Taxxtime

Accurate and affordable tax preparation. Stress Free Tax Preparation services for Individuals and Small Businesses. IRS representation to address IRS issue

We prepare accurate tax return with your maximum refund in mind. Certified Tax preparers meticulously do your taxes. CPA on staff. Most of all, very affordable as well. Can help you with financial planning for Individuals and small businesses to minimize their tax liability.

09/12/2022

IRS Provides Penalty Relief to Millions of Taxpayers – Did You Know?

As part of ongoing COVID-19 tax relief efforts, the IRS is waiving penalties for many businesses and individuals who file their 2019 or 2020 tax returns late. Eligible taxpayers will not have to pay a late filing penalty in relation to returns for those two years. Those who have already filed their 2019 and/or 2020 returns and paid late filing penalties will receive a refund of the penalty.

This penalty waiver will be automatic for all eligible taxpayers. However, in order to receive penalty relief, taxpayers must file their 2019 and 2020 federal tax returns by September 30, 2022.

Note that this waiver generally applies only to penalties for late filing, and not to penalties assessed for late payment of tax or other reasons.

09/06/2022

Quarterly Estimated Tax Payments - Reminder

If you are making quarterly estimated tax payments to the IRS, the due date for the June 1st - August 31st, 2021 quarter of year is Thursday, September 15th, 2022.

For payments made using IRS Direct Pay, you can make payments until 8PM EST, and for payments using a credit or debit card, payments can be made up to midnight on the due date.

08/29/2022

Educator Expense Deduction for 2022 – Did You Know?

For tax year 2022, the maximum deduction amount has increased for the first time, to $300. Joint return filers who are both educators may deduct up to $300 per spouse.

You may qualify for this deduction if you work as a teacher, counselor, principal or aide for grades K-12 in a public or private school. You generally must work at the school for at least 900 hours during the school year.

Eligible classroom expenses include:
- Books, supplies and materials that you purchase for classroom use
- Classroom equipment, including computers, peripherals and software
- Items such as hand sanitizer and masks purchased to prevent the spread of COVID-19

Tuition and fees for professional development courses may also qualify for the Educator Expense Deduction. However, you may get a larger tax benefit by claiming the Lifelong Learning Credit or a different deduction for these costs. A tax professional can help you find the most advantageous way to report all your qualified expenses.

08/23/2022

Newlyweds Have Special Tax Considerations – Did You Know?

If you get married in 2022, you may need to update your tax planning and report new information to the IRS and Social Security Administration (SSA). In particular, newly married couples should:

- Report any name changes to the SSA and get a new Social Security Card (link below)
- Report any address changes to the IRS and the U.S. Postal Service
- Recheck their paycheck withholding and/or estimated tax payment amounts. Marriage can affect your tax rate, as well as your deductions and credits. You can use the IRS Withholding Calculator (link below) to make sure you are staying on track.

One of the biggest tax decisions you will need to make as a newly married couple is whether to file separate returns or file jointly. A tax professional can help you determine which status is most advantageous for you.

Social Security Administration: https://www.ssa.gov/myaccount/
IRS Withholding Estimator: https://apps.irs.gov/app/tax-withholding-estimator

08/17/2022

Crowdfunding and Taxes – Did You Know?

Crowdfunding has become one of the most popular ways to raise money for charities, businesses, and people enduring hardships. Depending on a variety of circumstances, money raised through a crowdfunding campaign may be either taxable or non-taxable.

In many cases, if people donate to a crowdfunding campaign and receive nothing in return, the IRS treats the donations as gifts. Therefore, the person who receives the funds may exclude them from their gross income for tax purposes. Also, if you organize a crowdfunding campaign for someone else's benefit, you may exclude the funds raised from your own income, as long as you do not keep any of the money for yourself.

However, there are situations where funds received through crowdfunding are taxable, such as when an employer contributes to a campaign for an employee. Taxpayers generally must also report income received via crowdfunding if contributors get goods or services in exchange for their donations.

If the funds raised exceed $600 or contributors receive goods or services, you may get a Form 1099-K from the crowdfunding website. Receiving this form does not automatically mean that you have to report or pay tax on the money raised. A tax professional can help you determine whether you must report income from crowdfunding, whether the income is taxable, and how to properly handle Form 1099-K and any other tax documents you receive.

08/08/2022

Recognizing Scams: The IRS Does NOT Contact Taxpayers in These Ways

Scammers often claim to represent the IRS in order to steal Americans' identities or money. You can better protect yourself by learning how to distinguish legitimate IRS communications from fraudulent messages or calls. As a starting point, it is important to know that there are some types of messages that the IRS never sends.

With the exception of verification codes for secure online account login, the IRS does not contact people or businesses about tax issues via text or SMS messages. The IRS also does not send messages to taxpayers through social media platforms or chat services.

While the IRS may communicate with a taxpayer via email, the messages will not ask the taxpayer to provide personal or financial information by replying or clicking on a link. All official IRS emails will originate from an address ending in irs.gov. If you are not 100% certain that an email claiming to be from the IRS is legitimate, do not reply and do not click any links in the message. Instead, delete the message and call the IRS directly for more information.

