Tax Articles

Let’s get clear on the steps, status meanings, and timelines so you can feel confident that everything is progressing as normal, or if you need to do a little follow-up to discover if there’s a reason to take action. Your best bet to avoid any surprises later on is to proactively track the progress every step of the way. That tracking starts right in the TurboTax software and your email. TURBOTAX Pending - Your tax returns were sent to the IRS and state taxing authority (if needed). Now you’ll watch to see if they Reject them or Accept them. This, typically, takes 24-48 hours. Rejected -  Most rejects are for very common reasons such as typos in a Social Security Number.  You should receive an email from TurboTax (keep an eye on your TurboTax account too) that will tell you the reject code or reason. Then simply log in to your TurboTax account, go to your return and select Fix it now or Revisit the section that applies to the reject code. To help, common reject codes and the

Would you like to take the overwhelm out of tax-filing? Let’s be honest - tax filing is no fun, and stressing about getting it right is normal. Rest assured, filing your taxes doesn’t have to be super-complicated. Actually, it can be broken down into just 3 simple steps - and a few tips to make it even easier in years to come!  STEP 1 - Gather Financial Records It’s so much easier, and definitely reduces stress, if your financial documents are all together and ready to go. Here’s what’s needed: Gather all official tax forms (such as W-2s, 1098s, 1099s) from brokerages/investments, education, mortgage interest and don’t forget your 1095-A form if your insurance is from the Healthcare Marketplace. Remember, many tax forms are now only available online so you might need to log into your various accounts and download them. Some can even be imported directly into the TurboTax software.  Collect your receipts for childcare costs, charitable donations and out-of-pocket medical cost

The biggest challenge for retirement planning is the mindset that we don’t have enough “extra” to invest. The answer to that part is simple: think of investing in your retirement as a monthly bill you must pay. You commit to an initial amount, and it can change as income increases or decreases. The next biggest challenge is deciding what types of investments to make. Usually, the best and first place people start to invest is a tax advantaged plan like your employer’s 401(k) or 403(b). The reason for that is because those contributions save you taxes right now which make less of an impact on your overall cash flow. If you don’t have access to those, the next most common place is a Traditional or ROTH IRA.  The five strategies below are the very basics, forget the fancy, high-risk  “get rich quick” investments. If you get these down, you’re on track for a financially prosperous and comfortable life in your golden years! But if you do want to “play with your money”, it’s probab

Filing taxes in multiple states is fairly common these days! People are mobile  - they’re making the big move to their dream location, taking temporary out-of-state jobs, purchasing a short-term rental/vacation home in another state, and traveling for their business. Whatever the reason, filing taxes for more than one state doesn’t have to be scary - it’s actually simpler than most people realize. Not only does TurboTax make it easy, but the scenarios below are going to make it clear for your unique multi-state tax situation. You’ll be confident and ready to go at tax time!  DO YOU REALLY HAVE TO FILE IN BOTH STATES? Maybe - maybe not. Each state has its own filing requirements ranging from states with none at all (because they don’t even have income tax), to those that require filing simply because you’re filing a federal tax return, even if you don’t have enough income to have a tax liability.  To find out if you even need to file in a particular state, it’s best to go

  Update October 8, 2025: The IRS announced that it was furloughing employees. According to the IRS, essential workers will still process e-filed tax returns. A government shutdown can create uncertainty, especially if you filed a tax extension for tax year 2024. If you’re wondering how it might impact your tax return, here are the answers you need. Key Takeaways: File by the deadline: The extended tax deadline of October 15 is still in effect for tax year 2024. E-file for speed: The IRS continues to process e-filed returns and issue direct deposit refunds. Should I still file my 2024 taxes by the extension deadline? Yes. The October 15 deadline still applies, and you should file by this date to avoid potential late-filing penalties. The only exception is if you’ve been granted a specific extension due to a recent federally declared disaster. E-filing is the fastest way to get your return processed, and you’ll receive an electronic confirmation once your return is acce

There’s help if you owe! More cash flow is a great thing and can come from an unexpected bonus, a new side job, or some other windfall you didn’t expect. But sometimes there’s an unexpected “tax-filing surprise” that goes along with that extra money in your bank account.  You might have even planned ahead and had taxes withheld or paid quarterly estimates. Yet your new money flow put you into a higher tax bracket and you simply didn’t pay enough to cover it. You guessed it - that tax filing surprise can come in the form of a larger tax liability, and often a balance due. It’s frustrating for sure. Whatever the reason you owe, you have options to pay your balance due…or even negotiate with the IRS if you truly are in a financial hardship.  Keep in mind that you must first file your tax return in order to use any of the options below.  Simple Payment Plan - The Simple Payment Plan is a fairly new option as of March, 2025 and most people will qualify for it. You must owe l

