A reminder to Home based Businesses on choosing the Simplified Method to Claim the Home Office Deduction. The advantages Of Simplified Claim Method are :
1. Reduce Paperwork
2. Reduce Record Keeping
Home Office Deduction is based upon the Square Feet area at 5$ Per Sq. Feet, up to a maximum Of 300 Sq. Ft. i.e. $1500.00 Max.
Self employed Individuals can claim this deduction on Schdule C Line 30. Form 8829 is not required when Simplified method is used.
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Sunday, March 29, 2015
Monday, March 23, 2015
" Did You Receive Identity Verification Letter From IRS? "
When Suspicious and Fraudulent Tax Returns are filed to get Tax Refunds, IRS mails the Identity Verification Letters (5071C) and puts the Tax Return Processing on hold until the Taxpayer's Identity is verified.
The Taxpayers who receive Letter 5071C should access IRS Site - idverify.irs.gov and correctly answer Identity Verification Questions that only the Taxpayer can. After the Identity is verified the Taxpayer needs confirm if the Tax Return was filed .
If the Tax Return was was filed, IRS will remove the hold and resume processing. It takes 6 weeks to process the return and issue a Refund Check. If the Tax Return was not filed IRS will reject the Tax Return on Hold as if the Tax Return was never filed.
IRS never calls or send emails to Taxpayers, so be aware of Scammers who try to steal Tax payer Identities.
The Taxpayers who receive Letter 5071C should access IRS Site - idverify.irs.gov and correctly answer Identity Verification Questions that only the Taxpayer can. After the Identity is verified the Taxpayer needs confirm if the Tax Return was filed .
If the Tax Return was was filed, IRS will remove the hold and resume processing. It takes 6 weeks to process the return and issue a Refund Check. If the Tax Return was not filed IRS will reject the Tax Return on Hold as if the Tax Return was never filed.
IRS never calls or send emails to Taxpayers, so be aware of Scammers who try to steal Tax payer Identities.
For Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
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Saturday, March 21, 2015
" When Are The 2015 Estimated Tax Payments? "
List 2015 Form 1040-ES Estimated Tax Payment Info:
1. Payment Dates:
1st payment = April 15, 2015
2nd payment = June 15, 2015
3rd payment = Sept 15, 2015
4th Payment = Jan 15, 2016
2. Payment Address:
Internal Revenue, Service, P.O. Box 510000, San Francisco, CA 94151-5100
For Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
For Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
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Thursday, March 19, 2015
"When To Take Required Minimum Distribution From Retirement Plans?"
If you Turned 70 1/2 years during 2014, you have to Take Required Minimum Distribution (RMD) by April 1, 2015. The Retirement Plans include IRA, 401(k), 403(b), 457 plans. RMD amount is based upon Life Expectancy Tables and worksheets in IRS Pub 590-B. Also, you will be required to take a second RMD Distribution for 2015 by Dec 31, 2015.
Suggest Tax Planning for RMD Distributions of 2015.
For Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Suggest Tax Planning for RMD Distributions of 2015.
For Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
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Tuesday, March 17, 2015
" What Free Tax Help Is Available To Military? "
Free Tax Tips For Military Personnel:
1. Armed Forces Tax Council (AFTC) - Oversees Military Tax Programs Offered World wide. AFTC Partners with IRS to do Outreach to the military including Air Force, Army, Navy, Coast Guard, Marine Corps.
2. Military VITA Sites - Staff of Trained Volunteers provide Tax help on Benefits and Combat Zone pay and extensions to File Tax Returns Including Earned Income Tax Credit and New health care laws.
3. Bring Photo ID, Last year's Tax Return and all the Tax Docs you received along with relevant Income & Expenses Documentation.
4. Joint Returns - Bring a Valid Power Of Attorney (POA) if both of you can't be present - Special Exceptions if Spouse is in the Combat Zone and unable to sign.
5. IRS Free File Program - If your income is less than $60,000 you can you can use online brand name software on line and electronically fillable forms and Free efile.
For Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Facebook : www.facebook.com/yma.taxpro
Twitter : http://twitter.com/kash_yajnik
Linked In: http://linkedin.com
1. Armed Forces Tax Council (AFTC) - Oversees Military Tax Programs Offered World wide. AFTC Partners with IRS to do Outreach to the military including Air Force, Army, Navy, Coast Guard, Marine Corps.
