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Tax Laws

Understanding Tax Laws in Houston, Texas

Understanding Tax Laws in Houston, Texas

By on Aug 26, 2013 in Tax Laws | 0 comments

Understanding tax laws can be complicated and take time as well as require some patience.  There are complicated rules and regulations that must be followed, but there are some very basic principles of our tax system that will help you make sense of these complex guidelines. Taxes are in place to help pay for things we all use everyday like roads, our military, national parks, and hospitals. Everyone in the US is required to pay taxes.  The amount of taxes you pay is based on your income.  The more you earn, the more you pay. For most people, taxes are withheld from your paycheck every month, so you actually pay your taxes throughout the year.  At the end of the year, you essentially are asked to complete a calculation to determine whether you have paid too much over the course of the year or too little.  This determines whether you receive a refund at the end of the year or must pay your outstanding balance.  This is due to the government by April 15th each year. You are legally responsible to submit a tax return every year.  The IRS can take legal action against you if you do not file and/or submit inaccurate information on your tax return. Tax Resources There are many valuable and reputable online resources that you can consult for specific questions you might have about your taxes.  The IRS website has an extensive amount of important information and is easily accessible.  This website offers links to important tax forms, information on current topics, links to respond to inquiries made by the IRS and resources for the Spanish speaking community.  In addition, you can check on the status of your annual return (or refund) via the IRS website (by clicking “Where’s My Refund?”). Your employer can also provide you with very important tax information including your W-2, your withholding status, your pay stubs, and retirement information. Tax firms can be a critical part of the tax preparation process. Tax firms can handle a wide variety of tax issues including routine tax preparation, settling back taxes, audit appeal and representation, offers in compromise and installment plans, and helping customers fight liens, levies and wage garnishments. Success Tax...

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5 Facts on Late Tax Filing and Late Payment Penalties

5 Facts on Late Tax Filing and Late Payment Penalties

By on Jul 15, 2013 in Tax Laws | 0 comments

Most people met the April 15 deadline for filing their income tax return and paying taxes that they owed. However, you may be one of the individuals unable to meet this commitment. You may not have been able to find your records and time has just slipped away, or perhaps you no longer have a partner who did the paperwork for the family. In these and other scenarios you may fear dealing with the IRS on your own, especially if you think you may owe some money. The law The action the IRS may take as part of their legal obligation includes issuing penalties you may have to pay for failing to file as well as for not meeting tax payment due dates. Five facts There are several main things to remember as part of these penalties that can assist you with decisions on moving forward. Reducing the overall cost It is better for you to file on time without including your tax payment than not filing at all. The fee for not filing is usually more than the one for failing to pay.  Also, extra interest and penalties can be reduced through payment of as much as you can with the return. Perhaps a loan will help you out or looking at a payment installment agreement. How the penalty is calculated for filing late An amount of 5 per cent of the unpaid taxes is normally the penalty for each month or part thereof for late tax returns. This amount begins accruing one day after the due date for tax filing and will not go higher than 25 per cent of taxes you have not paid. How the penalty is calculated for paying taxes late You usually receive a failure-to-pay penalty of half of 1 percent of your unpaid taxes if you do not meet the deadline for your tax payments. This amount begins accruing one day after the due date for tax filing and applies to the number of days. Benefits of an extension of time done in time If you request an extension of time within the offered period and you pay at least 90 percent of the taxes you owe with it, you may avoid...

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