Tax Carnival Ecstasy – October 23, 2012

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Welcome to the October 23, 2012 edition of Tax Carnival Ecstasy. In this edition we start with Anisha from the NerdWallet who takes a look at oil companies and the taxes they pay. Bill Smith reviews H&R Block‘s small business tax software. Anna Deguzman looks over the Fiscal Cliff and how the two presidential candidates will handle the crisis. Finally we have four easy ways to save money on your taxes that you can implement before the year ends. Hope you get a chance to read all the posts here, bookmark for later, share on the social networks like Twitter and Facebook and follow the carnival in the future.

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Bill Smith presents File Your Taxes posted at 2010Taxes, saying, “When it comes to online tax filing security is the major issue. Many people may like the concept or many might look down, most of them may feel worried about putting their information all on the internet and doubt that is it actually safe and secure to submit your tax return this way.”

taxes

Bill Smith presents Gay Marriage Increases Federal Tax Headaches posted at 2008 Taxes, saying, “The advent of a new era in our nation’s history brings with it more than gay marriage acceptance; we are witnessing the dawn of a new era of federal tax headaches.”

Bill Smith
presents 2010 Tax Credits For Your Home posted at 2010 Tax, saying, “For those of you thinking of buying a new home but are not sure about the 2010 tax credits, maybe this will help you.”

[email protected]
presents Should oil companies pay higher taxes? Prof. Ho explains the economics of optimal taxation posted at NerdWallet, saying, “Should oil companies pay higher taxes? Prof. Ho teaches the economics of optimal taxes for the purpose of reducing the federal deficit.”

Bill Smith presents Tips to Get TurboTax Discounts posted at 2009 Tax, saying, “Turbotax software comes in various different versions like Premier, Deluxe, etc. Turbo tax software is used to prepare both State & Federal Income Tax Returns.”

Bill Smith
presents How to get online tax refunds with H&R Block? posted at 2008 Taxes, saying, “Nowadays there are many tax filing programs available online, but even today most of the people think twice while filing their income tax returns using these online programs.”

Bill Smith
presents H&R Block- Small Business Tax Software Review posted at 2009 Taxes, saying, “H&R Block is one of the best tax preparation software used worldwide. Today more than 500 million clients mainly in Australia, the U.S., and Canada use H&R block.”

[email protected] Obama vs. Romney vs. The Fiscal Cliff posted at NerdWallet Blog – Credit Card Watch, saying, “What change will the impending “fiscal cliff” bring? The nerds weigh in on the issue and the roles the presidential candidates could play.”

tips

Bill Smith presents FreeTaxUSA- Prepare your Taxes Yourself posted at 2011 Taxes, saying, “There are several tax preparation programs available online. Let’s begin with a very simple and a detailed review.”

John Schmoll presents 4 Simple Ways to Save Money on Taxes Before Year End posted at Frugal Rules, saying, “Tax season is quickly approaching us. Don’t fall behind and wait til the last minute to prepare for it. There are numerous things you can do now to help save you money and give less to Uncle Sam.”
That concludes this edition. Submit your blog article to the next edition of tax carnival ecstasy using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

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Personal Tax Planning

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A lot of money is “lost” through taxes, and personal tax planning ensures that a person gets the most out of their finances while paying less tax. At the end of the day one will be sure of saving up quite some amount of money and hence securing their finances.  There are ways that one can plan their finances in order for them to minimize the amount of taxes that they are to pay. There are a few ways in which one can achieve this and they include the
reduction of one’s income, increasing deductions and making use of tax credits.

The reduction of income

One of the most important elements that will determine the taxes on one’s income is the Adjusted Gross income. This element plays a very important role in finance. One needs to realize that the higher one gets in terms of their income, the higher the tax they are to pay. With AGI it simply means that you need to add up all your income and subtract any
adjustments. The examples of the adjustments made to your income include making contributions towards retirement plans including the 401(k) and other similar plans. The adjustments will ensure that your income is lower hence lowering
your tax.

Increasing tax deductions

The best way to ensure that a person is increasing ones taxable deductions is by itemizing the deductions. These include the state taxes, mortgage interest and gifts to charity. Once you keep track of the itemized deductions it is important to compare the expenses to the standardized deduction. This will largely depend on the number of dependents one has. The more the dependents the higher the standard reduction one is expected to have. This is one of the strategies that used in reducing the amount of income that is subject to being taxed.

Tax Credits

Tax credits can work to reduce one’s taxes. Some of the people illegible for tax credits include college students who get tax credit for their first two years and for those that commit to taking a lifetime tax credit. The course one takes does not really matter. One can also reduce taxes by avoiding making withdrawals from their retirement plan. This will
ensure that the tax bill is lowered on your finances.

One can also increase their withholding which will keep of any owing. Through this one is to get a larger refund as compared to what would have been taken from their paycheck during the year.

Author’s Bio: Val Anne is an in-house writer from Franklin Debt Relief, a company specializing in programs for people with high credit card debt.

