If the due date of filing tax returns is over, and you have not filed your returns yet, there is no need to worry. You can hire the services of tax preparers from the East West Accounting Services, LLC in Miami, FL to clarify your doubts regarding income tax extension.
Individual taxpayers should fill the Form 4868 provided by the IRS to apply for an extension for six months. However, you must remember that this extension is for filing the returns only and not for clearing off your tax debt.
Taxpayers will also incur the late filing penalty equal to 5% of amount owed each month. If the taxpayer fails to make the timely tax payment, he or she will have to pay a penalty of 0.5% of amount owed every month.
Myth No 1: The problem of audit if you file for tax extension
The tax preparers in Miami, FL do not believe in this argument. There is no correlation between auditing and extension of the date for filing tax returns. It is absurd to think that if you file tax returns early, your accounts will be audited first. According to the records with the IRS, only 1% or less tax return had been audited in the income groups below $2, 00,000.
Myth No. 2: A tax filing extension refers to an extension of payment deadline.
You may apply for tax extension, but that does not mean the due date of tax payment changes; it is still April 15. Income tax extension avoids the burden of late filing penalty but the outstanding tax amount will incur an interest rate of 0.5% per month. Hence, the tax preparers from East West Accounting Services, LLC will advise you to file the tax returns on time.
Myth No. 3: Claiming pets as dependents
It is a misnomer. You can reduce the expenses incurred on your pet in case the pet is a vital part of the business such as guard dog.
Myth No. 4: Tax returns are not filed by students
Partially true, this myth according to the tax preparers in Miami, FL is misleading. Even if you are studying in the United States, you are not exempted from filing tax returns. Your income as a student will determine the need of filing tax returns at the end of every financial year. For example, if you are earning a minimum income of $10,150, you will have to file the income tax return regardless of the fact you are a student. If you earn less than $10, 500, you must file your tax return because you may earn a tax refund if the federal taxes were not included in your salary. You can apply for educational tax credits such as American Opportunity Tax Credit.
Myth No. 5: Deductions claimed under home office serve as an automatic financial audit
It is a common scenario for the tax preparers in Miami, FL to give sound advice to home offices, which is a common sight nowadays. You can claim a legal tax exemption for your home office but remember the rules for tax exemptions under the IRS do not consider the expenses on your home office as a direct tax exemption. The tax preparers in Miami, FLwill tell about the IRS rules related to claiming deductions for home office expenses.
Myth No. 6: File joint tax returns if you are married
It is not mandatory to file tax returns jointly if you are married. Generally, the tax preparers in Miami, FL will advise you to file tax returns jointly because of several benefits. The applicable tax rates will be lower in case you file joint tax returns. However, a couple will be eligible for ‘marriage penalty’ if it files tax returns jointly. If both earn a high income, you might consult the tax preparers from East West Accounting Services, LLC .
You can file your tax returns online provided you are clear about the terms and conditions of payment of taxes and e-filing of tax returns. You can visit the online website of the IRS to file your tax returns online; it is convenient and time saving. Moreover, as the due date of filing returns approaches closer, you do not want to get into the trouble of waiting in the long queues.
However, partial information of IRS rules can be detrimental. Then you would have to seek advice form a professional tax preparation company like the East West Accounting Services, LLC to assist you with the filing of tax returns properly and on time.