08/01/2022

Summer Income Tax Reminder - Did You Know? (2/2)

Americans of all ages with summer income from self-employment may need to pay estimated tax on a quarterly basis in order to avoid IRS penalties. Alternatively, if you have self-employment earnings but also work as an employee, the IRS Withholding Estimator tool (link below) can help you determine the correct withholding amount to cover your income and self-employment tax responsibilities.

You may also qualify to reduce your tax by deducting business expenses. A tax professional can help you comply with record keeping requirements, and fully prepare for any tax implications of your summer endeavors.

IRS Withholding Estimator: https://www.irs.gov/individuals/tax-withholding-estimator

07/27/2022

Summer Income Tax Reminder - Did You Know? (1/2)

Students and other young people who earn summer income, including gig economy and other self-employment income, should prepare now for potential federal tax obligations.

In particular, minors and young adults with self-employment earnings (including gig economy income) of at least $400 must file a federal tax return and may owe self-employment tax in addition to federal income tax.

07/23/2022

Summer time Special! Starting at $300 per month book keeping service for small businesses!

07/18/2022

$600 1099-K Threshold FAQs (3/3)

Here is an answer to one of the most common questions about the new over $600 1099-K rule.

Why have I never gotten 1099-K forms from payment processors before?

Prior to tax year 2022, the IRS only required third-party payment processors to file Form 1099-K for individuals and businesses that received over $20,000 in gross payments in a year. As a result of the dramatic lowering of this threshold, many people who have never received a 1099-K form will get one for 2022.

07/11/2022

$600 1099-K Threshold FAQs (2/3)

Here is an answer to another one of the most common questions about this new over $600 1099-K rule.

When will I receive a 1099-K form if my payments exceed the threshold?

Third-party payment processors must file 1099-K forms to report 2022 payments by January 31, 2023. Therefore, you should receive the form in late January or early February.

07/05/2022

$600 1099-K Threshold FAQs (1/3)

Here is an answer to one of the most common questions about this new over $600 1099-K rule.

Do payments from friends and families (splitting a check, gifts, etc.) count toward the form 1099-K filing threshold?

No, only payments for goods and services count toward the $600 limit. If you receive a Form 1099-K from a payment processor that includes non-business payments like gifts or settling up with friends, contact the processor and ask for a corrected form before you file your tax return. To help prevent this issue, remind friends and family to check the “Sending money to friends and family” option when sending payments.

06/28/2022

Lower $600 1099-K Filing Threshold for Payment Processors – Did You Know?

A new IRS rule may affect millions of taxpayers who receive payments through third-party processors like PayPal, Venmo, Zelle and Square. The rule applies to payments for goods and services, including payments for independent contract, freelance and gig economy work.

Beginning in 2022, the annual threshold for filing a 1099-K form is $600 in gross payments for goods and services, with no minimum number of transactions. Payment processors must submit the form to the IRS and provide a copy to the recipient of the payments.

In most cases, you must report payments shown on a Form 1099-K as income on your tax return. Note that the form shows gross payment amounts, which may include processing fees. You generally must report the gross amount on your return, but you may be able to deduct processing fees and other charges as business expenses. A tax professional can help you properly figure your gross income and any deductions you are entitled to claim.

06/21/2022

IRS Enhances “Where's My Refund” Tool – Did You Know?

The IRS has added a new feature to the “Where's My Refund?” tool, available online (link below) and in the IRS2Go mobile app. Previously, you could only use the tool to check your refund status for your most recently filed return, and only if that return covered one of the last two tax years. However, the tool can now provide information on refunds from any of the last three tax years (2019, 2020 and 2021).

To use the tool, you will need your filing status, taxpayer ID number (SSN or ITIN) and expected refund amount for that tax year.

IRS Where's My Refund? Tool: https://www.irs.gov/refunds

06/13/2022

IRS Raises Standard Mileage Rate for Second Half of 2022 – Did You Know?

In recognition of the recent rise in gas prices, the IRS has announced an increase to the optional standard mileage rate for the second half of 2022. For January 1 through June 30 of this year, the rate is set at 58.5 cents per mile. The rate will then rise to 62.5 cents per mile for the period from July 1 through December 31.

Note that the standard rate of 14 cents per mile for eligible charitable activities will not change.

06/06/2022

Quarterly Estimated Tax Payments & Overseas Filing Deadlines - Reminder

If you are making quarterly estimated tax payments to the IRS, the due date for the April 1 – May 31 quarter of the year is June 15th, 2022.

If you are a U.S Citizen or Green Card Holder living abroad or in active military service and have not filed your taxes yet, the deadline is also on June 15th.

For payments made using IRS Direct Pay, you can make payments until 8PM EST, and for payments using a credit or debit card, payments can be made up to midnight on the due date.

05/31/2022

IRS Issues Answers to FAQ About 2021 Child Tax Credit (3/3)

Q: What happens if two different taxpayers claimed the CTC for the same qualifying child?

A: In some cases, a child meets all the IRS tests to be a qualifying child for multiple taxpayers. Generally, however, only one taxpayer may claim the child for the CTC. As a result, the IRS may reject a return because the taxpayer claimed the CTC for a child already listed on a return filed earlier by someone else. If this situation arises with your return, you will need to submit a paper return instead of filing electronically. You will then receive an IRS notice detailing next steps, so that IRS personnel can determine which taxpayer may actually claim the credit.

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