Blog

12/30/2015

The Holiday Temp. Shuffle




The thrill of the holiday season is beginning to thin out, and everything is quickly going back to normal, which may be a good thing for some, but not so good for others. For those of you who managed to snag a seasonal work position during the holidays, you’re likely looking forward to that holiday check. And while that might have been your “reason for the season,” your joy could turn into sorrow around tax season, if you weren’t attentive to your classification given by your seasonal temp employer.

What’s this deal about classification?
Well, if you’re classified as an employee, then it is your employer’s responsibility of withholding income and payroll taxes; these also include amounts for social security and Medicaid. But if you’re classified as a contractor, then the responsibility falls on you to pay estimated income and self-employment taxes as required by the IRS, or you could end up facing penalty charges.

Employee vs. Contractor
If you’re not quite sure which category you belonged to during the recent holiday season, here are three questions that the IRS uses to determine classification:

Who is in charge of how the job is done? (Behavioral Control)

Consider yourself an employee if the company retains the right to direct and control the worker; a dead giveaway is some sort of employee training. The employer explains the proper methods and procedures to successfully complete a given assignment. You probably were also given a handbook or manual to follow as well.

Who has significant investment in the work? (Financial Control)
Generally, a contractor isn’t reimbursed for any expenses that are needed to complete a job. Even if you factor expenses into your original work fee, you’re still considered as a contractor. Another indication can be signs of self-employed concerns such as realizing a profit or loss for the work you’ve done.

How are you and the company involved? (Party Relationship)
If you receive benefits like paid time off, insurance, or health care, you’re basically seen as an employee. However, you may not receive any benefits and still be classified as an employee. For instance, part-time employees generally don’t receive any benefits.

A sure fire way to understand your classification from the very start is to have a written contract drawn between yourself and your employer. Most jobs will request you sign an employment contract anyway; this contract should also address you by your proper classification.

If a discrepancy about your classification appears during tax season, it’s an issue that will need to be thoroughly reviewed by you, your employer, and the IRS - there’s no one determining factor. Allow yourself more time with a personal tax extension from ExpressExtension. Within minutes, you can receive an automatic 6-month extension and get your tax information properly together. You can also e-file your personal tax extension on-the-go with our FREE downloadable app for iOS/Android tablets.

ExpressExtension makes tax extension easy, but if you need further assistance or have any questions, our live support experts in Rock Hill, South Carolina are ready to help out. We’re available Monday through Friday from 9 a.m. to 6 p.m. EST; you can reach us at (704) 839-2321. You can also send us an email 24/7 at support@expressextenion.com, or chat with us live from our website.




Read More »

12/28/2015

Expect the Unexpected


You can never predict how things are going to turn out. You may have done efficient planning, set aside a number of days, and even prepared for everything expected just to have something unexpected throw it all out of sync. Now that doesn’t mean that all your planning went to waste; it’s always better to be safe than sorry. But it does show that neither of us can be completely ready for everything.

One of things that we all dread is an unexpectancy during tax season. You’re aware of the deadlines, and you know the penalties. So of course, you plan accordingly on when and how you file your taxes. However, you find yourself waiting extra long for that 1099 or W-2, or you’re missing information about a couple employees, or it’s taking longer than expected to list all your sources of revenue. Whatever the case may be, you need extra time. And that extra time can be yours within a matter of minutes with ExpressExtension.

The best thing is that you don’t have to wait around for the unexpected to happen. You can create your FREE account, right now, and have all your basic details entered at no charge. If the time comes when you need to file for extra time, you can transmit the information you already have in your account.

So don’t wait until the last minute, get a head start on the upcoming tax season by preparing a tax extension with these forms:

  • Exempt Organization Extension Form 8868
Complete and e-file a Form 8868 to receive an automatic, 3-month extension, or an additional, non-automatic 3-month extension for tax-exempt organizations such as public charities, private foundations, and other nonprofits.

Our internal audit and error check guarantees that your extension gets approved every time. You can receive notice of your tax extension within minutes.

  • Business Extension Form 7004
Quickly and easily e-file a Form 7004 for multi-member LLCs, c-corporations and s-corporations, partnerships, or trusts and estates with the IRS and receive same-day approval for either a 5 or 6-month extension depending on your type of organization.

