Understanding Tax Withholding Federal income tax is a “pay-as-you-go” tax, meaning that taxpayers pay the tax as they earn or receive income throughout the year. Employers generally withhold income tax from their employees’ paychecks and remit it to the IRS on their behalf. At the end of the year, the employer sends the employee a … Read more
The Internal Revenue Service (IRS) plays a crucial role in the U.S. tax system, ensuring compliance and collecting revenue. When taxpayers encounter difficulties fulfilling their tax obligations, the IRS initiates a series of communication processes, including the issuance of notices. These notices serve as official reminders and provide essential information regarding outstanding balances, payment options, … Read more
Yes, taxes can be taken out of Social Security checks. If you are receiving Social Security benefits, you can request that the Social Security Administration (SSA) withhold federal income taxes from your monthly benefit payment. This can help you avoid owing a large tax bill when you file your annual tax return. Who should have … Read more
Property taxes are a significant expense for homeowners, and they can be especially burdensome for those on a fixed income or with limited financial resources. The good news is that there are a number of steps you can take to lower your property taxes, including: 1. Get a copy of your property tax card. Your … Read more
The Internal Revenue Service (IRS) has issued a stern warning to taxpayers about a recent surge in IRS-themed text message scams designed to pilfer personal and financial information. These scams, known as “smishing,” have proliferated in recent months, prompting the IRS to urge vigilance and caution. Modus Operandi of Smishing Scams Smishing scams typically involve … Read more
Navigating the Complex Landscape of Homebuyer Tax Credits The prospect of purchasing a home can be both exciting and daunting, especially when it comes to navigating the complexities of tax credits. In 2020, the tax landscape for homebuyers underwent significant changes, leaving many wondering if there are any tax credits available to ease the financial … Read more
What is an Offset? An offset is a debt collection method where the federal government intercepts a taxpayer’s federal income tax refund to satisfy an outstanding debt owed to a federal or state agency. This process is administered by the Bureau of Fiscal Services (BFS), a division of the U.S. Department of the Treasury. How … Read more
As a self-employed individual, you’re responsible for paying both the employee and employer portions of Social Security and Medicare taxes, known as self-employment taxes. These taxes are calculated at a rate of 15.3% on your net income, which is your total income minus any allowable business deductions. To ensure you have sufficient funds to cover … Read more
Understanding your tax bracket is crucial for effective financial planning and budgeting. This guide will delve into the tax implications of an $85,000 salary in Colorado, using data from reputable sources like TaxAct and Talent.com. Tax Brackets and Calculations Tax brackets are income ranges that determine the percentage of your income subject to taxation. In … Read more
The Canada Revenue Agency (CRA) is responsible for administering tax laws and ensuring compliance among Canadian taxpayers. A common question that arises is: “Does the CRA know how much money I make?” This guide will delve into the various methods the CRA employs to obtain information about your income and how this knowledge impacts your … Read more