In the United States the Internal Revenue Service always working hard to make the procedure of paying federal taxes easy and accurate. There are different ways for e-filing your 1040 taxes but the question is which one you are eligible for ?

How will you file your individual income tax return this time? Basically, you have three tax forms to choose from; IRS 1040ez, Form1040A and Form1040. If you have simple taxes to do, you may consider the easiest and least complex form 1040ez. If you meet the requirement, then only will you be able to file this form. To get to know more about this easy IRS Gov 1040ez form, you may visit the IRS official website irs.gov and make this clear.

Therefore, you need to understand factors which help you qualify for this easy form 1040ez. If you go through the IRS official site, you will fairly get to know about these issues from the depth. Suppose, your taxable income is something less than $100,000, you may qualify for it. Moreover, there are certain things such as your filing status, your age and dependents can also be taken into consideration. To be eligible for federal 1040ez form you need to be single, or married but filing jointly, and below the age of 65. Apart from these, you should not be blind and you are not supposed to have dependents, the only you may qualify for it.

Every time you prepare and file your return, you must have seen that how much efforts and money are paid in the process. The more time and money is needed if you have complex taxes to do in timely manner. If you take all these small issues into consideration, it will really be an easy task to complete individual tax return online using easy form like federal 1040ez. If you have salary, taxable scholarship, unemployment compensation, then you may use this form. And therefore, you are advised to get to know more about such issues before you start doing your work.

Now if you don’t have many deductions and have simple claim to file, then using 1040ez form will be perfect option for you. This form will make it easy for filing your tax return online if you have simple taxes to do. You can do filing of the federal 1040ez online on your own and become worry-free. If you feel confusion regarding this tax form, you can visit the IRS website at irs.gov and get to more about this IRS 1040ez tax form.
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All About Late Filing of Federal Taxes

The IRS allows for late filing of federal taxes provided the appropriate paperwork is filled out (there’s always paperwork!). This simple guide shows you how to go about it.

Forms for Late Filing of Federal Taxes

The form to apply for an automatic extension of the deadline for filing federal taxes is IRS form number 4868. It is a very simple form to fill out, consisting of just nine questions. The first three questions are merely personal details such as name, address and social security number. The last two are check boxes to mark off if you are a US citizen or resident living abroad or if you file form 1040NR or 1040NR-EZ, for nonresident aliens. The remaining four questions are: the estimate of the total tax liability for the year; the estimate of the total tax payments for the year; the balance remaining when you subtract the latter from the former and the amount you intend to pay. If you cannot afford to pay the entire balance, pay as much of it as you can. You can pay online using a credit card. If you choose to do this, you will get a confirmation number by e-mail, which you will also need to enter on the form.

Who Is Eligible for Late Filing of Federal Taxes?

To qualify for late filing of federal taxes, you need to be able to complete form 4868 accurately and submit it by the normal federal filing deadline. Generally, the IRS cannot extend the deadline for more than six months, but there are certain exceptions for Americans and their foreign spouses living abroad. In these cases, you can apply for an additional two months on top of the six month extension by writing a letter to the IRS Service Center in Austin, Texas explaining why you need these extra two months.

Penalties for Late Filing of Federal Taxes

Late filing of federal taxes can carry substantial penalties if you don’t get permission from the IRS first. The penalty for filing late is 5 percent of the tax shown on the form per month; and for paying late, a half percent per month, both up to a maximum of a quarter of the total tax owed. However, the IRS recognizes that some people are forced to pay late due to personal circumstances beyond their control. If this applies to you, call 1-800-TAX-FORM (1-800-829-3676) or look in the phone book for the address of your local Taxpayer Assistance Center, to talk to an IRS official in person.

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tax extension form 2010

Federal taxes are normally due on April 15, yet every year people are late to submit the proper forms. Missing tax forms and long lines at the post office can leave many people scrambling to meet the deadline. Why wait until the last minute to file your taxes? Here are three helpful tips to make sure you never miss another IRS deadline.

Stay organized

It?s easy to finish your taxes on time when you?re organized. Keep tax forms you receive throughout the year together in a central location and file them into separate categories, such as mortgage, income, and assets. Keep track of the forms you?re still missing a few months before the deadline. You might have to download some forms and print them yourself.