All you need to do is enter your business details, choose your form, and transmit to the IRS; it’s that simple.

  • Personal Extension Form 4868
Extend your tax deadline with an automatic 6-month extension by e-filing a Form 4868 for personal returns (single and family), 1099 contractors, sole proprietorships, and single member LLCs. The process takes only minutes and includes full support filing with the best-rated value.

For even more convenience, you can e-file your Form 4868 through our FREE mobile app for iOS and Android tablets, or through our mobile site for all web-enable smartphones.

Remember, you can start your form at this very minute, but pay only when you’re ready to transmit to the IRS. We also offer a support team of live experts that is readily available to assist you with the e-filing process. You can reach us by phone (704.839.2321, Monday through Friday, 9 a.m. to 6 p.m. EST), email (support@expressextension.com), or live chat (www.expressextension.com).







Read More »

12/23/2015

Happy Holidays from ExpressExtension

No matter how old we all eventually get, there is always that small tingle of excitement around Christmas time, right? As adults, we may not get exactly what we wish, but sometimes it’s the thought of being around those you care about the most that can make you as anxious as a child seeing gifts under the tree. At ExpressExtension, we get that same tingle from each of you every time you all choose to e-file your tax extension with us, and we appreciate your continued support.

It’s been an amazing year, and with you all still rocking with us, we’re going to have an even better time next year. Remember, even though there are deadlines for extensions, you don’t have to wait until the last minute. You can prepare for your tax season in advance with proper recordkeeping, separating personal and business expenses, keeping your books current, and even having your extension ready to transmit.

At this very moment with ExpressExtension, you can create a FREE account and enter your information for an extension all at no charge. When the time comes to apply for an extension, all you’ll need to do is just transmit the information you already have in your account.

ExpressExtension offers support for these extension forms:
Never get left behind - even if you’re speeding through the sky in a reindeer-powered sleigh. E-file your personal tax extension on the go with our mobile app for iOS/Android tablets, or visit our mobile site. You can also e-file extensions for exempt organizations while on the move, with the mobile apps and mobile site from our affiliate product ExpressTaxExempt.

Special Holiday Reminder - Business Extension Users
Don’t forget that the new year brings new requirements for Affordable Care Act (ACA) reporting. Check out our affiliate service, ExpressACAForms, to get your ACA reports easily done way before the February 1 deadline. The process is simple: Create a FREE account, select the proper form, enter business and employee details, review, and transmit.

We all celebrate this joyous time of year in our own unique way, and to honor the significance of the holiday season, our office will be closed on Christmas Eve, Christmas Day, New Year’s Eve, and New Year’s Day with limited email support available at support@expressextension.com. Outside of the holidays, we will be available during our regular business hours of 9 a.m. to 6 p.m. EST, Monday through Friday.

For any questions or assistance with e-filing an extension, our support team of live professionals in Rock Hill, South Carolina is more than happy to help you through the e-filing process. Feel free to give us a call at (803) 514-5155.

From us, to you and yours, have a Merry Christmas and a safe and happy New Year.




Read More »

12/21/2015

IRS Penalties


We’re less than two weeks away from the start of 2016, and with a new year, there comes a reset of all the tax filing deadlines. Some of you may have to deal with only one deadline, while others - especially if you’re a certified public accountant (CPA) - have to be aware of all three. The following are the tax deadlines for the upcoming year:
  • Business Tax Deadline - Tuesday, March 15, 2016
  • Personal Tax Deadline - Friday, April 15, 2016
  • Exempt Organization Tax Deadline - Monday, May 16, 2016 (Or the 15th day of the 5th month after the tax year end date for fiscal year organizations)

Tax deadlines are very important, but even more important are the penalties that you will incur if you happen to miss a due date. Remember, there are two types of penalties, failure-to-file and failure-to-pay, with the first leading to more expensive consequences. So even if you can’t pay the taxes you owe, your best option is to still file the return on time.

Business & Personal Taxes
Failure-To-File
If you fail to file at all, the penalty is generally 5% of the unpaid taxes for each month or part of month it is late, up to 25% of your unpaid tax.

If the return is more than two months late, the minimum penalty is $135 or 100% of the unpaid tax, whichever is smaller.

