1. Filing is underway for the 2024 filing season to file tax year 2023 income tax returns.

2. Gather and organize documents and prepare to update new information.

3. Get additional information like transcripts or current PINs at IRS Individual Online Account.

4. What’s new?

Get Ready now to file 2023 federal income tax returns in 2024.

With the nation’s tax season right around the corner, the Internal Revenue Service reminds taxpayers there are important steps they can take now to help get ready to file their 2023 federal tax return.

Get ready to file your taxes | Internal Revenue Service (irs.gov)

Tip! on form 1099k

The $600 threshold for payment apps and online marketplaces to report payments on Form 1099-K is delayed for tax year 2023. The threshold for tax year 2023 will continue to be payments over $20,000 and 200 transactions, although taxpayers could still get forms reporting less than that amount. The IRS is planning a threshold of $5,000 for tax year 2024.

What’s taxable?

There’s no change to the taxability of income. All income, including from part-time work, side jobs or the sale of goods is still taxable. Taxpayers must report all income on their tax return unless it’s excluded by law, whether they receive a Form 1099-K, a Form 1099-NEC, Form 1099-MISC, or any other information return or not.

What’s not taxable?

You shouldn’t receive a Form 1099-K for personal payments, including money received as a gift and for repayment of shared expenses. That money isn’t taxable. To prevent getting an inaccurate Form 1099-K next filing season, note those payments as “personal,” if you can.

Good recordkeeping is important and invaluable.

Be sure to keep good records because it helps you when it’s time to file your tax return. Don’t forget to keep track of expenses, what you’ve sold and what you’ve been paid for services throughout the year. And it’s a good idea to keep business and personal transactions separate to make it easier to figure out what you may owe.

Gather, organize and update tax records.

Organizing tax records makes it easier to prepare a complete and accurate tax return. It helps avoid errors that can slow down refunds and may also help find overlooked deductions or tax credits. Having a copy of last year’s return nearby can serve as a guide when getting ready to file.

Get helpful information to file through IRS Individual Online Account

Taxpayers should create an account at Your account | Internal Revenue Service (irs.gov) to review and receive helpful information about their individual income tax accounts.

What’s new?

-RS Individual Online Account enhancements
Taxpayers and Individual Taxpayer Identification Number (ITIN) holders can now access their Individual Online Account and view, approve and electronically sign power of attorney and tax information authorizations from their tax professional.

-Form 1099-K reporting threshold delayed
The Form 1099-K third party reporting threshold for tax year 2023 will continue to be for payments over $20,000 and 200 transactions. After feedback from taxpayers, tax professionals, and payment processors, the IRS delayed the new $600 Form 1099-K reporting threshold for 2023.

-Understand energy related credits
Taxpayers who bought a vehicle in 2023 should review the changes under the Inflation Reduction Act of 2022 to see if they qualify for the credits for new electric vehicles purchased in 2022 or before or the new clean vehicles purchased in 2023 or after.

If taxpayers made energy improvements to their home, tax credits are available for a portion of qualifying expenses. 

The Internal Revenue Service will begin accepting and processing 2023 tax returns on Monday, January 29, 2024. The tax deadline to file for those who have balances due is on April 15, 2024. Folks who receive refunds technically have three years to file, so filing by the April deadline is more of a recommendation. Although the IRS will not officially begin accepting and processing tax returns until January 29, people do not need to wait until then to work on their taxes if they’re using software companies or tax professionals.

For example, most software companies accept and hold electronic submissions until the IRS is ready to begin processing.

The Colorado Department of Revenue (CDOR) announced that processing of state income tax filers will begin no later than February 10, 2023, and that people can still file their income tax returns through all methods except the state’s Revenue Online platform. Coloradans can use Revenue Online to file their state income taxes no later than February 22, 2023. 

Last November, Coloradans voted to lower the income tax rate to 4.4%, which, coupled with multiple legislative changes, created a much larger end-of-year programming workload for the Department, resulting in a slight delay.

