The Small Business Tax Help Blog

Archive for September, 2009

Liberty Tax Service is Ready For Internal Tax Preparer Certification Program

Its Internal Tax Preparer Certification Program Has Been in Place Since 2007 (PRWeb Jan 7, 2010) Read the full story at http://www.prweb.com/releases/20100106/taxpreparercertification/prweb3415784.htm

President Obama Holds Online Town Hall on Health Reform

Question: How do I file taxes for self employment using turbo tax?

I work part time for a friend and I am paid 100.00 per week. I have been working for one year. How do I provide this information on Turbo Tax? Also, I am curious if I would still be able to get a Tax Refund. I realize that I will have to pay about 700.00 in taxes but would I still receive the Earned Income Tax Credit? I don’t want to go to a big chain Tax preparer because they are too expensive.

Answer: The joy of a program such as Turbo Tax is that you do not have to understand things like "Schedule C". Just log on to Turbo Tax and answer the questions. After you enter W2 info, it will ask something like "Did you make money from any other sources?" If you say no, Turbo Tax skips onto something else. If you say yes, it will ask if you have a business, etc. etc. until it has the info to file a schedule C for you without your even worrying about it. If you don't feel comfortable with that and don't have money for a chain to do your taxes there are alternatives, especially if your income is low. Even if your income is not low, you can manage to get free tax help. For more on this, check out my resources here: http://www.ehow.com/how_4688030_help-taxes.html Good luck!

Singletary: Tax preparers getting some overdue IRS oversight

Most of us don't do our own tax returns. My husband did ours for years. He finally surrendered, too frustrated with the never-ending task of keeping up with the many changes to the tax code.

Self Employment Tax Tips : Tax Tips for Temp Employees

According to the IRS, if “Bob” can prove that he would face serious financial hardship by paying his taxes, or is unable to pay them right away, he can apply for a monthly installment plan. The IRS also says in form 9465 that under certain circumstances, the IRS may lower the taxes it charged him.

Before Bob fills out the form, however, the IRS warns him that it may be better to take out a loan or use available credit on a credit card because there is a fee required to submit the form. There is a $105 fee ($52 if payment is made by electronic funds withdrawal) or a reduced $43 fee if Bob’s income is below a certain level. The IRS also cautions him not to use the form if he can make the payment in 120 days or if he wants an on-line payment agreement.

If Bob can make the payments in 120 days, he needs to call 1-800-829-1040 and request to make the full payment in 120 days. This way he can avoid the application fee of form 9465. He should also call this number if he is in a bankruptcy, or he has filed–and the IRS has accepted–an offer-in-compromise.

If Bob wants to apply for a payment plan on line, he needs to go to the IRS website (link below), use the pull-down menu under “I need to…” and select “Set Up a Payment Plan”. This will liberate him from filing form 9465.

The Installment Agreement As Laid Out In Form 9465

If Bob completes form 9465 and files it, the IRS will probably notify him of the results in 30 days–unless the request is for tax due on a return filed after March 31–then it might take longer. In the event that the IRS approves the request, Bob will receive a notice detailing the terms of the agreement and requesting the fee due for the submission of his request. The IRS will let Bob know if he qualifies for the reduced fee, but he can request the reduced fee using form 13844 if the IRS does not say he qualifies.

The IRS will charge Bob interest, and may charge him a late payment penalty on any tax not paid by its due date, even if his request to pay in installments is granted. Interest and any applicable payments will be charged until the balance is paid in full. In order to limit Interest and penalty charges, the IRS recommends that Bob files his return on time and pays as much of the tax as possible with his return (or notice).

