Archive for Dan Gordon

8 Facts On Late Filing And Payment Penalties

April 15 is the annual deadline for most people to file their federal income tax return and pay any taxes they owe. If, for whatever reason, you missed the deadline you may be assessed penalties for both failing to file a tax return and for failing to pay taxes they owe by the deadline. Here are eight important facts every taxpayer should know about penalties for filing or paying late:

1. Two penalties may apply. A failure-to-file penalty may apply if you did not file by the tax filing deadline. A failure-to-pay penalty may apply if you did not pay all of the taxes you owe by the tax filing deadline.

2. File even if you can’t pay. The failure-to-file penalty is generally more than the failure- Read More

Written by | Posted in Income Tax • Individual • IRS

8 Facts To Know If You Receive An IRS Letter

The IRS sends millions of letters and notices to taxpayers for a variety of reasons. Many of these letters and notices can be easily dealt with without having to call or visit an IRS office. Here are eight things you should know about if you receive a notice or letter from the IRS.

1. Don’t panic. There are a number of reasons why the IRS might send you a notice. Notices may request payment, notify you of account changes, or request additional information. A notice normally covers a very specific issue about your account or tax return. Most of the time, you can take care of a notice simply by responding to it.

2. Each letter and notice offer specific instructions on what action you need to take. Read More

Written by | Posted in Individual • IRS

Tax Implications of Retiring Overseas

Are you approaching retirement age and wondering where you can retire to make your retirement nest egg last longer? Retiring abroad may be the answer. But first, it’s important to look at the tax implications because not all retirement country destinations are created equal. Here’s what you need to know.

Taxes on Worldwide Income

Leaving the United States does not exempt U.S. citizens from their U.S. tax obligations. While some retirees may not owe any U.S. income tax while living abroad, they must still file a return annually with the IRS. This would be the case even if all of their assets were moved to a foreign country. The bottom line is that you may still be taxed on income Read More

Written by | Posted in Individual • International • Retirement

What To Do If You Haven’t Filed A Tax Return

Filing a past due return may not be as difficult as you think.

Taxpayers should file all tax returns that are due, regardless of whether full payment can be made with the return. Depending on an individual’s circumstances, a taxpayer filing late may qualify for a payment plan. It is important, however, to know that full payment of taxes upfront saves you money.

Here’s What to Do When Your Return Is Late

Gather Past Due Return Information

Gather return information and contact me via TaxConnections. You should bring any and all information related to income and deductions for the tax years for which a return is Read More

Written by | Posted in Income Tax • Individual • IRS • Tax Provision/Tax Reporting

Turn Your Vacation Into A Tax Deduction

Tim, who owns his own business, decided he wanted to take a two-week trip around the US. So he did–and was able to legally deduct every dime that he spent on his vacation. Here’s how he did it.

1. Make all your business appointments before you leave for your trip.

Most people believe that they can go on vacation and simply hand out their business cards in order to make the trip deductible.

Wrong.

You must have at least one business appointment before you leave in order to Read More

Written by | Posted in Tax Deductions

Your Taxes And The Affordable Care Act

Starting with this year’s filing season, taxpayers must report certain information related to health care coverage on their 2014 tax return when they file this April. In addition, taxpayers must provide proof of health insurance coverage or that they have received an exemption.

With that in mind, let’s take a look at how the Affordable Care Act might affect your tax situation, and based on your type of coverage, which new tax forms you might be receiving.

Tip: For additional information about IRS tax forms related to health care insurance, please see the article, Health Care Law: Changes to IRS Tax Forms, below.

Overview

Read More

Written by | Posted in Affordable Healthcare Act

Penalty Relief: Overpayment of ACA Tax Credits

Beginning in 2014, an eligible individual or family member covered under a qualified health plan through a Health Insurance Marketplace (Exchange) is allowed a premium tax credit.

The premium tax credit offsets the cost of premiums paid for healthcare coverage in a qualified health plan. It is unusual in that taxpayers are able to take advantage of the credit in advance of filing an income tax return for the taxable year of coverage.

Advance credit payments are made directly to the insurance provider. The amount of the advance credit payments is determined when an individual enrolls in a qualified health plan through an Exchange and is based on projected household income and family Read More

Written by | Posted in Affordable Healthcare Act

What You Should Know About The AMT

Even if you’ve never paid Alternative Minimum Tax (AMT), before, you should not ignore this tax. Why? Because your tax situation might have changed and this might be the year that you need to pay AMT. AMT attempts to ensure that taxpayers who claim certain tax benefits pay a minimum amount of tax. You may have to pay this tax if your income is above a certain amount.

Here’s what you should know about the AMT:

1. When AMT applies. Your filing status and income determine the amount of your exemption. You may have to pay the AMT if your taxable income, plus certain adjustments, is more than your exemption amount. In most cases, if your income is below this amount, Read More

Written by | Posted in Individual

Can You Take the Earned Income Tax Credit?

Since 1975, the Earned Income Tax Credit has helped workers with low and moderate incomes get a tax break each year. Four out of five eligible workers claim EITC. Wondering if you can too? Here’s what you should know about this valuable credit:

1. Review your eligibility. If you worked and earned under $52,427 in 2014, you may qualify for the EITC. If your financial or family situation has changed, you should review the EITC eligibility rules because you might qualify for the EITC this year even if you didn’t in the past. If you qualify for the EITC you must file a federal income tax return and claim the credit to get it. This is true even if you are not otherwise required to file a tax return.

2. Know the rules. Before you claim the EITC, you need to understand the rules to be sure Read More

Written by | Posted in Income Tax • Individual

Health Care Law: Changes to IRS Tax Forms

This year, there are some changes to tax forms related to the Affordable Care Act. Along with several new lines on existing forms, there are also two new forms that need to be included with some tax returns.

While most taxpayers simply need to check a box on their tax return to indicate they had health coverage for all of 2014, there are new lines on Forms 1040, 1040A, and 1040EZ related to the health care law. Information about the new forms and updates to existing forms is summarized below

Form 8965, Health Coverage Exemptions

Complete this form to report a Marketplace-granted coverage exemption or claim an Read More

Written by | Posted in Affordable Healthcare Act • Income Tax • Individual • IRS

5 Ways to Improve Your Financial Situation

If you are having trouble paying your debts, it is important to take action sooner rather than later. Doing nothing leads to much larger problems in the future, whether it’s a bad credit record or bankruptcy resulting in the loss of assets and even your home. If you’re in financial trouble, then here are some steps to take to avoid financial ruin in the future.

If you’ve accumulated a large amount of debt and are having difficulty paying your bills each month, now is the time to take action–before the bill collectors start calling.

1. Review each debt. Make sure that the debt creditors claim you owe is really what you owe and that the amount is correct. If you dispute a debt, first contact the creditor directly to resolve your questions. If you still have questions about the debt, contact your state or Read More

Written by | Posted in Individual

Taxpayer Beware: IRS Impersonation Phone Scams

IRS impersonation phone scams, as well as phishing continue to be a serious threat to taxpayers topping the list of the IRS “Dirty Dozen” tax schemes once again.

The IRS impersonation phone scam has claimed nearly 3,000 victims who have collectively paid over $14 million, the Treasury Inspector General for Tax Administration recently warned.

Phishing email scams continue to be pervasive as well. Illegal scams such as these can lead to significant penalties and interest and possible criminal prosecution. IRS Criminal Investigation works closely with the Department of Justice (DOJ) to shutdown scams and prosecute the criminals behind them. Read More

Written by | Posted in Individual • IRS
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