FAQ's for Income Tax

IMPORTANT NOTE: The information found on this website is general in nature and may not apply to the reader's situation. Therefore, the reader should not rely on the information on this website alone. For specific advise, please call us at Charles H. Enders, Jr. CPA. Thank you.

Q. Can I deduct student loan interest?
A. Since personal interest is generally non-deductible must meet several tests: You must be the person liable on the debt and the loan must be for education only. Your income can't exceed $130,000 on a joint return or $65,000 on a single return; married couple filing separately can't deduct. You can't deduct if you're claimed as a dependent.

Q. Do I need to visit your office to have my taxes prepared?
A. It is not necessary to visit our office. Many clients utilize the mail or express services to send their information to us. For new clients, we encourage a meeting so that we can discuss your unique tax situation.

Q. Can I ever save tax by filing a separate return instead of jointly with my spouse?
A. You sometimes may benefit from filing separately instead of jointly. Consider filing separately if you meet the following criteria: One spouse has large medical expenses, miscellaneous itemized deductions, or casualty losses. The spouses' incomes are about equal. Separate filing may benefit such couples because the adjusted gross income "floors" for taking the listed deductions will be computed separately.

Q. How are Limited Liability Companies (LLC) taxed?
A. A single-owner LLC defaults to being taxed as Sole Proprietorship. Income/loss from the LLC is reported on the owner’s personal income tax return. A multi-member LLC defaults to being taxed as a Partnership. A Partnership tax return must be filed. The profit or loss is then reported on the owner’s personal tax return. Any LLC can elect to be taxed as a corporation. To do so, one must file an election within 75 days of creating the LLC.

Q. Is there any non-tax record that I should keep?
A. There are other records you should keep, even though they don't appear to have any use for your tax returns. Family documents, certain medical records, insurance policies, records of major purchases, are just a few examples. These documents will be needed in the case of any emergency that may arise.

Q. Should I keep my old tax returns? If so, for how long?
A. Yes, you should keep your old tax returns for at least 7 years. When a return contains information pertaining to the basis of property owned, it should be kept until that property is sold. One of the benefits of keeping your tax returns from year to year is that you can look at last years return while preparing this years. If you do throw out an old return you may fill out form 4506, Request for Copy or Transcript of Tax Form, and send it to the IRS service center where you filed your return.

Q. What is the standard mileage rate?
A. The standard rate is 53.5 cents/mile in the year 2017. The rate was previously 54.0 cents/mile for 2016,

Q. What is the annual gift tax exclusion?
A. The annual exclusion is $14,000 per individual,

Q. How can I pay my taxes by credit card and which credit cards are accepted?
A. Credit card payments can be made by phone (1-8002PAY-TAX or 1-888-ALLTAXX, toll free) or Internet (www.officialpayments.com or www.1888ALLTAXX.com) using Discover, American Express, or MasterCard. You will be provided a confirmation number at the end of the payment transaction and your credit card statement will provide confirmation of your electronic payment. The payment and return are reconciled based on the social security number entered and type of tax selected during the transaction.

Q. Is the IRS storing credit card information?
A. No. IRS does not have access to credit card numbers or directly participate in the credit card transactions. The IRS relies on private credit card processors to verify the validity of the card and line of credit. The processors forward the appropriate tax payment information to the IRS.

Q. Is there a fee charged for using by credit card to pay my taxes?
A. The company that processes your credit card payment charges a convenience fee. You are informed of the convenience fee amount before you authorize the payment. The fee is in addition to any charges, such as interest, that may be assessed by your credit card issuer.

Q. What do I gain by using IRS e-file?
A. Accuracy! Security! Electronic Signatures! Proof of Acceptance! Fast refunds with direct deposit! Electronic Payment Options! Federal/State e-file! Only IRS e-file offers these advantages.

Q. What is an Authorized IRS e-file Provider?
A. An Authorized IRS e-file Provider is a tax professional or firm who is accepted into the IRS electronic filing program. One type of Authorized IRS e-file Provider is an Electronic Return Originator (ERO). An ERO is a person or firm that taxpayers entrust with tax information for the purpose of filing income tax returns electronically to the IRS. Charles H. Enders, Jr. CPA is an ERO.

Q. Do I really get my refund faster?
A. With IRS e-file you get it back in half the usual time. It's even faster and safer if you have your refund deposited directly to your bank account in as few as 10 days. ask you Authorized IRS e-file Provider for the estimated date of depositQ. Should I wait until April 15 to file electronically if I owe taxes?

Q. Should I wait until April 15 to file electronically if I owe taxes?
A. No. You can e-file your return as soon as it is completed. Then send your payment in on or before April 15. Charles H. Enders,Jr. CPA will give you a payment voucher and addressed envelope to make sure it goes to the correct IRS center.

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