The Tax Questions Blog

Archive for December, 2009

Question: What should I do with 1099-Misc forms from vendors?

I'm a tax person by training and still learing as I go on. I've been receiving tons of 1099-Misc forms from our vendors. What are these and what should I do with them?
I'm receiving 1099s from our customers. What are these and what should I do with them?

Answer: Apparently you are running a small business or are considered an independent contractor. You'll need to report this income on schedule C (or CEZ, if you qualify) along with any business-related deductions you may have. The bottom-line figure flows to the Form 1040.

See IRS Pub 334 for details.

Good luck!

How to Start Freelancing (Without Quitting Your Job) [Career]

Got a job that's totally boring but pays the bills? Hold onto it. But don't use it as an excuse NOT to go after your dream of being self-employed doing something you love. A common misconception...

Bush vs. Clinton Record: Do Tax Cuts Work?

Question: How long after the affidavit of support will it take for a US citizen to get their foreign spouse over here?

filing for a spouse's permanent residency to the US

Answer: It depends on the state. If you have an receipt # (usually shows on the upper right hand corner of any letters received by immigration) you can check the status of said case. Here is the link you can check that # https://egov.immigration.gov/cris/caseStatusSearchDisplay.do;jsessionid=cdLnC1PFjDx7

2010 - another year of high profile cases

Not unlike 2009, this year will be another hectic one for the country's courts with a number of prominent cases and trials pending conclusion.

Green Card through Marriage Application Forms - Immigration Lawyer

Yes, there is a power when buying a sewing machine. By power, this means that you have every right to ask, test, or compare the machine before buying it. If you are a lover of sewing, sewing for hours on end is normal. Therefore it is just right to find a sewing machine that could keep up with your sewing habit.

 

First of all, don't be pressured by the sales agent selling the sewing machines. We all have the same experiences with sales agents that we bought something that they wanted us to buy from them. Well don't blame them if you purchased something you didn't like after all. It is their job to convince you, but you have the power to take charge of the situation. Learn how to say no to them by also knowing what you really want in a sewing machine. Tell the sales agent what features do you want in the machine. In this way, you will know if the sewing machine they are showing you is the right one.

 

Don't hesitate to try on each sewing machines from different stores before finally selecting the perfect one for you. You can ask the sales agent some questions about the sewing machine that are not clear to you. The best thing is bring a fabric or two for testing. This will help you to compare the performance of each machines.

 

Use your power when buying a sewing machine. It is your right as a customer and this may avoid problems to arise when you start your sewing at home on the new machine.

Laughlin in brief - a collection of area events.

LAUGHLIN - Laughlin's second annual Health, Safety and Activity Fair will come to Mountain View Park on the Needles Highway at Arie Avenue on Saturday, Feb. 26, from noon-3 p.m.

Question: What should you do if you receive an IRS audit letter for 2005 from NY and recently relocated to Florida?

My problem is I was in a very serious car accident in June of 2006 and lost all my records in my totalled out car when I was moving to North Carolina. My file cabinet with all my records and many other valuable personal belongings were also lost. What is the proper way to represent my situation at the audit? Also the examiner in NY requested a letter faxed to her and she said the exam would take place in Florida. Is there anything else I should do to prepare for this since all my records were lost. I have all the reports about the accident and my injuries and subsiquent disibility for 8 months. I just returned to work in march 2007. I am in sales so they are questioning my unreembursed expenses and cash contributions. Should I just make a deal with them and pay what they ask for? HELP!!!!!

Answer: Depending on the situation, you may find it necessary to hire either a tax attorney, a CPA, or an enrolled agent to assist you with this.

The first question is did you do your own taxes? If not, then the tax professional who did your taxes may have some of the copies you need. Tax professionals are required to keep paper or electronic (and in some cases both) copies of your tax returns for at least 3 years from the date of preparation of the return.

If you did your own taxes, then you have more problems. Your first request would be to obtain a complete copy of the return that you submitted, so you can determine what you need to document, and how much. Then, you are going to have to reconstruct, from memory, those records, and then prove that. Hopefully, the payments for travel, meals, gas expenses, etc, were made by check or credit card. If they were, then those records should be available from your bank or credit card company.

Cash contributions, you may be in trouble on. If you can't provide documentation on the cash contributions, (i.e. receipts from the recipients), then the IRS may disallow them, and adjust your taxes accordingly.

It seem to me that you should probably do some homework, and then seek out a CPA, Tax Attorney, or Enrolled Agent, any of whom can assist you with problems in front of the IRS.

Look under tax professionals or tax preparation in your phone book. BTW: it doesn't matter where you live now.. the IRS Examination can be held there.

Guest Contributor Dawn Ross: No shortage of new laws for 2010

Each year brings a new set of laws for employers to comply with, and this year is no exception. Below is a summary to assist employers in negotiating the maze of new laws and to give you a preview of what else to expect in 2010.

Obama's ASU Speech: Napolitano's 'Extraordinary Talents...Keeping America Safe'+ IRS Audit Joke,etc.

Question: Taxes on ROTH IRA vs. 401(K)?

Can someone please explain this quote:

"For example, profits from stocks that are held for at least a year will be taxed as long-term capital gains -- a rate no higher than 15%. Interest from corporate bonds, on the other hand, is taxed as ordinary income -- a rate as high as 35%. Yet many investors keep their stock investments in their tax-advantaged accounts and their bonds in regular, taxable accounts. That just doesn't make sense. Asset location can be just as important as asset allocation." http://finance.yahoo.com/focus-retirement/article/104396/Nine-Retirement-Killers?mod=retirement-preparation

I thought the advantage of a ROTH IRA (which is what I'm invested in now -- 100% stocks) was the fact that you are putting in post tax money that won't be taxed when you retire. But say I'm in the 28% tax bracket now, wouldn't it make more sense for me to put the money into an account that taxes later, if it's only going to tax my interest by 15%??? Am I totally confused?

Answer: It depends on how you will be living when you retire. It's also no guarantee the tax rates now won't be higher 20-30 years from now. I would max out my 401K especially if there is an employer match. I would also max out my Roth. There is no right or wrong way. It just depends on how much income you plan on having in retirement, you need to plan accordingly. I would always opt for the Roth because just like I said it's no guarantee with the future tax rates.

Pletschet: New Decade's Resolutions for every investor

Out with the old decade, blotched with wars, terrorism and financial collapse, and in with the new. So let me offer today and tomorrow some New Decade's Resolutions regarding you and your money, steps that you should take and stumbles you should avoid in order to preserve capital for retirement.

How Washoe County School District Bond Money Is Spent?