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Don’t Get Suckered: Five IRS Myths Exposed

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5 Biggest IRS myths

Any taxpayer feels a bolt of fear when they look in the mailbox and see correspondence from the IRS, or when they answer a phone call and it is the IRS on the other end of the line. This government agency is the most well known, the most feared, and the least liked out of all the government agencies, and for very good reasons. The Internal Revenue Service has a variety of powers, and this agency can make the life of any taxpayer miserable when the taxpayer does not comply or understand their rights.

The IRS uses fear, exaggeration, and intimidation as scare tactics so that taxpayers comply without protesting or consulting a qualified and experienced tax attorney. There are a number of myths and false strategies that are widely available which many tax payers believe, and hopefully this article will correct this inaccurate information and expose the truth about the IRS and what this agency can do.

Myth 1: The IRS Only Audits High Income Earners

Fact: If you are a high income earner then you have a higher risk of being audited by the IRS but even low income earners may be audited in any given year. Every single tax return that is filed for the year has the possibility of being audited, no matter how simple the return may seem or how low the income reported is on the tax return. If you assume that this government agency will not audit you because of your lower income then you could be creating future IRS problems and tax disputes for yourself in the future.

Myth  2: You Can Not Avoid Paying Your Tax Bill In Full

Fact: The IRS wants every taxpayer to pay off the full amount that this agency claims is owed, and IRS agents will not usually be quick to explain that there are alternatives for taxpayers, The truth is that taxpayers have a number of options and programs available to settle IRS tax debts and tax disputes. A qualified tax attorney with experience dealing with the IRS can help taxpayers navigate the paperwork and applications necessary in order to access programs which can assist with resolving tax debts for less than the full amount.

Myth 3: Ignoring the IRS and Dragging Your Feet Will Make the IRS Go Away

Fact: This is a strategy that many taxpayers use, but it will not help resolve a tax debt and it is a big mistake. Ignoring this powerful government agency will not cause them to go away, it will only compound the problem and create additional problems, penalties, and interest amounts for the taxpayer. Meet the problem head on, and contact an experienced IRS lawyer for advice.

Myth 4: The Collection Powers of the IRS are Unlimited

Fact: It is true that the IRS is a very powerful government agency, and they have a wide range of options in their attempts to collect a tax debt that is owed. The powers of the IRS are not unlimited though. This agency can freeze accounts, seize assets, and even cause companies to close down,. In serious cases the IRS can even file criminal charges against a taxpayer that could result in jail or prison time if the taxpayer is found guilty. In spite of all these powers there are still rules, regulations, and laws in place that IRS agents must follow. An IRS attorney can help the taxpayer understand the rules, and ensure that the IRS follows them.

Myth 5: Leaving the State or Even the Country Can Stop the IRS

Fact: It is not possible to out run the IRS, this agency will usually find you no matter where you go. You should never underestimate the ability of the IRS to track down a taxpayer who owes a tax debt. Instead of running contact a tax dispute attorney and meet the problem head on.

Don’t Get Suckered: Five IRS Myths Exposed is a post from:


Dallas Tax Attorney Nick Nemeth Publishes New Article Exposing IRS Myths

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Dallas based law firm The Law Office of Nick Nemeth founder Nick Nemeth corrects some of the most common myths about the IRS.

Dallas, TX –August 22, 2014- A new article written by Nick Nemeth, who is the founding partner for The Law Offices of Nick Nemeth, has been published online at his website. The title of the article is “Don’t Get Suckered: Five IRS Myths Exposed”, and it covers a number of common IRS myths that many taxpayers may believe.

When contacted Nick Nemeth, renown tax attorney, wrote that  “An envelope from the IRS can cause any taxpayer to be apprehensive. A call from a tax agent causes many people to want to flee or to hide from the problem and the agency.”

