Related Tax Articles

• IRS Vehicle Donation Program for Charity

  Significant Benefits for the Taxpayer and the Charitable Organization During these tough economic times we all want to help in any way we can. You may want to donate your used vehicle to a charity of your choice to help... Significant Benefits for the Taxpayer and the Charitable Organization During these tough economic times we all want to help in any way we can. You may want to donate your used vehicle to a charity of your choice to help those who are less fortunate. Donating your used vehicle is an effective way to raise money. There are significant benefits for the charitable organization and the taxpayer if, the organization is well managed. IRS Recordkeeping and Filing Requirements The General Accounting Office estimates 733,000 returns had a tax deduction for a vehicle donation. These donations were valued at about $2.5 billion. This reduced the taxpayer liability by an estimated $654 million. This is certainly good news for the taxpayer and also for those in need. There are a few important steps you need to take in order for this to work properly. You must receive written acknowledgement from the organization for the donation The donation of the used vehicle will be valued at the fair market price You must claim the deduction for the vehicle for the year it was donated Make sure the organization is qualified Donations are Simple You are able to get rid of an old car you donʼt want or need anymore. While helping a worthy cause, you are eligible to take advantage of the tax provisions that allow for the profits to be deducted from your income tax. The IRS supports the generosity of Americans who are helping their fellow Americans. This tax deduction for the donation of a used vehicle is for taxpayers who itemize their deductions. You can accept the standard deduction or itemize each deduction you have if, itʼs worth more than the standard deduction. Many Organizations have a Program for a Charity Donation Letʼs face it; weʼre all trying to keep our taxable income as low as possible during these times. If we can help others and have a little benefit for us too then, itʼs good for all involved. Just remember what you have to do in order to take advantage of the deduction. A few simple steps can avoid big problems later. To learn more about IRS Vehicle Donation Programs for Charity please visit TurboTax Online. TurboTax Online will help you meet all of the IRS requirements to get the largest deduction possible.

• Stimulus Check, Tax Rebate Calculator

  Did you receive a stimulus payment in 2008, but it was less than you were expecting? You can review your information using a tax rebate calculator. These calculators will help you determine the amount that your stimulus payment should have... Did you receive a stimulus payment in 2008, but it was less than you were expecting? You can review your information using a tax rebate calculator. These calculators will help you determine the amount that your stimulus payment should have been. Try using an online tax calculator such as the one available at TurboTax Online. It will ask you very simple questions regarding your marital status, number of dependents, and a few questions regarding your income. This a free tool that is offered to help you determine the amount you should have received. The government issued over 130 million payments that started going out on May 2nd and finished up on July 11th. There was a small amount of individuals who received their payments after this date that required additional time to process. If you were late in filing your return and missed the April 15th deadline, the government will continue to send out checks weekly. If you received a smaller amount than expected it could be due to the following reasons: Your adjusted gross income exceeded $75,000.00 Your income came from supplemental security income Your income came from pension and annuity payments Your child turned 17 in December of 2007 Your qualifying income is less than $3,000.00 You were claimed as a dependent on someone else’s return You paid less than $600.00 in federal income tax. You do not have a social security number Additional payments will be made by a credit offered on your 2008 return that you will file in 2009. If you have had a change in income or dependent amounts then you may receive additional stimulus funds. TurboTax will automatically notify you if you qualify for the recovery rebate credit. Visit TurboTax Online and try the free stimulus tax rebate check calculator.

• Allowed Job, Work, Gas, & Travel Mileage Deduction Amount

  There can be potentially huge tax savings by deducting your vehicle mileage. There are many reasons that your mileage may be tax deductible. If you must travel for your job and use your own vehicle then those miles are tax... There can be potentially huge tax savings by deducting your vehicle mileage. There are many reasons that your mileage may be tax deductible. If you must travel for your job and use your own vehicle then those miles are tax deductible. You can choose to take these optional standard rates if you are an employee, self-employed, and all other taxpayers if you have vehicle operating costs that fall in to tax deductible categories. What is deductible? Mileage for Work Related Travel Medical Travel Mileage Moving Travel Mileage Servicing for Charitable Organization Mileage Mileage Deduction Amounts 50.5 Cents Per Mile For Business 14 Cents Per Mile For Charitable 20 Cents Per Mile For Medical 20 Cents Per Mile For Moving The rate for business travel has recently increased. It was previously at 48.5 cents per mile for 2007. Due to the current state of the economy the IRS has offered an even higher tax break that will cover mileage deductions from July 1st, 2008 through December 31st, 2008. The rate for business purposes for this six month window will be 58.5 cents per mile. The rate for moving or medical purposes for this six month window will be 27 cents per mile. The deduction for charitable travel will remain the same. The reasons for this increase are the higher price with fuel and the increased price of vehicles. The standard rate for business, moving, and medical comes from an annual study that is done to determine the costs of operating a vehicle. The IRS will usually hire an outside company to complete this study. The standard rate for charitable travel is set by a previous statute and has not seen any recent increase. To learn more about travel mileage tax deductions please visit TurboTax Online. TurboTax Online offers free tax software to help you maximize your vehicle mileage deductions.