2. Military VITA Sites - Staff of Trained Volunteers provide Tax help on Benefits and Combat Zone pay and extensions to File Tax Returns Including Earned Income Tax Credit and New health care laws.
3. Bring Photo ID, Last year's Tax Return and all the Tax Docs you received along with relevant Income & Expenses Documentation.
4. Joint Returns - Bring a Valid Power Of Attorney (POA) if both of you can't be present - Special Exceptions if Spouse is in the Combat Zone and unable to sign.
5. IRS Free File Program - If your income is less than $60,000 you can you can use online brand name software on line and electronically fillable forms and Free efile.
For Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Facebook : www.facebook.com/yma.taxpro
Twitter : http://twitter.com/kash_yajnik
Linked In: http://linkedin.com
Monday, March 16, 2015
" When Do You Pay Additional Medicare Tax? "
Generally, 1.45% of the wages reported on W2 Form given to Employee are tagged as Medicare Tax without any Wage Limit i.e. They are limit less. Similarly, Self employed also pay Medicare Tax.
Beginning in TY2013, Additional 0.9% Medicare Tax was imposed for High Income Earners. These Income Thresholds are listed below:
Filing Status Earnings Over Additional Medicare Tax
MFJ $250,000
S, HOH, QW $200,000
MFS $125,000
Form 8959 is used to compute Additional Medicare Tax and is reported on Form 1040.
For Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
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Beginning in TY2013, Additional 0.9% Medicare Tax was imposed for High Income Earners. These Income Thresholds are listed below:
Filing Status Earnings Over Additional Medicare Tax
MFJ $250,000
S, HOH, QW $200,000
MFS $125,000
Form 8959 is used to compute Additional Medicare Tax and is reported on Form 1040.
For Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
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Thursday, March 12, 2015
" When Are The C-Corp/S-Corp Tax Returns Are Due? "
TY 2014 Tax Return for C Corp. or S Corp. are due by March 16, 2015. Following actions are suggested if Filing Extension is required:
1. File Form 7004 For 6 Months Extension by 3/16/2015.
2. If Tax is Owed, Pay the Estimated Tax Along with the 7004.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
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1. File Form 7004 For 6 Months Extension by 3/16/2015.
2. If Tax is Owed, Pay the Estimated Tax Along with the 7004.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Facebook : www.facebook.com/yma.taxpro
Twitter : http://twitter.com/kash_yajnik
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Monday, March 9, 2015
'" Is Social Security Taxable ? "
If the Combined Income exceeds the Thresholds listed below, up to 85% Of Security Income may be Taxable depending upon Tax Payer's Filing Status. List the details:
1. S or HOH:
1.1 If the Income is Below $34.001, Up to 50% of Social security Benefits are Taxable.
1.2 If The Income is Above, $34.001, Up to 85% of Social security Benefits are Taxable.
2. MFS -
2.1 If the Spouses live apart through out the year - Benefits are Taxed at Same as Single Person.
2.2 If the Spouses lived together any time of the year, Benefits Taxed at 85% regardless of Income.
3. MFJ -
3.1 If the Combined Income is greater than $32,000 but less than $44,001 up to 50% Benefits are Taxable.
3.2 If the Combined Income is greater than $44.001 up to 85% Benefits are Taxable.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
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1. S or HOH:
1.1 If the Income is Below $34.001, Up to 50% of Social security Benefits are Taxable.
1.2 If The Income is Above, $34.001, Up to 85% of Social security Benefits are Taxable.
2. MFS -
2.1 If the Spouses live apart through out the year - Benefits are Taxed at Same as Single Person.
2.2 If the Spouses lived together any time of the year, Benefits Taxed at 85% regardless of Income.
3. MFJ -
3.1 If the Combined Income is greater than $32,000 but less than $44,001 up to 50% Benefits are Taxable.
3.2 If the Combined Income is greater than $44.001 up to 85% Benefits are Taxable.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
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Friday, March 6, 2015
" What Are The Effects Of Early Retirement Withdrawals ? "
Tax Payers need to plan for the Effects Of Early Retirement Plan Withdrawals i.e.Retirement Plan Withdrawals Before the Age of 59 1/2 Years. These withdrawals can be Taxable or Non-Taxable.