It is not an unhappy coincidence that the IRS has a reputation for being the agency of the government that is least popular and most hated by US citizens and taxpayers. There are many powers that the IRS has available to make any taxpayer completely miserable, but this agency also depends on many myths that taxpayers mistakenly believe as well. To make matters worse there are several false tips and incorrect strategies that taxpayers may also believe. The latest article from Nick Nemeth exposes the false information and myths that are out there, helping taxpayers understand what the IRS is allowed to do and what they can not.

1) It is not true that the IRS is unlimited in the ways that they can try to collect from taxpayers. This agency does have many powers that they can use. The IRS can seize property and other assets, take part of your paycheck or other wages with a garnishment, and even freeze any money that you have in a bank account. Sometimes you can even be charged with criminal offenses because of the IRS. The powers of IRS agents must follow a certain due process though, and the agency does have to follow rules and laws that are in place to protect taxpayers. An experienced tax attorney will make sure that the IRS does not cross the line and that your rights are protected every step of the way.

2) Many people believe that it is impossible to avoid paying the amount that the IRS claims you owe or the full tax bill that you have claimed on your tax return. IF every single taxpayer paid all of the taxes that they owed in full the IRS would be one happy agency, but this is not reality. There are alternatives available to taxpayers but the IRS will not advertise these programs to you. A qualified tax lawyer can help you determine your options and alternatives, and even assist you in any necessary paperwork.

3) It is not possible to get away from the IRS by moving to another state, or even relocating to another country, yet many taxpayers believe that they can escape the IRS this way. It is never recommended to try and outrun the reach of the tax man, the IRS will only get more aggressive and you could end up facing a jail or even prison sentence as a result. Remember that as an agency of the US Government the IRS agents can access all of your personal and employment information and find you almost anywhere in the world. A tax attorney who is qualified will help you find a better way to resolve an IRS tax dispute instead.

The Law Office of Nick Nemeth assists taxpayers who have IRS disputes. The legal team of professionals works closely with business owners and individual taxpayers in order to resolve any controversy with the IRS. The complete article can be located here: http://www.myirsteam.com/blog/dont-get-suckered-five-irs-myths-exposed.php

To find out more about The Law Office of Nick Nemeth go to: http://www.myirsteam.com

About Nick Nemeth:

Nick Nemeth has over a decade and a half practicing tax law, and he also writes top selling  publications in his spare time. Nick specializes in protecting people and companies from abusive IRS tactics and methods, and often can help clients pay less while resolving problems with the IRS.

Dallas Tax Attorney Nick Nemeth Publishes New Article Exposing IRS Myths is a post from:

It Doesn’t Have to Ruin Your Life: Four Ways to Minimize the Damage from an IRS Tax Dispute

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Minimize the Damage from an IRS Audit

A tax dispute with the IRS is the stuff of nightmares for almost every taxpayer, causing sleepless nights and making many taxpayers break out in a cold sweat at the thought of this situation. There are many horror stories about the IRS and the abuses that this agency has performed in the past. The odds are at least one friend, relative, or coworker has found themselves in a tax dispute with the IRS and ended up losing money, time, and even sleep because of it.

The IRS can be quite aggressive, this can be seen with firsthand stories and actual cases where this agency has overstepped heir boundaries or with agents who were out of control in attempts to collect a tax debt that they believe is owed. It is important for consumers to understand that you can keep control in a tax dispute with the IRS but only if you act quickly and know what steps to take to keep this type of situation from spiraling out of control. There are strategic mistakes that can make your situation worse, and these should be avoided at all costs.

4 Steps to Take Right Away With Any IRS Tax Dispute

1) Contact an experienced attorney who deals with the IRS on a regular basis, one who understands this agency and the current tax laws very closely. Trying to take on the IRS without an attorney is usually a big mistake, one that can be very costly. The IRS will try to be aggressive, intimidate you, and even bully you into complying with their demands. An experienced tax attorney will not be bothered by these scare tactics though, because the IRS attorney knows the law and the limits of this government agency. An attorney can put the IRS in check for you, providing support and legal advice every step of the way.

