Jacobs Nones & Company, CPAs

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https://lnkd.in/gXnNTG_R

Tips for Calculating your Quarterly Estimated Taxes

Tips for Calculating your Quarterly Estimated Taxes

Filing a Personal Income Tax Amendment What You Need to Know Sometimes, people make mistakes on their tax returns. The good news is that you can fix these errors by filing a tax amendment using Form 1040X. Here's what you need to know about amending your taxes: Why File a Tax Amendment? You might need to file a tax amendment for several reasons: 1)????To correct mistakes on your original tax return 2)????To claim deductions or credits you missed 3)????To report changes in your filing status (like getting married) 4)????To report income you forgot to include 5)????To respond to an IRS notice or audit How to File a Tax Amendment 1)????Get Form 1040X from the IRS website. 2)????Gather your original tax return and any new documents you need. 3)????Fill out Form 1040X, explaining what you're changing and why. 4)????Submit your amendment either electronically or by mail. Important Things to Remember ·????You usually have three years from the original filing deadline to amend your return. ·????If you're expecting a refund from your original return, wait until you get it before filing an amendment. ·????The IRS takes about 8-12 weeks to process amended returns. Filing a tax amendment can help you fix errors, claim missed deductions, and avoid problems with the IRS. If you're unsure about how to amend your taxes, it's a good idea to ask a tax professional for help.

IRS announces tax relief for victims of Hurricane Helene; various deadlines postponed to May 1, 2025 The IRS has announced tax relief for people and businesses in parts of Florida affected by Hurricane Helene, which started on September 23, 2024. They now have until May 1, 2025, to file various federal tax returns and make tax payments. This relief applies to people and businesses in 41 Florida counties that FEMA declared as disaster areas. It also includes those affected by Tropical Storm Debby who had earlier deadlines. The new deadline of May 1, 2025, applies to: -Individuals who had an extension to file their 2023 tax return by October 15, 2024 - Businesses with deadlines during this period, including corporations - Quarterly estimated tax payments - Payroll and excise tax returns The IRS will not charge penalties for late payroll and excise tax deposits due between September 23 and October 8, 2024, if they are made by October 8, 2024. If you get a notice about late filing or payment penalties for deadlines during this time, you can call the IRS to have the penalty removed. For more information, refer to the following link:? https://lnkd.in/eGXvqMkx

Understanding Freelancers and Employees: Tax and Financial Differences When businesses grow, they often face a choice between hiring employees or working with freelancers. This decision has important tax and financial implications that can affect a company's bottom line. Let's explore the key differences between these two options. Freelancers: The Independent Workers Freelancers, also known as independent contractors, offer businesses flexibility and specialized skills. When working with freelancers: -You don't withhold taxes from their payments -Freelancers are responsible for their own taxes -You can deduct payments to freelancers as business expenses This arrangement can be cost-effective for short-term or specialized projects. Employees: The Core Team Hiring employees provides stability and consistency for long-term business needs. With employees: -You must withhold federal and state taxes, where applicable, Social Security, and Medicare from their paychecks -You pay a portion of Social Security and Medicare taxes (7.65% per employee) -You may offer benefits like health insurance and retirement plans, which are tax-deductible Making the Right Choice Consider these factors when deciding between freelancers and employees: -Project duration and specialization -Long-term business goals -Administrative responsibilities -Cost considerations Freelancers often have lower upfront costs, while employees offer more control and consistency. The Importance of Proper Classification Misclassifying workers can lead to serious consequences: -Penalties from the IRS -Expensive lawsuits -Potential jail time in severe cases The IRS defines employees as workers whose tasks and schedules you control. Freelancers, on the other hand, have more autonomy in how and when they complete their work. Penalties for Misclassification If you incorrectly classify workers, you may face penalties such as: -$50 for each incorrect W-2 form -1.5% of wages -40% of unpaid FICA taxes -0.5% of unpaid tax liability per month, up to 25% Conclusion Choosing between freelancers and employees is a significant decision that affects your business's finances and operations. Consider your company's needs, growth plans, and financial situation carefully. If you're unsure about the best path forward, consult with a tax professional for guidance. Remember, proper classification is crucial not only to avoid penalties but also to take advantage of financial benefits for your business. By understanding these differences, you can make informed decisions that support your company's success.