Tax season sends everyone into a frenzy and people who are often quite adept at their filing their taxes also are caught in the madness and end up making mistakes. This is often compounded by the fact that there are so many myths that have been created around taxes.
These myths are detrimental to your tax returns as you end up filing wrong returns or miscalculating something and this then lands you in trouble with the Internal Revenue Service. Instead of getting worked up and believing all these myths, you can let a qualified tax preparer from the Asharp Bookkeeper Company located in New Bern, NC take over the task of handling your returns.
These tax preparers make sure that you file your returns correctly and include everything relevant. They help you avoid being penalized by the Internal Revenue Service and keep you in their good books.
Common Myths And Misconceptions
The worst part about myths and misconceptions of filing taxes are it can make even people who are proficient at taxes doubt themselves. It is best not to adhere to the following myths:
Extensions mean more time to pay
This is a common myth, which has led many people into massive debt as they have ended up being heavily fined by the Internal Revenue Service. When you file an extension for your tax returns, it means you have more to submit these forms but it does not mean that you can pay whenever you feel like.
The payment of taxes must be done on the due date or you will not only have to pay the due date, but the interest as well. If you are unsure about the process of filing an extension for your tax returns, you can take the help of tax preparers in New Bern, NC.
Big losses mean no taxes
Unfortunately, even if you have faced huge losses in your business, you will still be required to pay a certain amount of tax. You can only deduct capital losses to the tune of $3,000 against ordinary income. The tax professionals from Asharp Bookkeeper will help you understand the same.
No need to report losses on stocks
Even if you have traded some stocks and not made any money or incurred heavy losses, you must report this on your tax returns. The Internal Revenue Service needs to verify all your information and check whether your claims are correct or not. As a broker or taxpayer, you are also required to specify the purchase price on the tax returns.
Reinvested dividends are not taxable
Once you receive dividends, they are considered as income and will be taxed whether or not you reinvested them. The Internal Revenue Service will penalize you a hefty amount if you do not report these dividends on your tax returns. The tax preparers in New Bern NC will show you how to report these dividends o your return forms.
Cash does not need to be reported
Sometimes people have this misconception that if their employer paid them in cash, they will not have to report it. This is not true, as income in any form, whether by cash, cheque, or wireless transfer, needs to be reported to the Internal Revenue Service. You will have to pay a high interest if you don’t report this income.
Tax returns have an age limit
No matter how young or old you may be, if you earn a decent income of say $5,700, you will have to file your tax returns. Even if you are dead, your family members will have to cover your personal and estate tax returns.
This is one of the biggest misconceptions that most people have, where they don’t report the income they receive from abroad and are thus made to pay heavy penalties. Any income you earn whether, in the country or in a foreign country, must be reported to the Internal Revenue Service.
Moreover, you will be required to pay taxes on this income. You should take the help of the tax preparers in New Bern, NC to avoid being heavily penalized by the Internal Revenue Service for not reporting your foreign income.
These common myths about filing taxes are best considered myths and you should not pay any attention to them. Report all your income, record all your profits and losses, provide all your documents and most importantly pay your taxes on time.
If you have any trouble filing taxes, you should use the services of qualified tax preparation companies like the Asharp Bookkeeper. Just click on the profile below to talk to a trained tax preparer and your tax woes will be put to rest.
Asharp Bookkeeper