2) You should always take care to meet any deadlines. It may be tempting to ignore the issue or bury your head in the sand but this will not make the IRS or any tax debt go away. The IRS is not going to forget about you or disappear. By missing deadlines or ignoring the problem you are making things worse, and you will end up paying more in any interest and penalties that are accumulating.

3) Gather all documents and documentation that you will need and put these in order. When you are involved in any tax dispute with the Internal Revenue Service documentation is critical. The more you can document the data and information on your tax returns and filings the better you will be to defend these filings and be successful in any tax dispute with the IRS. Get all of the documentation for your tax dispute and keep it together in an organized fashion.

4) Only provide what the IRS asks for. Many taxpayers want to show complete cooperation, and this often means turning in more than what was requested by the IRS. When this is done the IRS is given the opportunity to closely examine all of the information and documents provided, not just the information that they asked for. This can complicate the tax resolution situation even further and actually make things worse. Only provide the information and documents that are requested by this agency and nothing else.

No one wants a tax dispute with the IRS, but if one is started it is essential to take action quickly in order to minimize the damage. An experienced tax attorney can help. Contact us today and let us deal with the IRS for you!

 

It Doesn’t Have to Ruin Your Life: Four Ways to Minimize the Damage from an IRS Tax Dispute is a post from:

Dallas Tax Attorney Nick Nemeth Publishes New Blog Offering Tips To Help Taxpayers Manage IRS Disputes

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Lawyer Nick Nemeth, who founded the reputable Dallas law firm of the same name, identifies 4 essential steps that taxpayers who are involved in a dispute with the IRS should take.

Dallas, TX –August 28, 2014- Law firm managing partner Nick Nemeth, a well regarded tax attorney in the renown legal firm in Texas, recently published another blog entry for his website which discusses controversy with the IRS and the ways that taxpayers can handle communications from this agency.

The blog entry has the title “It Doesn’t Have to Ruin Your Life: Four Ways to Minimize the Damage from an IRS Tax Dispute”, and it explains why a tax dispute or controversy with the IRS does not have to devastate your life or make you miserable.

According to tax lawyer Nick Nemeth “Any controversy with the IRS is a nightmare. There are many horror stories concerning abuse by IRS agents out there. You probably know someone who has found themselves suffering because of the actions of the IRS.”

The experienced attorneys at the Nick Nemeth law firm have seen up close how aggressive the tactics, methods, and communications from the IRS may become. It is important for every taxpayer to realize that any IRS dispute can be kept under control, but only if the taxpayer acts quickly and follows the right steps. Far too many taxpayers make errors and commit mistakes in their strategy when they are dealing with the IRS, and this just complicates the matter and makes the situation escalate instead of resolving it. 4 steps that you should take right away when you are involved in an IRS tax dispute are:

1) Only provide the documentation and information that the IRS is asking for, nothing else. Avoid the temptation to give the IRS everything you have or try to overwhelm the agency with receipts and documents that were not requested. This will only provide additional ammunition and more areas for the IRS to examine and evaluate. You will make your circumstances even worse instead of better, and the IRS will not be appreciative.

2) Make sure that you have all of your documents and supporting information together, and in a place where you can get to it and locate each item quickly. Documentation is something that the IRS places a high priority on, and this can be a deciding factor in any IRS tax dispute. If you can show documentation to back up your tax claims then you will be in a much better position, and get a more favorable outcome.

3) Always stick to any deadlines that the IRS gives you. You may be tempted to ignore any communication from the IRS but this will only increase the issues and the penalties. The Agency will not back off, they will continue to use more aggressive methods until they get what they want if you try to ignore them. Pay attention to any deadlines listed in IRS correspondence.

4)  Contact an experienced tax attorney for advice and guidance. You do not want to fight the IRS without an experienced tax attorney because if you try you will probably lose, and your life will be miserable in the meantime.