It’s hard to believe, but some people just don’t find joy in tax preparation. And if a mistake is caught or there are missing documents, that makes for an even less joyful task! If that’s you, you’re probably also wondering if you really even need to amend. Can you just skip it? The truth is not all changes require filing a tax amendment (Form 1040-X).  It’s a happy surprise to many that if there’s a change that doesn’t affect your tax bottom line, you really don’t need to prepare and file that amended tax return. As a matter of fact, the IRS prefers you don’t (in most cases). Whew! You also don’t need to amend if you received an IRS or state taxing authority “love letter” telling you they adjusted your tax return. Instead, follow the instructions on the letter. Of course, always verify the letter is authentic and any corrections they made are accurate to your situation. Here are few other reasons you don’t need to file an actual tax amendment - but still need to take some action

There’s an entire world of tax reporting forms beyond the most famous of all tax forms, the W-2 Wage and Tax Statement. All of them serve a purpose - and most are to let the IRS know what they should expect to see on your tax returns. Some increase your taxable income, while others can help you get incredible tax deductions!  It’s not practical to list all of the forms the IRS has created, but let’s see if we can sort through some of the most popular ones and include links with more information to help you understand them better. INVESTMENT AND BANKING FORMS 1098, Mortgage Interest Statement 1099-B, Proceeds From Broker and Barter Exchange Transactions 1099-DA, Digital Asset Proceeds from Broker Transactions (coming for Tax Year 2025) 1099-DIV, Dividends and Distributions 1099-INT, Interest Income 1099-OID, Original Issue Discount 1099-S, Proceeds from Real Estate Transactions 1099-PATR, Taxable Distributions Received From Cooperatives SELF-EMPLOYMENT OR MISCELLANEOUS “OTHER” IN

Claiming dependents are definite tax return perks as they can provide huge tax breaks! So it would be quite a surprise if your tax return is rejected simply due to claiming your precious kiddo - especially if you’re the one entitled to claim them. Even if you did everything right, it could happen to you. If your tax return is rejected due to someone else using your dependent’s Social Security number, it might be as simple as a typo in a Social Security number (either by you or the other person). Or maybe the other parent thought it was their year to claim your child and they filed first. Sometimes your dependent files their own tax return as an independent - and, of course, they didn’t run it by you first. You typically learn of the e-file rejection via an email with a reject code of IND-507-01. The 01 at the end means it’s the first dependent listed on your tax return. If you had a second dependent whose Social Security number was the reason for the reject, the code would be IND-

Getting your taxes filed early has its benefits! It’s amazing how accomplishing certain things can uplift your spirit and set the mood for the day, week, or in this case…the year! To me, there’s rarely a better feeling than getting that one (possibly daunting) task accomplished - box checked - and done. It’s even better if you get money in your pocket as a result of taking action! That leads us to the most obvious and enticing perk to filing early - getting your tax refund earlier! Even if you owe more taxes, it’s great to know sooner rather than later, so you can budget and pay on time. Did you know that early filing is also a deterrent from tax-related identity theft? If a scammer files with your social security number before you do, that would create a mess and refund delay. Sadly, it’s you who would bear the burden to prove it’s fraud. But if you file first, the would-be fraudster’s tax return would be rejected.  And there are other perks that might even make or break a life-c

Who knew conserving energy could put so many tax dollars in your pocket?! It’s no secret that there’s an ever-increasing movement toward energy efficiency in recent years (decades, really). The push is so strong that even the IRS continues to jump on the eco-friendly bandwagon with Energy Tax Credits.  Every homeowner and car driver needs to be aware of these wonderful (in many ways) tax credits. If you don’t have a clue what I’m talking about, start with the basics on what energy tax credits actually are and what it means to get one. For the rest of you, keep reading because there’ve been some recent changes and they’re for the better!   LET THE SUN SHINE!  Solar energy is all the rage - and it should be! The sun is essential to life, why not let it be essential to our energy needs as well?!  It seems the IRS agrees with a big YES to tax savings! Under current tax law, the solar energy credit is a massive 30%! That's a big chunk of money when you consider the

Depreciation, COGS, and QBI! Oh my!! Self-employment tax reporting can be like taking a walk down the yellow brick road. There could be twists and turns and even strange sightings of unusual “terms”.   No need to fear, the path to home will soon be clear. And yes, the rumors are true - you can take a deduction for your home office and your vehicle too!! But, just when you think you’re nearly there, more confusing words start to appear. They’re coming right at you and piling high. You see Gross Receipts, Gross Income, and Gross Profits.  Oh why?!  As you venture on your journey through the land of SE (SE means self-employment, in case you didn’t guess), there may be terminology that you don’t quite understand. And if you do, it’s possible the IRS defines it just a little bit differently than what you’re familiar with.  Let’s clarify the meanings for common terms every self-employed person needs to know: Gross Receipts (aka Gross Sales)  - Think of thi

