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Happy Arbor Day
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Ask TaxMama is sent to you for FREE every Friday
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*** Ask TaxMama Volume 3, Issue #110, April 27, 2001 ***
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Dear Family,
---
Deadlines looming - http://taxmama.com/taxcalendar.html
Payroll and Sales taxes due on April 30th
----
As you know, I spent last weekend on a cruise ship in Florida
the Bahamas. Our AffiliateFORCE2001 even was a big success.
People are writing about it all over the web.
And in the course of all that, being concerned about folks on
cruises, Rod Aries of http://www.howtointernet.com/ sends this
tip for other travelers - about Departure Taxes
http://www.Tourist-tips.com/Tip/10290.asp
And oh look! Just in time...Terrill Epps of http://suiteinternet.com
took lots of pictures - so if you want to see us at play:
http://suiteinternet.com/members/Affiliate_Force_2001/
(I effectively managed to avoid all photos - except Steve, with
the video camera kept following me around - but he promised
to pixelate all pictures with me in them)
-----
There's a new bill in the Senate designed to provide businesses
with tax credits for information technology (IT) training for
their employees - up to $1500 per employee.
http://www.techcoalition.org/teta_2001.htm
You may want to drop a note to your Congressperson in support
of this.
---
For now, I am taking a brief breather and sleeping in this weekend,
for the first time this year.
You, go outside. The weather is fabulous.
(Then finish getting your tax information all caught up.)
Love and Best wishes,
Eva Rosenberg, EA
Your TaxMama is watching...out for you.
http://taxmama.com/red/amazon1honor.htm
P.S. Welcome to all the new subscribers - and thanks, everyone,
for telling your friends about Ask TaxMama! Please don't stop.
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< NOTE TO TAX PROFESSIONALS: Joining a weekly discussion
list just for tax professionals, please sign up at
<http://taxmama.com/Insider/guidelines.html">
------------------------------------------------
Do You Have to File?
------------------------------------------------
From: Overland Park, Kansas
Dear TaxMama,
Do you have to file your state taxes by deadline
if you are getting a refund?
Thank you
Jessica
<TaxMama Replies>
Hi Jessica,
It's not the end of the world, if you don't.
And several states do have automatic extensions.
(I don't know if Kansas is one of them.)
But do file as soon as you can.
Some states do have penalties for not filing
on time, even when you do have a refund.
(Spelled California)
Best wishes
Eva Rosenberg
Your TaxMama
http://taxmama.com/red/amazon1honor.htm
http://workinghumor.com
-----------------------------------------
Tax Freedom Day
----------------------------------------
From: Birmingham, AL
Hi TaxMama,
Is May 3rd a tax exempt day for wages?
I heard something on the radio and did not hear all of it.
Rosalind
<TaxMama Responds>
Dear Rosalind,
Oh dear, hardly.
Tax Freedom Day means that, until then,
all the money you've earned has gone
towards paying your taxes.
It takes working that many days a year to cover
your tax obligations.
Sad, isn't it?
And do you think that takes into account all our sales tax and
property tax and gasoline tax and sin taxes (tobacco, alcohol,
etc.) that we pay everyday?
Best wishes,
Eva Rosenberg
http://taxmama.com/red/amazon1honor.htm
http://wz.com/arts/WorldofComics.html
------------------------------------
Seeking W-2s
------------------------------------
From: Colfax, WI
Dear TaxMama,
Are there any web sites that let you look at your past W-2 forms?
This would be a great help.
Thank you for your help!
Dan the Man
<TaxMama Replies>
Dear Dan,
No there are not.
And be glad.
With all the clever hackers about, you really don't
want your life exposed.
However, you can get copies (or at least transcripts)
for free from IRS. Simply fill out Form 4506
http://ftp.fedworld.gov/pub/irs-pdf/f4506.pdf
The recent W-2s will be in your hands before you
know it. The older ones take 6-12 weeks.
If you really need them quickly, though, you might get
in touch with a good tax pro who does representation.
We know a sneaky little secret about how to get IRS to
provide recent information like that in about 24-72 hours.
Good luck!
Best wishes,
Eva Rosenberg
http://taxmama.com/red/amazon1honor.htm
http://wz.com/business/ReducingTaxes.html
----------------------------------------------
OOPs. I Left it Out!
----------------------------------------------
From: Dallas, TX
Hello TaxMama,
I just filed a 1040 at the last minute.
I had to fill out a schedule D form because of a few stocks.
Well, after I returned from the post office I realized that I
forgot to attach the Schedule D form? What do I do now?
Robert
<TaxMama Replies>
Hi Rob,
It's simple.
You have two choices, actually.
1) File and amended return, using Form 1040X.
Add the Schedule D. Pay the taxes, interest
and a small underpayment penalty, if applicable.
or
2) IRS will be sending you a letter, sometime
around October, reminding you that you
didn't report the sales of those stocks.
You can reply then with a completed Schedule D,
pay the taxes and interest due, along with a
larger underpayment penalty - but there won't
be any late-filing penalties.
If you did everything right, but simply left out that page,
just wait - you'll get a letter...then just add the copy of the form.
(If you try to send it to them now, you'll just confuse them.)
Forget it about in the meanwhile.
You'll be fine.
Best wishes
Eva Rosenberg
TaxMama
http://taxmama.com/red/amazon1honor.htm
http://www.adventive.com/lists/ihelpdesk/
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Independent Initiative
----------------------------------------------
from: Water Mill NY
Hi TaxMama,
My husband and I both work as independent Contractors.
We each receive 1099's at the end of the year.
What forms do we need to make our allowable deductions
for our businesses?
Lula
<TaxMama Replies>
Dear Lula,
You each need to file your own Schedule C to report all your
business income and expenses.
