(NewsUSA) - We can all agree that filing taxes can be confusing. Asking questions or web searching for answers only leads to more confusion and misconceptions because when it comes to taxes, one standard answer does not always fit all.
The National Association of Enrolled Agents -- a group of federally licensed tax practitioners who specialize in taxes -- sheds some light on six common tax misconceptions.
Myth: I had a really big loss in the stock market this year, so I won't owe any income taxes.
Fact: Deduction of capital losses against ordinary income is limited to $3,000 per year. Also, whether you reinvest or receive dividends, they are technically still income and are taxed as such.
Myth: I'm filing an extension this year, so I don't need to pay anything yet.
Fact: Tax extensions only extend the time you have left to file, not the time you have to pay any taxes owed. If you owe money and file an extension, you have until April 15 to pay, regardless of the extended deadline date. Otherwise, interest and penalties begin to stack up.
Myth: Income earned in a foreign country is not taxable.
Fact: The operative word is "income," which means it's taxable. The IRS requires taxpayers to report all earned income, even if it's earned abroad.
Myth: They paid me in cash, so I don't have to report it.
Fact: If it's income, you must report it. You always report income, regardless of whether it's cash, tips, bonuses or dividends.
Myth: I'm too young to have to pay taxes.
Fact: Even dependents working part-time while in high school must file a tax return if they earned more than $6,100 in 2013 or if they want to receive their refund.
Myth: Tax preparers only fill out forms that you can do yourself.
Fact: Paid preparers know the intricate (and constantly changing) tax laws, regulations and codes, and how they can be applied for your benefit and save you money. Enrolled agents, America's tax experts, receive annual continuing education so they are knowledgeable of tax laws and how they can apply to you. Enrolled agents not only specialize in tax preparation and tax planning, they can also represent you before the IRS.
Find an enrolled agent in your area on the "Find an EA" directory at www.naea.org.
(NewsUSA) - Across the nation, identity thieves are using legitimate information to scam honest taxpayers, and frequently posing as the IRS to do so. So, what can you do?
The IRS is taking this seriously, and has created the IRS Identity Theft Protection Unit to address the growing problem. However, being aware of some of the most common scams can help protect you from having your personal information used to commit fraud or other crimes.
Phony IRS emails. In a "phishing" scam, an official-looking email shows an IRS logo that lures the consumer to a website that requests personal and financial information, such as a Social Security number, bank account, or credit card numbers. In truth, the IRS does not send out unsolicited emails and does not use email to ask for detailed personal or financial information such as PIN numbers, passwords or similar secret access information for credit cards or bank accounts. The only genuine IRS website is www.IRS.gov.
Refund scam. In a refund scam, a bogus e-mail tells the recipient that he or she is eligible to receive a federal tax refund for a given amount (often $63.80) and sends the recipient to a website to complete a form to submit the tax refund request. The form then asks for personal and financial information. In fact, the IRS does not notify taxpayers of refunds via e-mail.
Antifraud Commission scam. In this case, the scammer sends an email stating the IRS "Antifraud Commission" has found that someone tried to pay their taxes through the Electronic Federal Tax Payment System, or EFTPS, using the email recipient's credit card. As a result, some of the recipient's money was lost and the remaining funds were blocked. The e-mail includes a link that sends the recipient to a website where he or she is directed to enter personal and financial information in order to unblock their funds. Don't take the bait! The IRS does not have an antifraud commission.
Get help. A taxpayer who believes they may have received a fraudulent or otherwise questionable communication related to taxes should contact a licensed tax professional. Enrolled agents (EAs) are America's tax experts. They are the only federally licensed tax practitioners who specialize in taxation and also have unlimited rights to represent taxpayers before the IRS. That means that if you get a letter from the IRS, or worse, are audited or are the target of a collection action, your EA can speak directly to the IRS on your behalf. Find an EA in your area on the directory at www.naea.org.
(NewsUSA) - Running a small business can be tough, and keeping the money you earn in your pocket can be a challenge, especially at tax time. Check out these tips to help ensure you don't give more money to the government than you must:
1. Deduct everything you can. The IRS has a variety of ways it helps small businesses, but many owners don't take full advantage of all of the deductions they can claim. For example, if there's a place in your home that you use exclusively for business, you can deduct some of your housing costs. For your 2013 return, you can claim $5 per sq. ft. of your office up to 300 sq. ft.
Mileage is another overlooked expense. You can deduct the miles you drive for business, such as driving to see a client or pick up supplies. Every trip counts, even the short ones, so it pays to keep track of your business mileage. Small businesses can deduct 56 cents for each mile travelled.