Do you love getting a jumpstart on filing your tax returns? Some of us have a real need to be organized and make sure our tax returns are completed as soon as possible - if for no other reason than to just check it off our list. Others aren’t as obsessed about getting it done, but know they’re receiving a refund. Maybe they typically qualify for a refundable tax credit such as the Earned Income Credit (EIC). Or they have over withheld the taxes on their paychecks and want that money back in their own pockets ASAP. After all, the IRS has “borrowed” it for long enough!There’s another group of tax filers too - the ones who are filing for the very first time and are anxious to see what the “tax season” fuss is all about.  If this is you, and you need to know where and how to begin, you’ll get a great start with this info-filled article called Help! It’s My First Time Filing Taxes. It includes the basics like some tax terminology, help with gathering your docs, links to calcu

If you’re in one of California’s affected counties, you now have until November 16, 2023 to file and pay your 2022 taxes. Both the IRS and the State of California have extended this deadline.  It’s automatic and no further extension request is required on your part. According to the IRS, 55 of California's 58 counties (all except Lassen, Modoc and Shasta counties) qualify.  The original decision to extend (previously to October 16, 2023) was due to last winter’s natural disasters in the state. This additional month will provide much needed relief to those still recovering from those events.  As always, TurboTax is here to help!  Reach out and get Expert Advice your way. You can also check out the resources below for more details and assistance. IRS Announcement - For California storm victims, IRS postpones deadline to Nov. 16IRS provides tax relief for California storm victimsWhat are the tax deadline extension for those affected by natural disasters?Last

Did you file a tax extension? Perhaps you needed a little extra time to track down missing tax documents, had an unforeseen life event, or just procrastinated (let’s face it - we all do at times). The reason doesn’t matter, but the deadline to file does! The extension deadline of October 15, 2024 (for 2023 tax returns) is rapidly approaching. The time to file is now!  If you’re still reading this, it’s possible you need a little extra information on how filing an extension might have affected your tax returns. If that’s not you, just jump right into your TurboTax account and finish up your tax returns.  For the rest of you, let’s first make sure there’s a clear understanding of what filing a tax extension really means - just so there aren’t any unexpected “taxing” surprises. Filing a tax extension is a great option if you need a little extra time to file your taxes. However, it’s only an extension of time to file your tax returns, not to pay any taxes owed.  If this is n

UPDATE: On November, 21, 2023 the IRS announced a delay in implementing the $600 threshold amount required to file Form 1099-K . Per the IRS "...the IRS is planning for a threshold of $5,000 for tax year 2024 as part of a phase-in to implement the $600 reporting threshold enacted under the American Rescue Plan (ARP)." For tax year 2023, the original amounts of 200 in transaction or $20,000 in revenue for the year remain in place as the phase-in to $600  threshold progresses. If you receive money through an app (and most of us do), you might be surprised to receive a new tax form. It’s called Form 1099-K and they’re “all the rage” right now! If you have no idea what this form is, let me fill you in!  Prior to 2024, payment platforms and apps such as PayPal, Venmo, CashApp and many others were only required to send a Form 1099-K to their customers who exceeded 200 transactions or over $20,000 in revenue for the year.  Starting in tax year 2024, you’ll receiv

What a relief! Your taxes have been filed and you’re so happy that’s over with!  But wait - you might not be done quite yet. After you file there are a few things you should do to be sure that what happens next goes smoothly. Did you print or save a PDF copy of your tax return(s)? This is more important than you might think. You’ll need them to help you complete future tax returns, purchasing a home, and applying for financial aid. If you get audited or if they need to be amended, you will absolutely need a copy for those reasons too. Make sure to print or save a copy as soon as you finish filing. And keep them for a minimum of three years - seven years is better! Have you confirmed that your tax return has been Accepted? Being Accepted means that the IRS and/or state tax authorities have your return and can begin to do their job of processing them. You’ll receive an email from TurboTax telling you if they’ve been Accepted or Rejected within a few days from when you submit your ta

Have you wondered how to avoid paying taxes on your crypto transactions? There’s only one sure way to not create a tax situation with cryptocurrency - buy it and never do anything with it - ever!  Almost anything else you do with your “digitals dollars” will result in a requirement to report it on your tax return.  As a matter of fact, the IRS has a specific crypto question on your tax forms that you must answer. This is how the IRS Form 1040 question reads with regard to digital currency: “At any time during 2022, did you: (a) receive (as a reward, award, or payment for property or services); or (b) sell, exchange, gift, or otherwise dispose of a digital asset (or a financial interest in a digital asset)?”  Whew! Let’s just say that covers pretty much everything you would do with cryptocurrency, except buying it. Even though we know the IRS is serious about getting their share of your digital profits, there is still much confusion about what needs to be reported. As sta