Nick Nemeth assists taxpayers who have IRS disputes, and his legal team of professional lawyers work closely with business owners and individual taxpayers in order to resolve any controversy with the IRS. The entire article can be seen by clicking:
http://www.myirsteam.com/blog/it-doesnt-have-to-ruin-your-life-four-ways-to-minimize-the-damage-from-an-irs-tax-dispute.php

To find out more go to: http://www.myirsteam.com

About Nick Nemeth:

Nick Nemeth is a lawyer with 15 years of industry experience, and also an author of best selling publications as well. He has worked tirelessly with individuals and also with businesses to ensure that his clients are protected from IRS aggression and over reach.

 

Dallas Tax Attorney Nick Nemeth Publishes New Blog Offering Tips To Help Taxpayers Manage IRS Disputes is a post from:

Don’t Get Sucked In: Five Ways to Avoid a Tax Dispute with the IRS

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5 Ways to Avoid a Tax Dispute with the IRS

Our passion is protecting taxpayers from the life-damaging impact of an IRS tax controversy. We have seen firsthand how devastating IRS disputes can for hardworking people, and we battle the IRS relentlessly to defend our clients and enable them to get on with their life.

But, as a taxpayer, the best way to overcome an IRS dispute is to AVOID it to begin with. In that spirit, today we are going to identify five important steps you can take to stay out of the IRS crosshairs and avoid IRS trouble.

1) Don’t under-report income. Yes, it is tempting to under report income when you are filing your taxes– who doesn’t want to keep more money in their pockets? But the IRS uses a variety of sophisticated methods of detecting income, and it’s very possible that they’ll recognize that you’ve under-reported. And that will lead to a whole lot of pain down the road. It’s just not worth it.

2) Save your supporting documentation. If the IRS is questioning your tax returns, the very first thing they will do is ask for documentation of claimed deductions, tax credits, expenses, and more. If you can’t produce this documentation you may see your tax bill skyrocket, and a messy IRS dispute is likely to follow. Save those documents!

3) Avoid double-claiming dependents. If you claim your children as dependents, but somebody else does too… you’re going to have problems. This includes your children filing their own returns as independents. Ensure that nobody else is claiming your dependents, because if they do, the IRS will consider it a major red flag.

4) Double check your arithmetic and proofread your return. The last thing you want when you are filing your taxes is to give the IRS any reason to look further into your tax return. So avoid careless mistakes  – double check all of your arithmetic to make sure everything adds up. And double check all of the details – make sure you have signed everywhere you are supposed to, spelled your name properly, provided the right social security number, mailing address, and so forth. The extra thirty minutes it takes to proofread everything could save you months and months if your mistake results in an IRS audit.

5) If you are contacted by the IRS for an audit, talk to a tax professional immediately. Every taxpayer dreads the possibility of being audited by the IRS, and for good reason. But if you ARE audited, it’s important to immediately seek professional guidance. The wrong audit strategy can result in a true IRS nightmare, so don’t go it alone.

If you’re facing an IRS dispute, we can help. If you’re not, consider yourself fortunate… and make sure you follow these tips to keep yourself out of trouble!

Don’t Get Sucked In: Five Ways to Avoid a Tax Dispute with the IRS is a post from:

Dallas Tax Attorney Nick Nemeth Publishes New Article With Tips To Help Taxpayers Avoid IRS Trouble

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Nick Nemeth, the lawyer who founded a well known law firm in the DFW areas of Texas, gives readers 5 important steps when dealing with the IRS.

Dallas, TX- September 11, 2014- Attorney Nick Nemeth, who is well known for his role in founding a well known and respected law firm that operates in Dallas, Texas, recently published an article online which shares several helpful tips on how to avoid trouble with the IRS. This article can be found on the home page of his website. The title of the article is “Don’t Get Sucked In: Five Ways to Avoid a Tax Dispute with the IRS” and it can be very helpful for readers because it provides information that is practical and that every taxpayer can benefit from.

According to experienced IRS lawyer Nick Nemeth “Our passion has always been to protect people from the stress that an IRS dispute over taxes can cause. We have firsthand knowledge of the devastation that IRS issues can cause for good people who work hard, and we will fight  the IRS for you at every step, enabling clients to put the past behind them.”