Failure-To-Pay
If you fail to pay, the penalty is usually .5% to 1% of your unpaid taxes for each month or part of month your taxes are not paid - up to 25% of unpaid taxes.

Important: It is possible for both penalties to be applied within the same month. The 5% failure-to-file penalty is reduced by the failure-to-pay penalty, but your return can’t be more than 60 days late. The minimum penalty will still be $135 or 100% of the unpaid tax, whichever is smaller.

Business Tax Only
For late returns with no tax owed, the penalty is $195 for each month or part of a month your return is late - up to a complete year. This amount is then multiplied by the total number of shareholders within the corporation during that tax year.

Exempt Organization Taxes
Failure-To-File
Exempt organizations with gross receipts of less than $1 million, and no reasonable cause for filing late, can be charged $20 for each day your return is late - up to $10,000 or 5% of your total gross receipt, whichever amount is less.

For tax-exempt organizations with revenues of $1 million or more, the IRS can charge you $100 for each day your return is late - up to a max charge of $50,000.

And the biggest penalty of all...
If your exempt organization fails to file for three consecutive years, it will automatically lose its exemption status.

Don’t let all this talk of tax deadlines and penalties get you blue this holiday season. ExpressExtension brings you the gift of extra filing time through tax extensions. We offer support for business, personal, and exempt organization tax extensions. With just a few clicks and keystrokes, you can quickly and easily receive up to six months of extra time.

Let our holly, jolly support team assist you, if necessary, with the e-filing process. Don’t hesitate to give us a call at (803) 514-5155 Monday through Friday from 9 a.m. to 6 p.m. EST, or drop an email down our chimney 24/7 at support@expressextension.com.




Read More »

12/16/2015

Keep A Record, For The Record

To all our small business owners, let’s have a heart-to-heart chat. And by small business owners, we mean those one-person startups, or companies with less than 10 employees. While providing awesome items or services through your amazing company, you realize that a substantial deal of effort has to go into your business administrative work. All you want to do is continue doing what you’re good at, whether it’s lawn care, baby-sitting, designing, writing, building, or whatever. 

Nevertheless, paperwork is just as essential to the success of your business as doing the actual job. And with decent recordkeeping, you can assure that nothing important goes unnoticed. Here are some helpful tips for keeping business records featured in the IRS Publication 583.

Method of Recording
It’s your business so you should choose a recording method that works best for you. The ultimate goal is that your method clearly displays your company’s income and expenses. To do so, it’s best that your record system contains a business transaction summary. Typically, the summary should include your accounting book, or business checkbook, with records of your gross income, credits, deductions, or other business entries.

For the tech-savvy business owner, you can digitally store your business records. All requirements for physical paper records will also be for electronic records. Your digital record system must be able to collect, arrange, save, recover, and duplicate all electronic books and records in an easily read format. Each record of data must be complete, accurate, and accessible to the IRS.

Important: If you happen to be in charge of more than one small business, make sure you maintain separate sets of records for each business.

Track with Supporting Documents
“The proof is in the pudding,” and who wouldn’t like having proof to back them up? Along with your accounting books, you need to keep supporting documents that can justify what’s within your records. For transactions, these can include paid bills, receipts, monetary slips, invoices, and checks. You’ll also want supporting documents for business income, purchases, and other business expenses.

Separation is Key
The most important thing to remember, especially for businesses with only a sole proprietor, is to keep business and personal spending completely separate. One of the most common mistakes made is making business purchases through personal accounts.

Important: A business must look and operate as a business in order to be seen as a business.

It would be more beneficial to have separate credit cards and bank accounts specifically for business use only. By doing so, you can easily differentiate professional records from your personal ones.

Whether you keep your records on paper, or digitally, make sure they’re stored neatly in a safe place. If you find yourself still getting together your records during tax season, you don’t have to stress. Get extra filing time with a tax extension from ExpressExtension. Within minutes, you can receive an automatic 5 or 6-month tax extension depending on the type of business you operate.

Like any good business team, ExpressExtension has you covered with our live support team in Rock Hill, South Carolina. If you have any questions, or need assistance e-filing an extension, we’re available Monday through Friday from 9 a.m. to 6 p.m. EST. Call us at (803) 514-5155, or you can contact us 24/7 at support@expressextension.com.




