Don’t Get your Refund Early

With tax season coming up, many people are already planning how they will spend their tax refund. In order to get more people coming through their doors, accounting companies are promising to give you the expected refund on a secured credit card as soon as your taxes are filed. In these hard times this is a tempting offer. After all, who couldn’t use a little extra money during these economic times? Although you may be tempted by these claims, there are a number of reasons why you shouldn’t be depending on this type of refund anticipation loan to pay off your bills.

By using this refund anticipation loan instead of simply waiting for your refund check to be mailed to you, you are looking at losing money over the long term. The amount of fees that come with using this “Emerald Card” are staggering. Unless you are in significant need of your tax refund right away, there is a lot of benefits to simply waiting a little bit longer to receive your money. Unless you are about to file for a Minneapolis bankruptcy and are advised to take this type of loan by a Minnesota bankruptcy lawyer, you should consider the number of fees that are included with this type of loan.

There are a number of fees associated with using an Emerald Card to collect a refund anticipation loan. Each time you want to use your Emerald Card at the ATM there is a $1.50 fee that will come out of your tax refund anticipation loan. You may think that you can get around this fee by simply walking into your bank and talking to the teller. However this does not work either as there is a 1.5% fee on any withdrawals that are taken out. These are only a smattering of the fees that come with accepting a refund anticipation loan. Although it may be necessary for some who are truly desperate for the money, in the majority of scenarios it is a much better idea to simply wait a few extra weeks and allow the government to mail you a check for your refund.

Dealing with IRS Tax Debt

Dealing with tax debt is different from how you handle your other debts. But you need not worry since it can be managed given the right amount of patience as well as the willingness on your part to lower down your debts.

For starters, getting debt help is highly recommendable especially for those who do not know where and how to start eliminating their outstanding balances with their creditors. Seeking for professional assistance is a very sensible thing to do because you will have to think of it as an investment in order for you to live a comfortable and financially secured life in the future.

Managing tax debt on your own – If you do not want to spend money to pay for debt relief services, you may opt to control your tax debts on your own. You can do this by requesting copies of your tax returns and double checking it for any discrepancies. From there, you can choose which option you can take.

Get professional help to deal with your tax debts – People with low tax debts can get away without the assistance from financial counselors, however for those who happen to owe thousands of dollars, get expert help from debt relief companies. Here are several things that you can check and counter-check in order for you to ensure that the company can truly extend their services to you:

Amount being charged or rate of services – There are several companies that can give you a quotation for the whole duration that you are going to require their services, while there are some companies that charge by the hour. Whichever way you prefer, bear in mind a budget and stick to it so that you will not have any added troubles.

Their credibility as a company – While there are many companies out there, you still need to check the legitimacy of the agency that you are going to tap. Professionals who are dealing with tax debts need to be certified public accountants, tax attorney, or an enrolled agent.

Several of the debt strategies that they can suggest to you, apart from double checking your tax return documents, include the following: installment agreement, filing for bankruptcy, offer in compromise, and partial payment.

You see, dealing with tax debt is not an entirely complicated process. Given the right time and strategy, you will be able to control your balances and slowly pay them all off.

Advantages of Incorporating in Nevada

Nevada has spent the last several years revising its corporate code to become more suitable to small, privately held companies to incorporate in.

Nevada boasts no corporate taxes, maximum privacy and protection of private assets.  Other benefits include; many tax advantages, total privacy of shareholders, nominal annual fees, and no minimum initial capital requirements to incorporate.

Some of the tax benefits include no state corporate taxes, no franchise tax, no tax on corporate shares, and no personal income tax.

Probably the most appealing advantage is the protecting to your personal assets when you incorporate your business in Nevada.  The way a corporation is set up completely separates your assets from that of the business.  The business becomes its own entity even if you are the only owner.  In the case of a sole proprietorship, if a lawsuit is filed against your business your personal assets may be seized also.  Incorporating in Nevada provides you with a corporate veil that is almost iron-clad.  In the last 30 years the corporate veil has only been pierced twice.