The deadline is approaching if you applied for an automatic extension to file your 2022 tax returns. If there is or will be a balance due, then filing for an extension avoids the ‘failure to file’ penalty; however, the ‘failure to pay’ fine still applies. 90% of the expected balance due must be paid by the original due date in April to avoid such penalties. If you expect a refund, you have three years to file, and no application for an extension is necessary if you don’t file (but only if you expect a refund). The tax year 2020 must be filed by the October 2023 deadline to receive a refund, if there is one. Otherwise, it is forfeited.

Here are five things you should do to file your tax returns before the extension deadline: 

1. Gather all your necessary tax documents, such as W-2s, 1098s, 1099s, and Financial Statements for businesses. If you are not preparing and filing your tax returns, send all necessary information to the person who prepares your tax returns. As a preparer, I ask clients to keep receipts at home and only send totals to me.

2.   Determine which tax forms you must complete based on your income and deductions. A tax professional will guide you, but it’s extremely important that you understand the basics. You should understand the standard deduction, itemized deductions, and which deduction benefits you (not your neighbor, sibling, or friend) – your situation is different than anyone else’s.

3.   Double-check all your calculations and ensure you’ve filled out every section of the forms accurately. Your tax return preparer will or should send you a copy for review before e-filing. It is still your responsibility to ensure the correctness of the return, even if you hire a preparer to help with drafting and submitting the forms.

4.   Submit your tax returns. Typically, they will be e-filed regardless of whether you prepare them yourself or hire a tax return preparer or accountant.

5.   Keep a copy of your tax returns and all supporting documents for your records.

Taxes are an indefinite ongoing task, and it might be helpful to create a folder specifically for tax stuff where you can save documents and tax return copies year after year. Every year is separate, so create a new folder every year within your ‘tax’ folder.

Dealing with the Internal Revenue Service is a massive pain for everyone. For many reasons, a return may be delayed in processing or require additional information. There once was a time when everyone who filed electronically and had the refunds directly deposited received their refunds within 21 days. That is not so much the case anymore.

Over the last two or three years, identity theft has become a big issue, and the IRS and States are taking steps to minimize fraud. One way is by asking folks to verify their identity through the websites confirming information from the last two years’ tax return copies.

The main IRS phone number is 1-800-829-1040

The taxpayer protection hotline 1-800-830-5084

Go to http://www.irs.gov to set up IDme

Go to http://www.colorado.com/revenueonline to create an account for the CO state.

In some cases, it seems like the IRS (representative) disagrees with the 1040 pg2, line 28, refundable child tax credit. In 2021, the IRS gave out advanced payments of the CTC totaling half of what the credit would normally be at tax time. For example, if you have 2 dependents under age 6 and your credit is $7,200 then you would have received $3,600 during the year and $3,600 as a credit on your return. The advanced payments are reconciled on form 8812, and any remainder flows to line 28 of the 1040. Review form 8812 if line 28 is in question.

The IRS sends letters and notices of proposed changes. I encourage everyone to challenge those letters for accuracy.

Since the Tax Cuts and Jobs Act of 2017, employee withholdings have been tricky. The IRS would like folks to withhold only what their tax liability will be. This means that people, especially those who receive the child tax credit, will receive more on their paychecks during the year (withhold less taxes); although if you ask anyone they will not agree with that fact. The IRS is not meant to be your savings plan or safety net. It is a refund of an overpayment. We don’t voluntarily make extra payments to Netflix or Centurylink, and then ask for a refund at the end of the year (yes,we would like to). Learn what your tax liability is. It is listed on the 1040 that you file every year. My clients can review the Comparison Sheet for three years worth of tax liability. Then, review your paycheck stubs to make sure you are on course to cover the total liability by the end of the year.

Two points here,

• There is no longer the 1040EZ or 1040A. You may file a simple return, but it’s not the EZ or an easy – just for clarification. There is the 1040 and 1040-SR. For me, most returns are easy. I have been doing this for 16 years. I would encourage anyone who can accurately prepare their returns to do so. The IRS allows qualified returns with income under $75,000 to be prepared for free to low cost through their website at irs.gov.

