Quick Tax Tips for Single Parents

Being a single parent can bring its own unique challenges and concerns in life, but filing taxes shouldn’t be one of them!

Here are some basic things to consider before filing your taxes this year.

Dependents:

Determining who you claim as dependents affects your ability to receive some credits and deductions. In a separation or divorce, this is usually a stipulated agreement between the two parents. However, the both parents can benefit if the parent who normally claims the child agrees to sign a waiver allowing for the non-custodial parent to make the claim. While you cannot split the deduction for a single year, parents can alternate years making the claim or only claim certain children if there are more than one. Remember that a child can only be a dependent if the child has lived with a parent for at least six months out of the year and was financially supported from that parent.

Head of Households:

You can file as head of household if you were not married on December 31, 2014, your kids live with you for at least 50% of the year, and you earn at least 50% of your household income. Head of household status will allow you a lower tax rate and higher deductions.

Exemptions:

For every dependent child you are allowed to deduct $3,950 for 2014. Head of households earning $275,650 or more are phased out.

Tax Credits:

Single parents earning $75,000 adjusted gross income or less can take $1,000 off their tax bill for each dependent 16 and younger in 2014.

Child Care:

Head of households who have an income or are full-time students can claim up to $3,000 per child for qualifying health care. This includes day care, summer day camps, and after school programs. Phaseout starts at $75,000 for single head of household filers.

Earned Tax Income Credit:

The maximum credit is $6,143. If you have three or more children and earn less that $46,997 as a single parent you can take this credit. If you have two children you can still qualify if you have a smaller income.

We hope this will help you begin to file your taxes! For all your tax preparation and tax debt needs call 888-737-0200. The tax experts at Advocate Tax Solutions are here to be your one stop shop for every tax question and problem. Visit www.advocatetaxsolutions.info for more information today!

Planning for the Future: Non-conventional Uses for a 529 Plan

If you have kids you know they can be expensive and planning for their education can be overwhelming.

The cost of college tuition has risen at an average amount of roughly 8% per year over the last few decades. For example, the tuition at the University of Pennsylvania, a private undergraduate school, was $2,770 in 1960. In today’s dollars, that’s $22,219.24 and in a half century it will cost nearly three times that at $61,800!

Luckily, 529 Plans, or Qualified Tuition Programs (QTPs), offer families a way to save for their kids (and their own) future. 529 Plans offer significant tax benefits by allowing for the prepayment of qualified higher education expenses at eligible educational institutions. This allows you to lock in the rate of your kids’ college rate at the current number. So while rates are always increasing, there are no federal taxes on your contributions’ earnings. There are often no state taxes either if you are a local resident and if your child attends an in-state college.

The benefits don’t even end there. Here are some creative ways you can use your 529 plan.

1. Pay for Your Own College Expenses

If your child receives a scholarship or decides not to attend college, you can use any 529 funds toward your own educational expenses. Most plans allow you to change the beneficiary once a year, allowing you to transfer the funds to yourself. If you’ve held off on furthering your own education this is a great way to save on your own college expenses.

2. You don’t have to use the 529 plan on a traditional four year school.

529 plans can be used for two-year Associate Degree programs, technical schools, trade schools, vocational schools, and even for study abroad — as long as it’s with an accredited institution.

3. Benefits for Multiple Beneficiaries

Since you can change beneficiaries yearly, you could technically fund multiple beneficiaries with a single plan. If you have more than one child, and if you want to further your education, you can contribute to all of the beneficiaries’ education with a single plan.

4. Plan for the Distant Future

529 beneficiaries can be anyone you choose. You can help protect your family’s future generations by including your grandchildren and even their children. This way you can ensure your legacy is secure.

5. You can pay for non-qualified expenses with a poorly performing plan.

If you end up in major financial difficulties and need to pay for non-educational expenses , you may withdrawal from a plan if it is in the red without any penalties.

Start planning your little ones’ and your own future now! 529 Plans will help you secure your future and legacy. We know that taxes can be the worst. Planning ahead can help you avoid large tax costs in the future. If you need help with your 529 plan or current back tax debt our reputable tax experts at Advocate Tax Solutions are your qualified tax resource to solve your tax problems.

Call 888-737-0200 for all your tax questions or visit us online at www.advocatetaxsolutions.com 

IRS SCAM ALERT

Beware of IRS scams!

