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Tax-relief attorneys are attorneys who help taxpayers with tax-related issues and, in particular, assist taxpayers with obtaining all of the tax relief that they are eligible for from the federal and state tax authorities. Most tax-relief attorneys focus on providing their clients with services related to offer in compromise, full audit representations, and penalty abatement petitions. Tax-relief attorneys work as private practitioners or are employed with tax firms. Most of these tax firms have dedicated tax personnel who also undertake preparation of tax forms and filing of taxes, apart from helping clients with obtaining tax relief.

The federal and state tax authorities have numerous tax-relief programs that are aimed at reducing the tax burden on the taxpayers. Most of the tax-relief measures come under property tax relief, income tax relief, and relief for small business owners. However, working through the tax forms and finally obtaining the eligible tax relief is quite a challenge to many taxpayers. Tax-relief attorneys are particularly helpful in this situation since they are trained in taxation and law and are aware of the constant changes to tax regulations and legislations both at the federal and state levels. Since tax relief is targeted in a large part at taxpayers belonging to Read more…

Tax-relief checks are checks that the tax authorities mail to taxpayers as a means to lessen the tax burden. They can also be refund checks that are received from tax authorities for taxes paid in advance. After computing the tax assessment for the current assessment year or for the previous year, the tax authorities send any excess tax paid back to the taxpayer.

Tax-relief checks assumed prominence recently with the passing of the Economic Growth and Tax Relief Reconciliation Act of 2001, arguably the first major tax-relief program in the nation in the last two decades. The objective of the legislation is to reduce the burden on taxpayers by disbursing in advance tax-relief checks. The U.S. Treasury mailed checks for up to $300 for singles or $600 for couples in the summer of 2001, and the process is expected to be phased in over the coming years. Significantly, these tax-relief checks heralded the switch from the old 15 percent tax rate to the new 10 percent tax bracket. The objective here was to accord the highest priority to low- and moderate-income families by timely disbursal of the tax-relief checks based on the income tax burden.

The tax-relief legislation also has provisions to lighten the tax Read more…

The accessibility of tax preparation software these days does more than allow you the possibility of computing your yearly income tax and transferring in your calculated return. Today, the tax preparation software programs take account of features that make tax preparation easy. Utilizing these features enables you to evaluate a variety of scenarios involving income tax concerns. Whether you own a single proprietorship or incorporated business, tax preparation software can always save you from burden of manually filling out your annual tax forms.

Top Pick Tax Preparation Software Programs

QuickTax Tax Software: This tax preparation software features their exclusive EasyStep Interview, which includes a step-by-step tax preparation method, investment gains and incorporation analyzer, and the capacity to handle manifold tax calculations.

TAXWIZ Tax Software: This software is effective when preparing several individual income tax returns, as this similarly contains features found in the QuickTax. However, the CD-Rom is only available for Windows.

TaxTron Tax Software: This software is available for both Macintosh and PC, and comes in a personal as well as a corporate version. The corporate version allows you to file your personal or company income tax easily and quickly.

GenuTax Tax Software: There is no reason for you to worry because this software can prepare, file, and send limitless tax returns.

UFile for Windows Tax Software: An “interview” interface allows you to manually enter your pertinent income tax data. Using this software, you are also able to Read more…

Tax-relief help pertains to helping taxpayers settle their current and past due taxes. Many taxpayers are increasingly finding it difficult to pay their taxes on time and for them, tax relief reduces the burden of taxation. The Internal Revenue Service introduced a new tax-relief program in 1992, allowing individuals and corporations to settle back taxes. Several such tax-relief programs exist at both the federal and state levels.

Tax relief help is the assistance offered by various service agencies and companies that engage in tax-related matters. These companies have specialized personnel who are typically taxation experts and attorneys who help taxpayers with receiving the full benefits that they are entitled to under the federal and state tax-relief programs. Even though the program introduced by the IRS in 1992 allows taxpayers who are in financial hardship to settle their tax liabilities for less than the full amount, the task of interacting with the IRS can be very emotionally draining. This is particularly so in the case of tax-relief programs since most of them are aimed at low-income persons and senior citizens.

There is a wealth of information Read more…

The authority over federal payroll tax in the United States is the Internal Revenue Service (IRS that determines the percentage of payroll tax withheld from an employee’s wages, the formalities to be fulfilled by an employer and any other issues relating to federal social security, Medicare and unemployment taxes.

Federal payroll tax withheld from an employee’s wages and paid by the employer includes federal social security tax and federal Medicare taxes. This is a mandatory government extraction from your check on every payday. The federal payroll tax also includes the Federal Unemployment tax that has to be paid by the employer. Medicare and social security federal taxes have to be equally divided with the employer and employees. Social security is taxed at 6.2% currently and Medicare at 1.45% currently in the United States.

Every organization and every employer must report to the Internal Revenue Service for the federal payroll tax. As an employer, your obligations for federal payroll tax are many. The first step is to get an Employer Identification Number (EIN), by filling out form SS-4 and applying for it at the local office of the IRS. Each employee then needs to fill out form W-4 for Read more…

The IRS is very strict on payroll tax and the deductions associated with it. Even a small miscalculation can land an organization in serious trouble with this regulatory authority. So, it is important to maintain careful records of payroll accounts in an organization.