Start early

Most employers and financial institutions mail W-2 and 1099 forms at the end of January. You can begin filing your taxes as soon as you get the forms. If you?re expecting a refund, you?ll see your money much sooner if you file early. If you opt to receive your refund via direct deposit, you can usually receive your money in less than ten days.

Use software

There are several different tax programs and software to take advantage of when filing your taxes. Most programs are easy to use and will save your information as you enter it. Tackling one section at a time instead of waiting until the last minute can minimize stress and keep you focused. Software programs can also alert you about any potential errors in your paperwork before you press “submit.”

Tax day doesn?t have to be a stressful experience if you start planning early, and if you find that you do need extra time you can always apply for an extension.

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Investments as a tax planning are of much importance as it has dual benefits of savings of taxes and generation of income. Many persons devote much time in evaluation various options while making general investment decisions which have no tax benefits and take hasty decisions at the year end to make investments to save taxes. One should note that investing can be a periodic activity but tax-planning is an annual exercise and hence can have far greater implications on one’s finances.

A person continues to look at tax-planning as just another annual obligation that must be fulfilled as against necessity for future. As a result, they haven’t fully understood the benefits that the tax-planning exercise can deliver.

A person should appreciate the fact that tax planning forms an integral part of their financial planning and accordingly, an adequate amount of time and effort must be devoted towards the exercise. This will give them the opportunity to thoroughly evaluate various options and to work out a beneficial investment avenue.
Another popular reason for a person shying away from the tax-planning exercise is that it is perceived as being too complicated. However, with the online tax computing and tax filing web portals like www.taxsum.com, tax-planning becomes simple since it provides tax tips, tax planning tools and answers to the frequently asked questions, which helps to save maximum taxes through proper utilization of available investment avenues.

To begin with tax planning, following points should be considered:
1. There are various avenues of tax planning like ?
- section 80C (specified investments),
- section 80D (mediclaim premium),
- section 80CCF (infrastructure bonds),
- section 80DD/80DDB (medical treatment),
- section 80E (loan for higher education),
- section 80G (donation),
- section 80GG (rent paid), etc.
the most used and favored investment option is section 80C and section 80CCF for the simple reason of their popularity and ease of investments.

2. To start with, a person should find out how much (based on their incomes) they need to invest towards Section 80C kitty and such other tax savings kitty like section 80CCF.

3. Once the investment amount is known, the next step is to get a check on the ongoing investments and contributions that are eligible for tax benefits. Payment of life insurance premium, contribution to PF / PPF, ELSS scheme of Mutual Fund, Tax saving Fixed deposits, etc., must be taken into account, which are also eligible for deduction under overall cap of Rs. 1,00,000/- of section 80C.

4. A person with less risk taking appetite should ensure that a greater portion of their tax-planning portfolio is held in assured return schemes like PPF, NSC and tax-saving bonds. A high risk-taking person can have a portfolio tilted in favor of market-linked avenues like tax-saving mutual funds (also known as equity-linked saving schemes – ELSS) and unit linked insurance plans (ULIPs). Thus, principles of financial planning like asset allocation and investing in line with one’s risk profile are also important & considered while working out investment avenues.

Thus, a person needs to do tax-planning exercise in a more efficient & methodical way and so that he can get maximum tax benefits along with higher returns.

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Although the filing deadline of June 15th is just 3 weeks away and the FBAR deadline of June 30th is only a little over a month away, a recent survey of over 200 Americans living overseas shows that 62% of respondents did not know about the FBAR.

“This is very worrying,” said David McKeegan of Greenback Expat Tax Services. “If these individuals do not know they need to file their Foreign Bank Account Reports they could unknowingly be putting their savings at risk and could face some very large penalties in the future.”

The US Department of Treasury requires all US citizens and green card holders with a financial interest in or signature authority over a foreign financial account to report these accounts to the US Treasury each year. The report must be received by the US Treasury on or before June 30th of the year immediately following the calendar year being reported. Even if you have an extension to file your US expat taxes you must file your FBAR by June 30th as there are no extensions. If you have a financial interest in or signature authority over financial accounts and these accounts exceeded $10,000 at any time during the calendar year you must file or face penalties of up to 50% of the account value.

