Tax Information For Small Businesses And Self-Employed Individuals

The 2011 Tax season is quickly approaching, and many people are busy getting all of their tax information together so they can file their taxes on time. Business owners face many more challenges at tax time than employees. It is crucial for business owners to have all of the information they need in order to file their taxes, which can be quite a grueling process. In most cases, the law does not require businesses to keep detailed records, but they must be able to supply evidence of all earnings related transactions. Small business owners should keep a record of their sales slips, purchases, receipts, payrolls, paid bills, invoices and any other financial documents. All businesses should employ a qualified bookkeeper or accountant who is able to keep accurate business records throughout the year.

Self-employed individuals must also prepare themselves accordingly before filing their taxes. Most people who work as freelancers do not bother to hire a bookkeeper or accountant. Unless someone knows the ins and outs of taxes, they will need to conduct plenty of research before filing their tax return. For example, there are many tax write offs that need to be considered. A local income tax agency can help a self-employed individual file their income tax return, but the person filing is responsible for providing them with all of the required information. Just like small business owners, self-employed individuals should save all of their financial documents throughout the year.

There is plenty of information for Small Business and Self-Employed Individuals available online. Small business owners and self-employed individuals can find out more information online at the IRS government website. The official IRS website offers information on forms for small businesses, employer ID number applications, social security, Medicare, income tax and more. The IRS website offers helpful articles, videos, virtual workshops and a printable tax calendar. They also offer information on small business tax audits.

Do You Know Your Options For the Tax Season?

Preparing and filing your federal tax return is quite simple with the IRS e-file free tax filing program. The Internal Revenue Service provides this program to help ensure that you can get your taxes done fast and easy. In addition, the IRS E-File is safe, free and ensures that you get the highest refund amount entitled to you.

There are two ways to take advantage of free 2011 tax return filing from the IRS. You can choose to use easy tax software or file electronically online. If you earn less than $58k per year, you are eligible to take advantage of Free File Software.

If you are one of nearly 100 million who are eligible for free 2011 tax filing, you can access the IRS e-file online forms by visiting the government IRS website. Once you begin, you will be assisted in finding free software and after choosing the right one for you, you will then be instructed through the filing process for your 2011 tax forms. The best thing about e-file is that it eliminates the high costs of having a professional complete your tax return and most anyone can successfully file their return online for free without prior tax knowledge. If the government owes you money, such as the EIC, the software will automatically apply your earned income credit to your refund.

Of course, safety and security is always a concern when filling out private information online and the IRS takes this into consideration with Free File. To date, the software has been used both securely and safely by millions of people since the year 2003.

If you are not comfortable doing your 2011 tax return online, there are still options that allow you to mail your tax forms. Although it takes longer to receive a refund when you file by mail, it is still preferred among some tax payers and will likely remain an option when 2012 tax time rolls around as well.

Settling Tax Debt

Filing for tax returns and finding money for those ridiculous taxes are enough stress that can add another wrinkle in one’s aging memorabilia. However, these things are simply unavoidable and mandatory. Despite how one tries to live ideally and be a model citizen, there are times where one fall short from his/her responsibilities to pay taxes. Some simply ignore the payments due to financial concerns while others neglect such duties to focus on important circumstances. Whatever reasons they may have, settling tax debt requires certain processes.

Firstly, it best for the debtor to check on his/her previous tax returns just to double check on unseen deductions. Amending your tax return can mean lower tax payment. Second, read on the different IRS debt settlement program and choose on a program that suits your financial status. Third,decide whether to hire a profession or you can manage to settle IRS tax debt on your own.

When do you hire a professional or when is it okay to settle IRS debt on your own? Hiring or not is purely your prerogative. Nevertheless, it is recommended to hire a professional when you are dealing with a tax debt of $10,000 or more. You must make sure that the professional you hire is a certified public accountant, enrolled agent or a tax attorney. These professions are credited by the Internal Revenue Service as eligible to handle such problems.

You would also consider that fees charged by these tax experts. Some would have an hourly rates while others might have fixed rate for services rendered. See to it that the task done by these experts requires specialized skills and knowledge, offer to do the task on paper works and errands.

Lastly, remember when there is an opportunity to make money, most of the time, con artists and scammers will seized this chance to snatch your hard earned money. According to reports, fake tax companies guarantee results without prior knowledge of you tax debt situation, require amount of cash as deposit, pass you to different representatives, and does not a physical address. Always be on the look out for these signs.

