Top Taxes

Filing tax returns is no fun and if you've added a new child into your home there are a few tax tips that you need to consider. Uncle Sam has a few rules that you must abide by if you want those deductions that you so much deserve. Here are 5 important tax tips if you have a new one in the house.

1. Social Security Number. Before your child can be included as a dependent on your return they must have a Social Security Number. Make sure you get this ahead of time so there are no delays when filing.


2. If you adopted a child make sure you deduct expenses the same way as you would a biological child.


3. Make sure the name of the child on the electronic tax return is exactly the same (matches) as on their social security card. This will slow your return down with the IRS if it is not.


4. Don't forget to file a W-4 with your employer. This is to claim an additional withholding allowance for your new dependent.


5. File as head of household if you are a single parent instead of as a single. This will lower your tax liability. If not single file jointly for the same break.

Below are just a few of the changes in the tax code for 2010 that affects small businesses. As with any tax issues you should always consult your accountant or the IRS website before taking any deduction to confirm you qualify. The majority of what is new for 2010 are carryovers from tax laws that were changed during the economic turmoil in 2009.

Here are just a few that have affected my clients here in Las Vegas:

1st time homebuyer & home based business tax credit

1st time homebuyers that also run a small business from their home are eligible for the $8000.00 1st time homeowner tax credit until April 30 2010, please consult your tax advisor or the IRS website to see if you qualify.

New Mileage rates for small business and Non profits

Starting January 1st 2010 mileage rates will be reduced some as follows:

• 50 cents per mile for business miles driven
• 16 cents per mile for medical transportation or moving miles driven
• 14 cents per mile for miles driven for a charitable organization

Cancellation of Business Debt

This law is a carry over from a law passed in 2009 in the Recovery & Reinvestment Act of 2009. It in its simplest terms states that a company can delay the recognition of cancelled business debt in 2009 & 2010. There is some fine print to this please refer to the IRS website or your tax advisor for all the details.

These are just a few of the many new tax laws that have been implemented for 2010, it is best advised to review all the new laws and understand how each will effect you business.

Worries creep in the moment you start planning to file your tax returns. Filing returns may be quite a task but you cannot ignore them. If you decide to file the returns electronically then you may decrease your stress level to some extent. This is not an intricate process but requires some tax software or a web site that files returns. There are some legal internet tax sites that are managed by tax professionals who make the process of preparing a return easy and error free. All you need to have an internet connection. You submit your tax return and receive a receipt which you may save in your email. It would be better if you keep a print with you for further reference.

Easy filing

You just need to input your details into the software and wait for it to do the rest for you. The software would check your calculations and remove the basic errors that crop up in manual calculations. Calculation seems to be a small issue but a minor difference could get you audited. I feel anybody would want to stay away from audits.

Tax norms

With e-filing service you don't have to understand the complexity of tax code. The codes and rules change every year adding to your difficulty. If you wish to file returns without complexity difficulty then you may try e-filing

Easy process

Sign up to an internet site; create your user account to login as a member. Once you log in as a user you would be asked some questions like your name, date of birth, family size, annual income etc. When you provide all your details that is similar to the W2 form then the program calculates the best possible tax situation for you. After this, all important information is placed into relevant forms and the returns are filed with IRS. IRS would accept the returns if there are no errors and you would receive an acknowledgment within a few days.

Error correction

Once all your information is input, the program does an error check before sending the return to IRS. If errors are found, you come to know about them immediately and correct the errors right there. If you take the non-electronic route to filing returns then the process becomes long and time consuming. You have to wait for IRS to get back to you.

Fast refunds

Refunds are processed quickly and you have cash in hand much earlier than it would take in non-electronic filing. If you have a bank account, then your bank details can be input into the program for IRS to deposit the refund into your account.

You may have apprehensions about putting in personal information on tax websites as your personal information may be misused but if you are able to find a legitimate website for filing taxes then it neither would reveal your information to any third party nor would it misuse your information. You must discuss with co-workers and friends and look for websites that they have used for filing their returns.

The year 2009 income tax return will be the first time that taxpayers will be able to use their income tax refund to purchase up to $5000 in low-risk, liquid Treasury I Bonds. The Treasury Bonds pay interest and help protect the investor against inflation.

The bonds are issued in the taxpayer's name and if it is a refund from a joint return, the refund is issued in the names of both taxpayers. There are no beneficiaries to the bonds. You can purchase the bonds even if you do not have a TreasuryDirect account.

You simply use Form 8888 and enter the routing number 043736881 and check the box marked, savings. Use BONDS as your account number.

I Bond requests are done in multiples of fifty and the IRS will need a direct deposit routing number for the balance of your refund. If you have a $500 refund and you request $250 in I Bonds, the IRS needs to know where to send the rest of your money.

If the refund happens to be an exact multiple of fifty, the taxpayer can indicate that all of the refund be used for I Bonds. This is done by filling out the direct deposit information on your income tax return, and not filing Form 8888.