The ideal way for a taxpayer to overcome a tax dispute with the IRS is avoiding this altogether. With that in mind we have identified 3 key steps that taxpayers can use to avoid gaining  attention from the IRS in the first place and avoid any tax dispute with this agency at all.

1) Always report any income that you have, never report less than your full income and all payments that you get. It can be extremely tempting to fudge some so that you pay less in taxes, we all want to have cash in our pockets. The IRS has many sophisticated tools and technological methods to detect any unreported income, and you will usually get caught if you try this. Eventually you will end up owing taxes on any unreported income, and your whole life can be turned upside down in the process. The risks are really not worthwhile, and if you are caught under reporting your income you are in for a world of pain and misery from this government agency.

2) Make sure that you are the only one claiming any dependents that you list on your tax return. A common red flag with the IRS is a dependent being claimed by more than one taxpayer. If you claim a dependent who is also claimed as a dependent on the tax return of someone else then the agency will notice, and each taxpayer who claims the same dependent may become involved in an IRS tax dispute. Keep documentation about who is allowed to claim the dependent whenever possible.

3) Keep track of any documentation that supports your tax claims, deductions, and other factors. If the IRS decides to audit you or has questions concerning your specific tax return then they will want to see documentation for the questioned information, deductions, or other tax claims. If you do not have the documentation that the IRS demands then you could end up owing a big tax bill because your deductions or exemptions were removed. Keep all supporting documents organized and easy for you to access if they are needed.

The Nick Nemeth legal practice assists taxpayers who have IRS disputes. The legal team of professionals works closely with business owners and individual taxpayers in order to resolve any controversy with the IRS. The article in full is located at this link: http://www.myirsteam.com/blog/dont-get-sucked-in-five-ways-to-avoid-a-tax-dispute-with-the-irs.php.

Further information about the practice and associated lawyers is available, please see: http://www.myirsteam.com

About Nick Nemeth:

Nick Nemeth has more than 15 years working as a tax lawyer, and he is also an author as well. Nick  focuses on assisting both businesses and individuals deal with IRS problems head on, eliminating the problems and harassment that this agency can cause. The law firm is located in Dallas and Fort Worth, and specializes in resolving issues with the IRS as well as saving clients money. The Law Offices of Nick Nemeth only handles tax disputes and IRS issues, and one of the most common types of cases seen is delinquent tax returns.

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The IRS Takes Advantage of Taxpayers Who Do Not Know Their Rights

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According to taxpayer advocate and Dallas based tax attorney Nick Nemeth the IRS takes advantage of taxpayers who do not know or fully understand their rights under the US tax code and the current laws. In this situation IRS agents may violate the rights of the taxpayer in the hope that the individual does not realize this is happening. Americans have a set of fundamental rights whenever there is a dispute or even contact with the Internal Revenue Service, but it is up to the taxpayer to know what these rights are so they are aware of it if one of these rights has been violated.

Privacy and confidentiality is critical when it comes to taxpayer information and account details. This government agency is responsible for making sure that all employees keep taxpayer information private and confidential, and that the taxpayer account is only accessed for authorized government reasons. The taxpayer also has the right to be kept informed about their account and any tax liability or IRS actions and decisions that affect the account. This also means that the agency has the responsibility to be clear so that the taxpayer understands what they need to do to comply with agency demands, requirements, and communications.

Every taxpayer who has any contact at all with the Internal Revenue Service has the right to expect a certain level of professionalism and quality customer service according to IRS lawyer Nick Nemeth, an attorney who represents taxpayers with IRS problems. IRS agents should provide prompt service, courteous responses, and assistance which is professional and which provides the proper respect and dignity for the taxpayer. Ay taxpayer who has been treated in a manner that is inconsistent with the taxpayer rights can speak with a supervisor at the IRS to discuss the service that they received. The agency must allow a taxpayer to choose a representative to deal with the IRS on behalf of the taxpayer, and the choice of representative is up to the taxpayer and not the agency.

