find the small print on their website and read it. Also do searches online to see what other people are saying about them.
  • Find out what the real cost is. Sometimes fees are not mentioned at the beginning of the sale. These are known as hidden fees. Smoke them out!
  • Make sure you will be able to contact your tax preparer later on in case you have a problem, a question, or you are getting audited by the IRS. If you sign your info over to a tranger at a mall, how do you know you will be able to find that person again when their kiosk is gone in mid April?
  • Never sign a blank form. Some tax return preparers do not have your best interest in mind. Signing a blank return means that you are responsible for whatever they add to that signed form. This is just like signing something without reading it or handing a signed blank check to a stranger. Just don’t do it.
  • Make sure the tax preparer signs the form in front of you. They need to sign by law, so if they make a mistake and turn in your return without signing it themselves, your tax refund will be held up until the issue is resolved, which could take a very long time.

Aside from these tips, common sense will help you avoid pitfalls and help youget your refund faster. Remember that the info we provide to the IRS each year is very sensitive peronal information. Be sure you can trust the people you are signing this information over to.