If you have assets (like a car, computer, equipment, etc.)
you will need Form 4562 to report the depreciation.
If you work from home, you may each need to use a Form 8829
to report the office in home expenses.
http://www.taxmama.com/Articles-cur/homeofc.html
If you have a profit, as you probably will if this is your
only source of income, you will need Schedule SE, to compute
your Self-Employment taxes (Social Security and Medicare).
There may be other things that crop up in the course
of preparing your taxes, but these are the primary forms
that will affect you.
Actually, you might want to get more in-depth information
and see about doing bookkeeping and keeping records.
Here are some good resources you might want to use.
Now, don't be put off by the title - it's one of the
most sensible (and cheapest) books I've found:
Minding Her Own Business : The Self-Employed Woman's Guide
to Taxes and Recordkeeping by Jan Zobel
http://www.amazon.com/exec/obidos/ASIN/1580622003/mywishlistA
And if you can, you really should start keeping books.
The better you track your expenses...especially the
cash expenses, the higher your deductions will be.
I have ALL my business clients on QuickBooks
(and look! they finally started an affiliate program -
meaning they pay me a commission if you use this link)
http://taxmama.com/QB.htm
Or, if your mind works better in Excel...Gail Perry has
written a pretty good book that might help.
http://www.amazon.com/exec/obidos/ASIN/0072118830/
Eva Rosenberg
Your TaxMama
http://taxmama.com/red/amazon1honor.htm
http://www.adventive.com/lists/ihelpdesk/
-----------------------------------
Owing, Owing To the IRS
----------------------------------
In last week's issue, Erika asked this question:
I owe over $700 this year to the IRS from an investment payout.
Can I get information or a form on making payments.
And TaxMama explained about installment plans with IRS
http://taxmama.com/AskTaxMama/109/owing.html
This week, we get some clarification from Don at IRS's
Tax Advocate's office:
Dear Mama,
Still Love You Mailings..
You probably knew this, but may not been able to say it..
so FYI if you don't know, there is a $25 minimum on installment
plans.
Normally, a taxpayer gets 1 free "late or missed" payment before
the installment plans is defaulted. But as you probably know, I
can't promise what that computer might do....
If you can pay it all in 90 days..then no $43 installment plan fee.
[TaxMama: I didn't realize that IRS would waive the $43
processing fee if you could arrange to pay off the balance due in
90 days. But, it makes sense - it saves them a lot of paperwork and
follow up. Eva]
-------------------------
Because We Care
--------------------------
A.N.G.E.L.S. DAY http://taxmama.com/care/
-----
Drop in on the DJ Martin Foundation to help families of
murder victims deal with the trauma resulting from a
loved one's death http://www.djmartin.net/
-----
Do your good deed for today... it only takes a second.
Go to this site http://www.thebreastcancersite.com
-------------------------------------------------
MONEY FUNNIES and Inspiration
-------------------------------------------------
From Joyce Ragels, our trusty EA in Arizona sends this
mailto:jragels@uswest.net
===>
Troubled business
A businessman was in a great deal of trouble. His business was
failing, he had put everything he had into the business, he owed
everybody-- it was so bad he was even contemplating suicide.
As a last resort he went to a priest and poured out his story of
tears and woe. When he had finished, the priest said, "Here's
what I want you to do: Put a beach chair and your Bible in your
car and drive down to the beach. Take the beach chair and the
Bible to the water's edge, sit down in the beach chair, and put
the Bible in your lap. Open the Bible; the wind will rifle the
pages, but finally the open Bible will come to rest on a page.
Look down at the page and read the first thing you see.
That will be your answer, that will tell you what to do."
A year later the businessman went back to the priest and brought
his wife and children with him. The man was in a new custom-
tailored suit, his wife in a mink coat, the children shining. The
businessman pulled an envelope stuffed with money out of his
pocket, gave it to the priest as a donation in thanks for his advice.
The priest recognized the benefactor, and was curious. "You did
as I suggested?" he asked.
"Absolutely," replied the businessman.
"You went to the beach?"
"Absolutely."
"You sat in a beach chair with the Bible in your lap?"
"Absolutely."
"You let the pages rifle until they stopped?"
"Absolutely." |
"And what were the first words you saw?"
"Chapter 11."
--------------------
IRS NEWS
----------------------
THE BIG QUESTION!
When Can You Expect Your Tax Refund?
Courtesy of AccountingWeb.com
* * * * * * * * * * * * * * * * * * * *
Are you getting a little anxious? Or do you know someone who
is looking for a refund? Here's the official IRS schedule for
mailing and directly depositing those tax refunds.
http://www.accountingweb.com/item/45067/101
--------------------------------
FREE Workshops
--------------------------------
Smart Business Tax Moves You Can Make for 2001
http://taxmama.com/Articles/taxsmart.html
or See TaxMama in action - in their archives at Digevent's
Small Business University
http://digevent.com/events/consumer/business/sbu/info.asp
The archives should be up ...if you want to view the show
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TaxMama On the WWW & Tooting Her Own Horn
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Critical Dates: http://taxmama.com/taxcalendar.html
____________________________________________________
Ask TaxMama is published by the good folks at
http://taxmama.com ISSN 1532-0790
© copyright, Eva Rosenberg, 1999, 2000, 2001
Written (e-mail) permission is required to copy or redistribute this
publication or to use it on your site. mailto:taxmama@taxmama.com
However, you are encouraged to forward an intact copy to all your
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----legalese ----
This publication is not designed to offer legal advice. It is designed
to point you in the right directions so you can ask the right
questions - or do your own research. It is designed to alert you to issues
and encourage you to think and plan. When you read it, the information
may already be outdated. Tax laws do change quickly. Please, please
engage the services of a competent tax professional if you do anything
the least bit complicated. It will save you so much money and grief
in the long run.
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