• Federal Tax Withholding Info & Calculator

  Paycheck Withholding You may think we pay our taxes by April 15 but, this is not true. A little bit of what we owe is taken out of every check we get. What we pay in April is the difference... Paycheck Withholding You may think we pay our taxes by April 15 but, this is not true. A little bit of what we owe is taken out of every check we get. What we pay in April is the difference between what we have already paid and the total amount we owe. A withholding tax is taken out of a salary, wage income, tips earned, pensions, retirement distributions and certain gambling winnings. Withholding is also taken out of interest and dividends earned. Income Taxes Withheld on Wages The amount of tax withheld from your wages depends on your marital status and how many dependents you claim. You have to file Form W-4 with your employer. If you do not do this, they assume you are a single person with no dependents. Form W-2 Your employer must give you duplicate copies of your 2008 W-2 form by January 31, 2009. This is a statement of all of the wages you have earned for that year, the withheld income and the Social Security tax. If you no longer work at your place of employment before the year ends then, you may ask your employer with a written request within 30 days of leaving the job for your W-2 form. Withholding Should Cover Your Estimated Tax By filling out a W-4 form with your employer, you can adjust your withholding tax. The number of allowances you claim will either increase or decrease the amount of taxes being taken out of your check. On your W-4 you may also claim other allowances like the child tax credit and many others. Are You Withholding Too Much or Too Little? If you have to pay a large tax at the end of the year, you had too little held. If you are getting a large tax refund, you had too much held. If you are not expecting a tax refund, you may want to pay more each quarter to avoid paying so much at the end of the year. Paycheck Tax Withholding Calculator This valuable tool looks at your entire tax situation, including your other income and expenses, and figures out what you'll actually owe on your taxes for the year. The TurboTax Online Calculator then determines how much you should have withheld to cover what you'll owe for the year, without giving Uncle Sam a big loan.

• Schedule C Form Instructions for Filing

  For small business owners and the self employed, perhaps the most important form on their tax return is Schedule C, where income and expenses are reported and the profit and loss of a business are calculated. If you are a... For small business owners and the self employed, perhaps the most important form on their tax return is Schedule C, where income and expenses are reported and the profit and loss of a business are calculated.  If you are a sole proprietor, all of your income and expenses relating to your business are reflected on this schedule.  This schedule is more straightforward than many forms you need to file with your return.  But it does require supporting schedules for common items like the home office deduction, Section 179 and depreciation expenses, and vehicle expenses.   These items are calculated on separate forms and schedules, and then the appropriate amounts are included on Schedule C. One of the things you may find most challenging is deciding upon the appropriate business activity code which must be included on Schedule C.  As the business owner, the IRS allows you considerable latitude in determining the business activity code that most closely matches your business.   What you must take care of, however, is that if you have businesses that generally or primarily engage in different activities, you are required to file a separate Schedule C for each business activity.  You are not required to file a separate Schedule C for an activity that is merely incidental to the primary business activity.  For example, if your principal business activity is a property manager of real estate, and you are a licensed real estate agent who occasionally receives a commission for your work as an agent -  you would not need to file a separate Schedule C unless your agency acted entirely independently from the property management business. You'll find everything you need at Turbo Tax Online to help you prepare and file your taxes online. 