File Back Taxes

There is no way to avoid death or taxes. Postponing either may be possible, but in the case of taxes, the longer the postponement, the more painful the possible outcome. There are some completely legitimate reasons that a tax return does not get filed, but estimated taxes must be paid even if the actual return submission will be delayed. If there are back taxes owed, postponing the inevitable will only make a bad situation worse. Taking action to file returns, regardless of what the delay to date, will not only reduce interest and penalties, but may keep the Internal Revenue Service from wanting to prosecute you. If the IRS must come after you to get their taxes, the enforced tax collection process can be very unpleasant.

If your records have been lost or destroyed by natural disasters such as floods or fires, or perhaps your house was burglarized and papers stolen along with belongings, then you particularly need the assistance of a tax attorney or accountant. These professionals are accustomed to dealing with such situations. There are many ways to reconstruct records. An experienced and knowledgeable tax accountant or attorney will have the skills and tools to locate duplicates of record, and they will know what tolerances IRS has for proofs when there is a legitimate reason why original records are unavailable. Although difficult, recreating information for up to 15 or 20 years has been done, and the tax returns successfully filed and accepted by IRS.

Many taxpayers are honest people who have always paid their taxes until some unexpected situation made paying impossible. The family may have had a medical emergency or recent job loss. Money to pay taxes owed for the previous year may have evaporated. Since they do not have the funds to pay the taxes, they fear the repercussions if they file a return. What they need to know is that there are provisions for filing a return without payment of the taxes, so that they have at least complied with the law. They can save additional tax penalties of 25 percent for failing to timely file a return. Some states will impose hefty penalties even if no taxes are owed, on those who failed to file.

Obviously it would be a great time saver if you still had the information on all returns from previous years. But the only solution to your stress and worry is to bite the bullet, start the process and get the returns filed. You need the assistance of a professional because the delays have complicated the filing process. An experienced tax attorney or accountant has guided many other clients through the same legal maze with success. They understand your fears and concerns, and they also understand how to help you through the process and assist you in dealing with the IRS.

IRS does not allow taxpayers to file their tax returns online if they are filing to pay back taxes owed. These returns must be submitted on paper as the IRS will take an extra-hard look at them and will not deal with electronic returns. A wise move is to send the returns certified mail, and have the post office return proof the filing was received, in order to have proof that IRS did receive the returns and to document the dates mailed and received.

Filers who end up owing taxes will incur some interest and possibly penalties. The IRS will work with taxpayers who want to pay their taxes and who may need to make payment arrangements.

IRS wants people to file their tax returns. Taxpayers who want to be totally up front and get back on track will find the process fairly quick and simple. The mistake that will cause the biggest problem is to take no action at all. Ongoing failure to take action and file returns, with or without payment of taxes, is hard to justify in the opinion of the IRS. Honest efforts to do the correct action as soon as possible will usually prevent the most severe consequences. Putting off the obligation will only increase the costs and penalties.

Hiring a Tax Relief Attorney

turbotax

Looking to hire a tax relief attorney for your personal or small business taxes?  Find out more on tax attorneys here.

If you need help with your tax debt, it is recommended for you to call a tax relief attorney. The first step however is to look for one of the best. This means you have to look for a tax relief lawyer with a good record.  How will you do this? When hiring someone, you would need to do a proper assessment. Asking for a resume and checking out his or her qualifications for example is just one way of making sure you will be getting the assistance or help you need.  You should make sure that the lawyer you are hiring passed the bar and have the license to operate in your area. Getting a CPA lawyer is advisable since you will need someone with a background in accounting.

After checking for your lawyers qualifications you can now move on to checking out your lawyer’s limitations and experience. You should ask if your lawyer has handled cases that involved the IRS before. You also need to ask if he or she has served as a tax relief attorney or worked as a tax consultant for the Internal Revenue Service before.  If you are planning to contact a law firm, you should ask first who will be handling your case to make sure that you are getting the value for your money.

Another thing you need to take into consideration is the cost. Make sure you can afford an attorney to take care of your tax debt. Be prepared to pay your lawyer by the hour, some may call for a retainer so you must be prepared for all costs. Before getting an attorney however, clients must already know what the lawyer can do for you.