Blog

2/27/2017

We Have The Answers To Common Tax Questions

Even though we’ve been filing and paying our taxes for years they can still be a source of major confusion. With a variety of different laws and changes that get made on an annual basis, it can be difficult to keep up with everything. However, taxes shouldn’t be avoided just because they come with unknowns! That’s why we’re tax experts here at ExpressExtension, and have the answers to commonly asked tax questions.

Common Tax Questions


1. Will I get a tax Refund?


Unfortunately, the answer to this question is maybe. As you work throughout the year your employer takes withholdings out of your paychecks, which isn’t very fun. These withholdings are an estimate on how much money you’ll owe in taxes.

If too much money was taken out you’ll receive a refund from the IRS. However, if not enough money was withheld then you’ll send the IRS a check.

A lot can change in a year, so just because you received a refund last year doesn’t mean you’ll get one this year. For example, you could default on a loan, have a child to add as a dependent, get a better job and move into a higher tax bracket, and more.

2. Can I claim my kids as dependents?


Good news, yes you can! The government recognizes that the costs of raising children are high, so they want to help you out by giving you a tax break for them. However, your kids do have to qualify as dependents.

To count as dependents your kids must be 19 or under, unless they’re a student, then they can be 24 or under. Your kids also need to live with you for more than half the year, but exceptions apply. If you’re divorced and your ex-partner also claims your child as a dependent then certain rules apply.

Your child can have a job, but their income must total less than half of their financial support for you to claim them.

Children do not have to qualify as a dependent. They can be nieces, nephews, adopted, etc. Any child that you take care of as long as they meet the other qualification standards.

3. Who Can I Claim As A Dependent?


You can actually claim more than just your children on your tax return. Parents, partners, relatives, whoever you take care of financially can be claimed as dependents as long as they qualify.

To qualify they must be a U.S. citizen, U.S. national, or resident alien. They can be married, but you can’t claim them if they’ve filed a joint tax return unless it’s for a tax return. Also, they have to make less than $4,050 for their annual income.

Also, the person can’t be a qualifying dependent for someone else, and the person either has to be related to you or they must live with you for at least a year.

4. What Happens If I Can’t Pay My Taxes?


If you can’t pay your taxes don’t ignore them. The penalties and fees for not paying them aren’t fun to deal with at all and they collect interest over time.

You can get an installment plan from the IRS. That’s basically a loan with an agreed upon amount that you pay to the IRS on a monthly basis until you pay off the amount you owe. However, the interest rates on installment plans can be pretty steep. It might end up being cheaper to use credit cards because they have lower interest rates.

Contact your accountant or a local tax professional to discover your best payment option. Also, you can contact the IRS directly for an installment plan. They’ll be more than happy to walk you through the process.

5. Can I Get A Tax Extension?


Yes! If you need a little more time to file you can file an extension. Some extensions are automatic, meaning you don’t have to provide the IRS with a reason for needing an extension. If the extension isn’t automatic then you have to give the IRS a valid reason for needing one.

Also, extensions only give you more time to file your taxes, not more time to pay them, so please remember to pay your tax bill on time!

Filing an extension is easy. Simply create a free ExpressExtension account and click the form that you need. We provide helpful instructions that will guide you through the filing process in order to have your extension filed in a matter of minutes!

Plus, ExpressExtension provides outstanding support. Please don’t hesitate to contact us via live chat, phone, or email with any questions that you may have.

No comments:

Post a Comment

Watch
IRS Tax Extension

Support Center

Chat with us