Read More »

12/14/2015

Home Office Deductions

In recognition of the holiday season, we recently decorated two Christmas trees that we have placed in the office. We also have seasonal decor displayed along our workstations just to make the scenery a little more festive for this time of year. If you’ve recently been to a doctor or dentist office - anywhere, really - since the beginning of December, you’ve probably seen the same type of holiday decorations.

For those of you with a home office, you might be following the same tradition of seasonal decorating. But decorating isn’t all you can do with your residential workspace. If you haven’t heard yet, there is an easier way to file for home office tax deductions. Introduced during the 2013 filing season, the Simplified Method Worksheet within Schedule C of Form 1040 and 1099-MISC greatly reduces the amount of information required to file.

Unlike the regular Form 8829 for claiming home-office deductions, the simplified worksheet only needs to calculate $5 per every square foot of your workspace - up to 300 square feet, which maxes out at only $1,500. The major benefit of this simplified method is that it requires little-to-no record keeping; however, that’s about the only good thing.

If you have a substantially large home office, or a great deal of expenses related to working from home, then you won’t be receiving the full deduction amount. It really all depends on what is more important to you - money or time. The best thing is that you don’t have to be committed to the same method each year; you can interchange how you deduct as often as you want.

House Rules
Now before you go designating spaces within your house as a home office, there are tax rules that must be met in order to consider your workspace as tax deductible.

For Business Owners:
  • A Home office has to be regularly used for business only. Any personal use will forfeit the tax deduction. It doesn’t have to be an entire room; a portion can work as long as it’s meant for business only.
  • Home office space must be used as your primary place of business. You can still do business outside your home, but a substantial amount has to be done regularly in your home workspace.

For Home Employees:
  • You have to meet the same requirements as business owners, and you must also prove that your home workspace is for the convenience of the employer and not for yourself.

More information about deducting your home office can be found with your local tax professional or the IRS Publication 587.

Don’t forget that if you need more filing time to get all your deductions together, you can receive a tax extension within minutes with ExpressExtension. We offer support for business, personal, and exempt organization tax extensions. Our friendly support team of live professionals in Rock Hill, South Carolina is more than excited to lend a helping hand with your e-filing experience.

If you have any questions or concerns about e-filing, please call us at (803) 514-5155 Monday through Friday from 9 a.m. to 6 p.m. EST. You can also reach us at any time of day with our 24/7 email support at support@expressextension.com.




Read More »

12/10/2015

Income Deferment

“On the first day of Christmas, my true love gave to me…,” a lower tax bill.
“All I want for Christmas is my…,” tax bill lower.
“I’m dreaming of a…,” low tax Christmas.

You might not verbally express it, but we know what the perfect holiday gift could be. Honestly, who wouldn’t want to pay less in taxes, or receive an even bigger tax refund? The possibility is more tangible than you think, and it doesn’t involve giving away your possessions as deductible contributions. But you have to be a little bit open-minded. If you read the title carefully, you might not be too eager to participate, but doing so could prove to be worth the effort.

Basic Tax 101: The amount of tax that you pay back is dependent on your taxable income. The main goal is to lower your taxable income, which leads to a low tax bill. Typically, people use standard or itemized deductions to shrink their amount of taxable income.

Another way to lower your taxable income is to just make less money. *gasp*

Now before you click that little “x” on the top-right of your browser, let’s humor the idea for minute; it’s a bit more common than you think. We don’t mean for you to take a paycut or just quit work entirely. The idea is to delay your income when you anticipate a large tax bill into the next year when your income is little less.

Self-Employment: It’s not as difficult as it may sound. Let’s say you’re self-employed and you just completed work for a client in November or December. Instead of billing the client as soon as possible, you can send the bill at the start of the new year. The income received won’t be added to your taxable income until the following tax year.

Important: Be sure that you’re financially able to make it through to the start of the new year. There’s really no point in trying to save a few hundred dollars around tax season if you’ve got to “hobo-it” or “bum-it” for a month or so. Low taxes are great, but they shouldn’t dictate your life.

