Hobby or Business? Taxpayers must report on their tax return the income earned from hobbies. The rules for how to report the income and expenses depend on whether the activity is a hobby or a business. There are special rules and limits for deductions taxpayers can claim for hobbies. Here are four tax tips to consider: Is it a Business or a Hobby? A key feature of a business is that people do it to make a profit. People engage in a...
Hurricane Preparedness Tips for Taxpayers Don’t Forget to Update Emergency Plans Because a disaster can strike any time, be sure to review emergency plans annually. Personal and business situations change over time, as do preparedness needs. When employers hire new employees or when a company or organization changes functions, they should update plans accordingly and inform employees of the changes. Make plans ahead of time and be sure to practice them. Create Electronic Copies of Key Documents Keep a duplicate set of key documents...
Do You Know About These 5 Overlooked Medical Tax Deductions? It’s getting more and more difficult to claim medical tax deductions. That’s because you can only claim those tax deductions once they exceed 10% of your adjusted gross income. So you’ve got to do your best to maximize every opportunity you can to do smart tax planning. Here are five of the most overlooked medical tax deductions to help you do just that. Medical Transportation You don’t have to take a trip in an...
Extension, procrastinator…Who me? Are you one of those “wait till the very last minute” type of people” better known as a procrastinator? Millions of taxpayers file tax extensions each year thinking that they can delay the inevitable.The IRS is glad to give you an extension if you owe taxes because they are going to charge you penalties and interest in the meantime. If you are due to receive a refund, the IRS will send your payment, and penalties do not apply. Regardless...
Yet Another New Warning on a Last-Minute Tax Scam!! It seems that we receive notices almost daily about new and more aggressive IRS scams. The IRS and state tax agencies recently issued another a new scam warning, this time for both tax professionals and their clients of late-season phishing e-mail scams, especially those requesting last-minute deposit changes for refunds or account updates. As tax season winds down, tax-related scams are peaking, the IRS said, as cybercriminals use sophisticated scams to trick people into divulging sensitive data. One new...
Beware the Ides of March William Shakespeare famously wrote “Beware the Ides of March” in the play Julius Caesar in 1599 and for many years it was just something that was horrific for Caesar, who was assassinated by Marcus us Brutus the Younger in the senate on that date, which corresponds to March 15, in the year 44 B.C.E. But from 1918 to 1954 everyone was wary of it, because March 15 used to be Tax Day. After the 16th amendment was...
Working Grandparents May Be Eligible for Earned Income Tax Credit (EITC) The Internal Revenue Service wants working grandparents raising grandchildren to be aware of the Earned Income Tax Credit (EITC) and correctly claim it if they qualify. What is the EITC? The EITC is a federal income tax credit for workers who don’t earn a high income ($53,505 or less for 2016) and meet certain eligibility requirements. Because it’s a refundable credit, those who qualify and claim the credit could pay less federal...
Health Insurance: You may qualify for a Special Enrollment Period You may qualify for a Special Enrollment Period if you or anyone in your household experienced these changes within the past 60 days: Did you get married? Pick a plan by the last day of the month and your coverage can start the first day of the next month. Have you had a baby, adopted a child, or placed a child for foster care? Your coverage can start the day of the event — even if you...
Watch out for IRS Impersonation Telephone Scams An aggressive and sophisticated phone scam targeting taxpayers, including recent immigrants, has been making the rounds throughout the country. Callers claim to be employees of the IRS, but are not. These con artists can sound convincing when they call. They use fake names and bogus IRS identification badge numbers. They may know a lot about their targets, and they usually alter the caller ID to make it look like the IRS is calling. Victims are...
