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What Happens if You File Your Taxes Wrong?

What Happens if You File Your Taxes Wrong?

By on Apr 15, 2017 in Consultation | 0 comments

Taking your tax responsibilities as a United States taxpayer is something you shouldn’t take lightly. Major consequences have to be faced by those who do. Some are minimal and others are quite serious. The good news is that all of these consequences can be avoided! Success Tax Relief, is a tax relief firm that has been in the business of helping taxpayers get out of debt for over 30 years. We’ve managed several cases where improper tax filing was corrected with a smack on the hand to something far worse. Many people thinking they can keep more of their tax refund if they file their own taxes. However, many have discovered that they end up paying more because they prepared them improperly. Be Aware of the Tax Due Date! The Internal Revenue Service (IRS) gives you approximately three months to file your taxes. April 15 is usually the deadline, unless some federal event pushes the date forward. If such a thing happens, the IRS makes sure that the amended deadline is posted on their official website. The Success Tax Relief blog does a pretty good job of informing you too! At any rate, should you miss the deadline, you can expect to pay a late penalty. You’ll Pay a Late Payment Penalty Many taxpayers probably already know about the late filing penalty, but they might not know about the late payment penalty. Usually, when you file taxes, you’ve already taken care of how you’re going to pay if you owe and may have already supplied the IRS with your bank and routing number for a direct deposit. So, when you file your taxes, the IRS considers that you’ve already taken care of the payment. Therefore, if you have not filed your taxes on time, then the IRS has no choice but to believe that you haven’t taken care of your payment, because the filing determines this! This is why you’re penalized with a late payment fee on top of a late filing fee. You’ll Delay Your Tax Refund Filing your taxes wrong is going to result in delaying your refund. It also means that you might get audited. This is because if you file your taxes wrong, then the...

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What to Keep in Mind When Hiring a Tax Relief Service

What to Keep in Mind When Hiring a Tax Relief Service

By on Apr 11, 2017 in Consultation, Filing Taxes | 0 comments

  The only thing that might be holding you back from hiring a tax relief service is money. However, it can be argued that the lack thereof may be the reason you’re in the financial predicament today. At some point, you’re going to have to bite the bullet and ask for help. You’ll Spend Money to Save Money. Be OK with That Asking for financial help to handle your taxes isn’t anything to be ashamed of. You’ll find that you’ll be avoiding a world of unnecessary financial discomfort by investing in a tax relief service early on. What you need to come to terms with is that you will have to spend some money. You’ll just need to decide if that expense is going toward alleviating your tax debt or toward late payment of penalties and fines. Once you understand that it’s time to call in the professionals, then the next step is to research the firms that you are seriously considering. When conducting your research, here are the things that you need to keep in mind when hiring a tax relief service: Weigh the Pros and Cons of Having a Professional Handle Your Taxes While you can easily file your own taxes, it can easily get complicated quick, fast, and in a hurry. One lifestyle change, one error, launching a business, or closing one down can make all the difference in how your taxes are filed. A good tax relief firm will be able to handle such information and report it to the Internal Revenue Service (IRS) accordingly. Hire a Tax Relief Service with Proven Experience In any hiring process, the hirer will do the research to make sure that the services he or she is expecting will be delivered in a professional and timely manner. When it comes to a service, there’s really only one way to find out if the tax relief firm is the one for you—testimonials. Testimonials can be found on a company’s website. You can also ask around. If you want more insight, then contact the company that gave the testimonial. Testimonials and the longevity of a tax firm speaks volumes to a company’s success. Success Tax Relief has over 30 years of...

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I Have 2 Dependents…How Much Money Can I Expect On My Return?

I Have 2 Dependents…How Much Money Can I Expect On My Return?

By on Apr 5, 2017 in Consultation | 0 comments

For most of us, claiming a dependent on our annual tax return is fairly simple. Generally speaking, claiming a dependent means that we have a qualifying child that is related to you, lives with you, is under the age of 19 (or 24 if a student), and that you support financially. So, how much can you expect to see on your return for one dependent, or for two? The deduction for dependents can help you out a lot. Quite simply, claiming one or more dependents can lower your overall tax bill. This means more money left in your pocket and less paid to the Internal Revenue Service (IRS). Each year, the IRS sets the amount that you can deduct for a dependent. For 2016, you could claim a dependent exemption deduction of $4,050 for each child and other dependent. You should be aware that this does not mean that you will receive a refund of $4,050 for each dependent; this amount actually reduces the portion of your income that is subject to federal tax. If you are in the 15% bracket this may save you $607.50 for 2016, and at 25%, you can expect to save $1,1012.50. In summary, the higher your tax bracket, the more each dependency exemption saves you. These same rules remained in effect for the 2017 tax year as well, which is good news if you happen to be saddled with back taxes. However, they changed somewhat after that. While $4,050 was the value again in 2017, exemptions were replaced the next year by an increased standard deduction coupled with a larger child tax credit and a new dependent credit. See below for some more details about how these new credits work. Additional Tax Benefits for Those with Kids There are additional tax benefits that you might qualify for if you claim two dependents: Child Tax Credit The child tax credit might be even more beneficial to you (financially speaking) than the deduction for your dependents, because a tax credit actually reduces your taxes dollar for dollar.Under the Tax Cuts & Jobs Act (TCJA) the new tax credit rules effect the way the child credit works in 2018 and 2019. While the age cutoff stayed...

