Tag Archives: tax returns

Many changes to 2019 tax forms!

Many changes to 2019 tax forms!

I recently previewed the initial release of the 2019 income tax forms. Many of the forms have undergone design changes. There are new lines on existing forms, as well as several new forms that taxpayers may need to complete. For example:

  • The most obvious change taxpayers will notice is the form 1040 no longer fits on one page. The 2019 version is now 2 pages.
  • The 2018 schedule 2 and schedule 4 have now been combined into a revised 2019 schedule 2.
  • The 2018 schedule 3 has been merged with the 2018 schedule 5 into a new 2019 schedule 3.
  • The form 8867 has been expanded even more for taxpayers claiming the Earned Income Credit, the Child Tax Credit or the College Tuition credits.
  • There is a new tax form for senior taxpayers 65 years and older. It is the form 1040-SR. It is optional if you are a senior. You certainly may continue to file the form 1040 instead.

Some forms have been discontinued:

  • The 2018 Schedule 6 is no longer included in the 2019 tax returns.
  • The Schedule C-EZ has been eliminated for self employed individuals.

There are many other new lines and changes to existing tax forms. What started as a tax simplification process has evolved into anything but. At our office, we are in the process of attending seminars, viewing tax-related webinars, and educating ourselves regarding this year’s changes. It is a challenging process, but we will be ready to guide our clients through the maze of forms and law changes when preparing this year’s income tax returns.

Tax-Related Telephone Scams

Tax-Related Telephone Scams

This week our area has been hit with an increased number of tax-related scam telephone calls. They are starting to sound much more realistic than similar scams in prior years. Usually the caller will identify themselves as a member of an enforcement division of either the IRS or Maryland State Police. They will inform you… Continue Reading

IRS to Audit More Small Businesses!

IRS to Audit More Small Businesses!

The 2018 IRS Forum was a valuable source of information regarding the upcoming tax filing season. Among the many tidbits I gleaned were issues of IRS concern relating to small businesses. The IRS has announced they are going to scrutinize such things as: personal use of the business assets such as cell phones and laptops,… Continue Reading

Do You Need to File a Form 1099 Misc?

Do You Need to File a Form 1099 Misc?

A Form 1099 Misc should be filed for every unincorporated vendor or contractor who you paid $600 or more during the calendar year 2017. The amounts to be reported are for services only. If you paid someone for products and services, only the labor charges are to be reported in box 7 of Form 1099… Continue Reading

Biggest Audit Risks for Business Owners

Biggest Audit Risks for Business Owners

The Schedule C for an unincorporated business and the Schedule F for farming activities are the forms MOST AUDITED by the IRS! The IRS has published the following list of issues they scrutinize when auditing the Schedule C and the Schedule F: Lack of record keeping for automobile use – no mileage logs. Personal phone… Continue Reading

Would Your CPA Approve of How You Organize Your Files & Receipts?

I recently met with a contractor who had very organized files. You could tell he spent a lot of time assembling his receipts. The problem: they were organized in a manner that was not efficient for preparing a tax return. Instead, the gentleman had organized his records by vendor. The solution: The income tax return… Continue Reading

How Do I Handle My Mother’s Estate?

QUESTION: Dear Taxman – I am the administrator of my Mother’s estate. All she owned at the time of her death was her car, her house and a few investments which were all sold at a loss. Am I required to file an estate income tax return? ANSWER: Dear Reader – An estate tax return, form… Continue Reading

Do I File A Return If My Business Had More Expenses Than Income?

QUESTION: Dear Taxman – This summer I started a lawn mowing business and made about $3,000 mowing grass. However, my expenses were more than my income. Do I need to report it on my tax return? ANSWER: Dear Reader: The IRS requires all business income to be reported when you file your tax return. You… Continue Reading

Claiming Dependents

QUESTION: Dear Taxman – My Daughter graduated from college in May of this year. She started working in September and expects to make about eleven thousand dollars this year. Can we still claim her as a dependent for this year? ANSWER: Dear Reader: To claim her as a dependent in any year, she must have been a… Continue Reading

How Long Do I Keep Tax Records?

QUESTION: Dear Taxman – How long am I required to keep my tax records? ANSWER: Dear Reader – You should save all your income tax records for the current year and six previous years. Certain tax records like your income tax returns should be kept permanently. Property settlement transaction documents should be kept for four… Continue Reading