Nick Nemeth advises taxpayers that the IRS has a responsibility to determine and assess a tax liability that is appropriate and correct. If a taxpayer disputes the agency position then the individual has the right to appeal and challenge the disputed claim. The appeal must be heard by an independent forum, and the taxpayer has the right to take the IRS to court if they feel this is needed as well. The Internal Revenue Service has a responsibility to the taxpayer to provide finality, so that the taxpayer has a clear answer about what is owed, when something is due, and even how long the agency can try to collect on a tax debt.

Tax attorney Nick Nemeth works with taxpayers and provides assistance with IRS tax disputes, and he has helped many individuals and business owners resolve IRS tax problems. Don’t let the IRS take advantage of you. Taxpayers who know about their rights are more likely to prevail in any dispute with the Internal Revenue Service.

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Tax Deduction and Exemption Facts Everyone Needs to Know

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Almost anybody can claim an exemption when they file a tax return. This lowers the amount of taxable income. Some of the top tax deduction and exemption facts that everyone should know include:

  • In addition to a personal exemption for yourself, an exemption is also allowed for each dependent, as long as certain qualifying factors are met. In order to claim someone as a dependent certain criterion must be met. You are almost never allowed to claim your spouse as your dependent. Any dependent claimed must have a valid social security number.
  • Choose to electronically file your taxes. E-file is the most effective way to ensure that you file a tax return that is accurate and complete. There are a number of software programs which can be used. These programs assist in determining the right exemptions for your tax return.
  • A dependent’s return cannot include a personal exemption for the dependent that you can claim. In other words, even if you choose not to claim the exemption for the dependent, he or she cannot claim their own personal exemption on their own tax return.
  • Tax exemptions cut the taxable income you have. There are generally two exemption types of exemptions. One is the personal exemption and the other is the dependent exemption. Each of these exemptions will deduct approximately $3,950 from your income on your tax return for 2014.
  • Typically a taxpayer is allowed one personal exemption for themselves. For those who file married, filing jointly, a personal exemption can also be claimed for your spouse. Anyone filing a married, filing separate, return may be able to claim a personal exemption for a spouse if the spouse did not have any gross income, if the spouse is not filing a tax return for 2014, and the spouse could not be claimed as a dependent on the tax return of another taxpayer.
  • In most cases a married individual cannot be claimed as a dependent if they are filing a joint 2014 tax return with their spouse. Some exceptions do apply, so professional tax assistance may be needed in some situations.
  • The 2014 exemption amount of $3,950 is subject to certain limits on income. IRS Publication 501 can provide further details. If your income amount is subject to the exemption phase out, the amount of the allowable exemption may be reduced or even eliminated.
  • The IRS.gov website offers a tool called the Interactive Tax Assistant which can help taxpayers determine if a person meets the qualifications of a dependent or not.

Anyone who can be claimed as a dependent on your tax return for 2014 may still have to file their own tax return. There are a number of determining factors which include the income amount of the dependent, the marital status of the dependent, and whether or not they owe certain types of taxes.

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Do You Need to File a Tax Return for 2014?

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The IRS tax filing requirements can be very complicated, and Dallas Fort Worth attorney Nick Nemeth often sees clients who have ended up in a dispute with the IRS. The tax code is so complicated that it can be difficult for someone to even determine whether they need to file a tax return for 2014 or not. In some cases it would be beneficial to file a tax return for 2014 even if you have no legal requirement to do so, in order to get a refund and take advantage of certain tax credits. The Law Offices of Nick Nemeth focuses solely on tax issues, and they offer the following tips for taxpayers when it comes to filing tax returns for 2014:

