Medical & Dental Expenses – 8 Things to Know

If you, your spouse or dependents had significant medical or dental costs in 2011, you may be able to deduct those expenses when you file your tax return.  Here are eight things the IRS wants you to know about medical and dental expenses and other benefits. [Read more…]

Child Tax Credit – 11 Key Points

Parents, guardians and other taxpayers who are eligible to claim a child as a dependent on their tax return may also be eligible for a federal tax credit of up to $1,000 per child.  The Child Tax Credit is one of serveral tax-related benefits for families and children.  Remember that a tax credit is different (and in most cases better) than a deduction.  The Child Tax Credit is available to “eligible taxpayers” with “qualifying children” under age 17.  Be aware that there are additional criteria and not all dependents will qualify.

Amount
With the Child Tax Credit, you may be able to reduce your federal income tax by up to $1,000 for each qualifying child under age 17.

Qualification
A qualifying child for this credit is someone who meets the qualifying criteria of seven tests: age, relationship, support, dependent, joint return, citizenship and residence.

Age Test:  To qualify, a child must have been under age 17 – age 16 or younger – at the end of 2011.

Relationship Test:  To claim a child for purposes of the Child Tax Credit, the child must be your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister or a descendant of any of these individuals, which includes your grandchild, niece or nephew. An adopted child is always treated as your own child. An adopted child includes [Read more…]

Safeguard Your Refund – Choose Direct Deposit

Direct deposit is the fastest, safest way to receive your tax refund. When a taxpayer combines e-file and direct deposit, the IRS will likely issue your refund in as few as 10 days.  Why choose direct deposit?

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Save Those 1099’s

It’s that time again!  Individuals and businesses throughout the United States have started receiving various tax-related documents.  This year it is very important to save all of these documents and forward them to your accountant.  Even if you are a corporation and don’t usually give the 1099s you receive to your accountant, you should do so this year.  Be on the lookout for a new form, Form 1099-K. [Read more…]

What if you are missing a W-2 ?

Make sure you have all the needed documents, including all your Forms W-2, before you file your 2011 tax return. You should receive an IRS Form W-2, Wage and Tax Statement, from each of your employers. Employers have until January 31, 2012 to issue your 2011 Form W-2 earnings statement.

If you haven’t received your W-2, follow these four steps: [Read more…]

April 17 Tax Deadline

Tax Tips for the Self-Employed

There are many benefits that come from being your own boss. If you work for yourself, as an independent contractor, or you carry on a trade or business as a sole proprietor, you are generally considered to be self-employed.

Here are six key points the IRS would like you to know about self-employment and self- employment taxes: [Read more…]

New Hire Retention Credit – FAQs

What is the new hire retention credit and what does it apply to?
This is a general business credit to encourage retention of new hires (retained workers). The employer may claim the credit for each retained worker. A retained worker is a qualified employee (as defined for purposes of the payroll tax exemption) who remains an employee for at least 52 consecutive weeks, and whose wages (as defined for income tax withholding purposes) for the last 26 weeks equal at least 80% of the wages for the first 26 weeks. The amount of the credit is the lesser of $1,000 or 6.2% of wages (as defined for income tax withholding purposes) paid by the employer to the retained worker during the 52 consecutive week period.  Here is a worksheet to aid you in providing information to us.

If an employer chooses to claim the WOTC for a qualified employee, can the employer still claim the new hire retention credit for that qualified employee?
Yes, an employer may claim the retention credit for a qualified employee even if the employer has also claimed the WOTC for the same employee. [Read more…]

Credit for Small Employer Health Insurance Premiums

Again for the 2011 tax year, the IRS is allowing up to a 35% tax credit to eligible small employers for health insurance premiums paid for employees.  Below is a general summary of who would qualify for this credit.  These are general requirements to let you know if you might possibly qualify and the specific requirements can be found in the attached instructions for Form 8941.

You are an eligible small employer for the tax year if you meet the following requirements: [Read more…]

Ten Tips to Help You Choose a Tax Preparer

Many people look for help from professionals when it’s time to file their tax return. If you use a paid tax preparer to file your return this year, the IRS urges you to choose that preparer wisely. Even if a return is prepared by someone else, the taxpayer is legally responsible for what’s on it. So, it’s very important to choose your tax preparer carefully.

This year, the IRS wants to remind taxpayers to use a preparer who will sign the returns they prepare and enter their required Preparer Tax Identification Number (PTIN).

Here are ten tips to keep in mind when choosing a tax return preparer: [Read more…]