The first step to calculating payroll tax is getting each and employee to fill up the W-4 form from the Internal Revenue Service. This form aims to calculate the payroll tax depending on the marital status of an employee and the number of dependants. Since most states have payroll structures that are based on the federal system formulated by the IRS, this form helps organizations calculate the payroll tax withholding for both federal and state governments.

Currently, the social security tax withheld from an employee’s wages is calculated as 6.2% of total salary. This same amount has to be contributed by the employer, and added to the payroll account of the organization. The wage base for this tax is $76,000 dollars a year, beyond that, taxes need not be deducted from the employee. The same procedure is followed for Medicare taxes, calculated at 1.45% of the employees’ salary. There is no wage base for Medicare taxes, and the employee and the employer goes Read more…

The tax levied on an individual’s or corporation’s income is known as income tax, which is a direct tax. Individuals are taxed on their total income, taking into account the standard deductions. Corporations or businesses are taxed on their net income, which is the difference between gross receipts and expenditure. Companies would have to pay corporate or corporation tax. Tax is charged on wages, business income and capital gains.

Anyone who works in the United States has to file income tax returns and pay federal income tax every year by the 15th of April. If you cannot do so then you can apply for an extension from the IRS by filing Form 4868. You must then file within four months, by August 15th.

The two major types of tax systems are flat rate taxes and progressive taxes. Flat tax rate is when all earnings are charged at the same rate. Progressive taxes are calculated differentially, based on how much has been earned. For example every $10,000 will be charged higher in the beginning and the following ones would be charged at progressively lower rates. Deductions help individuals and companies pay a lower amount in taxes.

U.S. residents have to file Form 1040. Nonresident Americans will have to file Form 1040 NR. If you are exempt from taxes, you then file Form 8843. The most essential documents you need are your visa, passport, and social security number or TIN (Tax Identification Number).

As an employee of a firm you will file the W-2 form, while the self-employed will need to file Form 1099. If you generate income from investments, dividends, royalties or rental income you will also need to file the 1099 form.

If you have paid interest on mortgage or real estate taxes, you will be mailed a 1098 along with this information. These forms come in triplicate, so send the original to the IRS, and keep the copies carefully.

The IRS e-file program makes it easy to file your taxes online. Before you do so, get a PIN number. For this you will need to give your birth date, social security number, and information from your previous year’s tax return.

A single person would file Read more…

The tax imposed by the U.S. government on the taxable incomes of individuals, corporations, trusts and estates is known as federal income tax. Personal income taxes are payable on the total income of the individual (after some permissible deductions). Corporate income taxes are payable on the gross profit, the difference between the total receipts and total direct and indirect expenses.

Federal income tax was imposed for the first time by the U.S. government in 1861 to finance the Civil War. A tax of 3 percent was levied on incomes above $600, which rose to 5 percent for incomes above $10,000. These rates were raised in 1864. A new income tax act was enacted in the late 1800s. After the Civil War, income tax was rescinded in 1872.

In the present scenario, the revenues of the federal government mainly accrue from personal and corporate income taxes. Earlier, tariffs on imported goods constituted a large chunk of the government?s revenues, but, at present tariffs represent only a minor portion of federal revenues. Other non-tax fees are also levied, which recompense agencies for services or fill specific trust funds.

Several specific taxes, in addition to the general income tax, are also collected by the federal government. For example, the social support programs such as social security and Medicare are funded by taxes on personal earned income. Estate taxes are also levied on inheritances.

It is income tax that forms the bulk of the Read more…

The small business segment creates a lot of new jobs. Even though big business always demands the limelight, small businesses play their part in providing a support base to the national, state, and local economies. They are critical in providing the much-needed economic vitality, especially in traditional areas of commercial activity. Given their importance to the national economy, tax plans and reforms have targeted small businesses in terms of providing them various kinds of tax relief.

Most small businesses are sole proprietorships or limited partnerships. New legislation has reduced the amount of taxes that small businesses have to pay. Tax relief to small businesses has come through as relief on income tax returns, growth incentives, and reduction of taxes on dividends and capital gains.

The income tax reductions for small business owners have come from inclusion of more items under the 10 percent and 15 percent tax categories. So, more of the income will be taxed at these lower rates. Further, the 27 percent, 30 percent, and 35 percent tax rates were each reduced by 2 percentage points, with the highest tax rate being reduced from 38.6 to 35 percent. The death tax has been repealed until 2011, which benefits small owners from paying tax when they pass their businesses to their family members.

The Jobs and Growth Tax Relief Reconciliation Act of 2003, increased depreciation rates on qualified Read more…

The preparation of tax documents and filing of tax returns is a complicated process and requires professional handling. Professional help is generally expensive and can burn the pockets of taxpayers if availed of. Taxpayers can also prepare tax files on their own but there are risks of committing errors when a large number of deductions and exemptions are taken into consideration. As a result, taxpayers seek professional help even though it is expensive. In recent times however, some tax experts and tax companies have started offering free tax filing services.

The principal means of filing taxes for free is through online websites of tax companies and use of software provided by them. These companies offer online tax preparation help and electronic filing through a partnership agreement with the IRS. Almost all the free tax filing companies offer services based on different sets of criteria to qualify taxpayers for the service. Companies offer free filing service for taxpayers whose gross annual income is below or equal to $50,000. There are also many age and area restrictions for free tax filing service. Some tax filing companies prepare and file taxes for people of only certain area codes and states.

Primarily, Form 1040EZ is used to file tax returns of these types of customers. The companies fill out the forms and prepare Read more…