Phoenix Arizona CPA | Arizona Tax Accountant | Arizona Income Tax

When it comes to taxes, we all want to reduce the amount we have to pay in. All tax planning basically falls to looking at all of your options and keeping organized records throughout the year. With a little forethought, you can lower your taxes. There are some basic ways to minimize your taxes: reduce your income, increase your deductions and take advantage of tax credits. Read the rest of this entry »

When trying to qualify for the earned income tax credit you or your spouse must satisfy the age test if filing a joint tax return. You can not be a dependent of another taxpayer, and are not a qualifying child of another taxpayer.

If married and filing a joint tax return you must include your social security number on your IRS tax return and that of your spouse. Married couples who file separate returns are not eligible for the earned income credit. If you are married, but your spouse did not live in your home for the last six months of the year, you may be able to file as head of household and take the credit. If you are married and file a joint return, you meet this rule if at least one spouse works and has earned income. Read the rest of this entry »

One of the fundamental accounting principles is matching revenue with cost in any period. This is relatively simpler while dealing with items in cost of goods sold, such as purchase of raw materials, supplies, and cost incurred in conversion to finished goods for sale etc. But this becomes more complex while dealing with assets that have longer lives. There are two different types of fixed assets that a company invests in, tangibles and intangibles. Tangible fixed assets are assets such as Buildings, Plant and equipment that have nearly definite lives. In most cases the value of the fixed assets also depreciates over time. At the end of its useful life assets may have a salvage value. This is true for plant and machinery but not for buildings. Although the value of the buildings might increase from year to year, GAAP requires that depreciation be calculated and accounted as an expense. Read the rest of this entry »

You can lower your upcoming tax liability by making the following adjustments during the last quarter in the year. (2007)

1. This year, employers may put up to $15,500 of their pretax income into a 401(k). Next year and the next, you will learn about the new and upcoming tax laws during this same period of time.

2. Will you be celebrating your 50th birthday by the end of the year? You can give yourself an extra $5,000 per year. Contributions for IRA, Individual Retirement Accounts are capped at $4,000 this year and for people 50 or older, $5,000 a year. Read the rest of this entry »

A large number of workers are no longer provided with a work uniform; therefore, many individuals now have to buy their own work supplies. Work clothing that is required, but not paid for by an employer, can be listed as a tax deduction.

Itemizing individual purchases that are tax deducible may seem to be too complicated or take a long period of time, taking the time to itemize tax deductions, like a Self Employed Tax Deduction,  is worth it for many taxpayers. Read the rest of this entry »

One of the frequently over looked deductions is your children. Many home-based business owners hire family members to fill available staff positions.  An advantage or tax benefit of hiring your children is that they will have money to save for college and or their own personal expenses.

Young teens can work in family owned home-based business ventures by answering the phone, taking messages or orders. Typing, filling and answering correspondence are duties that can generally be carried out by a young teenager. Training is key no matter how old or young the staff member is. Read the rest of this entry »

For many people, life’s routines are perceived as a matter of endless work to earn that weekly or bi-weekly pay check to continue paying off monthly debts. At least, that’s how it feels. In reality, though, we work to earn money as a means to an end; basic living. Being able to eat, care for one’s family, maintain a home, and care for the needs of others are some of the most critical concerns of life. Unfortunately, even addressing these basics all require money, so we work long hours. Read the rest of this entry »

The IRS apart from being in charge of pursuing tax collection also takes care of enforcing the internal revenue laws and the internal revenue tax code.

It is always preferable that you are acquainted with at least the basics of Internal Revenue Tax Code since it is always helpful in the long run. The US tax code is known as the Internal Revenue Code of 1986. The Code is complex and sometimes difficult to understand for most of us. The complexity of the code stems from two major factors, firstly the code is generally amended often with new regulations and rules and secondly the use of the tax code for purposes which are not for raising revenue, for which it is meant for in the first place. Read the rest of this entry »

There’s no arguing that taxes on social security are incredibly high. As a matter of fact, according to current tax law, up to 85 percent of a person’s Social Security income is taxable when their total threshold income exceeds a set limit. What is threshold income?

Threshold income is the government’s formula for determining how much of a person’s Social Security is taxable. It is calculated by adding half of a person’s Social Security income with any other income they may have. The following threshold limits determine how much of a person’s Social Security is taxable: Read the rest of this entry »

After many years of having the “tax day” creep up on me, I have finally found a few great guidelines to handling the last minute rush.

1) GATHER THE FORMS YOU NEED. You can get them off the Internet at http://www.irs.gov/formspubs/index.html. Or you can go to the post office or, if you are using Turbo Tax, the forms are supplied with the program.

2) GET ALL YOUR PAPERWORK TOGETHER IN ADVANCE. This includes W-2 and 1099 forms. If you have not received them by January 31, call your company. Don’t forget to save a copy for your files. Read the rest of this entry »