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Tax Preparation

Commonly Overlooked Deductions

Itemized Tax Deductions

If total itemized tax deductions are more than the standard deduction, it’s usually more beneficial to itemize. For most homeowners it is worthwhile to itemize deductions because they can deduct interest, real estate tax, and certain mortgage insurance premiums.
Here are some popular (and commonly overlooked) itemized deductions not related to home ownership:

  • Medical expenses — This includes expenses spent on doctors, hospitals and medicine, some other tax deductible items include health insurance premiums, prescription eyeglasses and contact lenses, hearing aids, medical transportation, equipment for disabled people, and nursing home expenses. Medical miles can also be deducted.
  • State and local income taxes — This category includes income tax and personal property tax.
  • Charitable contributions — These include cash and property such as new and used household goods and items, securities, and vehicles donated to qualified charitable organizations. Volunteer expenses and miles can also be deducted.
  • Casualty losses — If you suffered a loss because of theft, fire, storm damage or other casualty, you can deduct an unreimbursed loss if it is more than the sum of $100 and 10% of your adjusted gross income.
  • Unreimbursed out-of-pocket job expenses — Tax-deductible expenses include vehicle expenses (other than commuting), travel expenses, uniforms, union dues and continuing education expenses.
  • Miscellaneous expenses — Safe-deposit box fees, investment expenses, tax preparation fees and certain legal fees are examples of miscellaneous tax deductions. The tax deduction for this category of expenses is allowed only for the total of these expenses and unreimbursed job expenses that is more than 2% of your adjusted gross income. Note: There are a few miscellaneous tax deductions that are not subject to the 2% floor. These include repayments of amounts exceeding $3,000 that you previously included in your income, gambling losses, estate tax on income in respect of a decedent, and a decedent’s investment in a pension. Continue reading

The CEO Discusses The New Tax Preparer Requirements

The IRS is working hard to protect the Taxpayer from issues that exist with non qualified tax preparers, tax fraud and erroneous tax returns that have increased over the last decade. We hear often in the news reports of tax preparers knowingly reporting fraudulent tax information to boost refunds, sometimes taking a kickback for the service. Our company and staff pride ourselves on providing tax and accounting services with the client in mind. Our goal is to also protect and provide top notch service to each client and assist with any tax issues that may exist. We take full responsibility for what is reported on the tax return, and we sign each return.

We are also complying with the new requirements that include passing examinations testing our knowledge of the tax laws, attending trainings each year provided by the IRS and working diligently to stay abreast of tax issues, and changes that affect our clients. We have listed below the tips provided by The Internal Revenue Service to assist in your search for a tax preparer. Continue reading

What to look for in a good tax preparer

If you pay someone to prepare your taxes, choose that preparer wisely because in the long run the Taxpayer (you) are held responsible for what is reported on the tax return, regardless if it was prepared by someone else.

Most preparers are professional, work with integrity, and provide excellent service to their clients.

The following are a few tips on what to expect when someone else prepares your return

Paid preparers are required by law to sign the return and fill in the preparer areas of the form.

The preparer should also provide their indentifying number (PTIN or SSN) on the return.

The preparer must provide a copy of the return to you for your records.

Review! Review! The completed return to ensure all tax information, your name, address, and social security number(s) are correct. Make sure none of these fields are left blank.

Also review and ensure you understand the entries and are comfortable with the accuracy of the return BEFORE you sign it.

Never sign a blank return, and never sign in pencil.

Continue reading

What To Bring To Your Tax Appointment

Documents You Should Bring To Your Tax Appointment

To assist your tax preparer in preparing the most accurate return, we have listed below information/forms that are required to be reported if applicable.

  • Social Security Card(s)
  • Driver’s License(s)
  • Dependents’ Social Security Numbers & Dates of Birth
  • Last Year’s Federal and State Tax Returns
  • Wage Statements (W-2)
  • Pension or Retirement Income  (1099-R)
  • Interest and Dividend Income  (1099- INT/DIV)
  • State Income Tax Refund Amount  (1099-G)
  • Social Security Income (SSA)
  • Unemployment Income (1099-G)
  • Commissions Received/Paid (1099-Misc)
  • Sales of Stocks or Bonds (1099-B)
  • Self-Employed Business Income & Expenses
  • Income and Expenses from Rentals
  • Lottery or Gambling Winnings and Losses
  • Income from Partnerships, S Corporations, Trusts, and Estates
  • IRA Contributions
  • Alimony Paid or Received Continue reading

Making Electronic Tax Payments

This information was provided by Levyloophole.com

There are a variety of ways to pay your taxes.