Traditional Employment: For those of you who are traditional employees, you’re less likely to defer paychecks, but it isn’t impossible. If you happen to receive a bonus near the end of the year, ask if you can get it at the start of the new year. Because most large companies use an accrual accounting method, they should still be able to deduct the bonus amount for the current tax year, while it isn’t added to your taxable income until the following tax year.

Remember: Your tax situation may be different from the next person, and you should consult with a tax professional before attempting anything that could lead to tax consequences. And during this time of year, with the holidays, gift-buying, and traveling, the suspension of income may not be in your best interest, but that’s fine. If you can’t do it this year, aim for it next year.

Make sure that your tax documents, either your 1099 or W-2, reflects the deferred income. If you happen to find a discrepancy, give yourself extra time to file a tax return by e-filing a tax extension with ExpressExtension. With our personal tax extension, you can receive an automatic 6-month extension within minutes, and you can use that time to get your information corrected.

Our live support team in Rock Hill, South Carolina is on standby to assist you with the e-filing process. If you have any questions or concerns, give us a call at (803) 514-5155 Monday through Friday from 9 a.m. to 6 p.m. EST. Feel Free to email us at anytime at support@expressextension.com, or live chat with us at www.expressextension.com.





Read More »

12/07/2015

Holiday Party Tax Write-Off




Our office is becoming alive with excitement because we’re now in the planning stages of our annual holiday office party that will be hosted soon. Throughout the many offices and workplaces nationwide, hopefully, you’re fortunate to be with a company that hosts some sort of holiday function. Whether the event is formal, semi-formal, casual, or just a fancy table spread in the breakroom, a holiday social just feels right.

If you’re a business owner, then an entertainment expense such as a holiday party can be used as a tax write-off; however, there are certain rules that come with attempting this type of deduction. Let’s start with the type of shindig you plan on hosting this holiday season:

Traditional Office Party

Simple, yet effective. The traditional holiday party at the office is as exclusive as you can get with holiday socials. It can be as extravagant or as quaint as you want. With the traditional office party, you’re most likely keeping the festivities well within the office space, and invitations are only extended to your employees and their families.

Write It Off: Because the guest list only consists of company employees and family members, the costs can be 100% deductible - every cent. You just follow whatever itemized deduction method your company has in place, and you’re good to go. Be sure to distinguish the expenses from any other entertainment expense.

Company Holiday Dinner

The quarterly earnings must have been more than fair, so this year you want to splurge on something a little more elaborate to show your appreciation. You may decide to host this event outside of the work space like at a restaurant or some other venue. Not only are you inviting your employees, but also a few business associates and a number of clients.

Write It Off: There are a few restrictions with this type of shindig. Unfortunately, you can’t deduct entertainment expenses from a goodwill party involving business associates and clients. However, in this situation, you do have employees attending so the expenses can be allocated between employees and nonemployees, and then deducted.
If you have a moment within your event when there’s clearly a substantial business discussion, like a presentation, speech, or an unveiling, you can deduct up to 50% of the expenses only towards your clients or customers in attendance. Like the traditional office party, expenses for employees are still 100% deductible.

Year-End Gala

Bonuses for everyone! It has been an amazing year, and you will spare no expense to host the most elegant holiday celebration that will be talked about for months to come. You have the largest fanciful venue, the most premium choice of decorations and foods, crystal glasses and champagne flutes, sterling silverware, a 74-inch ice sculpture of the company logo, and every beautiful thing you can ever conceive to enhance the atmosphere. Invitations have been extended to employees, business associates, clients, friends, even the general public, and everyone must be formally dressed in a tuxedo or gown.

Write It Off: With something of this magnitude, you definitely want to get back as much as you can. As mentioned with the holiday dinner, you can’t deduct expenses towards business associates; you also can’t deduct from friends either. You must have a moment of substantial business discussion to deduct 50% of expenses from clients or customers. You can deduct 100% from employees, and even 100% from the general public.

Obviously, you don’t need to have an event as specific as the examples given. All that matters is who's in attendance. Documentation is key - be sure to keep a record of the guest list for allocation purposes. Make sure to have a record of the invitation along with a clearly indicated business purpose. Record any presentation, speech, or unveiling to serve as proof.

If you need more detailed information to successfully deduct your expenses, give yourself more time with ExpressExtension. We offer support for business tax extensions in which you can get an automatic 5 or 6-month extension based on your type of business. We’ve also spared no expense with the effective, live assistance you can receive from our support team in Rock Hill, South Carolina.

