Things you need to have ready for your tax returns 

Tax returns in the United States are the reports filed with the Internal Revenue Service (IRS) or with the state or local tax collection agency containing information used to calculate income tax or other services. However, tax returns are generally prepared using forms prescribed by the IRS or other applicable taxing authority. Therefore, the federal government estimates that about 60% of individuals use paid preparers to complete and also submit their tax returns. 

Your preparer may take information directly from you or ask you to complete a questionnaire and in either way, you will need to even gather time and organize the information. The following are some steps to take before meeting your tax return preparation; 

Choose a preparer 

If you not have a preparer, you should find one and a great way to find a preparer is to ask friends and advisors to make a referral. However, you should always be sure that the person you choose has a preparer tax identification number showing that he/she is authorized to prepare federal income tax returns. Also enquire about the fees which are likely depend on the complexity of your return. 

Schedule an appointment 

The sooner you meet your preparer, the sooner you can begin the process. It is therefore important to act promptly if you anticipate a refund so you can receive money promptly. However if you wait for so long to schedule an appointment, you may not get to see your preparer. 

Gather your information returns 

You should gather your information on various types of returns that you need. Where, for each form, you should verify that the information matches your own records. Here are some of the most frequently encountered forms: 

  1. Form W-2 if you have a job 
  2. Form SSA-1099 if you received social security benefits 
  3. Various 1099s to report income 

Get your receipts together 

The receipts you need depends on whether you choose to itemize your personal deductions instead of claiming the standard deductions. You can therefore choose to itemize if this produces the greater write-off. For itemizing, get receipts together by whatever system used throughout the year to retain receipts for various deductive expenses. 

Gather records for charitable contributions 

If you had made donations to charity and itemize your deductions, you need to specify records to claim any write-off 

Brace yourself for tax law changes 

You do not have to become a tax expert but it helps to know about new tax rules so you will not be caught off guard. The individual health care requirement brought a series of changes, including new premium tax credit claim forms for eligible persons who have purchased coverage through a public marketplace. Find out more in this site: http://www.payrollserviceaustralia.com.au 

Make a list of personal information 

You need to know where to spend the money too so having the following documents will start the tax processing off right; 

  1. Social security number 
  2. Copy of the previous year’s tax return and spouse’s as well(if applicable) 
  3. Bank account number and routing number 

 

5 Common Payroll Mistakes

When a company chooses not to set up a payroll outsourcing system and keeps it in house, not very many consider the potential problems that could arise from one non-intentional mistake. Some of the problems could be the loss of trust from a valuable employee who will choose to leave causing loss of talent. Even more importantly, payroll mistakes can result in massive fines, penalties and payback amounts to the tax to the IRS. Here are the five most common payroll mistakes that you should be aware off and try to avoid. 

Incorrect payroll set-up 

This is one of the most common problems that can go unnoticed. Even if you are entering all the information correctly and making sure that all employees are paid their dues on time, a little mistake in the registration of the company or an error in the number under which the employee is registered can make the difference between a clear and perfectly legal payroll outsourcing and huge fines and fees. 

Not recording a cheque 

Any payments made to an employee need to be recorded accurately and on time. Not recording that can cause a hole in the balance and a bigger problem in tax returns. Many owners especially in small companies tend to give cheques quickly by hand sometimes, especially for bonuses and reimbursements. The problems arise whenever those cheques are forgotten and not recorded. 

Not fully knowing the tax rules 

Once you have paid your taxes and deducted those funds from your employees. You need to wait to receive your tax returns and from the government, you will need to deposit it and make sure that it is processed on time. Depending on your tax liabilities, these rules can vary and you should follow them in order to avoid any further problems. Make sure you know those rules and save yourself and the IRS staff a visit. 

Unemployment insurance 

Remember that you need to keep all the deduction and unemployment insurance up-to-date and those do tend to change often. Failing to update those regularly as they change can result in underpayment and hence cause you problems, penalties and fees. If you find that those problems are recurring you should consider payroll outsourcing as an option. Check here! 

Not running your payroll on time 

Many small companies are rushing to keep everything in order either because of a lack of resources or because of too much work and it does happen on occasions not to run their payroll on time or forgetting about it completely. 

Many small companies have problems because of payroll fraud. Such problems can be a huge financial drain especially on small businesses who are struggling to start up. Those mistakes are easily avoidable and can save the business by keeping the good employees around. It can also save the company much needed money that can be invested in expanding the business. If these problems continue to occur, you may want to consider looking into one of the many payroll services Australia has to take over that for you and save you all this trouble. Check this: https://payrollserviceaustralia.com.au, if you want to know more about payroll putsourcing.