Income Tax Questions

Following are some of the most commonly asked income tax questions. If you don’t see the answer to your tax questions, contact us at 847-297-6264

Beware of IRS Scams

The IRS called me/ emailed me and they need me to pay $XXXX amount of taxes or they will arrest me. They want my Social Security number and a credit card. When we did my return I got a refund. What should I do?

This is a phone/email scam that has been going on for years. REMEMBER….THE IRS NEVER CALLS OR EMAILS ANYONE BEFORE THEY SEND CORRESPONDENCE. ALSO THEY WILL NOT ASK FOR A DEBIT CARD, BANK ACCOUNT NUMBER OR MONEY ONLINE OR OVER THE PHONE. NEVER GIVE ANY INFORMATION. The IRS advises to hang up and not engage with these people. Go to the IRS Website and fill out an “IRS Impersonation scam form”. The IRS does not use the words “arrest” or “go to jail”. The IRS is always updating the most current scams on their website.

Please call us if you need more information.

I received a notice from the IRS in the mail. What do I do?

IRS notices can be handled most effectively when we have a copy of the notice if you are our client. Please fax or mail a copy of the notice to our office so that we can investigate and decide on a course of action.

If you are not a client we will need to set up an appointment.

I just received my W-2/1099 and the social security number is wrong

Go to the source of the document and have them give you a corrected copy.

What do I need to do if I am Self-Employed?

Self-Employment (even part-time) has special tax obligations. All income from self-employment needs to be filed with your 1040. Estimated tax deposits may need to be filed quarterly. Many self-employed people don't even know what tax questions to ask because it is so different from filing on wages or salary.

Please call our office to find out what your obligations are.

What do I need to do to start a business?

There are filing requirements/registrations both for the federal and state that need to be completed for any business. It is important to analyze what form your business should have. May it be a corporation, partnership, LLC or other.

We can assist with the mass of paperwork.

When do I need to start taking withdrawals from my retirement plans?

You have to start taking withdrawals at age 70 ½ from a traditional IRA or pension plan. Roth IRAs do not require minimum withdrawals.

We can help you compute the Required Minimum Distribution (RMD) needed so that a penalty will not be incurred.

I donated a lot of household goods and clothing to the Salvation Army. What do I need to do for a deduction?

On the Salvation Army website there is a form “Donation Value Guide” listing many items and their value. Get receipts for the donations. I f donating a vehicle or items worth over $500.00 make sure you get a 1098-C with the value noted.

How much will my return cost?

The cost of a return varies. Taken into consideration for the price of the return is:

Brokerage reports and complexity of analyzation
Rental Property
Foreign Income
Self – Employment
Earned Income Credit
Child Tax Credit
Education Credit

Every tax payer is different because their personal situation may require assorted forms. We do not just do forms to increase our fees. Our fees are competitive with the many franchise services. Ask about our discount for new clients.

When will I get my refund?

The IRS starts payouts on a different day each year but it usually is not until February regardless of when your return is filed in January.

Refunds are typically deposited in taxpayer’s accounts about 10 days after acceptance. Some forms are being looked at longer such as the Earned Income Credit and will delay a refund.

Check the IRS website “Where is my refund?” to get up to date information.

Do tips need to be reported?

Tips from any source must be reported to the employer if the amount is $20.00 or over in a given month. An employee who receives a tip from the customer like a server or a tip that is given to a busser / bartender etc. are all tips that need to be reported to the employer.

I see different answers to my tax questions online. Which are correct?

Tax rules change all the time and are dependent on many factors. The best way to be sure you are getting the correct answers to your tax questions is to have a tax professional you can trust who knows you and your situation.

At Best Financial Group, we take the time to get to know our clients and their circumstances so we can give them the best possible guidance to their tax questions.

Paying Too Much Tax?

Let Us Help You Today:

847-297-6264