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Same-Sex Marriage & Filing Taxes: What You Need To Know

Same-Sex Marriage & Filing Taxes: What You Need To Know

By on Feb 28, 2017 in Consultation, Filing Taxes, Tax Preparation, Tax Tips | 0 comments

It used to be that same-sex couples could only file separate tax returns, and if they had children, only one of them could claim a child, and only one could file Head of Household. In a sense, same-sex couples had to live like they were roommates when it came to filing their annual taxes. They had to do this because they weren’t allowed to get married, because it wasn’t legal. This all changed in 2015 when the Supreme Court ruled on June 26 that same-sex marriage is now legal. After that, a surge of marriages was filed, but what some newlyweds didn’t bother to take into account is how to take care of their annual tax filings. It could be said that there may have been some confusion for the following tax year because depending on when you marry, you may either have to file separately or married filing jointly. The Supreme Court ruling requires that all legally married same sex couples are to file their annual taxes as married filing jointly or married filing separately, just like anyone else. The Good News and the Bad News It can be said that there is a slight disadvantage for some same-sex couples who must now combine their income. A larger annual household income will boost you into a higher tax bracket causing you to pay more in taxes. However, there is the benefit of what’s called the “marriage bonus”. According to Investopedia, the marriage bonus benefits couples who bring in more income than the other, therefore, have the advantage of not paying so much more in taxes. In fact, they might end up paying less depending on what the combined income is for that household. Two Ways to File As aforementioned, same-sex married couples can file two ways: married filing jointly and married filing separately. Married Filing Jointly – This may be the better way to file in order to get a tax break. If either of you are in school, you’ll be able to take advantage of the student loan interest or tuition deduction. If you file married filing separately, you will not be able to do this according to Investopedia. If a couple is adopting a child, then,...

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Things to Know About Claiming Your Boyfriend / Girlfriend As Dependent On Taxes

Things to Know About Claiming Your Boyfriend / Girlfriend As Dependent On Taxes

By on Feb 23, 2017 in Consultation, Filing Taxes, Tax Tips, Taxes | 0 comments

As you think about completing your tax return this year, you may be wondering if there are additional items that you might be able to deduct.  It is always helpful to think about things in your life that may have changed over the year that could have positive or negative tax implications.  If you had a child, went back to school, or purchased a house, you could claim new deductions or credits on your annual return. So, what if you are in a serious relationship in which your girlfriend or boyfriend lives with you?  Can you claim them as a dependent on your taxes?  This is actually possible in some instances, but as with most things related to taxes, you should be careful and make sure that you follow specific guidelines set by the Internal Revenue Service (IRS). Criteria for Claiming Your Significant Other This Year In order to legally claim your boyfriend or girlfriend as a dependent on your annual tax return, the following criteria must be met: Your significant other must have lived with you for the entire calendar year (January through December). Your boyfriend or girlfriend must make less than the annual limit that the IRS sets. You should note that this limit can change. In 2016, the limit is $4,050 and can include any income that is subject to tax. You need to have paid more than ½ of your partner’s living expenses for the entire tax year that you claim your boyfriend/girlfriend. This calculation can be tricky, so you should be aware that you have to account for funds that your significant other receives from other sources.  If he/she also received support from their parents and that support exceeded the support provided by you, then you cannot claim them as a dependent. Two other important factors to note: You cannot claim a married person as your dependent if they are also filing a joint return with their spouse. You cannot claim a boyfriend/girlfriend as a dependent in states where “cohabitation” is illegal. You should check with your state laws to be sure that your state does not have this law on the books. Finding Reliable Tax Support The IRS website has a calculator that...

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Should I Be Including Tips in My Tax Return?

Should I Be Including Tips in My Tax Return?

By on Feb 13, 2017 in Consultation | 0 comments

  If your tips are business-related, you certainly can include your tips in your annual tax filing. It’s all about you being honest and responsible about your expenses. As a business professional, the Internal Revenue Service (IRS) is trusting that you will be. If not, they may find out and audit your business. So in order to avoid sending the IRS a red flag and forcing them to look a little deeper into how you’ve conducted business for the past 3 to 6 years, Success Tax Relief, a tax relief firm in Texas, is providing you a list of useful ways you can legally write off your tips. For Entertainment Purposes The term “entertainment” can be pretty broad, so it’s important to understand what all that entails. For business purposes, entertainment is mainly related to meals, drinks and beverages needed for business meetings, conference expenses, etc. whether you’re traveling to attend one, or participating as an exhibitor, you can write off the tips involved with valet parking, food and beverage, bus boy and/or concierge services. Entertainment here can also relate to the tips related to taking a client out for a meal, or the accommodation of their room and board. If during that time the client tips, and your company has agreed to take care of the expenses, then you’ll be able to write off approximately 50% of those tips. Tipping When Traveling During business-related travels, you’ll find that you’re eating out more often or ordering room service. The chances of cooking your own meal in an efficiency hotel room will be pretty slim. And you have to eat! So when you’re eating out, especially for professionals, a tip is expected. In some restaurants, the gratuity is already included in the bill. So, you may be paying for a tip without even being aware of it. If you choose to add an additional tip on top of the included gratuity, then be sure to record that on your copy of the receipt so that the total amount of tips can be expensed. Mixing Business with Pleasure It’s not uncommon to socialize and visit old friends while on a business trip. Some professionals may even take their spouse and/or family...

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