The FBAR is a tool to help the US government identify persons who may be using foreign financial accounts to circumvent US law. Investigators use the FBAR to help identify or trace funds used for illicit purposes or to identify unreported income maintained or generated abroad. There is even some indication that the Treasury will begin to fine foreign financial institutions that help individuals hide assets overseas, which could be particularly worrying for certain large Swiss banks.

Although US expats are not the primary target for the FBAR, they are required to file the form if they have over $10,000 in financial accounts. Many people do not realize that there is such a thing as the FBAR, especially if they are filing their own taxes and did not have overseas assets when they were living in the US.

“It is very important for US expats to file the FBAR accurately and on time. Failure to file can lead to significant penalties.” said David McKeegan of Greenback Expat Tax Services. “If you have not been filing your US expat taxes while living abroad or did not know about the FBAR requirement you should try to come forward now, before the end of the 2011 Offshore Voluntary Disclosure Initiative (OVDI), which ends on August 31, 2011. This is your best opportunity to get caught up on your expatriate tax obligations and disclose your overseas bank accounts. No one knows what of how the penalties will be enforced in the future.”

About Greenback Expat Tax Services

Greenback Expat Tax Services specializes in preparation of US Expat Taxes for Americans living abroad. Incorporated in New York, Greenback?s CPAs have 30+ years specialist experience in US expat taxes. Greenback offers flat fee pricing ($329 for a federal return); a simple, hassle-free process; and, most importantly, CPAs who are experts in the ins-and-outs of US expat taxes. For more information and to download a free guide to US expat taxes, visit www.greenbacktaxservices.com
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Using Software for Taxes with Turbo Tax

Turbo Tax is one of the more popular online or store bought software applications on the market for individuals who want to prepare their own taxes but have a complex enough life that they need some support in doing it. Turbo Tax is an affordable way to get this specialized help without paying an accountant an arm and a leg to do the taxes for them. Turbo Tax is often up to five times less expensive than going to an accountant and gives similar results, being planned by professionals who are experts in taxes and lend their accounting advice to the programmers who design the software application. In this way, the individual is led through the process of doing their taxes fairly painlessly, walked through by a series of questions that morph depending on the answers given on the forms so that all avenues are covered for that individual and they can get the best result possible on their tax return.

Options

Turbo Tax is divided up into different levels of software applications that are designed to meet the needs of the individual filing his taxes. There is a free version that can be used by individuals who have a very simple tax return, not having many if any assets and a very low income bracket. With this version, the federal tax filing is free but there is an additional fee for the state income tax filing through the system. In fact, on all the different versions of Turbo Tax, the state filing is additional to the federal income tax filing software, so the individual needs to take that additional amount into consideration. The additional fee for the state taxes is only about twenty-six dollars for the free filing, and thirty-five dollars for all other versions.

For those who have a more complex income tax filing, meaning they own a home, have medical bills, donate to charities but do not have any stocks or bonds, then there is a version that costs about thirty dollars to file. With this in addition to the thirty-five for the state filing, the total cost is about sixty-five dollars, still under half the cost of most accountants who file taxes for individuals. If an individual has stocks, bonds, rental properties or other investments, then there is a Premier version of Turbo Tax that handles those issues and costs about fifty dollars plus the state filing of thirty-five. For such a complex filing, this is very inexpensive, although the individual must be more knowledgeable about the assets that he owns.