This week there is a phone scam occurring mainly in Montgomery County, Texas. Fraudsters have been calling residents claiming to represent the Internal Revenue Service, IRS, and telling potential victims that they either owe money to the IRS or are due a refund. The callers then try to acquire financial and personal information.

These types of scams happen often throughout the country. We want to give you a few tips on how to recognize an IRS phone scam.

The IRS will not:

• Call about taxes owed without mailing you a notification first.
• Call to demand immediate payment.
• Ask for financial information such as credit or debit card numbers over the phone.
• Threaten to have law enforcement arrest you if you do not make immediate payment.

If you have been a victim to one of these scams please contact your local law enforcement right away.

If you do owe back taxes to the IRS, it is time to get help! Don’t get scammed and don’t let your tax problems and IRS debt continue to grow. Here, at Advocate Tax Solutions, we give you qualified and affordable representation that you can trust. No stress included. Call 888-737-0200 today to see how we can help you get the best tax resolution possible or visit our website at www.advocatetaxsolutions.com

Tax Tips for the End of the Year

April 15 may seem far off, but we have some end of the year tax tips that will make your life easier this year.

1. Don’t forget your deductions or credits

 

• Don’t forget your expenses or what you did during the year, for example giving away unwanted clothes to charity or doing a 5k, they can add up to some nice deductions.

 

• If you have dependents look at the Earned Income Credit Calculator on our website at https://www.advocatetaxsolutions.com/tax-calculators. If your wages and self-employment income fall below a certain level, you can earn deductions and credits based on how many dependents you have. You can also claim the Child Tax Credit-up to $1,000 if you have children under 17.

 

• If you are energy efficient and have installed the Energy-Star approved solar-power systems before the end of 2016, you can claim 30% of the cost as a tax credit for that year.

 

• If you have been unemployed in 2014 and had job searching costs, you may be able to deduct them.

 

2. If you didn’t have health insurance this year  This is the first year most Americans are required to have health coverage. If you were uninsured for 3+ months, you may not qualify for an exemption and may get hit with a tax penalty for 2014.

 

3. Check your withholdings Individuals should periodically check their withholdings to ensure they are in line with their true tax liability. Certain life changes like marriage and having a child will change your tax liability. That would be a good reason to adjust your tax withholdings.

 

4. Don’t NOT file your taxes Always file your taxes by the original or extended due date, even if you cannot pay. Late-filing penalties are worse that late-payment penalties.

 

5. Sometimes you need to consult a tax expert The tax code is an infinitely complex and can be extremely confusing and anxiety provoking. So it’s understandable to want to get professional tax help. Every year the tax law changes and its thresholds are adjusted. If you don’t know the law and how it applies to you, consulting with someone who’s up on the tax code is a good idea.

If you need help let the tax professionals at Advocate Tax Solutions know! All estimates are free, confidential, and guaranteed. Our tax professionals have years of experience negotiating with the IRS and representing thousands of clients.

 

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6 Tips for Budgeting Last Minute Holiday Trips

If you’re going home or decided to take a last minute vacation for the holidays, you may be thinking it is too late or that it’s going to kill your budget. After all, doesn’t everyone always say that you have to book a trip far in advance or it will cost you? While it may be easier to find deals when you have more time, there are plenty of ways to save money on last minute planning.

1. Use Expedia or Travelocity to find flights

If you don’t already have frequent flier miles, find a cheaper airline like Spirit Airlines. These sites will also widen your search, and will include alternate airports in the search results. Most major cities have several airports or airports than can be reached within an hour or two hour drive.

2. Sign Up for Fare Alerts

Save time by letting travel sites notify you when fares drop. You can sign up for fare alerts on:

• Airfarewatchdog
• Yapta
• FareCompare
• TripAdvisor
• Kayak

3. Search one seat at a time.

If you are searching for more than one seat, airlines will only show the fares that are available for all travelers, even if some of the seats are available at lower prices. You can save money by splitting up your reservation.

4. Travel on Christmas Day

It’s probably not ideal but it most likely cheaper. If you didn’t book early enough, try looking on Christmas Day. There are fewer people traveling which will result in lower fares.

5. Be Willing to Be Bumped

If you have enough flexibility, be willing to be bumped. It won’t save you money right away but you could get a voucher for your next trip.