• How to Calculate Federal Income Tax

  Federal Income tax is calculated based on the formulas established by the Internal Revenue Service according to the Internal Revenue Code, which is the tax law passed by Congress and updated from year to year. For most taxpayers, the calculations... Federal Income tax is calculated based on the formulas established by the Internal Revenue Service according to the Internal Revenue Code, which is the tax law passed by Congress and updated from year to year. For most taxpayers, the calculations are fairly simple. If you do not report business income, and use the standard deduction for all taxpayers, rather than itemizing your deductions, you may use a tax calculator and input a few simple items of information to determine the tax you owe: Age Filing Status (married filing jointly or separately, single, or head of household) Number of Dependents Other exemption items, i.e. for disabilities such as blindness Wages or Salary for the year Other Income, such as retirement benefits, interest and dividends, alimony, etc. Non-itemized deductions, like IRAs or other retirement savings Any tax credits Unfortunately, the tax code has become very complex. Once you come to the determination of your dependents and the other items, there are IRS rules to follow. Fortunately, with a good tax calculator like TurboTax, there are step by step instructions that walk you through each of these steps. Also, for most income and deduction items, wages, salaries, interest, dividends, etc., you will receive a year end tax statement, usually in the form of a W-2 or 1099. These are documents the payer is required to send to you, so you do not have to produce or calculate them yourself. Also, for many of the deductible items, like an IRA, you will also receive a statement from the custodian of the account, which tells you how much of a deduction you will be entitled to. In the end, all you need to do is gather a few records then go to the tax calculator at TurboTax Online, where the calculation will be done in a matter of seconds. Then you will know if, or how much of a refund you can expect to receive.

• Home Based Business Tax Breaks

  You may be able to deduct certain expenses for the part of your home you use for business whether you are self-employed or are an employee. Part of your home must be regularly and exclusively used for business to deduct... You may be able to deduct certain expenses for the part of your home you use for business whether you are self-employed or are an employee. Part of your home must be regularly and exclusively used for business to deduct expenses for home based business tax breaks. Here are the guidelines: Your home must be the principal place of business for your trade or business Your home must be the place where you meet and take care of your clients, patients, or customers in the normal course of business or your trade If you use a separate structure that is not attached to your house it must be in connection with your business or trade There is something called the exclusive use of requirement rule. This means you cannot deduct a home based business tax break if you also use that part of your home for personal use. For example, if you use a spare bedroom as an office and conduct your business in there, you then cannot use the same bedroom as a guest room. If the spare room is used for any personal use you canʼt claim the space as a tax deduction. There is a test called the principal-place-of-business test. You must determine that your home is the principal place of your business or trade. You must determine where your most important activities are performed and where most of your time is spent, in order to deduct expenses for the business use of your home. Deductions also may be taken for the regular use of a residence if youʼre providing day care services or for business storage purposes; exclusive use is not required in these cases. If you rent out your residence you also may take deductions, see Publication 587. You may not deduct expenses for lawn care, new landscaping in general or for redecorating a room that is not used for business. Deductible expenses for a home based business use include the business portion of real estate taxes, deductible mortgage interest, rent, casualty losses, utilities, insurance, depreciation, maintenance and repairs. To figure the amount you can deduct for the home based business tax break, you can use the entire amount of expenses attributable solely to the portion of the home used in your business. The percentage of your home used for business determines the amount you can deduct for expenses. To calculate this percentage, divide the number of square feet used for business by the total square feet of your home. If the rooms are about the same size then, base it on how many rooms you have in total by how many are used solely for business. If youʼre a day care provider then, itʼs based on how many hours are used for business by how many hours are used for personal use. If you have any other home business questions, TurboTax Online has a comprehensive web site that can give you the answers. If you run a business out of your home then, you do qualify for the home based business tax deductions. Donʼt miss out on the many deductions you qualify for.

• How to Figure and Compute Income Taxes Online

  Figuring and computing income taxes can be a difficult and cumbersome process. When you use TurboTax online, it is much easier to accomplish. A good starting place is the Tax Estimator provided by TurboTax on its web site. Walking through... Figuring and computing income taxes can be a difficult and cumbersome process. When you use TurboTax online, it is much easier to accomplish. A good starting place is the Tax Estimator provided by TurboTax on its web site. Walking through the process with the Estimator will tell you everything you need to know for the entire process. First, you start by entering the personal information that is relevant to your situation. Your personal address is very important in determining state and local income taxes. You also have many personal exemption options as well as your filing status (single, married filing jointly or separately, etc.), that will impact the final amount of your income tax computation. The second tab of the estimator is for your income. This includes your W-2 income, business income, capital gains and losses, social security benefits, and miscellaneous income from other sources. The next tab allows you to enter your deductions, including medical expenses, non-income related taxes, mortgage interest, charitable contributions, and other personal deductions allowed under the tax code. Finally, on the fourth tab, enter taxes and credits. These are the withholdings and estimated payments you have already made, and credits for child care, tuition, etc. When you click on the last tab, TurboTax will show you your tax liability and payment due or refund. By going through this simple process, you are ready to go back and prepare your taxes using TurboTax software. Plan ahead, go to TurboTax Online now to figure and compute your income taxes.