• The taxes paid out of your paycheck are
  • Federal Income tax. The refund or balance due is based on this amount
  • Social Security tax (Federal Insurance Contributions Act). This goes towards social security, you may start withdrawing around age 65. You don’t get a refund from this amount at tax time.
  • Medicare tax (Federal Insurance Contributions Act). This goes towards the medicare program. You don’t get a refund from this amount at tax time.
  • State income tax. The refund or balance due is based on this amount.

https://www.irs.gov/individuals/tax-withholding-estimator

IRS- Use this tool to estimate the federal income tax you want your employer to withhold from your paycheck. This is tax withholding. See how your withholding affects your refund, take-home pay or tax due.

https://www.irs.gov/newsroom/tax-withholding-how-to-get-it-right

IRS- The federal income tax is a pay-as-you-go tax. Taxpayers pay the tax as they earn or receive income during the year. Taxpayers can avoid a surprise at tax time by checking their withholding amount. The IRS urges everyone to do a Paycheck Checkup in 2019, even if they did one in 2018. This includes anyone who receives a pension or annuity. Here’s what to know about withholding and why checking it is essential.

Understand tax withholding

An employer generally withholds income tax from their employee’s paycheck and pays it to the IRS on their behalf. Wages paid, along with any amounts withheld, are reflected on the Form W-2, Wage and Tax Statement, the employee receives at the end of the year.

How withholding is determined

The amount withheld depends on:

• The amount of income earned and
• Three types of information an employee gives to their employer on Form W–4, Employee’s Withholding Allowance Certificate:
  • Filing status: Either the single rate or the lower married rate.
  • Number of withholding allowances claimed: Each allowance claimed reduces the amount withheld.
  • Additional withholding: An employee can request an additional amount to be withheld from each paycheck.

Note: Employees must specify a filing status and their number of withholding allowances on Form W–4. They cannot specify only a dollar amount of withholding.

Everyone should check withholding

The IRS recommends that everyone do a Paycheck Checkup in 2019. Though especially important for anyone with a 2018 tax bill, it’s also important for anyone whose refund is larger or smaller than expected. By changing withholding now, taxpayers can get the refund they want next year. For those who owe, boosting tax withholding in 2019 is the best way to head off a tax bill next year. In addition, taxpayers should always check their withholding when a major life event occurs or when their income changes.

When to check withholding:

• Early in the year
• If the tax law changes
• When life changes occur:
  • Lifestyle – Marriage, divorce, birth or adoption of a child, home purchase, retirement, filing chapter 11 bankruptcy
  • Wage income – The taxpayer or their spouse starts or stops working or starts or stops a second job
  • Taxable income not subject to withholding – Interest, dividends, capital gains, self-employment and gig economy income and IRA (including certain Roth IRA) distributions
  • Itemized deductions or tax credits – Medical expenses, taxes, interest expense, gifts to charity, dependent care expenses, education credit, Child Tax Credit, Earned Income Tax Credit

How to check withholding

• Use the Tax Withholding Estimator on IRS.gov.
  The Tax Withholding Estimator works for most employees by helping them determine whether they need to give their employer a new Form W-4. They can use their results from the estimator to help fill out the form and adjust their income tax withholding. If they receive pension income, they can use the results from the estimator to complete a Form W-4P, Withholding Certificate for Pension and Annuity PaymentsPDF, and give it to their payer.
   
• Use the instructions in Publication 505, Tax Withholding and Estimated Tax.
  Taxpayers with more complex situations may need to use Publication 505 instead of the Tax Withholding Estimator. This includes employees who owe, the alternative minimum tax or tax on unearned income from dependents. It can also help those who receive non-wage income such as dividends, capital gains, rents and royalties. The publication includes worksheets and examples to guide taxpayers through these special situations.

Change withholding

To change their tax withholding, employees can use the results from the Tax Withholding Estimator to determine if they should complete a new Form W-4 and submit to their employer. Don’t file with the IRS.

Those who don’t pay taxes through withholding, or don’t pay enough tax that way, may still use the Tax Withholding Estimator to determine if they have to pay estimated tax quarterly during the year to the IRS.  Those who are self-employed generally pay tax this way. See Form 1040-ES, Estimated Taxes for Individuals, for details.

