Frequently Asked Questions Relating To Taxes
Tax preparation and filing are things both individuals and companies often find a challenge. While some of us have the knowledge and skills to maintain our monthly accounts, we often need assistance arranging our receipts, preparing our documents, and planning to ensure we save our hard-earned money.
If you have a business, multiple expenses, or are not proficient in filing your tax returns on your own, hiring a tax preparation specialist ensures your accounts are always in order and you are never in danger of an audit from the IRS (Internal Revenue Service). However, unless you have used the services of an accountant and tax professional before, you have many questions that need answering before you decide on the best tax preparation firm for you.
To ensure you have all your doubts cleared, Hunter Tax Resolution wants to arm you with the most accurate information about tax preparation and filing. To do this, we’ve answered some of the most frequently asked questions relating to taxes.
1. Is there an age limit to claiming my child as a dependent?
To claim your child as your dependent, your child must meet either the qualifying child test or the qualifying relative test. To meet the qualifying child test, your child must be younger than you and either younger than nineteen years old or be a student younger than twenty-four years old as of the end of the calendar year. There’s no age limit if your child is permanently and totally disabled or meets the qualifying relative test. In addition to meeting the qualifying child or qualifying relative test, you can claim that person as a dependent only if the dependent taxpayer test, citizen or resident test, and joint return test are completed and passed.
2. How long do I need to keep my tax records?
Most taxpayers can shred their tax records three years after they’ve filed. However, to be safe, it’s best to keep records for seven years if you file a claim for a loss from worthless securities or bad debt deduction. Keep records for six years if you do not report the income that you should report, and it is more than 25% of the gross income shown on your return. Keep records indefinitely if you do not file a return.
3. How long will it take to get my refund?
Once your return has been accepted, the IRS issues most refunds within twenty-one days. However, it may take longer if your return is complicated and requires additional review, and attracts added attention.
4. Do I need to file a tax return this year?
Here’s how to figure out if you should file a tax return this year. Look at your income to see if you made the minimum required to file a tax return. Next, decide which filing status is best for you (you may be required to file a tax return depending on your filing status, income, and age). If you’re retired, find out if your retirement income is taxable. Finally, find out if you qualify to claim certain credits and deductions to lower the amount of tax you owe and use the interactive tax assistant to see if you need to file.
5. Should I use a tax professional or prepare my taxes on my own taxes?
The answer to this question depends upon your level of comfort. It is inevitable that as you advance through your life and career, your taxes will get more complex. Additionally, it would be best to remember that taxes, whether for small businesses or self-employed individuals, are complicated. You require a comprehensive knowledge of deductions, and filing and preparing and filing your own tax returns leave you open to avoidable mistakes.
If you have any more questions about our bookkeeping, accounting, and tax services, get in touch with Hunter Tax Resolution. We specialize in helping small businesses succeed. If you need assistance with tax liens, payroll services, offers in compromise, tax resolution, wage garnishments, IRS bank levies, unfiled tax returns, tax relief, freedom of information requests, etc., we are here to help. Our tax services are available to clients across Tacoma, Puyallup, Renton, Olympia, Seattle, and the surrounding areas.