Beginner’s Guide to Tax

Friends, this is the time of year. Tax season is here, you should already have a good collection of envelopes and splashed across the front, “the official tax documents.” You might just as excited as the prospect of high return, in fact, may be seriously daunting process tax returns. Especially if this is your first application, you may find yourself asking questions frenzy: What kind of form I need? If I messed up, what will happen? Should I hire someone to do this for me? Your response may be sitting on the couch, watching the other three sets card of the house, so your taxes back seat, until the last minute.

We are there, but no way delay the process. You may make mistakes and Missy ng the potential deduction, if you rush through your return. you have to return (or extended) and April 15 to pay what you owe any money If you are due a refund, you should file to get your money back earlier Statistics – and succeed identity thieves, who may request a refund prior to this. (By the way, if you get a refund, you may need to adjust your withholding fatten your annual salary). For tax season a little less frightening, we have some tips to help you with your big tax issues, so that you on your way.

First of all, to figure out, even if you have to file. If in 2013 you are 24 years of age, in school full-time at least five months, more than half the year and get home more T Han half financial support from parents, your parents may also ask you as a dependency. In this case, you only need to submit federal tax if your income exceeds $ 6,100 or your unearned income (such as interest or dividends from the things money) is higher than $ 1,000. If you are no longer dependent, the higher the record threshold. you need to return, if you earn more than $ 10,000 in 2013 (even if you do not have to a file, you can choose to do so, if you are due a refund.)

Next, taking into account all the income your source code 2013 and any potential tax credits or deductions, and incomeSet all supporting tax documents. in terms of equality of income, your employer (S) should have been sent to you a W-2 form, WHICH is the record of the money you earned, and carried what you pay out, such as the Federal the amount of taxes and social security. If you do not have any type of freelance or contract work during the year, you may receive a 1099 miscellaneous income documents. Not all of these documents will be displayed through regular mail; you might have to head online, dig up their own. If you are missing a form, you are still responsible for reporting all income and accurate payments. “put all your income track, and make sure it is correct in detail,” Tom Colitsas, Princeton Financial Group managing partner at New Jersey.

As for tax cuts, know Credit , it reduces your taxes dollar for dollar, than deduction , which is more valuable red UCE your taxable income.

For example, your education can help put money back in your pocket there are a couple of tax credit options. American opportunity credit worth up to $ 2,500 each for the first time in four years of college. Lifelong learning credit is 20% of the first $ 10,000 of tuition for any post-high school designed to acquire or improve job skills courses, including graduate school. You can apply only one time credit; credit is usually claimed by the parents, but it’s all yours, if you pay your tuition. Make sure your school has 1098-T Tuition Statement provides you. Also, if you (even your parents) to pay interest on your student loan, you can deduct up to $ 2,500. Score! If you pay at least $ 600 student loan interest in 2013, you’ll get a statement of interest on student loans in 1098-E. (See more tax savings teenagers have the possibility of tax breaks and deductions.)

Your filing options

Once you have all the paperwork to collect, it’s time to actually fill tax returns and file. which federal form you should use? people who do not own property, there is no investment income or dependent children are 65 years of age, and less than $ 100,000 can submit 1040EZ,A fairly simple one -page tax form. Otherwise, you’ll have to go a long form, in whole or 1040A 1040, one can www.irs.gov online.

In 1040EZ, as well as itemized deductions or potential tax had no choice, for example, tuition payment or reimbursement of work expen credits SES. However, for most young people, the standard deduction will be more than cover the full amount, or they may be itemized. “means the basic standard deduction amount, the government is giving you a certain amount of free and clear deductions,” Howard Samuel, in KDMS LLC, an accounting firm in New York and New Jersey offices of Certified Public Accountants said. Standard deduction 2013 is $ 6,100 if you are single, no one else can claim you as a dependent.

You can go old school and print, and fill out written declaration forms and mail them to the appropriate location. But, especially if you intend to file the form longer, it will be easier, cleaner, your bottom line may be beneficial to fill out and file electronic – I want to tell you how to do so in most cases for free.

“If you’ve seen these forms, they can get pretty scary very quickly,” Eric Roebuck, at H & R Block’s senior product manager. would like to request tax deductions and credits novice , a variety of tax software guides you save with simple questions, such as particularly helpful, “Do not you get married this year yet?” Or “You do student loans debt repayment “” you do not know the tax laws, you just answer the question of your life, “Lisa Green -? Lewis, an accountant for TurboTax said.

In addition, if you are a little confused during the application process, most software offers chat options, trained experts stand to answer questions. H & R Block company to take a step further and offers a IR to many offices around the country in a professional return your options. The software also comes with the added bonus of error checking of your files, so you can fix minor errors, such as your Social Security number or forget a number incorrectly on your total income, they become a bigger problem before, raised before you come back.

You may be eligible for some free digital archiving, if after your adjusted gross income is $ 58,000 or less in 2013 by the IRS Free File program, you can use federal tax returns software such as TurboTax’s, TaxAct or H & R Block company, fill out and submit your federal return electronically for free; free and may even help you with your tax country. Each company has its own eligibility requirements, so you have to answer a few questions to get started, take a look at what the program s is provided to you without any charge.

Even if your income exceeds the threshold for the IRS Free File, you may still be able to use tax software to fill in and submit your federal return for free. If you can use the 1040EZ, TurboTax and H & R Block’s to let you file free (although you pay your file state returns). TaxAct allows all File Manager to address their federal returns released. “Their goal is linked to the taxpayers, they are still young, so they will come back pay, they make more money,” Sandra Block, a senior associate editor of Kiplinger here who covers tax issues explained.

For other file managers, such as software applications with electronic capabilities can be purchased for less than $ 50.

When you should seek expert from the tax it? If you have more complicated tax help factors, such as self-employed or investment income, or, if the tax is particularly nervous time for you, it might be worth it to get an in-depth assistance. But it will not be cheap. As a general rule, is expected to cost at least $ 100 advisory and apply the most basic of return (not itemizing, no real estate, no dependents). If you have tax issues, such as self-employed, from retirement accounts, withdrawals or buy a property, you can easily be looking at more than $ 250 bill. accountant more comprehensive services, who is on call any tax problem, it may be more charged.

If you decide to outsource your taxes, the first step is to find one you trust. Referrals are the key here. What I ask friends and family who live in your state w ^ ho taxation of people is that they warpTest Yes. You can not find by referral people? The company specializes in tax planning, such as Jackson Hewitt, tax free and H & R Block Company, with offices, you can meet the tax pro to get your return achieved. You can also search for a small accounting firm in your city use search engines, such as Yelp, where you can check out a peer review.

Once you find someone, make sure they audit their own. “A phone number or e-mail exchange with a new key CPA,” Samuel, who strongly recommended that you get your taxes completed before the actual official estimate obtained. They proved taxes and how long they have prepared their questions and thoughts about your personal tax situation, are fair game. (See S three steps to hire a temporary tax for more information).