1. Non Taxable Withdrawals - Check out the Applicable Exceptions . Rollover Assets from one Retirement plan to another within 60 days.
2. ** Taxable Distributions - Unless the Exceptions apply, they have two major impacts:
o Penalty - 10% IRS Penalty plus 2.5 % California Penalty.
o Taxable Distribution - Taxpayer Taxable at the Marginal Tax Rate
** Suggest Taxpayer to Put aside these amounts to Avoid Future shock of Tax Liability.
3. Form 5329 - File for Additional Taxes if applicable.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Facebook : www.facebook.com/yma.taxpro
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1. Non Taxable Withdrawals - Check out the Applicable Exceptions . Rollover Assets from one Retirement plan to another within 60 days.
2. ** Taxable Distributions - Unless the Exceptions apply, they have two major impacts:
o Penalty - 10% IRS Penalty plus 2.5 % California Penalty.
o Taxable Distribution - Taxpayer Taxable at the Marginal Tax Rate
** Suggest Taxpayer to Put aside these amounts to Avoid Future shock of Tax Liability.
3. Form 5329 - File for Additional Taxes if applicable.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Facebook : www.facebook.com/yma.taxpro
Twitter : http://twitter.com/kash_yajnik
Linked In : https://www.linkedin.com/nhome/?goback=%2Ebzo_*1_*1_*1_*1_*1_*1_*1_*1_yajnik*5and*5mehta*5associates&trk=hb_signin
Wednesday, March 4, 2015
" Is Unemployment Income Taxable? "
Unemployment Compensation is Taxable at Federal Level. Taxpayer receives 1099-G Form stating the Taxable Unemployment Income and Taxes Withheld by Jan 30 of the following year.
Union Benefits may also be Taxable. Generally, it is a good idea to withhold Taxes form the Unemployment Compensation to avoid future Tax burden. Fill out Form W- 4V to withhold Taxes from Unemployment Income.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Facebook : www.facebook.com/yma.taxpro
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Union Benefits may also be Taxable. Generally, it is a good idea to withhold Taxes form the Unemployment Compensation to avoid future Tax burden. Fill out Form W- 4V to withhold Taxes from Unemployment Income.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Facebook : www.facebook.com/yma.taxpro
Twitter : http://twitter.com/kash_yajnik
Linked In : https://www.linkedin.com/nhome/?goback=%2Ebzo_*1_*1_*1_*1_*1_*1_*1_*1_yajnik*5and*5mehta*5associates&trk=hb_signin
Monday, March 2, 2015
" Do You Qualify For Free File IRS Program? "
If your Income was less than $60,000 in TY 2014, you Qualify for Free File From IRS. About 70% of the Americans are estimated to Qualify.
IRS Free File Program High Lights:
1. Fillable Tax Electronic Versions Of Forms
2. Partnerships with 14 Tax Software Manufacturers making their Products Free.
3. Free efile on IRS.Gov
4. Free Extensions
5. Quick Refunds with IRS efile.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Facebook : www.facebook.com/yma.taxpro
Twitter : http://twitter.com/kash_yajnik
Linked In : https://www.linkedin.com/nhome/?goback=%2Ebzo_*1_*1_*1_*1_*1_*1_*1_*1_yajnik*5and*5mehta*5associates&trk=hb_signin
IRS Free File Program High Lights:
1. Fillable Tax Electronic Versions Of Forms
2. Partnerships with 14 Tax Software Manufacturers making their Products Free.
3. Free efile on IRS.Gov
4. Free Extensions
5. Quick Refunds with IRS efile.
Q & A Contact : Kash, (925) 963 4891 @ Yajnik & Mehta Associates (YMA)
Facebook : www.facebook.com/yma.taxpro
Twitter : http://twitter.com/kash_yajnik
Linked In : https://www.linkedin.com/nhome/?goback=%2Ebzo_*1_*1_*1_*1_*1_*1_*1_*1_yajnik*5and*5mehta*5associates&trk=hb_signin
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