Tax Credits for Families with Children

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Individuals who support children may be eligible for several tax credits to help reduce their federal income tax. The child and dependent care tax credit is for families with children age 12 or younger. The credit is based on the amount of day care expenses. This credit is also available for dependents of any age […]

Reporting Interest Income and Related Expenses

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Taxable and tax-exempt interest income is reported on the tax return. Interest is subject to the federal income tax and the net investment income tax. Source documents needed: Form 1099-INT, Form 1099-OID and bank statements. Note: financial institutions issue 1099-INT forms if at least $10 of interest was paid out. If you earned less than […]

Reporting Investment Income and Expenses

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Income from investments and related expenses are reported on different parts of Form 1040. Interest income is reported on line 8 of Form 1040. Source documents include Form 1099-INT, Form 1099-OID and bank statements if no 1099 was issued. Schedule B is required if a person has more than $1,500 of interest to report. Dividend […]

Missing Tax Documents? How to Track Them Down

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Individual taxpayers may have received most of their tax documents via mail or by electronic delivery by mid-February. Form W-2 and most types of 1099 forms are required to be furnished to individuals by the end of January. Form 1099-B, which reports sales of stock, bonds, mutual funds and other investments, is required to be […]

Resources for Preparing Form 1099-MISC for Small Businesses

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Self-employed persons and businesses of any size are required to report payments for services rendered by independent contractors by using Form 1099-MISC. Form 1099-MISC is used to report a variety of different types of payments, including payments for services performed by non-employees, for legal services, for medical care payments, and for rent. In general, Form […]

How to Handle Owing the IRS

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If you find that you have a balance due on your 2013 tax return, there are four different ways of paying off your tax bill. To figure out a payment strategy for your 2013 taxes, analyze your personal budget to find out how much can you pay the IRS by April 15th, 2014. Will you […]

What Happened? Obamas, Bidens Release Tax Returns

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President Obama and Vice President Biden released their tax returns for the year 2013 to the public on April 11, 2014. The tax returns are available to download on the White House blog as PDF files. President Obama filed jointly with his spouse Michelle Obama. They reported a combined total income of $503,183 and a […]

Small Business Deductions

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Businesses can deduct a wide variety of expenses, such advertising and rent. The general rule is that to be deductible, an expense must be both ordinary and necessary. Here’s a list of the most common business expenses. Business owners who work from home can deduct part of their home expenses as a business deduction. This […]

Tips for Starting a Business

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Thinking of starting a business? Before starting a business, it’s good idea to first know how to run a business. Jean Murray outlines the topics you’ll need to grapple with to make sure your business venture gets started on the right foot in her article, What Do I Need to Know to Run a Business? […]

What Goes Where on the Form 1040

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The Internal Revenue Service publishes a really useful chart showing where information from tax documents are reported on Form 1040. The chart is found on pages 10 and 11 in the 2013 Instructions for Form 1040 (pdf), and the chart is also reproduced, verbatim, below. But first, let’s talk about how this chart can help […]