Is your head spinning and are your palms sweating just thinking about doing your taxes for the first time? It’s a daring undertaking for a first-timer! Be brave, you can do this and we’re here to help!You know the IRS is anxiously awaiting your year-end numbers, but you can rest assured knowing you’ve already made a smart decision. You came to the right place - TurboTax is not going to let you fail.The key to your successful tax-journey is to be prepared. Before trying anything new, you should start by doing a little research, gathering your “essentials” (income, expenses, financial documents), and organizing it all for easy access as needed.Maybe you didn’t earn very much money, or were told by someone else that you don’t need to file a tax return. In that case, you might be asking yourself if you really even need to file yours. Don’t assume the answer is no - instead make sure that’s the case or you may be subject to late filing or underpayment penalties and interest. The good news i

We get it - that tax refund is your money! You need it, want it, and deserve it! The IRS has "borrowed" your money for long enough. But where is it, and how do you track it? Let’s start by breaking down the filing and refund process, in the simplest way possible. First up, you do your thing! You gather all your income/deduction documents and carefully prepare your tax returns. Or, you have a TurboTax Live Full Service Tax Expert prepare them for you. Your tax return looks good - and even better, you’re getting a refund! Woohoo! You finalize, verify the bank details or how your refund should be sent to you, and submit your tax return (likely by e-filing). Now, tech does its thing! And your return is quickly Accepted or Rejected. It’s your responsibility to keep an eye on your email, or check your TurboTax account, in case there is a rejection. Then correct it and resubmit. Common reasons for Rejected returns are typos in a Social Security Number, last name, or a dependent who was claim

Have you ever heard someone say “We’re having a baby - we get a tax deduction!” or “I hope the baby is born by December 31st, so we can claim them on our taxes!”?  The excitement is real when it comes to those precious little bundles of joy and taxes!   Dependents can give you some fantastic tax credits and deductions.  Which ones and how much is where the confusion comes into play. Let’s see if we can clarify some of the “rules”, maximize your refund, and help you pay less to the IRS! Often there is a misunderstanding between a tax credit and a deduction.  Tax credits are typically better because they can reduce your tax liability dollar-for-dollar, and some are even refundable (you get the dollars added to your refund even if you don’t have a tax liability).  A tax deduction simply reduces your taxable income so you pay less overall tax (you save the percentage of tax for that deduction amount).  Remember, this is merely an overview and TurboTax has

Today President Biden, Vice President Harris, and the U.S. Department of Education announced a three part student loan debt relief plan to help federal student loan borrowers following the pandemic.  The three part plan includes an extension of the pause on student loan payments, debt cancellation, and proposal to create an income-driven repayment plan to help lower future monthly payments. You may be asking “What does the new student loan relief mean to me?” and “How do I get the student loan relief?”.  Don’t worry, we have you covered.  Here is a breakdown of what is in the plan and how you can get student loan debt relief. What is in the Biden-Harris Student Debt Relief Plan? Student Loan Payment Pause The student loan payment pause that was set to expire 8/31/2022 has been extended to Dec 31, 2022 for federal student loans. Note the pause includes suspension of loan payments, 0% interest, and stopped collections on defaulted loans.  You may also see

Today the President signed the Inflation Reduction Act of 2022 into law, which includes new tax provisions, extensions, and expansions of tax benefits related to energy efficiency and healthcare. Here’s what’s included in the Inflation Reduction Act and what it can mean for you and your taxes. Energy Efficient Tax Benefits To help address climate change, a portion of the tax bill will go to consumer home energy rebate programs and include the Clean Vehicle Credit, the Alternative Fuel Vehicle Credit, and energy credits for your home. Clean Vehicle Credit Before the Inflation Reduction Act people were able to claim a credit of up to $7,500 for the purchase of a new electric vehicle.  Under the new law people still may be eligible for the renamed Clean Vehicle Credit, up to a $7,500 tax credit for purchasing a new electric vehicle and for the first time, people may be eligible for a tax credit up to the lesser of  $4,000 or 30% of the sales price  for buying a used electr

It is helpful to get organized before you start preparing your tax return. Let’s review some of the information that you can gather now to save time when working on your taxes. First, make sure that you have the Social Security numbers and dates of birth for you, your spouse, and your dependents. Next, gather all documents related to your income from wages, investments, state and local tax refunds, unemployment, alimony (if the divorce was finalized prior to January 1, 2019), business or farming, retirement distributions, rental properties, Social Security benefits, the sale of property, and any other miscellaneous sources.  It is also important to gather information regarding adjustments to your income such as contributions to retirement and pension plans, student loan interest payments, contributions to Medical Savings Accounts (MSA), moving expenses, self-employed health insurance premium payments, alimony payments (if the divorce was finalized prior to January 1, 2019), and e