With 2018 just around the corner, tax season will be here before you know it. While April 15 is a dreadful day for many Americans, it doesn't have to be that way if you think ahead and prepare your taxes now.
Here are eight ways to prepare your taxes now for next year.
Do you plan on filing taxes on your own or paying a professional to do it? Do you owe taxes for this year or past years? Have you gotten married or had a child? These are all questions that should be asked to help you prepare your taxes now.
If you are an independent contractor or self-employed, there are a few more questions you should ask yourself as far as your business is concerned as well. Do you have any employees? Did you put mileage on your car because of your business? These are just a few of the questions to ask to make sure you are getting ahead of the game.
Know How You Will File
Are you single, married, or filing jointly? Do you have any dependents? Knowing how you will file can make filing a lot easier when the time comes. You will know how much to withhold from your paychecks based on your allowances.
You'll also roughly know how many deductions you qualify for based on members in your household. ...continue reading
Taxes can get confusing — just looking at the names of some of the forms you have to fill out can be enough to get your head spinning. Like the 1099-C, for example. What is that, and why is it in your mailbox? Well, we’re here to help and answer all your 1099-C questions.
What Is a 1099-C?
“A 1099-C is a document sent by a bank when they have canceled a debt,” Craig W. Smalley, EA, founder and CEO of CWSEAPA, LLP and Tax Crisis Center, LLC, said. “For instance, if you have negotiated with your credit card company to pay them a lesser amount than you owe them, the difference would be reported on this form.”
Bruce McClary, the vice president of communications at the National Foundation for Credit Counseling, said this is an important reason to “be familiar with the tax consequences when considering debt settlement as an option. You don’t want to be blindsided by a costly IRS bill when you may already be struggling financially.”
Why Did I Get a 1099-C?
If you have had a canceled debt, expect to see a 1099-C arrive in your mail, as “the bank is required to send this form, because it is taxable income,” Smalley said.
According to the IRS, lenders file a 1099-C if you have $600 or more of debt that is canceled. Here are four common reasons that may be the case. ...continue reading
I've never considered moving to Delaware, Montana, New Hampshire or Oregon as a way to avoid paying local or state sales taxes, but I see how it can be tempting — especially to retirees looking to save money.
Other than some local resort areas in Montana, those four states don't have local or state sales taxes, giving residents and visitors plenty of reasons to shop there.
Some states make up for low or zero sales taxes with high income taxes. Oregon has no sales tax but high income taxes, while neighboring Washington state has high sales taxes but no income tax. In theory, it could pay off to live and work in Washington state and buy everything in Oregon.
But which states should you avoid for high sales taxes? The Tax Foundation recently put out a mid-year report of state and local sales tax rates, combining the state and average local sales tax rates for each state.
Highest sales taxes in the Bayou
The full list is in the report, but here's the top 10 states for combined local and state sales tax rates, followed by the combined rate: ...continue reading