Why Not Hire a Tax Consultant To Handle Your Taxes For You?

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If you plan on managing a business, why not hire someone else to handle the taxes for you? If you are new to owning businesses, it can get really complicated because of the ever changing tax code. You need someone dedicated to learning and is able to use the tax code to their advantage while obeying every rule. If you make one mistake, it can be extremely costly for your business. You may be afraid to learn how to find a tax consultant because it may cost money, but the amount of headache and time they save you is priceless. Of course, you still have to go through the trouble of finding a good tax consultant, so you’re going to have to work for that part. To get ahead, don’t wait till the last second to find one. Look for one several months in advance when they have less work, that way they’ll be more likely to be available.

Reading the tax code and being able to make sense out of it is an amazing talent. For most people, it can be extremely boring. But if you find someone that is passionate for what they do, they can point out things you would have never seen yourself. In order to find a passionate person, ask your friends and former employees about the consultants they use. Good references are key to finding someone that cares. It may be a small bit of trouble trying to find the tax consultant right for you, but once you find one, they usually stay yours for life. If you can’t bother to put up with the effort, be prepared to pay because your business will probably violate something down the line. If that happens, the only thing that can save you is a tax settlement. Otherwise, the government will hunt you down and take your money because they don’t like being cheated, even if it was an accident. Ignorance is no excuse.

When looking for a good consultant, take a look at their background, references, and former experience. There are different types of tax specialists so make sure you pick someone that specializes in businesses. Each tax code is different depending on if it’s a person, business, or a contractor paying, so make sure your tax specialist knows the difference. If you find a specialist that is green, as long as they are willing to learn, they still may be a good fit for your company. An expert may overlook things but a newbie is likely to pay extra special attention to you because they don’t want to mess up their reputation.

Tax Deductions Can Help To Improve Your Bottom Line

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Small Business Often Overlooks Tax Deductions

You can have a successful tax season in your small business if you plan all round the year so that the deductions are maximized. This requires that tax matters should be kept in mind at all times, and you must constantly look for methods of reducing your bottom line, while continuing the profitability of the company.

Expenses for Start-Up

The expense of starting a business is quite often overlooked by small businesses and this can give one quite an advantage when the tax season is being considered. It is possible to deduct the expenses incurred for overhead,marketing and other expenses that are related and this can be done for a period of five years after starting the business. However the deduction of such expenses is only allowed after you have actually started the business and cash flows have commenced.

Education and Training Has To Be Continuous

A continuity in training and education, makes you eligible to deduct the expenses incurred for this. Attending a conference on new trends for treatment of cancer in horses allows a veterinarian who specializes in treating horses to deduct the expenses of attending that conference. As the conference is related to the field in which the veterinarian is practicing this seminar can be a part of the deduction form the yearly tax. However if he is not practicing in that field and only treats smaller animals, he would not be eligible for any deduction. The rules for the classes that qualify the deduction are quite strict.

Fees for Professional Services

Any professional fees that you pay to your accountant can be deducted from taxes.If however the work is for future years, the benefit has to be spread out over the term envisaged. If you have hired an architect for designing a building that may take two years to construct,the architects fees have to be spread over the period during which the building construction takes place.

Volunteer Tax Assistance

Volunteer Tax Assistance is available from an IRS sponsored program this tax season. This community-based program is operated by volunteers who will assist with 2010 tax preparation. The top ten items the IRS wants taxpayers to understand about the IRS sponsored volunteer programs are:

  1. There is tax assistance available for taxpayers that are 60 years old or older.
  2. This program offers free preparation to individuals or families who earn $49,000 or less.
  3. Electronic filing is available at all volunteer sites
  4. The volunteers have been educated on topics such as the child tax credit, homestead tax credit, and the elderly tax credit.
  5. Several tax assistance sites have volunteers who can help people with English as a second language.
  6. Partnerships with community organizations make it possible for the IRS to offer more 12,000 tax preparation sites. All sites offer the services free.
  7. The AARP tax-aids do primarily assist people who are 60 and older, yet they are willing to assist any taxpayer with low-to-moderate incomes.
  8. The Armed Forces has a volunteer tax council that is trained to understand tax issues that are specific to military individuals and families. There are volunteers available for all branches of the military.
  9. City information hotlines, community organization, and the public libraries can provide information on the locations and dates for the volunteer tax assistance programs for 2010.
  10. Call the toll-free number for the IRS at 1-800-906-9887 if you are having trouble locating a volunteer tax assistance program near you. If you have internet access, you can gain information using the following web address:  www.IRS.gov. Visit AARP.org to find an AARP Tax-Aide location or call 1-888-227-7669 (888-AARPNOW).

It is wonderful when  community volunteers work together to help people prepare their tax forms. No one should feel alone or overwhelmed while preparing their 2010 taxes. The IRS Volunteer Tax Assistance, 2010 is available as a community based program.