The IRS says that by approving Bob’s request they agree to let him pay the tax he owes in monthly installments, instead of immediately paying the amount in full. All payments received will be applied to his account in the best interests of the United States. In return, Bob agrees to make his monthly payments on time, and to meet all future tax liabilities.This means that he must have enough withholdings or Estimated Tax Payments so that future tax liabilities are paid in full when he timely files his returns. Bob’s request will be denied if he has not filed all his tax returns. Furthermore, any future refunds will be deducted from the amount Bob owes, and that if a refund is applied to his balance, he is still required to make his monthly installation payments

Guaranteed Installment Agreement

Bob’s submission is guaranteed to be accepted if all the following conditions are met:

The Payments

Bob can make his payments by cash, money order, credit card, or one of the other payments shown below. The application fee is dependent on what type of payments Bob wants to make. The application fee submitted with his request is a one-time event:

After the IRS receives each payment, they will sent Bob a notice confirming it, and showing the remaining debt. If Bob chooses to have the funds automatically withdrawn from his checking account, his bank statement will serve as his notice. He will not receive an additional one from the IRS. The IRS will also send Bob an annual statement showing the amount he owed at the beginning of the year, the amount he owed at the end of the year, and a record of all the payments made during the year.

A Word of Caution

If Bob doesn’t make his payments on time, or doesn’t pay what he owes on a return filed later, he will be in default on his agreement. The IRS may then proceed to take enforcement actions such as the filing of a Notice of Federal Tax Lien, or an IRS Levy Action to collect the entire amount he owes.

If you don’t want to get your forms directly through the IRS, click link and use the search feature: http://www.irstaxhelp.com/tax-forms.html or call: 888-231-1100 (toll free)

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Sacramento-area developer Nehemiah Corp. pushes the nonprofit envelope

Nehemiah Corp. of America may be a nonprofit organization with roots in south Sacramento’s Antioch Progressive Baptist Church, but it operates more like a business than a typical charity.

Stay Rich Forever & Ever with Ed Slott on WMFE-TV!

Question: I am applying for a federal tax id number and not sure if I apply as a sole proprietor or LLC. Just need the..?

tax id number to start buying wholesale. I plan on doing majority of sales online or open own website. What are the advantages of having the business license(tax id) as LLC and as a sole owner. Do they have disadvantages also. Thank you for all feedback.

Answer: Disadvantages of a Sole Proprietorship
Sole proprietors are not personally protected from any debts and liabilities of the business.
Sole proprietorships have a hard time raising money from investors as there is no structure to invest in.

Advantages of a LLC
The owners are generally not liable for the debts and obligations of the corporation
Another advantage of incorporating is continuance. Unlike a sole proprietorship, a corporation has an unlimited life span; the corporation will continue to exist even if the shareholders die or leave the business, or if the ownership of the business changes..

Allscripts Reports Fiscal 2010 Second Quarter Results

CHICAGO, Jan. 10 /PRNewswire/ -- Allscripts-Misys Healthcare Solutions, Inc. (Allscripts or the Company) today announced its financial results for the three and six months ended November 30, 2009.

The Business Owner Movement with Business Attorney David M. Walker, Esq.

Question: ok tax people. help me with this one…am i screwed?

I was looking at my paycheck stub from my last paycheck of 2009 and noticed that no federal tax had been taken out. So, I dug through my stubs from earlier in the year and no federal taxes had been taken out. Social Security, Medicare, State, and city taxes have been withheld, but no federal taxes. Now, taxes were taken out last year and nothing has changed since then. So, I’m not really sure what is going on. I am very low income with two dependents. I don’t know if that matters. I did received all of my federal taxes back including the EIC. Am I completely screwed? What is going to happen?

Answer: If you're very low income and got all your money back last year, you probably didn't earn enough this year to be required to have taxes taken out.

Just fill out your tax return as usual at the end of the year and you'll likely find you still qualify for the EIC, so you'll get that.

If you *want* the government to hold on to some of your money interest-free for the whole year and pay it back to you when you file your tax return, then fill out a new W-4 for your employer and either decrease the number of exemptions you're claiming, or ask them to take out a certain fixed amount of money for you every pay period.

CBO: Federal Government Budget Deficit $389 Billion Through December

CBO: Federal Government Budget Deficit $389 Billion Through December

TaxSlayer.com "Get A Foot Ahead In 2009"