IRS does not call you! Phone Calls from IRS is a new Scam

The new scam is that you get a very official sounding phone call from the Internal Revenue Service or the Untied State Treasury of America.  Please do not talk or give any information to the person on the other side of the phone. The best thing is to hang up or write the number down and report it to the IRS. Usually these phone calls are about your refund, bank account error, taxes due, or error in your return.

IRS does not call anyone, if there is an issue with your taxes, you will be receiving a letter from the Treasury or your State. Even then, you need to examine the letter and make sure it is a legitimate correspondence.

 

Still time to contribute to your IRA for 2017

The deadline for 2017 IRA contributions is on or before April 17th. Individuals under 50 years old can contribute up to $5,500 per year. Individuals over 50 years old can contribute up to $6,500. Make sure to let your investment company know that your contribution is for tax year 2017.

Mileage Rates for 2018

According to IRS, the standard mileage rates for 2018 for the use of a car, vans, pickups or panel trucks is as follows:
* 54.5 cents for every mile of business travel driven.
* 18 cents per mile driven for medical or moving purposes.
* 14 cents per mile driven in service of charitable organizations.

2018 Filing Due Date (Tax Year 2017)

Form 2018 Filing Due Date (Tax Year 2017)
Est Estimated Taxes for 4th Qtr January 16, 2018
1040 Individual Tax Returns April 17, 2018
1041 Trusts and Estates April 17, 2018
1065 LLC and Partnerships March 15, 2018
1120 S S Corporations March 15, 2018
1120 C Corporations April 17, 2018
990 Tax Exempt Org May 15, 2018
W-2 Wage Reports January 31, 2018
1099  Information returns January 31, 2018
5500 Employee Benefit Plan July 31, 2018

 

Form Final 2018 Filing Due Date (Tax Year 2017)
1040 Individual Tax Returns October 15, 2018
1041 Trusts and Estates October 1, 2018
1065 LLC and Partnerships September 17, 2018
1120 S S Corporations September 17, 2018
1120 C Corporations October 15, 2018

4 Simple reasons to participate in your company’s 401K

1.  If your company matches a percentage to your 401K contribution, it is actually just like you got a raise. For example, if your company matches 3% of your salary to your  401K contribution, and lets say you make $40,000 a year, you are going to get an extra $1,200.

2.  Your contribution to your 401K plan is tax deferred. For example, if you contribute $2000 to your 401K, and your wages are at $40,000, you actually will only pay taxes on $38,000. You will save on paying the taxes on the $2,000 for now.

3.  Your contribution and the extra that your company matches grows in your plan and you will have an attractive amount of savings without really cramping your budget.

4.  You can borrow from your 401K plan when you need to, such as, for a down payment to buy a house.

Is my Scholarship taxable?

Scholarships  received by a student toward a degreed education is tax free for qualified expenses such as tuition, fees, books, supplies and equipment. The room and board and travelling expenses are taxable and should be included in the 1040 tax return.  The scholarships received for a non-degreed education is all taxable. For more information please refer to IRS publication 970.

I don’t have money to pay my taxes. Should I file my business tax return?

Yes, you are better off to file your business tax return on time even though you can’t pay your taxes due. You pay less in penalties if you file your taxes on time. The penalty of late filing will be added to the penalty of late payment of taxes and you end up paying more out of your pocket.

The pass-through companies such as LLC’s, S Corporations are penalized for late filing by IRS and if in California by the State.

The extension dead-line for the LLC and S Corporations is September 15th.

The extension dead-line for Individual tax return is October 15th.