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If you have employees, you are responsible for payroll taxes. This is a term that lumps all the different forms of employment taxes into one category known as “payroll tax”. In reality, payroll taxes encompass Federal and state income tax withholding, social security and Medicare taxes (also known as FICA), Federal unemployment tax (FUTA), as well as any state and local unemployment taxes assessed. Payroll taxes are deducted each pay period from an employee’s gross pay. The remaining money distributed to the employee is what is known as “net pay”. Along with any taxes deducted from an employee’s wages, there is a social security and Medicare liability incurred by the employer. You must match the social security and Medicare amounts withheld on each employee. This is the employer paid contribution. Until recently, most employers reported and paid payroll taxes quarterly. With the advent of the EFTPS, or Electronic Federal Tax Deposit System, all employers now pay taxes on a monthly basis. The payroll taxes may also be paid via a tax coupon that is taken to your bank and presented with the monies to cover the payroll taxes due.
Every quarter, a Form 941 (or 943 for agricultural employees) must be filed with the IRS. The amounts reported on the 941 should reconcile to the amounts turned in each month via the tax coupon or the EFTPS. At the end of the tax year, a Form 940 or information return must also be filed.
If you are a small business with employees, or you plan to begin operating a business with employees, you need to understand your tax responsibilities as an employer. The IRS provides links to all the relevant Forms and Publications via their Internet. Here you will find definitions and terms associated with employees from the onset of hiring, to termination. W-4′s, W-2′s, I-9′s, all the employment taxes you will be responsible for reporting, all the rates associated with those taxes. The IRS also provides you with information concerning recordkeeping, employment eligibility verification, benefit and retirement plans, and even the definition to be used in order to determine if someone is an employee. There is a tremendous benefit to be had by investing the time and resources necessary to understand and comply with all the federal, state, and local regulations concerned with employees and payroll taxes. However, you should frequently seek the advice of a qualified tax professional, your accountant.

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Income Taxes: What Do They Go?

Remember the Boston Tea Party? In 1773, the king in England and his Parliment had just initiated the Tea Tax – and the settlers didn’t accept it. Many of them dressed up as Indians, boarded a trade ship from England with tea on it, and pushed a whole lot of the tea (it was the cargo) overboard. It was their way of rebelling against the new tax. Because the king believed it was Indians, nothing was done to those settlers, but it didn’t stop the tax. This tax came about the same time period as the Stamp Act and the Sugar Act (which both lowered taxes), but this was just too much.

Taxes have never been popular, as the Tea Tax showed, but taxes are a “necessary evil” in our modern society. The payment of income taxes funds the government in many ways. Let’s take a look at some of them.

Not Just A Little Red Schoolhouse

The first type of public education in America was a one-room schoolhouse, where all the grades were educated together – when it wasn’t harvest time. The room was fueled with a wood stove, and the students used Our public education is funded by our income tax money. Though some people choose to homeschool or send their children to a private school, the vast majority of Americans attend public school for at least a portion of their education. Though many people don’t like our public education program – especially in comparison to other countries – at least it does get many students educated fairly well.

I Don’t Know What You’ve Been Told…

…But the military is also funded by the government, specifically from our income taxes money. Whether you are for or against the war, most people would agree that it is important for American to maintain a strong military. And what funds the military? The money we pay as income taxes.

Respecting Your Elders

In our country, we pay money in to the Social Security program our whole working life. They just automatically take it as a deduction from our paychecks – whether we want them to or not. That money is set aside to give back to us when we’re old and gray and can’t work anymore. At least, in theory it is. In reality, the money is given to other people, older and grayer than we are, who are already receiving Social Security payments. The idea is that our children, when they work, will be funding our Social Security. It should work out just fine. But in reality, often the money input into the system isn’t enough to cover the number of people now receiving Social Security payments – and so our government is paying a lot of that. You got it – it comes from our income taxes.

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People do not believe they can have any say when it comes to their taxes and assessments, but they are wrong. The economy is in an uproar right now and cost are rising all around us. We as consumers have the opportunity to take measures in many ways to help ease the financial burdens. Get yourself in the habit of questioning everything you spend money on by asking yourself if there is a way that you can somehow reduce this cost. I am going to discuss one particular bill that you have probably never even thought to question in the past. Your property taxes,based on your assessment, this is a major bill that you are faced with every year. I want you to read this article and relate it to your situation. Take this seriously because the chances are you will be able to save a substantial amount of money on your taxes.

The crash in the housing market has drastically reduced the cost of homes on the market. There are very few areas in the country where housing prices have not decreased exponentially. Entire neighborhoods have lost value in their housing. If your house has lost value, challenge the assessment. If you anticipate a silver lining in the black cloud of declining home prices in the form of lower property taxes you may be disappointed. The National Taxpayers Union figures that as much as 60% of taxable property in the U.S. is over assessed, largely because assessment cycles have not caught up with the decline in home values.