More resources

• Pay as You Go, So You Won’t Owe
• Estimated Taxes
• Form W-4S, Request for Federal Income Tax Withholding from Sick Pay
• Form W-4V, Voluntary Withholding Request

Although tax returns are prepared remotely, we accept documents through U.S. mail or by drop-off, however, the preferred method is to upload documents to the portal or email them directly to Stephanie. The new office is a shared space again, Office Evolution. The suite is located on the 5th floor of the Metro North building at 11990 Grant St., Suite 550 Northglenn, CO 80233. The new phone number is (303) 381-3014 ext 101

When dropping off documents, please make sure that they are enclosed in an envelope that can be sealed.

Mailing Address: 11990 Grant St., Suite 550

Northglenn, CO 80233

Phone number: (303) 381-3014 ext 101

e-mail: stephanie@paulinestaxservices.com

Portal: https://ptsdocs.securefilepro.com/portal/#/login

As a reminder, the 1040EZ and 1040A were removed. There is no “easy” form when filing tax returns. Individuals either file the 1040 or the 1040SR. Other forms or schedules may need to be attached to the 1040, like the Schedule C – Profit or Loss from Business. You are essentially considered self-employed if you receive a 1099-Misc or 1099-NEC for non-employee contributions and should include the Schedule C on your returns.

Many of the extended or given credits received over the last couple of years due to the pandemic have expired. We will be reverting to the pre-pandemic situation. IRS changes, e-file changes, and new or updated forms and schedules have been released. Here are a few of the significant changes.

Due to the expiration of American Rescue Plan Act of 2021 (ARPA) (P.L. 117-2)

For the 2022 1040, Lines 12b and 12c were removed, as the election to claim a charitable contribution for taxpayers who do not itemize deductions has expired. The tax law changes of 2017. The Tax Cuts and Jobs Act, drastically affected who could use their mortgage interest, and real estate taxes, among other items on the Schedule A (Itemized Deductions) or who must use the standard deduction that the government gives to everyone. For example, unreimbursed employee business expenses for most folks were eliminated. If you work for an employer and receive a W2 at the end of the year, you can no longer write off parking, mileage, or office use of your home. The TCJA increased the standard deduction, so the overall threshold to itemize increased. However, donating to church or Goodwill was still allowed on a separate line. That will be changing this year too. Charitable Contributions are included on the Schedule A so if you do not itemize, you cannot use those.

Line 27c was removed, as the election to use prior-year earned income to figure EIC has expired. The childless EIC age range (25-65) has been reinstated. Additionally, 2019 earned income can no longer be used in place of current-year earned income to calculate EIC. The earned income credit is available for taxpayers who earn under a certain amount. The number of dependents claimed on the return increases the EIC. Last year, the IRS allowed the best income amount to receive the highest credit. So if you made more in 2020 than in 2019, the IRS allowed you to use 2019’s income to calculate the EIC. That will not be the case for 2022.

Line 30, previously used for the Recovery Rebate Credit, is now reserved. If you did not receive the full amounts for stimulus 1, 2, or 3 when they were distributed, then the RRC would reflect that on your 2020 and 2021 tax returns.

https://www.opm.gov/policy-data-oversight/pay-leave/ARPA/

https://www.law.cornell.edu/wex/tax_cuts_and_jobs_act_of_2017_%28tcja%29

The IRS will begin accepting 2022 individual tax returns on January 23, 2023. Since the regular deadline of April 15^th is on a Saturday, the deadline to file tax returns that have balances due will be April 18^th.

https://www.irs.gov/newsroom/irs-sets-january-23-as-official-start-to-2023-tax-filing-season-more-help-available-for-taxpayers-this-year

The new 1099-K reporting requirements raise questions about how to input the data to ensure the income is included or excluded correctly. For excludable income, the first workaround I heard about was to use Schedule C to report the income and then use an expense line to ‘reimburse for personal use’ with the same amount. However, it turns out there is some IRS guidance available at https://www.irs.gov/businesses/understanding-your-form-1099-k that provides alternatives.

Adjustments to income may be more appropriate if the 1099-K does not relate to actual business transactions. 

