Identity Theft and Other Tax Scams to Watch Out For

Tax scams are on the rise. Therefore, it is important that you watch out for identity theft and other tax scams. Today, we are discussing some of the most common tax scams to watch out for.
Phone Scams
People will call you and pretend to be the IRS. This has been increasing over the years, and they threaten taxpayers with arrests, deportation, and other things. Keep in mind the IRS is not going to call you; instead, they will send a letter in the mail.
Phishing
Taxpayers are being targeted with emails or websites that have a goal of stealing their information. Keep in mind the IRS is never going to email you about a bill or your refund. You should never enter your personal information online on an unsecure website.
Identity Theft
Around tax time identity theft skyrockets because criminals will try to file using others social security numbers. The IRS is progressing on reducing fraudulent returns but taxpayers should always make sure that they safeguard their information.
Return Preparer Fraud
Do not go to individual tax preparers.  Individuals will steal your information, file your return, and spend your tax refund. Everyone is not trustworthy so you have to be careful as to who you give your personal information to. Instead, you need to go to a reputable business such as Huddleston Tax CPAs.
Bottom Line
At Huddleston Tax CPAs, we can advise you. You work hard for your money so do not let criminals get your well-deserved tax refund for free. Visit our Bellevue CPA site for information about our firm.

4 Tax Deductions That Can Save You Big Bucks

Everyone knows that there are tax deductions that can help him or her save money yet everyone does not utilize them. Today, we are discussing four tax deductions that can save you big bucks this tax season.

State and Local Sales Tax
If you live in a state with no income tax, you should take advantage of deducting the state and local taxes instead. You just have to remember to keep your receipts for in the event that you are audited.

Bonus Depreciation
Small and medium sized businesses are able to write off 50% of the costs of assets that they purchased for business during 2014. This means that they can deduct up to $500,000 of qualifying assets instead of the projected $25,000. This can help business owners save a large amount of money. Therefore, you want to make sure you check to see if you are eligible for these deductions.

Visit our Shoreline CPA blog to read “4 Things a Sneaky Tax Preparer Will Not Tell You”

Health Insurance Premiums
If you are self-employed, you are able to deduct your health insurance premiums. For some the Affordable Care Act will be expensive but self-employed individuals will get a tax break since they have to pay for their health insurance premiums themselves.

Mortgage Points
Many taxpayers are aware of the mortgage interest deduction but they are unaware that they can deduct the costs of the points. The costs of the points still have to be spread over the mortgage life but this is a deduction that can help you save.

Conclusion
If you need help with your deductions or need help in other tax areas, look into hiring a professional tax firm to file for you. We suggest reaching out to our tax firm Huddleston Tax CPAs. We are a Seattle CPA firm that specializes in assisting small businesses and individuals. You can reach us at (425) 483-6600.

What to Do About Missing W-2s

If you are an employee, before you are able to file your taxes you have to have your W-2. The IRS requires employers to send out this form by January 31. However, what do you do if your W-2 never arrives? Today, we will be discussing the solution.
Contact Payroll
If your W-2 has not arrived and February has already started making its way to an end, it is important to contact payroll. Make sure that they have the correct address on file and if they have not sent your form out yet you can go to the office and pick it up yourself.
Contact the IRS
If payroll is not up to helping you, contact the IRS and make sure you have your last pay stub on hand. This way your missing W-2 can be recreated. You can reach the IRS at 800-829-1040. They can send your employer a friendly reminder to let them know that they need to get you the form.
Recreate it Yourself
In the event that you are not able to get through to the IRS, you can download Form 4852 from the official IRS website and fill in the information yourself. Once done, you will be able to attach the form to your tax return. However, since the IRS has to verify the information is correct this can cause your refund to be delayed.
Bottom Line
Huddleston Tax CPAs is a Seattle CPA firm that can help you with any W-2 issues you may encounter. You have to have your W-2 to file taxes and usually if you contact your employer, they can get your W-2 to you quickly. Call us at  (425) 483-6600!