The law that Nevada has established to protect personal assets from individual business owners also protects corporate officers and directors from any person liability.  As long as the company acts in a lawful manor Nevada offers unbeatable corporate protection.

State residency or the need to hold meetings in the state of Nevada is not necessary.  Stockholders, directors and officers do not need to be residents of Nevada.  They don’t even need to be U.S. citizens.

Nevada is the one of the best states to do business in. If you set up your business and incorporate it in the state of Nevada you will be able to take advantage of all the tax benefits and be protected in every way possible, there is no better way to run your business.

By: Shannon John

Marketing Manger, Laughlin Associates, Inc.

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Tax Audit Help

The Internal Revenue System (IRS) fortifies its efforts in discovering and collecting tax returns and frauds. “The IRS aims to detect tax return differences which can eventually result to an audit,” said David Gannaway, tax litigation consultant of Marks Paneth and Shron, a New York accounting firm.

According to a recent survey conducted by the Oversight Board of the IRS, the concerted efforts to rectify tax return inaccuracies are prompted by a volatile and weak economic conditions. It is roughly estimated that thirteen percent of the tax payers say yes to tax cheating which is significantly higher than nine percent in 2008. The White House appoints the Oversight Board to monitor and supervise the IRS.

Tax analysts infer that taxpayers who are in deep financial struggles are more likely to indulge in fraudulent tax returns. The IRS is now looking into major search engines like Goggle and other social networking websites like Facebook in order to catch those people who are guilty of tax frauds. The IRS is also on the lookout for those who are into business and self-employment. They hope that they can elicit more information and eventually get bugger sums of money from the hidden stash of certain individuals. This is what they do to catch those people who engage in fraudulent tax returns.

For those who are consistently honest in filing their tax returns, they need not worry. But they also said that being scrutinized by the IRS is like being studied under a microscope. It is a very stressful and draining experience for many people. They also do not want to undergo through all the hassles and emotional stress during an audit. That is why it is always a good practice to declare honestly all your income in order to avoid this kind of issue. Be transparent and responsible when you present your tax returns.

Here are some useful tips on how to avoid the audit this year.

• Include all your income. Bear in mind that the IRS will always make a comparison between the 1099 and W-2s forms you received. Deductions which are not legal is seen as a simple mistake. But when you hide an income which you are fully aware of will always be considered illegal or fraudulent.

• Unusual deductions must be well documented. Gannaway said that it is the usual practice of the IRS to tweak certain tax returns once they notice that there are specific deductions which are not consistent with the income level. According to CCH, cited an example to illustrate this situation. CCH is a tax research institution. For instance, a taxpayer who earns between $50,000 to $100,00 deducts $6,690 in their medical expenses, $5,822 for interests, and $2,612 in some charitable donations in the year 2007. In circumstances when a taxpayer encounters a serious medical injury or lives in a place where there is a high tax rate, he or she can always claim legitimate deductions even way above the usual average. If this is the case, it should always be recorded and documented.

• Keep records of deductions if you are self-employed. During the global economic recession, a lot of individuals resort to self-employment. Some have set up their own business while the others choose to have their own consultancy firm. But the IRS is quite smart because they audit small businesses with a higher rate. When you are running a sideline business, you have the legal right to make deductions from all the expenses incurred from your business. These include lunch with clients, postage, printing, furniture, and office equipments. Gather and keep all the pertinent records and receipts. Then make some preparations should you need to defend each of those expenses.

• Take one step at a time during audit. The auditing process starts with a letter which focus on one aspect of a tax return. If you keep copies of all related information, then procure your own version and then also give IRS their own copy. When they request for a review or even a meeting in order to asks more questions about your overall tax return, then you can ask professional help to represent you. You can hire a tax lawyer, a CPA or certified public accountant, or even an agent. These people are all experts and competent to defend you and they will present your issues to your advantage. So do not hesitate to seek professional assistance if this happens.