Give us a call at (803) 514-5155 Monday through Friday from 9 a.m. to 6 p.m. EST. Or email us 24/7 at support@expressextension.com. We also live chat one-on-one at www.expressextenion.com.











Read More »

12/02/2015

New Tax Year Resolutions

The final countdown to the new year has officially begun, and while many of us are preparing for the “New Year, New Me” resolutions, it is also important to take a look at what can be done differently regarding your financial status and taxes. The key to taxes is to plan ahead and it can be accomplished all year long. You should understand that taxes are based from taxable income rather than your gross income, and this taxable income can be shortened by deductions.

Normally, those of you with many deductions will need to itemize the things that you want to “write-off.” If you don’t have as many, you can use the standard deduction method from the IRS to determine your amount. The goal is to have your taxable income much less than your gross income, and with these tips, you can begin a bright, new future for yourself and your finances.

Individual Retirement Account (IRA)
Any tax professional can tell you that putting money into a traditional retirement plan can serve as a deduction; the best part is that it’s a deduction that doesn’t need to be itemized. The money that goes into a traditional IRA is a pre-tax amount, so it lowers your taxable income either with standard or itemized deductions.

What’s even more amazing is that any contributions made to your IRA up to April 15 can be counted towards your tax return. The only downside is that taxes imposed on your retirement money is deferred rather than completely exempt, which means you’ll have to pay taxes on it at some time, normally during retirement. There are non-traditional IRAs that can prevent having to pay taxes later; your local tax professional should have more information.

Flexible Spending Plans

A flexible spending plan can lower your tax bill with the money you were going to spend anyway on things like medical expenses. Your employer, if they participate in such a program, can take out a pre-set, tax-free amount from your paycheck and place it in an account. Once the expenses have been made, the funds become available.

Putting money into a flexible spending plan will also decrease your gross income, which will decrease your taxable income even more. The catch here is that you have to use the money as intended. For instance, let’s say you put aside money for an adult day care to look after a dependent, but then a close friend of the family offers to watch over that dependent. If your friend isn’t operating a legitimate adult day care service, then the money within the plan is lost.

Each situation can be unique, so be sure to check with an advisor regarding your flexible spending plan.

Give to the Community
One of the most common ways to deduct from taxes is to make a sizable donation to your local charity or nonprofit. You don’t have to necessarily cut a check; you can give items such as toys, household goods, or clothes, which will all need to be itemized. Also, keep in mind that the organization you’re donating to is officially recognized by the IRS.

What you might not already know is that you is that you can also receive a tax deduction for volunteer work. Obviously, you can’t deduct based on time; however, if you had to travel a considerable distance to volunteer, or purchased an item for the organization’s own use, you can deduct those expenses.

“Bundle the Savings”
Ever heard that expression from a salesperson,”bundle the savings?” Each item is marked down, so the more you buy, the more you’re saving. Well, you can do the same with contributions. Let’s say you give a monetary donation to a religious organization every month. At the end of the year, you could match that total amount with a lump-sum gift that would have been next year’s total contributions.

What happens is that you’re basically receiving two years worth of deductions instead of just one. You can do the same with items. For instance, you donate $400 worth of clothing throughout the course of a year. You match that with another $400 worth of clothing, and you’ve completed two years of donating, but will receive the tax benefits all in the same year.

These are only a few examples of the steps you can take to change your financial outcome before tax season. You can even start to use these suggestions before the end of the year. Remember to carefully keep record of you what you plan on deducting; you don’t want to be scrambling around tax season.

However, if you do need more time before you file your tax return, you can quickly and easily e-file a tax extension with ExpressExtension. We offer support for personal tax extensions that can be filled and transmitted directly to the IRS within minutes. Our US-based support team in Rock Hill, South Carolina is committed to assisting you in any way possible with the e-filing process.

We’re available Monday through Friday from 9 a.m. to 6 p.m. EST at (803) 514-5155. We also offer 24/7 email support (support@expressextension.com), and don’t forget to live chat with us on the ExpressExtension website.





Read More »

Watch
IRS Tax Extension

Support Center

Chat with us