When you own and operate your own business, you'll have to deal with many financial concerns over the years. Some of these issues could pose a real danger to your company, especially if they affect your ability to take on new clients or deliver your products to customers. One way to avoid many of these problems is to hire a qualified financial professional to shoulder some of your responsibilities for you. Both accountants and tax attorneys can be of great help, but how do you know which professional to hire? Here's a quick overview of the differences between the two.
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The Mortgage Forgiveness Debt Relief Act, which was originally passed in 2007, was recently extended through the 2012 tax year. This law provides a substantial tax break for homeowners who lost homes to foreclosures by allowing them to avoid taxation on their cancelation of debt. The federal government extended the Mortgage Forgiveness Debt Relief Act using the Emergency Economic Stabilization Act in an attempt to revamp the lagging U.S. economy.
As a result of the economic crisis of recent years, many American taxpayers have applied for and received cancelation of some debts such as mortgages, car loans, and credit card bills. One thing that some citizens may not know, though, is that their canceled debt may be subject to income tax by the IRS. While the tax bill they get at the end of the year may be considerably less than the debt that was canceled, it may still put a strain on the household budget. The best way to prepare for this is to speak with a tax professional to find out if your canceled debt is taxable well in advance of the income tax deadline.
Have you gotten a letter from the Internal Revenue Service in the mail? If you have, you may have been nervous just to see the IRS return address in the envelope corner. However, the majority of IRS correspondence that is sent out is relatively harmless. In a few cases, though, IRS notices can bring bad news such as a stressful tax audit or a tax collection. Here's a quick overview of the types of IRS notices that are commonly mailed and how you can handle IRS correspondence.
Are you going through a divorce or a marital separation? If so, the effect that this life change will have on your income tax status is likely to be one of the last things on your mind. However, it's important to consider how a divorce impacts your income tax filing, especially if you normally receive a tax refund each year. The decisions you make during your divorce proceedings can literally make the difference between receiving a refund and owing a balance due on April 15.
Current and former members of the United States military spend much of their life serving in defense of the country. However, these soldiers are not exempt from the income tax regulations of the Internal Revenue Service (IRS). All members of the military should take the time to find out about the tax code laws to which they are subject. According to the IRS, some kinds of military income are taxable, while some are exempt from taxation. However, most military personnel will still have to file an income tax return each year.
If you were to ask taxpayers about their most common fear, many would say that they worry about being audited by the Internal Revenue Service. While the actual number of tax audits done each year is quite low, those who are affected by them can suffer serious financial trouble, leading to large judgments and years of back tax payments. It's far more important to do what you can to avoid a tax audit in the first place. With the proper information and preparation, your chances of being audited by Uncle Sam can become very small.
If you've been paying the traditional income tax for the past several years, you may not have even heard of the Alternative Minimum Tax. In reality, though, this separate tax system affects many Americans each year, including some who didn't know they were even subject to it. What is the Alternative Minimum Tax? Should you be concerned about having to pay it? Is there anything you can do to find out if it applies to your tax return?
Financial advisers and experts advertise their services every day. How can you tell which professional to hire for your IRS tax needs? Much of it depends on the specific kind of assistance you're looking for. Ideally, you should choose a professional who is best qualified to handle your money matters. Often, that means hiring a Certified Public Accountant (CPA) or an IRS Enrolled Agent (EA). But, how can you tell which one to choose for your financial needs?
