Metropolitan Accounting Associates receives questions from time to time by clients that we would like to share with you. If you have a question, please give us a call.
FREQUENTLY ASKED QUESTIONS:
How do I know if I have to file taxes?
In general, you should file taxes if you meet any of the following and
your filing status is:
Single you are under 65 and your gross income was at least $9,500.
Single you are 65 or over and your gross income was at least $10,950.
Married filing jointly, you are under 65 and your gross income was at least $19,000.
Married filing jointly, you are 65 or older and your gross income was at least $20,150.
Married filing separately at any age and your gross income was at least $3,700
Head of household you are under 65 and your gross income was at least $12,200.
Head of household you are 65 or older and your gross income was at least $13,650.
Qualifying Widow you are under 65 and your gross income was at least $15,300.
Qualifying Widow you are 65 or older and your gross income was at least $16,450.
If you had any taxes withheld from your income, even if you don’t meet the requirements to file, you should file a tax return to get a refund of any of your taxes.
Are grants, fellowships and scholarships taxable income?
In general, if they are received for anything other than tuition and fees they are considered taxable income. Summer grants, fellowships and scholarships received during periods of non-enrollment are considered taxable income. This is true regardless if the University sends you a tax statement or not.
If my spouse and I file married filing separately, can we choose who itemizes and who does not?
No, if one spouse itemizes deductions then both spouses must itemize. This is true even if this leaves one spouse with no deductions.
If we can’t pay the taxes we owe, can we file an extension and not have to pay the balance due until the extension due date and not have a penalty?
No, an extension is not for monies due. It is merely an extension of time to get all your records in order. You are required to pay the balance you estimate you will owe with your extension. If you still owe a balance when you file your return and it is more than $1,000, a penalty will be added into your balance owed. Penalty and interest begin at the initial due date of April 15th.
How long do I need to keep my tax papers?
You are required to keep your tax records for three years from the date you actually filed the return. For example if you filed on April 15, 2012 for the 2011 tax year, then you must keep your records until April 15, 2015. Any records such as a purchase or sale of real estate or stocks should be kept until three years after the sale is filed with your return.
I have a small business. Can I claim the mileage I drive and Do I need to keep track of it?
The IRS has become very strict on the allowance of mileage. You need to keep a record of your beginning and ending mileage for the year and a log throughout the year detailing where you went, the reason and the mileage for the trip.
If I move, do I need to notify the IRS?
Yes, the IRS needs to be notified. Depending on when you move will depend on the proper timing for notification. The form 8822 can be filed with your return or can be mailed in separately.
Are all charitable contributions deductible?
No. Charitable contributions must be made to a qualified non-profit organization. Donations made to individuals are not deductible. You are required to get a receipt from the organization for items donated and if cash, either a receipt from the organization on their letterhead or a copy of your cancelled check with the organization as the payee.