How Much the Average American Pays in Income Taxes

When filing your taxes you are probably shocked at how much you pay in income taxes. However, have you ever wondered what the average American is paying? Today, we have performed some research to see how the numbers add up around the nation.
The IRS is Collecting More
The economy is now recovering, which means the IRS is collecting money and the refunds are going lower. Based on public information it was found that the IRS collected $2.86 trillion in taxes in 2013, $2.52 trillion in 2012, and $2.35 trillion in 2009. The surprising thing is most of the revenue came from individual taxpayers and not businesses. Do you notice how each year taxes are going up instead of down?
Additionally, while taxpayers are paying out all of this money to the IRS, the amount the IRS is giving out is steadily decreasing. Public information revealed that refunds were $437.7 billion in 2009 and in 2013, this number decreased to $364.3 billion.
Where Are You Ranking in?
The IRS revealed that 146.24 million tax forms came in during 2013, which means that the average taxpayer is paying $8,548.49 in taxes. However, you do have to keep in mind that this number can be misleading because of the different income brackets, etc.
Closing Thoughts
Overall, you can expect the amount that you pay in taxes to continue to rise. This is why it is important for you to make sure you take advantage of all of the deductions and credits that you qualify for when filing your tax returns. At Huddleston Tax CPAs, Seattle CPA firm, we can make sure that you do. Now that tax season is here, give us a call at (425) 483-6600!

Unbelievable Tax Deductions

When it comes to taxes, we all know that there are numerous deductions and credits available. However, what you may not know is the number of unbelievable tax deductions there are. Today, we are covering the most unbelievable tax deductions.

Gastric Bands

Many Americans may feel as though Gastric Bands should not be deductible since it is a personal decision tax payers make when they could easily exercise. However, since obesity rates are constantly skyrocketing it is now considered a medical condition. Therefore, those who have gotten gastric bands as a recommendation from their doctor can deduct a portion of the surgery costs that exceeds more than 7.5% of their annual income.

Your Swimming Pool

If you have a pool at your home for medical purposes, you can write it off as a tax deduction. For example, Ken Cherry took advantage of this deduction since arthritis is not a tax-deductible medical expense. Just make sure that the pool is used for medical reasons and not for hosting pool parties during the summer months.

Bodybuilder Oil

This oil is considered a business requirement for bodybuilders. If you are a bodybuilder, you have to use this oil and the IRS considers it deductible.

Closing Thoughts

At Huddleston Tax CPAs, we can tell you these are just some unbelievable tax deductions. There are many others such as Doggy Day Care, drugs and alcohol rehab as well as carrier pigeons. When filing your taxes make sure that you check to see if any of your expenses are deductible because you may be surprised just how much you are able to write off to lower your tax bill this year. Thanks for reading our Seattle CPA blog post!

 Nannies and Taxes – What You Need to Know

Nannies can become confused when it is time for them to file their taxes. Therefore, today we are discussing what nannies need to know about taxes.

You Are Responsible for Reporting Your Earnings

In the event that you do not receive a W2 from your employer, you are still responsible for reporting your earnings to the IRS. This can be done via Form 4852 Substitute Form W-2.

You Can Ask for a Payment Extension

Nannies are able to ask for payment extensions just like any other taxpayers. If you do not have the money to pay for your taxes, contact the IRS to set up a payment plan. However, keep in mind that you want to make sure that you still file your taxes on time to avoid additional penalties.

Steps to Filing Taxes as a Nanny that is Considered Self Employed

  1. Calculate your AGI
  2. Apply the standard deduction
  3. Apply your personal exemptions
  4. If considered a self-employed nanny, pay the self-employment tax rate
  5. Put all of the above calculations on Form 1040
  6. Look up your income tax rate
  7. Multiply the taxable amount of income by the income tax rate to calculate the amount you owe
  8. Multiply the AGI by the self-employment tax rate to calculate self-employment tax

Additional Tips

Are you a nanny looking for a Bellevue CPA firm? Look no farther than Huddleston Tax CPAs. You can still claim deductions and credits on your tax return, too. Filing taxes as a nanny can be a bit complex. However, once you determine if you are a self-employed nanny or considered an employee things become a little bit easier.  Call us at (425) 483-6600!

The Most Overlooked Tax Credits

Tax credits are very beneficial to taxpayers because they can help you cover family expenses. Today, we are discussing the most overlooked tax credits.

Educators’ Credits

There are a few educators’ credits available to help parents and students pay for post-secondary education. We all know that college can be expensive and taking advantage of the available tax credits is your way to make it a little more affordable.

Savers Credit

The savers credit is for those who have a low to moderate income but still want to save for retirement. You qualify for this credit as long as your income is within the income brackets and you are contributing to an IRA or a workplace retirement plan.

Energy Saving Tax Credits

When you make energy improvements to the home that you reside in, you may be eligible for energy saving tax credits. The credit is limited to $500 but $500 can go a long way when you need money for the New Year.

