When you file a tax return, you usually have a choice to make: whether to itemize deductions or take the standard deduction. You should compare both methods and use the one that gives you the greater tax benefit. The IRS offers these six facts to help you choose. 1. Figure your itemized deductions. Add up the… Read More
WASHINGTON —The Internal Revenue Service today provided late-payment penalty relief to individuals and businesses requesting a tax-filing extension because they are attaching to their returns any of the forms that couldn’t be filed until after January. The relief applies to the late-payment penalty, normally 0.5 percent per month, charged on tax payments made after the… Read More
Some children receive investment income and are required to file a federal tax return. If a child cannot file his or her own tax return for any reason, such as age, the child’s parent or guardian is responsible for filing a return on the child’s behalf. There are special tax rules that affect how parents… Read More
If you haven’t filed your 2009 federal tax return, you may still have time to claim your tax refund. The IRS has $917 million in unclaimed refunds from an estimated 984,000 tax returns that people didn’t file for the 2009 tax year. The IRS estimates that half the potential refunds for 2009 are more than… Read More
Saving for your retirement can make you eligible for a tax credit worth up to $2,000. If you contribute to an employer-sponsored retirement plan, such as a 401(k) or to an IRA, you may be eligible for the Saver’s Credit. Here are seven points the IRS would like you to know about the Saver’s Credit:… Read More
Taking money out early from your retirement plan can cost you an extra 10 percent in taxes. Here are five things you should know about early withdrawals from retirement plans. 1. An early withdrawal normally means taking money from your plan, such as a 401(k), before you reach age 59½. 2. You must report the amount you… Read More
If your lender cancelled or forgave your mortgage debt, you generally have to pay tax on that amount. But there are exceptions to this rule for some homeowners who had mortgage debt forgiven in 2012. Here are 10 key facts from the IRS about mortgage debt forgiveness: 1. Cancelled debt normally results in taxable income. However,… Read More
Small businesses sometimes barter to get products or services they need. Bartering is the trading of one product or service for another. Usually there is no exchange of cash. An example of bartering is a plumber doing repair work for a dentist in exchange for dental services. The IRS reminds all taxpayers that the fair… Read More
The term “capital asset” for tax purposes applies to almost everything you own and use for personal or investment purposes. A capital gain or loss occurs when you sell a capital asset. Here are 10 facts from the IRS on capital gains and losses: 1. Almost everything you own and use for personal purposes, pleasure or… Read More