6. Look into buses and trains.

There are great alternatives for travel when flying is unaffordable. Taking the bus no longer means taking the Greyhound. Bus services like Megabus offer amazingly low prices and have Wifi and other amenities. Amtrak is also a viable option when flying is not.

With some creative planning, you can get to wherever you want to be during the holidays without paying too much. Have safe travels and a great holiday!

If you have any financial questions call your trusted advisers at 888-737-0200

or visit www.advocatetaxsolutions.com

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As Fuel Prices Lower, There Could be a New Gas Tax

Will there be a new Gas Tax?

When filling up your gas tank you may have noticed that gas prices are lower than they have been in years! While you may be enjoying the extra money in your pocket, former Pennsylvania Gov. Ed Rendell says you shouldn’t get used to it.

On average, gas prices are about 50 cents less a gallon than a year ago. Various politicians, including Rendell, have suggested that due to the low gas prices it is the optimal time to increase gas taxes.

He supports raising the federal gas tax in order to bring in funds for roads, bridges and construction across the U.S.  In an interview with CNBC the Pennsylvania Democrat argued, “Our infrastructure’s crumbling. Our roads and our bridges are in dangerous condition.” Rendell believes that if the roads were in better condition, it would allow for more efficient traffic, and that raising the tax would save actually save people money.

Raising taxes is never popular, but if the gas taxes were raised now, it wouldn’t seem like much of a tax hike. The average American wouldn’t be paying more out of pocket than they were in the recent past.

Gas taxes, by historic levels, are incredibly low right now. The Washington Post pointed out that the federal gas tax has been at a flat 18.4¢ since 1993. At that time the price of a gallon was on average around $1.

At least the move won’t be quite as unpopular as it would have been if it had been introduced when Americans were paying on average $3.50 or $3.75 per gallon.

Have tax questions? Call the tax experts at 888-737-0200 for help!

Or sign up for a free consultation at www.advocatetaxsolutions.com

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What Does the IRS Call Willful Neglect & What Does That Mean for You?

If you are filing your taxes this year, be careful! Remember that if the IRS even thinks there is an inkling of intentional fraud on your statements you could be facing jail time. Taxes are complex and can be confusing. You may assume that anything could be considered a simple mistake, but if the IRS deems it willful you would have the burden of proving that your mistake was unplanned.

How is a stupid mistake differentiated from an intentional mistake or willful neglect?

The IRS defines willful neglect is defined as “a conscious, intentional failure or reckless indifference to the filing requirement.” United States v. Boyle, 469 U.S. 241, n.3 (1985). Willful neglect is shown by your knowledge of your legal duty and report requirements. It means you made an intentional or voluntary choice to not comply.

But what does that mean for you?

“I didn’t know” won’t work for most mistakes. Willful blindness, avoiding learning about report requirements, can get you into IRS trouble. By law, you are responsible to learn filing requirements and to report exact truths when filing your taxes. A few mistakes may be inadvertent neglect but repeated mistakes can show deliberate disregard.

As the end of the year approaches, there is time to begin planning you tax preparations. After January 1099 and W-2 forms arrive and tax return preparations are right after. All Americans have to send tax returns and millions of Americans end up in IRS trouble because of not making estimated tax payments or improperly filing returns. We think it’s better to be safe than sorry! If you don’t want the stress of tax returns and determining what could or could not be willful neglect call our trusted advisers at Advocate Tax Solutions. It is quick, easy, and affordable for you!

Call 888-737-0200 or visit www.advocatetaxsolutions.com for a free consultation today!

 

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Happy Cyber Monday! It Could Be the Last Tax Free Season for Online Sales

Happy Cyber Monday!

As the online holiday shopping frenzy begins today, we thought we’d share some advice for our e-commerce friends: ENJOY THE TAX FREE ONLINE MARKETPLACE WHILE YOU STILL CAN! While the National Sales Tax probably won’t happen this season, we bet you can expect to give away a good chunk of tax money to the government in the future.

The National Retail Federation expects that Cyber Week will see over $9 billion in total sales this year. While that’s a lot of online sales, e-commerce merchants are not celebrating. That’s because the government took notice of this industry’s huge success and Washington wants in. Currently the Marketplace Fairness Act has been passed by the Senate and residing in the House. This bill would allow states to collect taxes from residents who buy online purchases from out-of-state merchants. The buyers would be taxed at the point of purchase, and the retailers would remit the taxes to the eligible states and local municipalities.