Scenario	Action(s) to take
Personal items sold at a loss	If you receive a Form 1099-K for a personal item sold at a loss, report the information on Form 1040, Schedule 1, Additional Income and Adjustments to Income with offsetting transactions. For example, if you receive a Form 1099-K for selling your couch online for $700 you will report: Part I – Line 8z – Other Income – Form 1099-K Personal Item Sold at a Loss $700 Part II – Line 24z – Other Adjustments – Form 1099-K Personal Item Sold at a Loss $700 The net effect of these two adjustments on adjusted gross income would be $0.
Personal item sold at a gain	If you sold an item you owned for personal use, such as a car, refrigerator, furniture, stereo, jewelry, or silverware, etc., at a gain, your gain is taxable as a capital gain. Report your gain as explained in the Instructions for Schedule D (Form 1040).For personal items sold at a loss, follow the instructions for Personal items sold at a loss.
Mix of personal items sold – some at a gain and others with a loss	Your gains and losses are to be reported separately and gains for assets cannot be offset by losses from the sale of personal assets. If you sold an item you owned for personal use at a gain, see Personal items sold at a gain for information on how to report. For personal items sold at a loss, follow the instructions for Personal items sold at a loss for information on how to report.
Form 1099-K received in error	If you received a Form 1099-K by mistake or if the form you received has incorrect information, contact the issuer of the Form 1099-K immediately. The issuer’s name appears in the upper left corner on the form along with their phone number. If you can’t get a corrected Form 1099-K, report as follows: Same as personal assets sold at a loss except changing the description as follows: Part I – Line 8z – Other Income – Form 1099-K Received in Error Part II – Line 24z – Other Adjustments – Form 1099-K Received in Error

The DrakePortals^® SecureFilePro^® mobile app is now available in Google Play and the App Store!

have instant and anytime access to the portal for:

• File sharing
• Return review
• Messaging
• And more contactless features!

To download the app

Download SecureFilePro on Google Play or Apple App Store and login with the email address you use to access your client portal.

The IRS shuts down the e-filing system at the end of every year for two months to perform updates and maintenance.  Attempting to e-file the tax returns outside of the authorized dates will cause a rejection.  Ensuring that the return has been accepted within a year is imperative because the IRS will take several years to send a letter informing you that they have not received it. 

If a balance was due on the original return, that could mean additional penalties and fees since it could be considered late.  A refund could be lost since there is a deadline for filing returns with refunds of three years.  

The e-file closure date has not been given yet (as of 11/01/2021), but last year it was 11/18/2020 so at least make sure to file by that date.

Do you still need to file 2018-2020 tax returns? Contact me at stephanie@paulinestaxservices.com for instructions on submitting your documents.

Timely File Your Tax Returns

It seems like the Internal Revenue Service is dishing out more penalties and fees than ever before, so filing on time might be in your best interest. If you generally receive a refund, you have three years to file, but if you owe, you must file by the due date, which is usually April 15^th.   Any time is a good time to file, and it can be as simple as sending your documents over.

Here is the process for new clients.

1. If you are an employee or are self-employed, upload here using the Guest Exchange.

• For employees, send W2’s, a copy of your driver’s license, and any other documents you might have, like 1099’s or 1098’s. If you are self-employed, send your Profit/Loss Statement or Income and Expenses with all other items. Totals Only, no receipts.

2.Please shoot me an email at stephanie@paulinestaxservices.com to start the interview and process as Ill need more information.

3. I’ll prepare the returns and send you a copy for review

4. If everything looks good, sign the e-file authorization documents, pay the tax prep costs, and the returns will be e-filed.

File Past Tax Returns

The process is the same as above. Generally, start with the last three years, and then we will determine the next steps.

Automatic 6 Month Extension of time to file

If you filed an extension, the due date is October 15^th.  The extension is ‘of time to file’, not ‘of time to pay’, so if you will owe or have a balance due, it will be accruing interest/penalties for failure to pay, so filing sooner rather than later is a good idea.

There are many types of identity theft. A few weeks ago I posted that someone had applied for unemployment benefits using my information. I still work at the company that I supposedly filed for unemployment from and they denied the claim but it seems as though Colorado granted all unemployment claims up front with the hopes of recovering that money at a later date if it turns out to be ‘not qualified’. Well folks, I just received a 1099-G from the state with the income that I did not receive to be included on my 2020 tax return.

