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Frequently Asked Questions

-How much will it cost to file my return?
-Do I need to file? And at what age can I stop filing returns?
-Why do you need to see a copy of my prior year’s return?
-Do you take Debit/Credit Cards?
-Do I have to pay taxes on my Social Security benefits?
-Is the loss on the sale of your home deductible?
-Is child support taxable?
-Can you deduct your fee from my return?
-Is workman’s compensation taxable?
-I remodeled my home/added on to my home, is there anything I can deduct for that?
-Do you do farm taxes?
-Should I incorporate my business or form an LLC?
-Someone I’ve worked for asked me to fill out a Form W-9, what should I put on it?
-Do I need an EIN?
-What if I can’t pay my tax?
-I can’t afford to pay my tax, can I file an extension?
-I received another W-2/1099 after filing my tax return; can we include it on next year’s return?
-I am very busy.  Can I just sign the form now and you e-file it when you’re finished?

 

 

-How much will it cost to file my return?

Unfortunately, there is no easy answer.  The fee charged is based on the complexity of the return and how well your records are organized.  You can however schedule an interview with us to look over your information and give you an estimate.  The estimate is not a set price and can vary depending on a variety of factors.

 

-Do I need to file? And at what age can I stop filing returns?

Your requirement to file a tax return has nothing to do with age.  It is based on the type and amount of income you have earned during the taxable year.

 

-Why do you need to see a copy of my prior year’s return?

Any preparer should ask to see your prior return mainly to see if you have any carryover items that need to be reflected on the current return.  We use the prior year return to look for these carryovers and any changes in your filing status or dependents claimed.  We will also glance at the return to look for any obvious errors that can be corrected.

 

-Do you take Debit/Credit Cards?

Debit and credit cards are accepted using the "PayNow" button on our website.  We prefer payments by cash or check in order to keep our fees as low as possible.  There is a $25 charge for returned checks.

 

-Do I have to pay taxes on my Social Security benefits?

Social security benefits include monthly retirement, survivor, and disability benefits.  They do not include supplemental security income (SSI) payments, which are not taxable.  The amount of social security benefits that must be included on your income tax return and used to calculate your income tax liability depends on the total amount of your income and benefits for the taxable year.

 

-Is the loss on the sale of your home deductible?

No, the loss on the sale of a personal residence is a nondeductible personal loss.

 

-Is child support taxable?

No, child support payments are neither deductible by the payer nor taxable income to the payee.

 

-Can you deduct your fee from my return?

No, payment is due at the time the return is completed and before it is filed or e-filed.  Keep in mind that anyone who offers this service will be charging an additional fee to do so because this service is offered through a bank.

 

-Is workman’s compensation taxable?

You don't pay tax on workman’s compensation received by you or your survivors for job related sickness or injuries paid under a workman’s compensation act or workman’s compensation statute in the nature of a workman’s compensation act.

The tax exemption on your tax return does not apply to retirement plan benefits you receive based on age, length of service, or prior contributions to the plan, even though you retired because of an occupational sickness or injury.

If your employer continues to pay your regular salary or wages and requires you to turn over your workman’s compensation benefits you are taxed on your tax return on the overage that was paid to you by your employer.

The part of your workman’s compensation that reduces your social security benefits or equivalent railroad retirement benefits is considered social security benefits and may be taxable on your tax return under rules for those types of income.  Accordingly, your workman’s compensation may be indirectly subject to tax on your tax return.

But, if your employer requires you to sign your checks over to them and continues to pay you, you will pay taxes as they will report the wages paid to you and the taxes withheld from those wages on your W-2.  Some employers only supplement with accrued leave time with the employee receiving the workman’s comp checks.  That is the only sure way to have your WC benefit non taxable.

 

-I remodeled my home/added on to my home, is there anything I can deduct for that?

Generally, you cannot deduct home repairs or home improvements on your tax return in the current tax year.  Home improvements add to the value of your home, prolong its useful life, or adapt it to new uses.  You add the cost of home improvements to the tax basis of your property.

Examples of home improvements include putting a recreation room in your unfinished basement, adding another bathroom, or bedroom, putting up a fence, putting in new plumbing or wiring, putting on a new roof, or paving your driveway.

Home repairs maintain your home in good condition. They do not add to its value or prolong its life, and you do not add their cost to the tax basis of your property. Nor can you deduct home repairs on your tax return.  Some examples of home repairs include repainting your house inside or outside, fixing your gutters or floors, repairing leaks or plastering and replacing broken window panes.

The entire job is considered a home improvement, however, if items that would otherwise be considered home repairs are done as part of extensive remodeling or restoration of your home.

 

-Do you do farm taxes?

Yes.  We prepare tax returns for many types of farm activities and of varying sizes.  If you are a new client and farmer needing to file your return by March 1, we encourage you to schedule an appointment prior to February 15 to give us time to complete your return.

 

-Should I incorporate my business or form an LLC?

There are too many variables involved with this question to give you a quick short answer.  The best answer is that you need to schedule an appointment with one of our tax specialists to discuss your specific situation and all your options.

