Taxes - My Tax Return

If you suspect or know of an individual or company that is not complying with the tax laws, you may report this activity by completing Form 3949-A. You may fill out Form 3949-A online, print it and mail it to: Internal Revenue Service Fresno, CA 93888. If you do not wish to use Form 3949-A, you may send a letter to the address above. Include the following information, if available: Name and address of the person you are reporting. The taxpayer identification number (social security number for an individual or employer identification number for a business) A brief description of the alleged violation, including how you became aware of or obtained the information. The years involved and the estimated dollar amount of any unreported income. Your name, address and daytime telephone number

A CP-2000 notice informs you of the proposed changes in income, credits, payments, or deductions and the amount due to the IRS, or a refund due to you. You should forward a copy of this letter to your local CPA for a follow-up response. Frequently these notices are sent out erroneously.

Costs incurred while entertaining customers, prospective customers, clients, suppliers, employees and other business associates are valid business expenses that are subject to conditions and restrictions. For entertainment costs to be deductible, the following must be documented: the time, place and the nature of the entertainment, a description of the business purpose involved, the amount of each separate expense, the business relationship and identification of the persons entertained. A calender diary is recommended to maintain this information.

A Roth IRA is a special, nondeductible IRA. Earnings are tax-deferred and tax-free upon withdrawal if certain requirements are met. (If requirements are not met, taxes and penalties may apply). Contributions are not tax-deductible. You may continue making Roth IRA contributions after age 70 1/2 if you have earned income. Your modified adjusted gross income must be below certain limits depending on your tax filing status and you or your spouse must have earned income. You are not required to take mandatory distributions at any age during your lifetime. Non-spouse beneficiaries are subject to minimum distributions rules.

AMT stands for Alternative Minimum Tax. The Alternative Minimum Tax was developed in 1969 to make sure that wealthy taxpayers didn't escape paying income taxes. The tax was meant to target high-income taxpayers who may have many deductions and can sometimes avoid paying any income taxes at all.
To make sure that all taxpayers with substantial income are not able to avoid paying tax, the law limits the benefit a taxpayer can receive from favorable treatment of certain deductions and preferences.
The Alternative Minimum tax is computed on IRS Form 6251.
If the Alternative Minimum tax calculation results in a higher tax then the Regular income tax, then the difference is added to the Regular tax computation.

On Form W-2, box 15 will have an X in the box "retirement plan". You are an active participant in a retirement plan if contributions are made or allocated to your account for the plan year that ends within your tax year.

Community property is property acquired after marriage in the states that follow the community property laws. These states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. The basis of the law is that both spouses form a partnership, and all property acquired during the marriage by the labor or skill of either spouse belongs to both spouses.

Your tax bracket is dependent on your filing status and your Taxable Income. Taxable Income is equal to your Gross Income, minus your itemized or standard deductions, minus your exemption amounts.
The tax bracket reflects the highest range of taxable income that your taxable income falls into and is taxed at that bracket rate. It does not mean that your "total" taxable income is taxed at that (10%, 15%, 25%, 28%, 33%, 35%,) bracket rate.
Therefore your tax liability on your taxable income is a graduated calculation.
The bottom layer of income is taxed at the 10% rate and the next layer is taxed at the 15% rate and the next layer is taxed at the 28% rate and the next layer is taxed at the 33% rate and the last layer is taxed at the 35% rate. This yields an "effective" blended rate at which your total income liability is calculated.
The current year consisits of 6 tax brackets and 6 tax rates. Income tax rates for individuals for the current year are 10%, 15%, 25%, 28%, 33%, and 35%.
The higher bracket and rates start at $8,701, $35,351, $85,651, $177,651, and $388,351 for a single person;
$17,401, $70,700, $142,701, $217,451 and $388,351 for married filing jointly and Qualifying Widower; $12,401, $47,351, $122,301, $198,0501 and $388,351
for head of household: $8,701, $35,351, $71,351, $108,726, and $194,175 for married filing separately.

ER0 is the acronym for Electronic Return Originator. EROs have passed suitability and background checks by the IRS and are accepted into the Electronic Filing Program. This means that they can transmit tax returns via computer.