I filed a fraud document initially, but clearly it wasn’t looked into. I followed the following next steps but its concerning because the IRS isn’t going to know that the document/income is fraud and now my tax return may not be processed correctly and timely.

Identity Theft

If you have received a 1099-G document from the Colorado Department of Labor and Employment but did not file a claim for unemployment benefits, you may be a victim of identity theft. Unfortunately, fraudsters steal or purchase private information from illicit data brokers and use that information to file fraudulent unemployment claims. While we have a sophisticated multi-factor program in place to flag suspected fraud, no system is perfect.

Here’s what you should do if you’ve received a 1099-G document from the Colorado Department of Labor and Employment but did not file a claim for unemployment benefits:

1. Report it to us using the Report Invalid 1099 form.
    
2. Contact the three consumer credit bureaus and put a fraud alert on your name and Social Security Number (SSN). Credit Bureau Contact Info:
   
   Equifax: 1-800-525-6285
   Experian: 1-888-397-3742
   TransUnion: 1-800-680-7289
    
3. File a “counter report” with your local police department to have a record on file.
    
4. Create a file where you can keep records of this identity theft in one place.

Reference: https://cdle.colorado.gov/tax-form-1099-g

Recently, I received paperwork from the Colorado Department of Labor and Employment with a PIN number and information on where to logon to view my unemployment information. Just one problem. I didn’t apply for unemployment benefits.

If this has happened to you too, here is the link for more information and to report fraud online. https://cdle.colorado.gov/fraud-prevention

There are rules that govern how an employee is to be treated versus an independent contractor but one of the easiest ways to decipher the difference is, are employment taxes paid on your behalf during the year by you and your employer? How can you tell? If you receive a paycheck stub and it shows withholdings for federal and state income tax and social security and Medicare tax then yes, you pay employment tax as you go and are considered an employee.

If you work for the same guy everyday but he cuts you a check without withholding taxes then you are most likely an independent contractor, not a true employee for tax purposes. The form(s) that you receive at the end of the year will be different. If you are an employee then you would receive a W2 but if you are considered an independent contractor then you would receive a 1099-misc( or not in some cases, see self employed self help).

Form W2 = Employee where employment taxes are “paid as you go”

Form 1099-Misc or Income Statement = Independent Contractor or self employed person who should be adding in additional expenses and usually employment taxes due are paid when the return is filed.

 

Quickly, because contrary to popular belief, my job doesn’t just end on April 15^th every year, a few public service announcements…

 

A big thank you to everyone who checked in on my well-being this tax season.  It was especially difficult rolling out and implementing a new tax plan to hundreds of folks that didn’t understand the previous version of this shit show.

 

Secondly, if you’re receiving an email from me every morning at 4 am, it’s most likely because you didn’t follow the instructions to login to the portal and check the messages and/or download your client copy that I sent to you for review.

 

Third, if you were pissed this year because you didn’t realize that all last year you weren’t withholding as much money as the prior year or the correct amount of tax in general, “they” are adjusting things again this year…. so, the same thing is happening right now.  Know your TAX from Tax Year 2018 and review your paycheck stub’s YTD’s to determine your withholding’s.

*The object of this game is no refund, no balance due *

• Hint #1 If you have multiple jobs, they’re supposed to be added together.
• Hint #2: Don’t include social security or Medicare tax withheld when calculating federal or state income tax information.

 

It is every individual taxpayer’s responsibility to understand this stuff, and if you don’t or can’t, in most cases, it might not be you, it’s the system. We need a real system of taxation!

 

Other helpful HINTS

Form W4 = Employees Withholding certificate; employee of someone else.

form W9 = Self-employed person required to give their business information for work performed, not an employee of someone else.

Form W2 = Employee’s Wage and Tax statement (employee of someone else and in most cases cannot deduct un-reimbursed employee business expenses).

1099 Misc (this is not a W2) = Generally, self employed income or Rents received (think subcontractors, taxi driver, or landlord’s;  business expenses can be deducted).

 

Alright, well there’s enough information to blow your minds for a few.

