Tax Tips

If you’ve always been an employee and are just starting out on your own, you’ve probably started to hear more about this “quarterly taxes” thing. And with good reason and it’s something you need to take seriously for sure.

Here are a few reasons why you may need to make estimated quarterly tax payments:

• Your employer doesn’t withhold taxes and you incurred a tax liability from the prior year.

• If you expect to have to pay more than five hundred dollars at tax time and you are filing as a corporation.

• If you owed taxes more taxes from the previous tax year

• If you file as a Partnership, an S-Corp, or as a sole Proprietor, and you project to owe more than a thousand dollars in taxes at the end of the year.

To file quarterly taxes, you’ll need to use form 1040-ES. The dates for filing and their related quarters are:

• Jan. 1 – March 31: Due April 15

• April 1 – May 31: Due June 16

• June 1 – August 31: Due September 15

• Sept. 1 – Dec. 31: Due January 15 the following year

In 2013, the IRS launched a new method for claiming a deduction for the work-from-home workforce. Find out if it’s right for you!

Technology has driven the sharp rise in the remote workers over the past decade. This rise has also hugely increased the amount of paperwork for all involved: the worker, the tax preparer and the IRS. Claiming the deduction for working from home means tracking expenses, keeping tons of receipts, and then doing some math to figure out just what percentage of those expenses went to the home and what went to the business.

The new method for claiming the home office tax deduction is simply this:

1. Measure the square footage of your home office.

2. Multiply it times $5.

Home Office Square Feet x $5 = Deduction

One thing to note though is that the deduction maxes out at $1,500. This may not be as financially advantageous as the other (old) method might be.

For example, if your home has a low square footage of 900 and your mortgage/rent is $2,900 and your home office space is 180 sqft, using the new more simple method would only equate to a $900 deduction. The old way would be a deduction of $6,960! The older style of deducting is more work and more paper trails, but this is a case of getting what you pay for in a way.

Now, if you have a ton of square feet and low mortgage/rent (good for you), it may make more sense to go with the simple method. The new method is also a great option for those out there that have not been tracking expenses and saving receipts.

Call us with us with any question you have about your tax situation!

If you incurred a significant amount of healthcare and dental cost costs last year, you may be eligible for a deduction when making your itemized deductions.

There are several things that you can deduct provided your healthcare costs were over at least ten percent of your yearly gross income:

• Surgeries
• Hospital Stays
• Prescriptive Eyewear
• Prescription Drugs
• Doctor Visits (including therapists and medical counsellors)
• Travel Costs (if you had to travel for a specific treatment)

Note that the above is not a complete list, you can check out Publication 502 on the IRS page. It’s also important to note that the costs are the costs you incurred and not the total costs. For example, if your insurance company paid a portion of the bill, that costs the insurance company paid are not eligible.

We’re more than happy to make sure that you qualify for claiming medical expenses. It’s always best to have tax professional like us assess your unique situation so you don’t end up missing out on deductions you’re eligible for as well as deductions you’re not eligible for.