 

-Someone I’ve worked for asked me to fill out a Form W-9, what should I put on it?

If you have performed services as an independent contractor for another business and have received compensation in excess of $600 for the year, that business is required to send you a Form 1099 to report the amount paid to you.  Form W-9 is used to collect your identifying information necessary to complete the Form 1099.

Provide on the Form 1099 your legal name as it appears on your tax return and either the social security number or employer identification number that relates to that name.  If you are a sole proprietor doing business under another name, you must provide your name as the legal name. If you’re an LLC, you must provide the legal name and identification number of the LLC regardless of whether you are taxed as a corporation, partnership, or disregarded entity.

Sometimes you will be asked to fill out a Form W-9 for a bank, insurance company, brokerage house, or someone else.  This will be because they have paid or credited some income to you or your account that needs to be reported on a Form 1099, such as interest, dividends, stock   proceeds, etc.  Failure to provide this information can result in the payer being required to withhold “backup” withholding taxes from any future payments made to you.

 

-Do I need an EIN?

You will need an EIN if you answer "Yes" to any of the following questions.  For your convenience, clicking on the "Yes" option will take you directly to How to apply for an EIN on the IRS website.

Do you have employees?

YES

NO

Do you operate your business as a corporation or a partnership?

YES

NO

Do you file any of these tax returns: Employment, Excise, or Alcohol, Tobacco and Firearms?

YES

NO

Do you withhold taxes on income, other than wages, paid to a non-resident alien?

YES

NO

Do you have a Keogh plan?

YES

NO

Are you involved with any of the following types of organizations?

  • Trusts, except certain grantor-owned revocable trusts, IRAs, Exempt Organization Business Income Tax Returns
  • Estates
  • Real estate mortgage investment conduits
  • Non-profit organizations
  • Farmers' cooperatives
  • Plan administrators

YES

NO

 

-What if I can’t pay my tax?

It is important that you file your tax return even if you cannot pay the balance due.  Doing so will  keep you from being charged late filing penalties in addition to late payment penalties.  It is always best to make whatever payment you can at the time of filing in order to reduce penalties as much as possible.  An installment agreement can be applied for with the filing of your tax return or later when you receive a statement from the IRS for the balance due.  The IRS charges a one-time fee for processing your request for an installment agreement.  Payments by credit card can be made for the balance due also.  You are responsible for paying a processing fee when making tax payments by credit card.

List of IRS e-pay service providers and fees

Service
Provider

Telephone

Web Site

Convenience
Fees

(Credit Card Option)

Convenience
Fees

(ATM/Debit1 Card Option)

Customer
Service
Number

Official Payments Corporation

 

1-888-UPAY-TAXtm

(1-888-872-9829)

Available in English and Spanish


officialpayments.com/fed

2.35%3

$3.952

1-877-754-4413

Link2Gov Corporation

1-888-PAY1040tm

(1-888-729-1040)

Available in English and Spanish

PAY1040.com

Businesstaxpayment.com

 

2.35%3

$3.892

1-888-658-5465

RBS WorldPay, Inc.

1-888-9-PAY-TAXtm

(1-888-972-9829)

Available in English and Spanish



payUSAtax.com

 

1.95%3

$3.892

1-888-877-0450      (live operator)

1-877-517-4881(automated  24x7)

1 The ATM/Debit card must be a Visa Debit Card, or a NYCE, Pulse or Star Debit Card.
2 Flat fee per transaction. 
3 Contact the service provider to receive up-to-date information regarding fees.  The minimum convenience fee is $1.

 

-I can’t afford to pay my tax, can I file an extension?

An extension is only good for extending the time to file a return, not to extend the time for paying the tax.  If the tax due is not paid by the original due date of the return, you may be subject to late payment penalties and interest.  There are very few exceptions to this rule.

See the following article:  http://www.irs.gov/taxtopics/tc653.html

 

-I received another W-2/1099 after filing my tax return; can we include it on next year’s return?

No.  Income and expenses from different years cannot be combined onto a return for one year. For a cash basis taxpayer, income and expenses must be reported for the year in which it is received or paid.  The rules for accrual basis taxpayers differ slightly and you should discuss this with your tax preparer.

If you discover income or expenses that were not included on your original return, you should file an amended return for that year to report any additional tax due or refund.  If you have an additional amount due on an amended return filed after the original due date, you may potentially owe penalties and interest on that amount.  An amended return filed before the original due date with payment for any additional tax owed will not be subject to late filing or payment penalties. There is the possibility of additional estimated tax penalties if the amended return results in an additional amount due.

 

-I am very busy.  Can I just sign the form now and you e-file it when you’re finished?

NO!  By regulation, I cannot allow you to sign a blank tax form and submit it later.  Any preparer who does so is violating the tax law and can be subject to severe penalties.  You must be presented a completed tax return for your review before we can get your signature for e-filing.

How often do you sign a blank check and tell someone to fill it in later????

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