Child Tax Credit

If you have qualifying children under the age of 17, you could be eligible for the child tax credit. In the event that the credit is more than your amount owed, you may even qualify for the additional child tax credit, which is a refundable credit.

Bottom Line

Huddleston Tax CPAs, a Seattle CPA and Bellevue CPA firm, can file for you. When filing your taxes this year, make sure you are aware of the credits that are available. It is ideal to claim all of the credits that you are eligible for so you can lower the amount that you owe and possibly receive some money back in the form of a refund.  Take a look at our tax and accounting services! Get in touch with us at (425) 483-6600!

Benefits of the Child Tax Credit

If you have children, it is beneficial for you to see if you are eligible for the child tax credit. Today, we are going to be discussing some of the benefits that come along with the child tax credit.

Reduces Your Tax Liability

If you are eligible to receive the child tax credit, you can lower your federal tax bill by up to $1000 per qualifying child that is under the age of 18. This means that by claiming this tax credit it is possible to lower your outstanding balance to the IRS to zero.

You May Also Qualify for the Additional Child Tax Credit

In the event that your outstanding balance due for your taxes is lower than the amount of the child tax credit you may qualify for the additional child tax credit. This means that you would have money refunded to you in the form of a tax refund.

It is Easy to Claim

As long as you are eligible for the child tax credit, you can claim it easily. You do not have to itemize your deductions or anything out of the ordinary. Therefore, if you qualify for the child tax credit it can be beneficial for you to take advantage of the credit.

Bottom Line

Huddleston Tax CPAs is a Seattle CPA firm, and here’s some advice: There are quite a few benefits of the child tax credit and those who are eligible to claim this credit are encouraged to do so. It could help you lower your tax liability, which is a great way to start the year.  Take a look at the tax and accounting services we offer! Get in touch with us at (425) 483-6600 for a tax consultation!

Three Tax Deductions You Do Not Want to Overlook

Most people just want to get their taxes filed so they can get it done and over with. However, you never want to rush through your tax return or you could be giving away your hard-earned money. Today, we are discussing some tax deductions that you do not want to overlook to try to help you keep the maximum amount of your hard-earned money in your pocket.

Out of Pocket Charitable Deductions

Little donations add up. Make sure you keep your receipts each time you donate, so if you go over $250 in donations you can provide documented proof to the IRS. Additionally, if you volunteer for a charity and spent your money for them that is deductible too.

Student Loan Interest Paid by Parents

If you are a college student who cannot be claimed as a dependent by your parents, you can deduct the interest that they paid on your student loans. You can do this without messing them up because even though they are the ones who pay for your student loans, the IRS looks at it as though they gave the money directly to the child.

Job Hunting Costs

Most of the money that you spend searching for a new job can be deducted when tax time comes around. However, to be eligible for the deduction you have to make sure that you were searching for a position in the same line of work that you did previously.

Bottom Line

When tax season rolls around, slow down and take your time when filing your tax return to ensure that you do not overlook any tax credits.

Thanks for reading our Seattle CPA blog post! We update weekly!

If you’re looking for a CPA this upcoming tax season, call us at (425) 483-6600!

 

5 Surprising Things That Are Taxable

Many people think that they know everything that they have to pay taxes on. However, today we are here to show you five surprising things that are taxable that you were more than likely unaware of.

  1. Buried Treasure – Let us say you find some gold coins or you purchase something from a thrift store that contains money inside of it. You are responsible for paying taxes on it.
  2. Some Scholarships – The next time you are applying for a scholarship make sure you consider how it will influence your taxes. When a scholarship covers room, board, and traveling expenses, you do have to pay taxes on a portion of the award.
  3. Stolen Property – If you decide to go rob a location and come out with money, you are responsible for paying taxes on the income. Obviously, criminals are not thinking about taxes yet if they are ever caught, they will have property seized, etc., to cover the amount that they owe in taxes.
  4. Gambling Winnings – If you go somewhere and win some money the IRS expects you to pay taxes on your winnings. For certain amounts you will have a Form W2-G given to you yet if you do not Uncle Sam still expects you to report your winnings.
  5. Fantasy Sport Winnings – If you are playing fantasy sports, even if it is among your friends, the IRS wants to know about it so they can tax you.

Are You Surprised?

Uncle Sam wants to know about all of your income. These are just five of the things that are taxable, can you imagine how many other things are taxable that you are not even considering?

Remember Huddleston Tax CPAs is a Seattle CPA firm! Get in touch with us at (425) 483-6600 for a tax consultation!