The top 5 tax questions you need to know the answer to

When you are filing your taxes on your own, you can feel challenged and overwhelmed at the same time. Whether you are using software or filing the tax documents manually, you need to take your time when doing it to avoid making mistakes.

Some people procrastinate on the idea of filing taxes because the tax codes are hard, and always keep changing. There are usually issues that arise every tax filing season, which brings up more confusion.

There are some common questions which people are concerned about, and tax attorney Dayton will help answer them.

1. How much should you make to file taxes?

Many factors come into play when deciding whether or not you should file your taxes. Your age, filing status, and income are all important factors. Say, for example, you are under 65 years of age or single, you will not be required to file federal taxes. The IRS has a tool which will help you make a decision on all this information.

Situations change in life, and some of them are beyond our control. Even if you feel that you are not in a position to file tax returns, it is a good idea to file a nil return. Approximately 70% of Americans should file their returns, but most of them never do it. As a low-income earner, there are deductions and credits which make it easy for people to make a tax refund.

2. When can you file taxes?

There is usually a time allocated by the IRS for filing returns. Once you miss that deadline, there is usually a penalty which you will be charged. There is no need for that. Always aim to do it early to avoid the last minute rush, which everyone usually waits for. There is usually an online system where you can do it before the 23rd of January 2018, to file for returns of the previous year.

When using mail, your payment and return should be postmarked before the 18th of April. Usually, during tax season, there are post offices which stay open until late hours.

When you are filing your tax returns online, the IRS has a free electronic funds withdrawal option. You can pay your taxes either using your debit or credit card.

3. How long does it take to get a tax refund?

Many fraudsters exist in today’s world. That is why the IRS is taking some time to check the information submitted by a filer. Usually, refunds are issued within 21 days of getting the return. The IRS has put in more measures to avoid identity theft and new refund fraud.

You can check the status of your refund online but not through your phone. This information will be available within 24 hours of filing online or after four weeks if you do it via post. To keep track of your return, you will need your social security number and the exact figure of the return.

If you want it done quickly, file your returns electronically and pick a direct deposit as opposed to getting a check in your mail.

4. How do I file a tax extension?

For those people who like doing things the last minute, it is advisable to apply for a tax extension. What this means is that you will still have to pay the taxes you owe but with an extension of six months. There is usually a penalty of 5% of the taxes you haven’t paid for every month or part of the month you have been late.

5. Who counts as a dependent?

For couples who are not married, one major question they ask themselves is whether they should claim their boyfriend or girlfriend as a dependent. In some instances, it is possible. There are also other exemptions for claims such as relatives and elderly parents.

If there is no relation, the person you are claiming should have stayed with you for a full year and should not be making more than $3,950.