In California, for example, a home’s assessed value is based on its purchase price, plus increases of up to 2% annually. The house is not revalued until it is sold again. This means that the home owners are paying taxes on the value of the house when they purchased it plus any yearly average increases. The fact is the real value of the home has without a doubt decreased in the face of our recent economy but the chances are your assessment has not. To capture the price plunge of the past few years, homeowners must file an appeal and prove that their home’s assessed value exceeds its market value. In San Diego County, the assessor’s office processed 80,000 appeals in 2008; the average reduction in assessed value so far is $110,000, equivalent to a tax cut of $1,200.

Many jurisdictions calculate a home’s assessment as a fraction of its market value, so do the math to make sure your home is priced fairly unless you enjoy paying taxes. Also verify that you have received any breaks you are entitled to, such as a homestead exemption or a reduction for seniors or veterans.

If you believe your home property assessment is to high you have the right to appeal. Go to the assessor’s Web site or office to double-check the “property card” and any working papers for your home. Are the figures for square footage and number of bedrooms and bathrooms correct? Has the assessor accounted for any features that could detract from your home’s value, such as an irregularly sized lot or a carport instead of a garage? Pull the property cards for five or ten neighboring homes that are similar in terms of age, style and features. If the assessments on similar properties are a lot lower-1O% or more you have a good case based on uniformity which means you could be paying less taxes. Everything you need is public record, meaning you have every right to request and receive the information.

If you believe your home’s assessment exceeds its market value, you will have to provide sales-price data for several comparable homes. You can get that information from a real estate agent, or check the local public library or your clerk’s office. Ask the assessor whether a recent appraisal for, say, a refinancing is acceptable proof of .your home’s market value.

Read your assessment letter for details on how to appeal. You will probably have two windows of opportunity. During the first, you may request a reduction in the assessment of your home for the forthcoming tax bill. During the second, you may appeal for a retroactive reduction and refund of taxes paid.

Until your appeal is resolved, pay your taxes in full to avoid incurring penalties and a lien against your home. As a last resort, you could go to court, but that is an expensive process usually best suited for commercial property owners with more at stake. You may see advertisements for companies that will help you appeal your assessment, often in exchange for about half of any savings on your taxes. But with the right preparation, you can do just as well yourself using a guide such as How to Fight Property Taxes ($6.95), from the National Taxpayers Union (www.ntu.org). The NTU’s Web site also has links to state and local taxpayer associations that may offer further insight into the appeals process.

In today’s economy you have to be proactive, every area of your life that you can save money you must take advantage of. As a home owner you have rights and just because the tax bill comes from a government agency does not mean that they are always correct. Exercise your rights and challenge your tax bill if you believe your home assessment is to high.

——

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An important function of any outsourced payroll processing service is their payroll tax service. Any payroll processing service that you are considering for your company must know how to solve any payroll tax service related problem. That is why you have to choose a company with competent payroll tax services.

Many people make the mistake of underestimating what it takes to start a business; and think that the whole thing is just a walk in the park. You initially focus only on the core functions of your business; but as time passes by, you discover that things are actually more complicated than you had anticipated and that you are doing payrolls and calculating taxes more than growing your business. At this point, you decide to outsource a payroll processing service to do the payroll and discover that they computed your payroll taxes using the matrix of a different state. Without proper payroll tax services and knowledge, outsourcing a payroll processing service is useless.

In order to avoid the scenario mentioned above, you, first, have to know how to compute payroll taxes yourself. You need to know about FICA taxes (these include social security and Medicare taxes), federal taxes, your local state taxes and the state taxes of all your branches. This way you can always check if your payroll processing service actually has a good payroll tax service as well.

Generally, when it comes to payroll tax services, it would be a wise decision to outsource your payroll processing service requirements to a company that has the expertise, experience and reputation in the field of payroll tax service and general payroll processing service. By doing your due diligence before outsourcing your payroll processing service you will ensure yourself of a worry-free payroll.

In order for you to be sure that the payroll processing service you hire can actually provide you with your needed payroll tax service, you need to ask them for suggestions on potential payroll tax problems and complexity. This way you will find out if they know what they are talking about. You may also ask your payroll processing service provider for sample calculations using some of your own employee payroll data just to make sure that they are familiar with the payroll tax service you need.

It always pays to do your homework when looking to outsource the right payroll processing service for you. You can avoid the hassles of tax penalties if you hire a payroll processing service with the right payroll tax service you need.
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