Liberty Financial Solutions, LLC: We worry about the IRS so you don't have to...
Filing Your Taxes: What You Need To Know...
Filing Your Taxes: What You Need To Know:
With tax season in full swing, here are some important tips to get you started. These are also some of the most prevalent questions that we get asked (especially this time of year).
Here are the most important tips to remember:
1. Know Your Deadlines
The IRS tax filing deadline for most individuals is April 15, 2024.
If you need more time, you can file for an extension (Form 4868), but you must still pay any taxes owed by April 15 to avoid penalties.
2. Gather All Necessary Documents
W-2: If you're an employee, your employer should send it by January 31.
1099 Forms: For freelancers, gig workers, and investors.
1098 Forms: Mortgage interest, student loan interest, or tuition payments.
Receipts for deductions: Medical expenses, charitable donations, business expenses, etc.
3. Maximize Deductions & Credits
Standard vs. Itemized Deduction: The standard deduction for 2024 is:
$14,600 for Single filers
$29,200 for Married Filing Jointly
$21,900 for Head of Household
If your eligible deductions exceed these amounts, itemizing may be beneficial. However, it's often difficult to meet these thresholds.
Tax Credits: Some important credits to be on the lookout for are:
Child Tax Credit (up to $2,000 per child)
Earned Income Tax Credit (EITC) for low to moderate-income earners
Education Credits (American Opportunity and Lifetime Learning Credit)
Energy Tax Credits (for solar panels, energy-efficient home improvements)
4. Report All Income
The IRS receives copies of your tax documents (W-2s, 1099s, etc.), so ensure all income is reported accurately to avoid an audit. Also, they are really scrutinizing income reported on 1099-K's. If you receive a 1099-K, make sure that you report the amounts on your tax return exactly as they appear on your 1099-K.
5. Take Advantage of Retirement Contributions
This is more of a "tax-planning," issue to be considered going forward, but nevertheless:
Contributions to Traditional IRAs and 401(k)s can lower your taxable income.
For 2024, the IRA contribution limit is $7,000 ($8,000 if age 50+).
The 401(k) contribution limit is $23,000 ($30,500 if age 50+).
6. Check for New Tax Law Changes
The Clean Vehicle Credit allows up to $7,500 for qualifying electric vehicles purchased in 2023 and 2024.
Higher Social Security thresholds may impact retirees' tax bills.
The Student Loan Forgiveness Exclusion applies through 2025.
Dallas-Fort Worth CPA
7. Watch Out for Tax Scams
The IRS never initiates contact via phone, email, or social media. Only after you are working with someone at the IRS will they reach out to you via telephone.
Avoid tax preparers who promise huge refunds or charge fees based on refund amounts. Anyone who promises you a refund or certain amount without knowing anything about your tax situation is not to be trusted.
8. E-File and Choose Direct Deposit
E-filing reduces errors and speeds up refunds.
Direct deposit is the fastest way to receive your refund.
The IRS aims to issue refunds within 21 days for e-filed returns with direct deposit.
9. Pay Taxes Owed to Avoid Penalties
If you owe taxes, pay as much as possible by April 15 to avoid late penalties.
Consider setting up an IRS payment plan if you can't pay the full amount.
Reach Out to Liberty Tax Defenders (817) 995-5008!
Please reach out to us at Liberty Tax Defenders (and our subsidiary Horton & Dennis, LLC). We offer free consultations, and we would love to be your CPA or tax professional. To date, we've saved our clients over $1.8 million dollars that the IRS has claimed they owed; and we'd love to do the same for you.
We're here to help!
Cheers!
P.S. Make sure you get your FREE copy of our SPECIAL REPORT: "The 8 Secrets The IRS Does NOT Want You To Know!" (simply click on the link in the previous sentence, scroll down to the second section of our home page, and download your copy today!)
Or, email us at: info@libertytaxdefenders.com for your FREE copy.
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