 

 

$SMCtaxhints$Keepyourmoney$Taxscam$thedollarsignisthenewhashtag$realtaxreform

 

Updated January 27, 2019

By Stephanie Cardenas

 

The new tax plan is intimidating, for everyone, including tax professionals.  The <numbers> changed, many of the forms changed, many rules were revised, added or removed and much more. But the process is essentially the same just a bit more time consuming at this time.   * Tax plan for 2018-2025 mind you*

 

Taxpayer’s should provide their information in the same way they had in the past, the result may or may not be the same however.  Essentially, prepare the returns as you normally would.  Yes, some of your calculated deductions may not “qualify” as they had in prior years, and that will be discussed when TY18 is prepared and can be compared to TY17.

• For Pauline’s Tax Service clients: There’s a forecast in the 2017 client copy that estimates the changes per your situation… assuming it stays relatively the same. Dropping or gaining a dependent will affect the estimate.
• For other folks: Grab your 2017 client copy (form 1040, 1040EZ, or 1040A) and locate your key numbers.  Taxable income and Tax due per that income.   When 2018 is prepared you can compare your taxable income for both years and the tax due per that income for both years see what the changes were.  Pay special attention to last years’ tax rate compared to this years tax rate.

What you will need to prepare your returns

 

Collect and save all necessary tax related items and documents as they arrive.  Create a folder on your desktop or computer if necessary. Once you’re positive nothing else will arrive, upload to the portal or mail/drop off in the office. Use the 2018 tax planning document document as a guide.

-W2’s, 1099’s, 1098’s, 1095’s, any spreadsheets you create, etc.

 

If you had a baby. That’s fantastic.  You will need a copy of the social security card/number, their name, birth date.  Additional questions for divorced or separated parents and people who qualify for the earned income credit (EIC).

• The exemption amounts no long apply but the child tax credit is available (For children under age 17).

 

If you started a business, awesome.  You will need a statement that shows the total of all of your income and expenses.  Every business is different and has different needs so tailor your income statement to suit you.  Here’s an example template.

template income statement

 

 

Use the tax organizer or tax planning document as a checklist to ensure you have the required information.  2018 tax planning document

 

You’re ready to file

 

Upload your documents to the portal https://ptsdocs.securefilepro.com or mail/drop off packet at the office: 12365 Huron St. Suite 1800 Westminster Co 80234. Remote processing preferred.  In the event we need an in-office appointment, ask about the availability of a Saturday appointment.

 

We’ll prepare your returns and provide you with a copy so that we can chat about what the changes were, if any.  E-copies and/or hard copies will be provided, generally within 24-48 hours.

 

Pay the tax preparation costs: Cash, check or charge. Generally, the tax prep fees range from $100-350 depending on the required forms and worksheets.  Most returns are anticipated to be average resulting in fees of $150-200.  The tax prep fee includes federal, state(s), e-filing, and many other features.   I’m available year round for help with notices and responses to the IRS.

• The audit process is generated electronically and randomly so always understand what they are PROPOSING before you agree and/or pay. But ALWAYS respond in a timely fashion.

 

stephanie@paulinestaxservices.com

https://ptsdocs.securefilepro.com

• Double check if the question is asking for the last 4 of your social or the last 5.
• You will need your username and password to log on to the portal, and if any client copies are password protected use the last 5 of the primary taxpayer’s social security number.
• Try using the forgot password, if you already have an account.  For new clients Ill need the last 4 of the social to set up a client portal so upload as a guest.

 

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You should know, generally, what your tax liability is for the year and plan on a 3 year basis.  Take a look at the last 3 years tax return copies and locate your tax due for those years.  Pauline’s Tax Service Clients:  Included in every client copy is a Comparison Sheet that lists the last 3 years side by side.

 

If you generally receive large refunds, you are doing this all wrong.  Refunds aren’t extra money… unless it is like from the Earned Income Credit but that’s another topic.  Refunds are of  your money previously withheld from your paychecks to cover your estimated tax liability.  The goal is to only withhold your estimated tax liability, in which case and in theory you would come as close to receiving nothing and owing them nothing at the end of the year.

 

If you over estimate your tax liability the IRS holds your money interest free all year long and gives it back when its convenient for them.   A more in depth piece to come about this but the point will be to keep more of your money on your paychecks during the year.