• The general rules for filing a tax return for 2014 cover a number of different areas and factors. Your age, filing status, and even the amount of income that you earned in 2014 will be used to determine whether you have a legal requirement to file a 2014 tax return. If you are self employed, if you qualify as someone else’s dependent, or in certain other situations then you may also be required to file a tax return for 2014.
• If you are eligible for the new premium tax credit for health insurance then you should file a tax return for 2014 even if you owe no taxes. This will allow you to get the credit. Form 1095A Health Insurance Marketplace Statement should be received by the end of February if you need one to file your 2014 tax return.
• According to attorney Nick Nemeth you may also want to file a tax return for 2014 if your employer withheld any federal income tax from your checks in 2014, or if you made any estimated tax payments towards any tax liability for 2014. If you overpaid last year and chose to have your overpayment applied to your 2014 taxes then it would also probably be in your best interest to file even if you have no legal obligation to do so.
• If you had an income of less than $52,427 for 2014 then you may be eligible for the Earned Income Tax Credit, and possibly a tax refund as a result. The 2014 EITC Assistant Tool found at www.irs.gov can help you determine whether you qualify for this credit. If you do then you must file a tax return for 2014 in order to claim it.
• If you are an eligible student then you could qualify for a tax credit that could be worth up to $2,500. This credit is allowed for any taxpayer who is involved in up to 4 years of their post secondary education. Eligible students will be enrolled for at least half time for a minimum of one semester, and this credit can be taken even if you owe no federal taxes.

According to tax lawyer Nick Nemeth there are also other times when you should or must file a tax return for 2014 as well.

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Tax Lawyer Nick Nemeth Offers Tips on Your Taxes If You Receive Social Security Benefits

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Tax lawyer Nick Nemeth offers some great tips that can help you with your taxes if you receive social security benefits. If you are a recipient of social security benefits, a portion of these benefits may be taxable. According to attorney Nick Nemeth many people have questions about their Social Security benefits. This area of tax requirements can be confusing. The following tips from the IRS can help you evaluate whether you owe taxes on the benefits that you received during the year. These tips can also help you identify the best method to file the tax return.

• Any social security benefits received in 2014 should generate form SSA-1099. in the mail. This form is a Social Security Benefit statement that will be mailed. It will show the exact amount of benefits received during the year.
• If the only income that you have for the year is Social Security benefits, they may not be considered taxable. It may not be necessary to file a federal tax return for the year, if this is the case. Income from sources other than Social Security benefits may cause some of the to be taxable.
• The IRS offers a free interactive tool that can help you determine whether the benefits you receive from the SSA are taxable To utilize the Interactive Tax Assistant, visit the IRS.gov website. The tool is available within the site.
• Take advantage of IRS Free File in order to prepare your tax return. It’s best to electronically submit it to the IRS at no cost. Taxpayers who earned less than $60,000 in the year can use brand name software from recognized companies who have partnered with the IRS to deliver this service. The software performs calculations for you and typically walks you through the process step by step to avoid any mistakes. Taxpayers who earn more than $60,000 can file electronically for free by using the Free File Fillable Forms available. Electronic versions replace paper forms offered by the IRS. This option is available at IRS.gov/freefile and is typically best for those who have experience doing their own tax returns.
• One simple way to determine if taxes are owed on Social Security benefits received. Is to Calculate 50% of the benefits received during the year. Add this amount to all the other income. Make sure to include any tax-exempt interest received in the total. Compare this amount to the base amount the IRS gives for your filing status. If the total of all other income plus 50% of your annual SSA benefit is more than the base amount allowed for your filing status, you could owe tax on some of the Social Security benefits.
• In order to determine whether any of your Social Security benefits are taxable you will need to know the base amounts for the different filing statuses.
• If you file married filing separately and you resided with your spouse at any point during the year in question, your base amount is $0.
• If your filing status is married filing jointly, your base amount is $32,000.
• If you file as single, married filing separately and did not live with your spouse at all during the year, qualifying widow or widower with a dependent child, or head of household your base amount is $25,000.

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Organizing Records

Who Should File a Tax Return?

Earned Income Tax Credit

IRS Problems and your Social Security Benefits

IRS Problems and Your Unemployment Benefits


Tips to Start Planning Next Year’s Tax Return

Back to School Tips

Amending a Tax Return

Beyond the Book

Do You Need To File a Tax Return?

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