Making decisions concerning your retirement account is not always an easy task because what works for one person may not be the best choice for the next.
When it comes to choosing between a Roth IRA and a 401(k) account for your retirement savings, the primary concerns involved in the decision are when you expect to pay out the taxes on any contributions, and which accounts you are eligible to contribute to.
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That’s right, we’re giving away copies of TurboTax Deluxe Edition 2011 (valued at $69.95) to two lucky Facebook fans!
Entering is simple. All you have to do is go to the BTH Tax Blog Facebook page and click the “Like” button by February 29th.
This tax season, you may want to do what millions of people do and hire a tax preparer to help you file your income tax return. To choose the best professional to help you with your specific tax needs, there are several criteria that you should consider. When making this important decision, be sure to take the following factors into account:
To ensure that you receive the proper assistance, never enlist a non-accountant friend to help. You need a qualified tax professional to help you avoid any costly mistakes on your return. Read more »
Because taxes can significantly impact the economy by changing the cash flow available to both individuals and businesses, a presidential candidate’s view on taxes has become an increasingly hot topic during the past several election seasons.
Each presidential candidate’s view on tax policy is different. Some candidates weigh heavily on the standpoint that tax money should be used to stimulate the economy, while others believe that taxes should be severely cut in order to stimulate the economy. Taking a look at the history of how the candidates voted on taxes – as well as the stances that they have taken – can give us a good idea as to how they’ll handle taxes if elected into office.
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Mitt Romney released his tax returns on January 24th, 2012. His 2010 earnings showed $21.7 million in income with an effective tax rate of just 14%. Newt Gingrich shared his tax return last week and his tax rate came in around 31%.
Why is Romney’s Tax Rate so low? Unlike Newt, Romney’s income mostly comes from dividends that are not taxed at the same rate as ordinary income; dividends are typically taxed at 15%. Romney’s tax rate was dropped more from charitable donations and other itemized deductions that he was able to claim. Many people take this lower tax rate out of context because they don’t understand that the capital gains income he’s receiving has already been taxed by the government before he received the income.
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Newt Gingrich shared his 2010 tax returns on his website on January 19th, 2012. Newt and his wife, Callista, filed a joint tax return with an adjusted gross income of $3.14 million. They paid a total of $994,708 in income taxes.
According to the tax returns, Callista was paid $191,827 in W-2 wages in 2010 and Newt received $2.5 million in K-1 profit from an S corp and an additional $250K in W-2 wages.
The 2011 fiscal year tax season will mark more than two decades of the extremely popular and highly successful IRS e-file program. This year, there are more options than ever for the average American to settle up with the IRS in a fast, free, safe and secure manner by using IRS e-file. Since e-filing means filing a paperless tax return, it’s also better for the environment than filing the old fashioned way.
The IRS website provides a great deal of information about the four major ways to electronically file taxes. You can e-file your taxes using any of these options:
As if Lindsay Lohan hasn’t had enough negative publicity lately, she has now been hit with an IRS tax lien. According to official documents filed in Los Angeles County, the actress failed to pay $93,701.57 in federal income taxes back in 2009.
Sources for Lohan told TMZ that the 25-year-old had no knowledge of her outstanding tax bill, as she assumed that her finances were being handled by her accountants.
Those sources also explained that the unpaid taxes may have been a result of the Mean Girls star’s recent overhaul of her business team, and made assurances that the issue would be resolved immediately.
Record producer, songwriter and rapper Jermaine Dupri (also known as “JD”) has finally paid off his back taxes from 2007 – but at a cost nearly twice the amount of the initial tax lien filed against him, according to TMZ.
JD’s original tax bill totaled $254,782.64. However, Georgia records show that late fees, penalties and interest – including $91,721.75 in associated interest, $64,969.57 in penalties, a $82,294.79 collection fee, and $50 in miscellaneous fees – were added to the principle amount owed, creating a new grand total of $493,818.75.
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If you are a small business owner who pays independent contractors, service providers and other individuals for freelance or contract work, you are required to issue IRS Form 1099. These forms are sent to any individuals who you’ve made payments to in order to be used in their own tax filing.
The information on Form 1099 is also reported to the IRS so that the information can be matched to the individual’s tax return and ensure that the income is being reported properly.
If you don’t issue 1099s, you will pay noncompliance penalties to the IRS.
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