Tax season is upon us…April 15th will be here before you know it. For many, using software packages like TaxACT, eSmart Tax, and TurboTax are the easy option for a simple tax return, but what if you started a business, lost a job, or experienced divorce last year? Big changes in your life, like starting school, the loss of a loved one, or making the decision to work from home, can mean big changes in your tax preparation.
Amy M. Currin at Oliver Friesen Cheek, PLLC possess outstanding advocacy skills and a wealth of knowledge and experience in all areas of state and federal tax law. If you’re planning for future needs, facing a tax challenge, or buying or selling real estate, she will partner with you to navigate and resolve even the most strenuous tax issues.
So, what may drive your decision to forgo preparing your own taxes?
You have time constraints. Since 2001, Congress has made nearly 5,000 changes to the Tax Code—a document which is now nearly four million words in length. Even the most thorough person would never have the time to read and digest all it contains. Tax laws cover income, corporate, excise, luxury, estate and property taxes, to name just a few.
The U.S. Congress and state legislatures are responsible for creating a majority of the tax laws and forms and instructions change each year to reflect new tax laws. For example, the federal government has imposed temporary income tax cuts and other business tax incentives to stimulate the economy. Cities, counties, and states adjust property tax rates from year to year based on different factors such as budget deficits and the cost of providing government services.
You overlook deductions. When filing taxes on your own, are you confident you’re utilizing all possible deductions? Sure, you count any charitable donations you made in the last year, but a tax lawyer can ensure you don’t miss out on those not-so-common deductions.
Student loan interest paid by parents:
When Mom and Dad pay back their child’s student loans the transaction is considered as a gift to him by the IRS. If that child is no longer a considered a dependent, he can deduct up to $2,500 of student loan interest each year.
If you’ve kept track over the past year of all job hunting expenses—cab fare, employment agency expenses, mileage you drive in your own car, and food and lodging if traveling was required during your job search—you may be able to deduct these costs if you itemize. You can even deduct the cost of a move when accepting a job more than 50 miles from your current location.
Military Reservist considerations:
If you traveled more than 100 miles to attend a drill and spent the night, you can deduct your lodging expenses, half the cost of your meals, and 51 cents per mile for travel. You can also deduct tolls and parking fees.
The self-employed & Medicare premiums:
Those who continue to run their own businesses after qualifying for Medicare can deduct the premiums paid for Medicare Part B and Medicare Part D, plus the cost of supplemental Medicare policies or the cost of a Medicare Advantage plan.
This is just a sampling of the huge number of deductions possible when filing your taxes. Wouldn’t you feel more comfortable with the assistance of a tax professional to make sure you don’t miss any of these opportunities? Speaking of confidence…
You lack the confidence your return is correct. The last thing you want is the IRS to find a problem with your tax return. Barring fraud or underreporting income, a three year statute of limitations exists for federal income tax returns for individuals; that means the IRS may challenge what you’ve reported for up to three years after the date of filing. It may cost a bit more, but filing with the help of a tax lawyer can save you big bucks in the long term.
You think filing business taxes can’t be that hard. If you’re a business owner, you more than likely do not have the tax knowledge you need to stay out of trouble. Partnerships report on Form 1065. If you’re a sole proprietor, your business income and expenses are reported on a Schedule C attached to your personal income tax return. If you have a corporation or have elected to treat your LLC as a corporation, then you will need to prepare a separate corporate tax return with Form 1120. Use Form 1120S is if you have elected S Corporation Status. Does this sound a bit confusing? It is.
And what about the Affordable Care Act (ACA)? With its passage, your business can face tax penalties for failing to provide health insurance to employees or for failing to report what type of coverage you’ve provided. ACA insurance and reporting requirements could be burdensome to your small businesses. Contact a tax attorney now to make sure provided coverage meets the minimal essential coverage. Is it a better financial decision to pay the tax penalty or provide insurance? A tax attorney can help you make that decision.
The experienced team at Oliver Friesen Cheek, PLLC possesses a wealth of tax law knowledge. Our attorneys can help clients avoid controversies and save money in taxes, interest, and penalties by helping plan transactions and structure operations. Contact our office for assistance if you need personal tax assistance or help fighting a business audit or other controversy.
Only you can make the ultimate choice on whether or not to enlist the help of a seasoned tax attorney. Just remember that that when you file on your own that means you’re also on your own if the IRS wants to take a closer look at your tax return! When you reach out for assistance with your personal or business tax filings you can be confident you have the necessary backing if the IRS comes calling.
For more information, or to receive assistance preparing your personal or business taxes, please contact Amy M. Currin at Oliver & Cheek, PLLC by calling (252) 633-1930 or by visiting www.olivercheek.com