Chicago Tax Tips
For Earlier Preparation – Chicagoland CPAs – 773-930-4503 – Offices at 5519 North Cumberland Avenue, Suite 1003
Chicago Tax Tips
An early start is the way to go when it comes to helpful Chicago Tax Tips! Not only will you be ahead of the tax season rush, but if you are due for a refund you’ll see it sooner! At Chicagoland CPAs, we believe well-informed clients are happy clients – here are a few basic Chicago Tax Tips you can take to be proactive on your taxes so you’ll be stress-free next April:
Collect and preserve your records. This especially includes forms such as your W-2s and 1099s. Be sure you make copies of all and keep them in your financial records.
Get the correct forms. Any of the tax forms you’ll need can be found anytime at IRS.gov. Simply go to their “Forms and Publications” section.
Take your time. It doesn’t help to rush when completing your paperwork. Errors will just take more time to fix.
Verify. Validate that your numbers and other relevant information – such as your Social Security number – are all accurate. Using careful attention while doing your taxes means you’ll be less likely to hear from the Internal Revenue Service down the road!
Get the quickest refund. When you file early, you will in all probability see your refund sooner. Filing taxes electronically with the convenience of direct deposit produces a refund sooner than “old school” paper filing.
Contact our offices today for more helpful Chicago Tax Tips and expert accounting services at 773-930-4503.
More Chicago Tax Tips
Regardless of whether you obtained a considerable tax refund this past year or if instead you owed taxes, you still might want to think about making some changes in your Chicago Tax Tips withholding strategy. Penalties may result if you owe taxes at the conclusion of 2018, for instance, while if you do get a refund you might have missed an opportunity to optimize that cash through the whole year. Issues like a recent marriage or divorce, a job switch or the purchase of a home can often mean alterations to how your taxes are assessed.
Simply utilize the handy withholding calculator at IRS.gov to get the right amount of tax to be withheld.
There are also worksheets included in Tax Publication 505 that can used for your calculations. If the resulting figures show you’ll need to make changes, you can submit a W-4 Withholding Allowance Certificate directly to your workplace.
Credits for disabled or elderly taxpayers. For those who turned the age of 65 or older at the end of last year, it may be possible to benefit from credits exclusively accessible to that age bracket. Furthermore, for retirees who are receiving permanent disability the IRS permits a reduction to your tax bill. The maximum amount of this tax credit continually changes, but you may be eligible if:
* You collect nontaxable income through Social Security or a nontaxable pension plan that totals up to below $3,750 to $7,500. This also is determined by your filing status.
* Generally, you may be eligible for this credit if you’re a citizen of the United States or a legal resident at the end of the tax year and you’re 65 or older. Eligibility is possible also for taxpayers who are not yet 65 who receive full, permanent or taxed disability income and who are not at the minimum retirement age prior to the beginning of the tax year. For those younger than 65, it’s possible to qualify for this credit if you’re on permanent disability benefits, meaning that:
* You were disabled when you retired
* Retirement on disability benefits started before the end of the tax year.
Although you may not retire “officially” you’ll still be considered as retired on disability benefits if you have ceased working because of your disability. Learn more about these and other Chicago Tax Tips with a no-obligation consultation at our offices.
Sale of your primary home. These Chicago Tax Tips may qualify you for up to $250,000 in gains from your federal tax returns. That amount is doubled for married taxpayers who file jointly. Permitted each time you sell your main residence, the exclusion is typically applied no more frequently than once every couple of years. To qualify, you need to own the home and have utilized it as your primary residence for not less than two of the five years prior to selling it. Additionally, you cannot have excluded fiscal gains from selling another home within two years before the current sale.
Taxpayers are required to own and use their home as a primary residence for a minimum of two out of the five years before selling. Specifically, time periods of 24 months, 730 days and temporary absences can be viewed as “use.”
If you are unable to meet the ownership and primary use criteria of these Chicago Tax Tips, it’s still possible to subtract a reduced amount of the gains obtained on a home sale if that transaction is caused by medical conditions or an employment change. Separation and divorce or natural disasters to a residence could also fall under this category. Call Chicagoland CPAs for further assistance today!
In the event you discover an error after you’ve already submitted your tax returns, you can look at making an amendment. In some instances the government will fix numerical mistakes or ask for missing forms. If this is the case, there’s no need to amend or change your tax return. Amended returns are allowed if any of the following items were reported inaccurately:
* Filing status
* Total income
* Deductions or credits
Consult our offices for more information on these Chicago Tax Tips today at 773-930-4503.
Amended returns. You can use Form 1040X, Amended U.S. Individual Income Tax Return to make corrections to Forms 1040, 1040A or 1040EZ returns. Be sure to enter the correct year of the return you’re changing at the top of the form. If you’re making corrections to more than just one tax return, fill out a different 1040X for every year, then mail each one separately to the IRS processing center in the relevant state. You’ll see three columns on Form 1040X. Column A shows the initial calculations from your first return. The adjusted figures are to go in Column C, with the difference between Columns A and C to be listed in Column B. Explanations for the items amended can be listed on the back of the form.
In the event that the amendments include added schedules or forms, simply attach them to your 1040X. If you are filing a 1040X because you wish to claim the Earned Income Tax Credit for a qualifying child, finish and attach a Schedule EIC to your amended return.
If you’re filing for an additional tax refund, don’t proceed until after receiving your original tax refund. You may also cash the original refund check in the interim prior to obtaining your additional refund. Should you still owe some taxes for the year before, they’ll need to be paid and the associated Form 1040X should be filed by April 15 of the current tax year. By meeting the deadline you’ll prevent interest or penalties.
You generally should file Form 1040X to obtain a refund in three years or less from the time you submitted your initial return or within two years from when the tax was paid – whichever date is later.
Please call Chicagoland CPAs to learn more about amended returns and other Chicago Tax Tips at 773-930-4503.