Other deductions small businesses are eligible for include travel expenses like tolls and parking, 50 percent of meals with clients, as well as supplies and furniture for your office.
2. Use the right business structure. Small businesses can be structured in various ways, and choosing the right structure for your particular business can affect how much or how little you pay in taxes. Most small businesses choose to operate as a sole proprietor, Limited Liability Company (LLC) or corporation. A tax specialist can advise you which structure is best for you, but as a general rule of thumb, if your business generates more than $50,000 in profit, you can save taxes by incorporating.
3. Don't get penalized. Many small business owners end up paying more to the government because they file late, resulting in the IRS charging interest, late fees and penalty fees. Missing deadlines is often the result of not being organized, which is all too common for owners focused on generating sales and servicing clients, rather than maintaining their books.
To keep organized, many owners are taking advantage of technology and turning to cloud-based systems like FreshBooks (www.freshbooks.com), which makes it easy to stay on top of accounting tasks like invoicing and expense tracking. Such systems also allow the owner to send their accountant all the reports and information they need with one click.
(NewsUSA) - Over the last several years, planning for retirement has been anything but simple. Market uncertainty, lower real estate prices and for some, job loss or stagnant salaries, have made saving and investing for a sound financial future more challenging than ever. That's where a financial professional comes into play.
A financial professional can help you save, invest and grow your money, while protecting what matters to you -- your family, a business or standard of living. But, how do you find a financial professional that's a good fit for you?
1. Start by considering his or her philosophy and approach to retirement planning. In today's tenuous financial environment, a professional who believes permanent life insurance plays a critical role in a financial plan should be a strong consideration.
Permanent life insurance provides a guaranteed safety net, should the unthinkable happen. A death benefit can give you peace of mind that your family or business is properly protected. Plus, the cash accumulation potential of permanent life insurance can be used to launch a second career, pay for a grandchild's education or supplement retirement revenue streams. Permanent life insurance also allows other elements of a financial plan, such as annuities, investments or disability insurance, to do their job.*
2. Make sure the financial professional has the proper education and training. Here are the top credentials to look for:
3. Make certain you have a good comfort level with the financial professional, and how they communicate with clients. You can do this by scheduling an in-person meeting, preferably at their office, to ask the following questions:
To learn more about working with a financial professional to take full advantage of the complete value of life insurance, visit www.PennMutual.com.
* All guarantees are based on the claims paying ability of the issuer. Accessing cash-values may result in surrender fees and charges, may require additional premium payments to maintain coverage and will reduce the death benefit and policy values. Any examples are hypothetical, intended for illustrative purposes only, and highlight a single possible outcome. Individual results will vary.
(NewsUSA) - There is a revolution that has been taking place for quite some time in the business world, and it's changing the way workers use the telephone and companies do business.
Chances are you've heard of it. It's called Internet telephony, and experts agree that, among other things, it has made office PBX systems obsolete while increasing employee productivity by allowing a very mobile workforce to stay connected to their business lines, no matter where they're working from or which device they're using.
In short, this not-so-new technology is making the phone system digital in a way that takes advantage of the Internet and of any phone or computer attached to it.
To that end, Switch, a San Francisco-based communications company, is taking the cloud-based business phone concept to the next level by creating a system that can be integrated with Google Apps and, most recently (and notably), Microsoft Office 365.
"Work is a thing you do, not a place you go," said Craig Walker, CEO of Switch Communications. "We understand the value of mobility and giving people control over the tools they need to be productive, and Switch is designed with them in mind."
For Office 365 users, this latest development by Switch can accelerate employee productivity by integrating with Outlook mail, Outlook calendar and LinkedIn. Users can log in with their Microsoft credentials, have their Outlook contacts instantly synced, have their calendar and email integrated so they can see the most recent shared emails and appointments when on a Switch call, and have instant access to the always-current corporate directory.
Ease of administration is critical for a business of any size. Switch's design makes it easy to sign up in less than a minute using dropdown menus to let you set up a virtual receptionist for your company, set business hours to keep your cell phone from ringing at night or on holidays, record custom greetings, add department lines and more.
"Regardless of productivity suite, platform or size -- your business can be an enterprise or a three-person shop -- with Switch your phone system and your experience is and should be the same: easy-to-use, scalable and with the flexibility of a true cloud service."
The cost for companies of any size is a mere $15 per month per employee, including a free company number and unlimited domestic calls and texts.
"Switch makes sense for anyone who realizes their business phone system that serves a desk is broken," says Walker.
Visit www.switch.co or call 844-9-SWITCH to learn more.