Last Minute Payments and Filing Tips
If you are up against the April tax filing deadline and still need some information to complete your tax return, you can obtain a six-month automatic extension to file your 1040.
The filing extension will give you extra time to get the paperwork together, but it does not extend the time to pay any tax due. You have to make an accurate estimate of any tax due and pay at least 90% when requesting an extension. Interest will be owed on any amounts not paid by the April deadline.
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Have you received all of your W-2s? These documents are essential for completing individual income tax returns, as they include the taxable amount of your wages and the amount withheld for federal and (if applicable) state income tax, along with pension plan and other information that is needed to prepare your return. Employers have until January 31st to provide or send you your W-2 earnings statement covering what you earned in the prior year, either electronically or in paper form. If you have not received your W-2 in a reasonable time frame (allowing for time for mail delivery) after the January 31 due date, follow these steps as outlined in this weeks article.
If your taxable income is exceptionally low this year, or even if you expect not to be required to file a tax return this year, a number of tax opportunities may be available to you. But time is running short, since these opportunities will require action on your part before year’s end.
It is quite common for teachers to spend their own money on classroom supplies – so common, in fact, that a few years back, Congress created a special deduction that allowed teachers to deduct up to $250 above-the-line for classroom supplies. “Above-the-line” means the deduction can be claimed whether or not the taxpayer itemizes their deductions. Although the $250 amount is subject to an inflation adjustment, there has been no increase to the limit, at least through 2018.
Remember the IRS’s promise about being able to file your income tax return using a postcard? 
This is a common question: How long must taxpayers keep copies of their tax returns and supporting documents?
If you have been procrastinating about filing your 2017 tax return or have not filed other prior year returns, you should consider the consequences, including the penalties, interest, and aggressive enforcement actions. Plus, if you have a refund coming for a prior you may end up forfeiting it.
Years ago, to prevent parents from transferring their investment accounts into their children’s name to avoid taxes, Congress created what is referred to as the kiddie tax. This counteracted the strategy of taking income from the parents’ higher tax bracket and shifting it to their children’s lower tax bracket.
Taxpayers are often confused by the differences in tax treatment between businesses that are entered into for profit and those that are not, commonly referred to as hobbies. We cover the differences in this week’s article and how it might apply to your small business.