You can pay by:

  • Check, money order, and credit card, or
  • Direct debit from your checking account, which you can do by phone on online, using the IRS’s Electronic Federal Tax Payment System (EFTPS).

Electronic payments may be made from your home or wherever you happen to be, 24 hours a day 7 days a week. You can even schedule payments in advance.

What’s great is, it’s a paperless process and saves you time and money.

For example:

  • No checks to write
  • No money orders to purchase
  • No trips to purchase money orders
  • No payment vouchers to fill out and mail.

NOTE: Employment taxes on Forms 940, 941, and 944 cannot be scheduled in advance.

There are three electronic payment options:

  1. Electronic Funds Withdrawal
  2. Credit Cards
  3. The Electronic Federal Tax Payment System (EFTPS)

Scheduling Estimated Tax Payments

Form 1040ES, Estimated Taxes

You can schedule up to four quarterly estimated tax payments from your bank account while e-filing a return.

Authorize an Electronic Funds withdrawal

You can authorize an electronic funds withdrawal to pay any penalties associated with Form 1065 and 1065B.

Make Past Due Payments

You can make past due Form 941 and Form 940 return payments by phone or online.

Trust Fund Recovery Penalty

You can make a Trust Fund Recovery Penalty payment assessed against an individual by phone or online.

Trust fund taxes include:

  • Federal income taxes, and
  • the employee’s share of social security and Medicare taxes.

Form 944, Employer’s Annual Federal Tax Return: While e-filing Form 944, you can make a Form 944 balance due payment by phone or online.

 

Excerpted from levyloophole.com

City Of Detroit Income Tax Amnesty Program

http://www.detroitmi.gov/DepartmentsandAgencies/Finance/IncomeTaxDivision/IncomeTaxAmnesty.aspx

Mayor Bing has announced Individuals or companies that owe income taxes to the City of Detroit can pay their back taxes without penalty from January 22 through February 16.

Who Must Pay Income Tax to the City of Detroit?

All Detroit residents who earn more than $600 in a calendar year are required to pay income taxes regardless of where they work. Residents would file Form D-1040(R).
In addition, all non-residents who spend any time working in Detroit and earn more than $600 in a calendar year are required to pay income taxes to the City regardless of where their employer is located.  This would include sales personnel, delivery drivers, physicians, attorneys, accountants, visiting nurses, professional athletes, visiting entertainers, reporters/media personnel, skilled trades, contractors, etc.  Non-residents file Form D-1040(NR).

Who is Eligible for the Amnesty Program?

Anyone who has not filed an income tax return or has an outstanding balance for tax years 2011 and prior can take part in the program.
That includes:

  • Individuals/Joint Income
  • Employee Withholding
  • Corporate
  • Partnerships

How and Where Do I File My Delinquent Taxes?

To take advantage of the program, individuals and companies must:

Complete income tax returns for the eligible years. For faster processing, the returns should be accompanied by company-issued W-2 forms and all federal schedules to support deductions.

File delinquent income tax returns and pay outstanding balances by mail or in person from Jan. 22 – Feb. 16 at the following location.


Finance Department – Income Tax Division
Coleman Young Municipal Center, 2 Woodward Ave. – Suite 130, Detroit MI 48226

Monday – Friday
from 8 a.m. – 4 p.m.

Saturday from 9 a.m. – noon (Use Randolph entrance on weekends)
(313) 224-3315 (office)
All customers arriving before closing will be serviced.

Pay by mail:  The delinquent amount must be paid in full using a cashier’s check or money order.  No cash or personal checks will be accepted through the mail.  Incorrect payment amounts will result in an adjusted balance due.

Pay in person:
  The delinquent amount must be paid in full using a cashier’s check, money order, cash or credit/debit card. Credit/debit cards will only be accepted in person, and an additional 2.5% service fee applies. No personal checks will be accepted.

For more information and to obtain tax formsclick here.  Additional tax information is also available on the City’s Web site by clicking on Departments and then go to Municode.

Note: If the taxpayer is in bankruptcy or has other legal matters with the City of Detroit, the taxpayer must contact their attorney to find out whether the taxpayer can participate in the 2013 City of Detroit Amnesty Program.