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July 2021

Child Tax Credit Payments: What You Need to Know

Child Tax Credit Payments: What You Need to Know

Last week, American families began receiving the Child Tax Credit Payments. Have you received yours? Are you familiar with the tools you can use to manage your payments? Keep reading to learn more.

Child Tax Credit Payments: What You Need to Know

The Child Tax Credit Payments are part of the American Rescue Plan, a package of measures geared toward providing financial relief to American families affected by the coronavirus pandemic.

These are monthly payments of $250 or $300 for per qualifying child since July 15 through December 2021.

The dates of the payments are July 15, August 13, September 15, October 15, November 15 and December 15.

Working families will receive these payments if they make up to $150,00 for a couple or $112,500 for families with a single family.

Some Useful Tools

The IRS has created some useful tools to help people get more information about the Child Tax Credit Payments.

For example, if you are not sure whether you qualify for the payments, you can use this online assistant to determine if your family qualifies. All you have to do is to answer the questions that the assistant will show you automatically.  

On the other hand, if you need to update your deposit information, or unenroll to stop getting the payments, then use the  Child Tax Credit Update Portal.

Taxpayers who qualify for the payments but weren’t required to file a 2020 tax return should use the Child Tax Credit Non-Filer Sign-up Tool to report their qualifying children born before 2021.

If you have questions even after using these tools, don’t hesitate to contact our experts. We’ll be happy to answer your questions about this and any other topic related to taxes.  

Contact the Experts at JT Tax Services

Do you need help preparing your taxes? Do you have questions about the Child Tax Credit? At JT Tax Services, we give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

We are located in Oxnard, California. Contact us today by email (info@jttaxservices.com), telephone (805-984-8890), or through our social media accounts on FacebookTwitter, and LinkedIn to schedule a consultation or to learn more about our services.

Have You Checked Your Tax Withholdings? This Is the Right Time to Do It

Have You Checked Your Tax Withholdings? This Is the Right Time to Do It

If your employer doesn’t withhold the right amount of tax from your paycheck, you may have unpleasant surprises when you file your tax return. Luckily, this situation can be easily avoided using a simple online tool.

How to Check Your Tax Withholding

Tax withholding is the amount of money your employer withholds from your paycheck and sends to the IRS on your behalf.  

Checking your withholdings is important because it helps you make sure that the right amount of money is being withheld from your paycheck.  

It’s particularly important to check your withholdings if you experienced an important life change that may affect your taxes, like having or adopting a child or buying a house.

To check your withholdings, all you have to do is use the online tool called Tax Withholding Estimator and follow the instructions below.

How to Use the Tax Withholding Estimator

To access the Tax Withholding Estimator, just click or tap on this link. Before you begin checking your withholdings, make sure to have the following on hand

  • The most recent pay statements for yourself, and if you are married, for your spouse too.
  • Gather information for other sources of income you may have.
  • Your most recent income tax return.

Once you have all this information, click or tap on the button “Use the Tax Withholding Estimator.”

Answer the various questions the system will ask you. If you have questions about specific words, click on the question marks that appear near some technical terms to read an explanation in plain English.  

The process is safe and totally automated. The Estimator won’t ask you to provide any personal information such as Social Security number, address, or phone number.

The Tax Withholding Estimator provides information useful to most taxpayers. If you need help checking your withholdings or if your tax situation is particularly complex, don’t hesitate to contact our experts today.

Contact the Experts at JT Tax Services

Do you need help preparing your taxes? At JT Tax Services, we give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

We are located in Oxnard, California. Contact us today by email (info@jttaxservices.com), telephone (805-984-8890), or through our social media accounts on FacebookTwitter, and LinkedIn to schedule a consultation or to learn more about our services.

Photo of brushes and palette ilustrates blog "Remember: You Must Also Pay Taxes on Income From Hobby Activities"

Remember: You Must Also Pay Taxes on Income From Hobby Activities

Whether it’s knitting, fishing, or reading books, we all need a hobby. However, if your hobby activity is a source of income, then you should make sure to report it on your tax return.

Paying Taxes on Income From Hobby Activities

Let’s begin with some basic definitions. A hobby is an activity you pursue for pure enjoyment, without intentions of making a profit.

While this seems like a clear-cut definition, things are not always so simple. For example, it happens often that people begin selling the products of their hobby. Do they have to report that income on their tax return?

The answer is yes. If you receive income from an activity you carry out with no intention of making a profit, then you should report it on your tax return, specifically on Schedule 1, Form 1040.

On the other hand, any income from for-profit activities should be reported on Schedule C.

When determining whether an activity is a hobby or a for-profit business, the following factors are taken into account:

  • Whether you carry out that activity like a business, and maintain complete and accurate books and records.  
  • Whether the time and effort you put into the activity shows you intend to make it profitable.  
  • Whether you depend on income from the activity for your livelihood.  
  • Whether any losses are due to circumstances beyond your control or are normal for the startup phase of their type of business.  
  • Whether you change the way you carry out that activity to improve profitability.  
  • Whether you have the knowledge needed to carry out the activity as a successful business.  
  • Whether you were successful in making a profit in similar activities in the past.  
  • Whether the activity makes a profit in some years and how much profit it makes.  
  • Whether you can expect to make a future profit from the appreciation of the assets used in the activity.

If you find it difficult to figure out whether an activity is a hobby or a business, don’t hesitate to contact a tax professional. They will help you figure out the tax strategy that better fits your unique situation.

Contact the Experts at JT Tax Services

Do you need help preparing your taxes? At JT Tax Services, we give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

We are located in Oxnard, California. Contact us today by email (info@jttaxservices.com), telephone (805-984-8890), or through our social media accounts on FacebookTwitter, and LinkedIn to schedule a consultation or to learn more about our services.

Beware of Charity Scams

Beware of Charity Scams

Scammers have no qualms about taking advantage of your willingness to help, that’s why you should keep an eye out for charity scams. Here’s what you need to know.

How do Charity Scams Work?

A charity scam is the act of asking for money to supposedly help a noble cause, although actually the money ends up lining the pockets of criminals. 

Any natural disaster or catastrophic event that makes the news creates the perfect conditions for fake charity scams.

Needless to say, criminals were quick to take advantage of the concern caused by the coronavirus pandemic, sparking an uptick in scam attempts that has become a major concern for authorities.   

How to Avoid Charity Scams

Luckily, avoiding charity scams is easy if you know how to identify legitimate charities.

If you are interested in claiming a tax deduction after donating money or goods, the IRS online tool Tax Exempt Organization Search will help you determine whether the institution you have in mind is a qualified charity.

Here are other guidelines to help you ward off charity scams:

  • Don’t let anyone pressure you into donating. This is a red flag that should put you on alert. If the other person wants you to donate as soon as possible, chances are that they want to prevent you from doing a thorough research.
  • Before donating ask for the exact name, web address, and mailing address so that you can confirm all this information yourself. Keep in mind that scammers will try to confuse you by using names that are similar to those of reputable charities.
  • Never donate to a charity by buying gift cards or wiring money. This is a well-known scam and no legitimate organization raises funds this way. The safest for you is to make your donations by credit card or check after doing all the necessary research.

Contact the Experts at JT Tax Services

Do you need help preparing your taxes? Do you want to learn more about refunds and credits? At JT Tax Services, we give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

We are located in Oxnard, California. Contact us today by email (info@jttaxservices.com), telephone (805-984-8890), or through our social media accounts on FacebookTwitter, and LinkedIn to schedule a consultation or to learn more about our services.