FREQUENTLY ANSWERED QUESTIONS
HOW MUCH DO YOU CHARGE?
We aren’t sky high like some firms nor are we dirt cheap. We tend to land somewhere in between. Tax preparation is not just entering numbers in boxes. We have spent years studying and completing tax returns so we know the right questions to ask to help maximize your refund or minimize what you owe. We explain to you, simply and clearly, what goes into your tax return and alert you on upcoming changes to watch out for. The price you pay for preparation and filing of your return is just the beginning of the value we provide. We are open year-round to help you with tax planning or as questions or situations arise. We want you to think of us as part of your financial power team, helping you get where you want to go, successfully.
IMPORTANT INFO FOR 2020 & 2021 TAX FILING
Unemployment: The latest stimulus bill provided relief for taxpayers by waiving Federal taxes on the first $10,200 of unemployment received in 2020 or $20,400 per married couple. If you filed early in 2020 and owed taxes due to unemployment, the IRS will be recalculating your tax liability and issuing refunds. The IRS requests that you do not file an amended tax return.
Stimulus Payments: In May/June of 2020 you may have qualified for a stimulus payment of $1200 and in Dec 2020/Jan 2021 you may have qualified for a stimulus payment of $600. If you were eligible to receive both of these and didn't, we can claim them as a credit on your 2020 taxes
Withholding is calculated using the Percentage or Wage Bracket Method: One of the biggest changes, beginning with the 2020 Form W-4, is that employees will no longer be able to request adjustments to their withholding using withholding allowances. Instead, employees will use the new Form W-4 to provide employers with amounts to increase or reduce taxes and amounts to increase or decrease the amount of wage income subject to income tax withholding. The withholding tables have been revised to include three filing statuses: single, married filing jointly, and head of household.
Contributions to 401(k)'s and HSA's for 2021: Individuals can contribute $19,500 to a 401(k), HSA contributions increase $50 for an individual to $3,600 & $100 for families to $7,200
Can you help me with a letter I got from the IRS?
Yes! Even if it is a result of taxes you filed yourself or somewhere else.
CAN YOU HELP ME FILE SEVERAL YEAR'S WORTH OF TAXES?
Absolutely! We get this question a lot so don’t think you are alone. If you have missing documents, we can help you get transcripts from the IRS and take it one step at a time.
WHAT IS AN ENROLLED AGENT?
You may have noticed that Brenda is an Enrolled Agent. This certificate is given by the IRS to individuals who have demonstrated their high tax knowledge by passing a three-part examination. Commonly referred to as an EA, someone with this certificate can represent a taxpayer before the IRS in matters of audits or to negotiate for taxpayers when large sums of money are due.
IS SOCIAL SECURITY INCOME TAXABLE?
It depends. Actually, this is the answer to many tax questions. Depending on how much other income you have, up to 85% of your Social Security can be taxable income.
IS UNEMPLOYMENT INCOME TAXABLE?
Yes... It is just like earning wages. Worker’s Comp. is not normally considered taxable. However, there are some employer provided insurance programs that may be considered taxable income.
WILL THE IRS EVER CALL ME?
First contact from the IRS should always be a letter sent via regular mail. Technically, they will call you if you have asked them to in response to a such a letter. No doubt you may have received one or more (many more in some cases) of those crazy calls saying they are coming to arrest you or our favorite, “a serious matter has been pressed upon your name.” HANG UP! Beginning 2018, the IRS did authorize certain collection agencies to call on their behalf. The names of those specific agencies may be found at www.irs.gov
CAN I DEDUCT MY SURFBOARD?
Okay, this isn’t really a FAQ, but the answer is yes, only under certain circumstances. And yes, we have done it!