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Posts Tagged ‘federal’

Question: Tax Form 2553 question?

I’m in the processes of incorporating my business. I used LegalZoom and they included a filled out 2553 form for election by a small business corporation. The thing is, they didn’t check any boxes on part II (page 3).

According to the 2553 instructions, I need to “Complete Part II if you checked box (2) or (4) in Part I, Item F.” Box 2 was checked in Part I, Item F. I called them up and they said it didn’t matter, what they sent me was fine. The guy didn’t seem too knowledgable though.

So my question is, do I need to fill out Part II? If so, what box should I check? Part I, Item E is 07/29/09 and like I said before, box 2, Item F in Part I is checked.

Thank you.

Answer: This is why you should not use service like LegalZoom without consulting with an attorney and tax pro FIRST. “The guy didn’t seem too knowledgable though” should have been a huge red flag.

You need to decide if you are making a fiscal year election and if so, when your fiscal year will begin and end. Making an election without knowing what you’re doing can cost you down the road, and changing it requires the approval of the Commissioner of Internal Revenue.

Before you go any further I’d strongly suggest a consultation with an attorney and have him or her review what LegalZoom provided and a tax pro to determine how to make the fiscal year vs calendar year election.

IRS Releases HIRE Act Payroll Tax Exemption Form

The Internal Revenue Service has released a new form to help employers claim the special payroll tax exemption for newly hired workers under the HIRE Act.

Tax Tips from the IRS – Undelivered Refunds (American Sign Language)

Question: Federal tax help?

Where does form 1099-Q and 1099- R.What line???

Answer: 1099-Q goes on line 21
1090-R – depends on what kind of distribution. Either 15a and 15b if distributions from an IRA, or 16a and 16b if distributions from pensions/annuities. For capital gain, you need to see the instructions on your 1099-R.

Flaw found in TurboTax software

The flaw may have caused thousands of retired federal employees to overstate their medical deductions.

Final Countdown to April 15 – Illinois CPA Society Answers Last Minute Tax Questions

CHICAGO, April 9 /PRNewswire-USNewswire/ — This is it. There are only a few days left to finish your taxes. Whether you’re a procrastinator by nature, or you’ve stalled just because you dread filing (or paying) taxes, there’s no avoiding the April 15 deadline. If you count yourself among those who have waited until the last minute, the Illinois CPA Society offers answers to some of your last …

Express Tax Lane – intro

Question: I need to take a distribution from my 401K. What can I expect as tax & penalty?

I need to take a distribution from my 401K due to a financial emergency (unemployment) and need to understand what i will owe the IRS out of that money. I know there is the 10% penalty (can that be waived if one has had to endure unemployment hardship?) and a tax amount. Is the tax going to be per my individual tax rate for is it a fixed amount?

Answer: The tax is whatever your bracket is including the distribution as income, and sorry but no the penalty can't be waived.

Rebates causing some tax troubles

Many people look forward to receiving a tax return around this time of the year as a little extra cash to put towards larger purchases or projects. However, some people may get a surprise when they file their tax return this year, and they won't like what they see.

Question: Does a US citizen, nurse, over 21 who received a 1099 misc have to pay social security?

US citizen, over 21, worked in US and received 1099 misc from company she worked for. Does she have to pay social security?

Answer: Yes. If you are self-employed -- which you are if your income is reported on Form 1099-MISC -- you must file Form 1040 and attach Schedule C or C-EZ to calculate your net self-employment income. If that net income exceeds $400 you must attach Schedule SE to calculate the self-employment tax. When you're self-employed you pay both halves of the Social Security and Medicare taxes so the effective tax rate is close to 15% instead of the usual 7.65% that employees pay.

COUNCIL APPROVES AUDIT FUNDS

The Pine Bluff City Council voted unanimously and without discussion at its Monday meeting to allocate $87,104 from undesignated funds to cover the back payroll and independent contractor taxes it owes the Internal Revenue Service from 2007 and 2008.