As sales skyrocket this week, we expect the National Internet Sales Tax debate to heat up. Key lawmakers and major online retailers, such as the National Governors Association, Footlocker, and Amazon are eager to use the next few weeks of this Congress to push the long stalled bill.

Amazon, the country’s largest online retailer, is already collecting online sales tax and has made a deal with Massachusetts to collect sales taxes. This agreement only applies in the state and solely for purchase made on Amazon.

Because of companies like Amazon, we, at Advocate Tax Solutions, believe that The Marketplace Fairness Act will pass this next season, even if not in the exact form it is currently. The bill will be advertised as a way to even out the playing field for all online merchants.

Whether you are an online retailer or an avid online shopper, the impact of this bill could be huge. So get your Cyber Monday on and take advantage of this holiday’s tax free online market! We know we will.

 

Along with cyber week, tax season is coming up. Don’t forget to get your taxes in order. Call Advocate Tax Solutions at 888-737-0200 for any tax concerns and for tax preparation. Enjoy the holidays and get the tax relief you need!

Visit http://www.advocatetaxsolutions.com to learn more.

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Bad News Saleen Fans: Automotive Company Out of Money and Owes Millions

       Saleen Automotive recently unveiled a modified Tesla Model S and announced plans to tune the 2015 For Mustang, but information contained in the company’s latest quarterly report has some wondering if Saleen will soon fall to the same fate as Hummer and Saab.

 

Jalopnik reported that as of September 30, “Saleen owed $583,900 in unpaid payroll taxes; $1,148,574 of accounts payable was greater than 90 days past due; $352,795 of outstanding notes payable were in default; and $398,176 is owed to a bank as of November 2014, which the Company has not paid and expects to be in default unless the bank agrees to another extension.”

Saleen’s cash assets were listed at $7,261 at the end of the quarter; definitely not enough to run a car company. The situation is so bad that Saleen is counting on another bank extension so the company can continue operating and hopefully turn things around.
This news casts doubt for Saleen enthusiasts and buyers. Saleen’s recently modified Tesla Model S, the Saleen FourSixteen, and the new Saleen 302 Black Label, that just started coming to the market, could be quickly put on hold.
It’s a sad day when ingenious companies come to a struggle due to financial issues and tax debts. We hope Saleen has the turnaround it hopes for and gets the representation it needs. Saleen if you need new accountants, we’re here for you!

 

Do you owe over $10, 000 in back taxes? Call us today@: (888)737-0200 

or visit www.AdvocateTaxSolutions.com to learn more about back tax resolutions and IRS debt help.

 

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Tax Solutions for the Family Caregiver

This year you could claim your loved one as a dependent. Advocate Tax Solutions gets you the help you deserve with tax preparation services and back tax relief.

Being a family caregiver isn’t just time-consuming, it can be expensive. Most caregivers donate to provide quality care for the ones they love.

This tax season, you may be able to claim your adult family member or friend as a dependent on your income taxes. This would allow you to get a tax exemption on his or her medical costs including prescription drugs, doctor and hospital visits, dental and eye care, transportation to get to medical appointments, health insurance programs, and nursing care.
To claim your loved one as a dependent:
• You, the caregiver, cannot be claimed as a dependent by another taxpayer.

• Residency: They must be a resident of the U.S., Canada or Mexico.

• Relationship: They must be a spouse, dependent child or step-child, a parent or stepparent, father-in-law, mother-in-law, OR they must have lived with you all year.

• Elder’s income: Your loved one’s gross income for the year must be less than $3,900 and they cannot file a joint tax return with their spouse. (Social Security is usually excludable)

• Amount of support you provide: You must provide more than 50% of you loved ones financial support. This can include food, housing, medical transportation. If they live with you, you can include a reasonable percentage of your mortgage and utilities. Those who are in assisted living or remain in their own homes can qualify if the correct support levels are still met.

• Records: In order to claim a loved one as a dependent you must keep proof of payments and receipts.

 
Don’t worry about figuring out what deductions you are eligible for, Advocate Tax Solutions can give you the expert tax preparation services you need to receive the tax deductions and credits you’re eligible for.

Do you care for a loved one and have tax preparation questions? Call us today@: (888)737-0200 

or visit www.AdvocateTaxSolutions.com to learn more about back tax resolutions and tax preparations. 

 

 

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