Frequently Asked Questions
As of March 20, 2020, the Treasury Department announced the following covid-19 tax deadline guidelines, giving certain taxpayers and businesses an additional 90 days to file and pay their 2019 tax liability. Here are the key dates.
Tax return deadline – July 15, 2020. Your tax filing is now due on this date. If you need more time, you can request an extension to October 15, 2020. Read the FAQs below for details.
Tax payment deadline – July 15, 2020. If you owe income taxes for 2019, you can delay your IRS payment until this time. You will not owe interest or penalties if you pay before this deadline.
Frequently asked questions about the coronavirus tax deadline changes
Q. Who is eligible for the tax payment deferral?
A. The following types of filers are eligible to use the special coronavirus tax extension.
- Individual Form 1040 filers
- Corporations
- Trusts
- Estates
- Partnerships
- Associations
- Companies
Q. What do I need to do to delay my filing and tax payment?
A. You must file your tax return or extension by July 15 as you normally would. The 90-day tax payment deferral itself is automatic when you file, which means interest and penalties are automatically waived for 90 days and won’t accrue for qualifying taxpayers and businesses until after July 15.
Q. What if I need more time to prepare my return?
A. You must file Form 4868 to request an extension by July 15, 2020. This extension would give you until October 15 to file your return, but your payment would still be due by the extended payment deadline, July 15, 2020.
Q. What if I’m getting a refund? Does this news affect me at all?
A. It should not affect you if you’re receiving a refund. The Treasury Department says you should still expect to receive your refund within the normal time period (9 out of 10 are received within 21 days of electronic filing).
Q. What types of payments does this deferral cover?
A. It covers income tax payments, as well as any normally associated interest and penalties, such as the failure-to-pay penalty. It also covers estimated tax payments (included payments of tax on self-employment income) due on April 15, 2020, for the 2020 tax year.
Q. How much can I defer?
A. There is no limit on the amount of tax payment you can defer.
Q. Does this deferral apply to 2020 estimated tax payments?
A. Yes. At this time, the tax payment deferral includes the first 2020 estimated tax payment (including estimated self-employment taxes) otherwise due on April 15, 2020.
Q. Does this announcement mean I don’t owe taxes for 2019?
A. No, the deferral only extends the due date of when your tax liability is due. Interest and penalties will again accrue on outstanding tax liabilities starting July 16, 2020. The deferral does not exclude or exempt taxpayers from filing if they are already required to file.
If individual tax meeting: Bring a copy of your prior year tax return and current year information (W-2, 1099, a list of deductions). We will make a list of additional items needed after the first meeting. See the Income Tax Organizer under Tax Tips.
If business tax meeting: Bring a copy of your prior year tax return and all current year financial statements or equivalent. We will make a list of additional items needed after the first meeting.
No, you can drop off your information or send it by Email (accounting6@silvasbox.com) and we will call you with questions, etc.
Fax or email a copy of the tax notice to us and we will analyze it and prepare a response.
We can provide you with a list of standard business expenses. Basically, you can deduct the money that your business directly spends on services, rental space, equipment and other items. As long as there is no gray area, such as is with home-based businesses, an expense will usually qualify as deductible.
Yes, each entity type is treated in a different way for taxes. Maybe you are a sole proprietor looking to incorporate or trying to decide between LLC and S Corp; either way, you will want to know how your choice is going to affect you when filing taxes.
This is a very important question because you have more responsibilities for a true employee, such as withholding income taxes and paying a portion of the employee’s employment taxes. In order to determine the answer to this, you will need to discuss your specific situation in order for us to provide you with the best way to treat those providing services to you.
This is an important question if you work from home. You can deduct utility and mortgage or rent amounts that you spend on your home office, but there are certain guidelines you must follow. As your tax preparer, we will know the exact answers that pertain to your situation.
You should keep all tax information you receive to provide to your tax preparer. Examples are W-2 forms, broker statements, bank interest statements, 1099 forms, end of the year Social Security statements, K-1 forms, etc. After you submit them to us.
The first step you should take when starting your small is business is to contact us at Master Accounting and Tax Service to schedule a free initial consultation so we can explain all of your options and what would work best for you.
The first step you should take when starting your small is business is to contact us at Master Accounting and Tax Service to schedule a free initial consultation so we can explain all of your options and what would work best for you.
You’re not the first person to say their records are a mess and you are embarrassed for anyone to see the paper mounds let alone organize them. You should start by contacting us. We can organize your records, set you up on QuickBooks Pro and get you organized and your accounting up and running. Do not be ashamed of paperwork. We love paper!
We will usually provide you with a balance sheet and profit & loss as well as other reports based on your needs.
Yes, We are open 6 days a week during tax season. M-F we are open 8 to 5 or by appointment. Just call and make an appointment for weekends and evenings.
Income tax is, basically, the taxes put on everything you earned over the past year as income. Taxable income is a surprisingly wide category. If you have a full-time job, that’s probably going to account for the majority of your income that’s going to get taxed. But it’s far from the only thing that’s getting taxed. In addition to full-time income, freelance and self-employment income gets taxed, as do any unemployment benefits you receive from the government. Severance pay can also get taxed. Additional wages and tips are also subject to taxation. Essentially, income from a job is taxed – whether that job is maintained or lost.
How much you will owe in income taxes depends on how much taxable income you made over that year. Income is placed into tax brackets to determine how much it is taxed.
In a bracketed system, those who make more money get taxed a higher percentage for that additional money they make. The ideal execution of this system is that those in the top percentages of income in the country pay a significantly higher level of taxes on their millions than those who make far less.
The income you make is taxed at various rates depending on how much you make: 10%, 12%, 22%, 24%, 32%, 35% and 37%. The specific income ranges that get put into these tax ranges will depend on whether you filed your taxes as a single person, married filing jointly, married filing separately or head of household. If you were to calculate how much you owed in taxes by knowing how much taxable income you made that year, you’ll need to calculate all tax brackets you are technically in. Let’s say you filed as a single individual and made $100,000 in the last year.
For a single filer, the first $9,525 gets taxed at 10%, or $952.50. The $9,526-$38,700 range gets taxed at 12%, which comes out to $3,501. $38,701-$82,500 is taxed at 22%, aka $9,636. The rest of your income is taxed at 24%, which ends up being $4,200. Add them up ($952.50 + $3,501 + $9,636 + $4,200) and you end up with $18,289.50 in taxes for the year. That means even though you’re technically in the 24% tax bracket, overall you paid about 18.3% in income tax.
Qualified education expenses are costs associated with a college education. This includes amounts paid for tuition, fees, school supplies, and other student costs. Items that cannot be expensed include room and board, insurance, medical expenses, transportation, non-credit courses, etc.
Each dependent comes with a tax exemption, so it’s important to solidify who can and cannot be claimed. Put simply, a dependent is anyone you support financially. A key requirement: you provided a least half of the dependent’s support for the year. This includes food, clothes, shelter, etc.