Taxpayers receive their Treasury Bonds through the mail.

If there is an error on an income tax return, in regard to calculating a refund, bonds will not be purchased. Bonds will also not be issued if the refund is offset, or the request is not made in multiples of fifty. When this happens, the purchase is canceled and all of the tax refund is issued through the mail.

When a taxpayer requests bonds, they can track them, after they have received the balance of the refund, by visiting the Treasury Retail Securities site.

The 2009 income tax rate will not be raised too drastically much because of the world wide recession. The rate at which congress raises taxes each year is determined by inflation. In 2009, inflation was at 0.19%, the unemployment rate hit 10%, consumer spending hit all time lows, and energy prices remained low all year.

What most Americans have forgotten about was the tax rates just 10 years ago. The brackets were 15%, 28%, 31%, 36%, and 39.6%. This is higher than the current rates which are 10%, 15%, 25%, 28%, 33%, and 35%. There is an extra bracket now, but the rate at which the wealthiest are taxed is still lower than it was 10 years ago.

In an unexplained twist, the tax rates 20 years ago were like how the corporate taxes are now. The wealthiest did not have the highest tax rate. There were only 3 tax brackets being 15%, 28%, 33%, then back to 28%.

With every tax reform act comes a new set of laws and brackets. But nothing compares to the mass confusion of the 1978 revenue act. There were 16 different tax brackets from 0% all the way up to 70%.

Someday, the government might get wise and realize that less is better when it comes to tax laws and the rate the citizens must pay. But until that time arrives, the income tax rate will continue to rise as compared to the tax payer's income.

Of course, the above is not legal or accounting advice -- it is for informational purposes only. Before making any decisions regarding legal or tax matters, it is vital that you consult a licensed professional lawyer or tax accountant.

Every year when April 15th rolls around, people panic. It's the last day to turn in our taxes and many of us are scrambling to meet that deadline. Whatever our reason - school, work, vacation, etc - it's tough to try and get everything done in time. However, the smart tax filer knows there's a different way. They know that for the 2009 income tax return, it's just the last day to file an extension.

What is a tax extension? A tax extension if the taxpayers way of telling Uncle Sam and the IRS that they need just a bit more time to get those taxes to them. It's not another year, sadly, but an extension gives you until October of that year to turn in your taxes - another 6 months to find all the receipts and fill out the forms in triplicate. That's what it's important to remember that you can file your 200 income tax return on the last day to file an extension.

Filing an extension doesn't mean you receive any penalties. Far from it! It's actually a great help for the IRS. It means that they know that you're going to pay them, but it also means they know you're going to do it honestly and fairly. You don't want to rush yourself - you want to do the job right! Moreover, it means that whoever puts the final touches on your form isn't swamped with work. So you get your refund faster or the government gets their money quicker. This is why the 2009 income tax return and the last day to file an extension are such important things to know.

It's easy to get an extension for the 2009 income tax return on the last day to file an extension. Simply go to the IRS website or your local office and fill out a simple form. All you need is a good reason and you're set! The IRS rarely turns down people for extensions and the process is painless. And since you can do it online, it's never been easier to file your extension on the 2009 income tax extension.

So this year, instead of staying up late the night before, fretting about audits, take an easier path. Filing for an 2009 income return on the last day to file an extension just means you have a little more time to do your taxes right - and it also means you have a lot less stress. Good luck!

Keeping your tax information is an efficient way of knowing about your tax returns and tax costs. You can also judge yourself according to your daily life finances and tax returns. However, it can be hectic at time to keep such heavy amount of tax information on papers because papers are hard copies which exists physically. They can be misplaced. Physical means of saving data also worn out therefore it is not the ideal way of keeping your information of tax returns. In our times computers can be of great use to save our daily records of any possible thing. We are lucky to have special built applications for computer to save our financial records as well. In market you can get a number of financial software packages that enables you to keep track of that you are spending for tax purposes. It is one of the most effective solutions for record-keeping and saving tax information.

Just don't rely on paper record-keeping always because it is an old way of doing things. Though you can have hard copies of your information and keep them in files but having a backup in your computer can be really useful. Also remember that computer does not make calculation mistakes which possibly human mind can. However, you cannot just install the software and start using it you first need to learn how to use the software and you need to enter a great deal of data for it to be useful to you come tax time. One more thing that you need to remember is that you will still need some paper savings like your receipts. You will need your receipts in order to back up your claims. The reason for such tax information is that in an audit the IRS may not accept your computer records without verifying them against your receipts.

If you are looking for such software that can do great keeping of tax information for you that you may consider personal finance packages such as Quicken (From Intuit) of Microsoft Money. Why I mentioned this software is because I used them both and I know that they are easy to use and most importantly very easy to learn. Both of the software has small-business modules, or your may want to explore a more business-oriented program, such as QuickBooks for your small-business accounting. It doesn't matter which software you choose, just remember that the software you choose must allow you to do everything you need to do to keep your tax information.