Expert Tax Preparation Services for Businesses & Individuals

Your filing status affects your tax rates, standard deduction, and eligibility for certain credits. The five primary filing statuses are:

• Single: Unmarried individuals who do not qualify for another status.

• Married Filing Jointly: Married couples who choose to file a combined return.

• Married Filing Separately: Married individuals who file separate returns.

• Head of Household: Unmarried individuals who pay more than half the cost of maintaining a home for a qualifying person.

• Qualifying Widow(er) with Dependent Child: Individuals whose spouse died within the last two years and who have a dependent child.

Selecting the correct filing status is crucial, as it influences your tax liability and available benefits.

Taxpayers have the option to reduce taxable income by either taking the standard deduction or itemizing deductions:

• Standard Deduction: A fixed amount that reduces the income you're taxed on. The amount varies based on filing status and is adjusted annually for inflation.

• Itemized Deductions: Specific expenses allowed by the IRS that can be deducted from your taxable income, such as medical expenses, state and local taxes, mortgage interest, and charitable contributions.

Choosing between the two depends on which option lowers your taxable income more. If your allowable itemized deductions exceed the standard deduction, itemizing may be beneficial. Otherwise, the standard deduction might be the better choice.

To select a competent and reliable tax preparer:

• Verify Credentials: Ensure the preparer has a valid Preparer Tax Identification Number (PTIN).

• Inquire About Experience: Ask about their experience, especially with tax situations similar to yours.

• Confirm Availability: Ensure they are available year-round to assist with any tax-related issues that may arise after filing.

• Discuss Fees Upfront: Understand their fee structure to avoid unexpected charges.

Asking these questions can help you choose a preparer who is both qualified and a good fit for your needs.

If you're unable to file your tax return by the April 15 deadline:

• Request an Extension: File Form 4868 to obtain a six-month extension, moving the filing deadline to October 15.

• Pay Estimated Taxes: An extension to file is not an extension to pay. Estimate and pay any taxes owed by the original deadline to avoid interest and penalties.

• Seek Professional Assistance: A tax professional can help you navigate the extension process and ensure compliance with IRS regulations.

Timely action is essential to minimize potential penalties and interest.

To monitor your tax refund status:

• Use the IRS "Where's My Refund?" Tool: Available on the IRS website and the IRS2Go mobile app, this tool provides updates 24 hours after e-filing.

• Provide Necessary Information: You'll need your Social Security number or ITIN, filing status, and the exact refund amount claimed on your return.

• Be Aware of Processing Times: While most refunds are issued within 21 days, factors like claiming certain credits or submitting paper returns can cause delays.

Regularly checking the status can keep you informed about your refund's progress.

Several factors can lead to delays in receiving your tax refund:

• Errors on the Tax Return: Mistakes such as incorrect Social Security numbers or mismatched income statements can slow processing.

• Incomplete Information: Missing documents or incomplete forms may require additional IRS review.

• Identity Verification: If the IRS suspects identity theft or fraud, they may delay the refund to verify information.

• Claims for Certain Credits: Refunds involving the Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC) are often delayed due to additional verification requirements.

If you realize you made an error on your tax return after filing, take the following steps:

• Determine if an Amendment is Necessary:
  Minor mistakes, such as math errors, are typically corrected by the IRS. However, if you forgot to report income, claim deductions, or used the wrong filing status, you should file an amended return.

• File Form 1040-X (Amended U.S. Individual Income Tax Return):
  Use this form to correct errors and submit the necessary documentation. The IRS allows amendments up to three years from the original filing date or two years from when the tax was paid, whichever is later.

• Wait for Processing:
  Amended returns are processed manually and can take up to 16 weeks to be reviewed. You can track your amendment’s status using the “Where’s My Amended Return” tool on the IRS website.

• Avoid Double Filing:
  Do not submit a second tax return for the same year, as this can create further complications.

By promptly addressing any mistakes, you can prevent penalties, ensure accurate tax filings, and avoid IRS inquiries.

While audits are relatively rare, there are certain red flags that can increase the likelihood of an IRS review. To minimize your risk:

• Report All Income Accurately:
  The IRS matches your reported income with employer and financial institution records. Any discrepancies can trigger an audit. Ensure that W-2s, 1099s, and other income sources are correctly reported.

• Avoid Overstating Deductions and Credits:
  Exaggerated charitable donations, business expenses, or home office deductions may raise suspicion. Maintain proper documentation to justify all deductions.

• Be Cautious with Large Cash Transactions:
  Cash-based businesses, such as restaurants or salons, are more likely to be audited due to potential underreporting of income. Proper bookkeeping and transparent records are essential.

• File Electronically:
  E-filed tax returns are less prone to errors and have a lower audit rate compared to paper filings.

• Hire a Tax Professional:
  A CPA or Enrolled Agent (EA) can ensure accuracy and compliance, reducing the likelihood of an IRS inquiry.

While audits are uncommon, taking these precautions can safeguard you against unnecessary IRS scrutiny.

The IRS recommends keeping tax records for different durations depending on your filing situation:

• 3 Years: Keep records for at least three years from the date of filing, which is the general statute of limitations for the IRS to conduct an audit.

• 6 Years: If you underreported income by more than 25%, the IRS can audit you up to six years after filing.

• 7 Years: If you claimed a loss from worthless securities or bad debt, retain records for seven years.

• Indefinitely: If you did not file a tax return or committed fraudulent filing, the IRS can conduct an audit at any time.

Documents to retain include:

✔ W-2s, 1099s, and income statements
✔ Receipts for deductible expenses
✔ Records of charitable contributions
✔ Mortgage interest and property tax statements
✔ Health insurance coverage records
✔ Supporting documents for business expenses

Maintaining organized digital or paper copies ensures that you are prepared in case of an audit or if you need past tax records for loans, applications, or legal purposes.