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How to Avoid Scams This Tax Season

March 9, 2021

The tax season involves gathering and organizing documents, double-checking information, but also avoiding scammers because they never take a day off.

Below you will find the most common types of scams, along with tips on how to protect yourself against them.

“Phishing” Scams by Email

“Phishing” occurs when cybercriminals send emails impersonating the IRS or other trustworthy organization to lure you into providing them with your personal information.

Remember, in some special occasions the IRS may call you or come to your home or business. However, the agency does not initiate contact by email to request personal or financial information.

If you receive an email that you suspect is a “phishing” attempt, don’t reply, don’t open any attached file, and don’t click on any link. You should report “phishing” attempts related to the IRS, the Treasury Department, or taxes to the email address phishing@irs.gov.

Telephone Scams

It’s important to pay close attention to telephone scams because criminals can spoof numbers belonging to the IRS or local agencies in order to appear more convincing.

When criminals contact you by phone, they usually resort to threats to force you to pay a fake tax bill. These are some facts worth keeping in mind:

The IRS does not leave pre-recorderd messages with threats.
The agency does not threaten to deport you or to bring the police immediately if you don’t pay.
The IRS will not call you to force you to pay a supposed tax bill with prepaid cards, gift cards, or wire transfers.
The IRS does not ask for checks to third parties.
With the IRS, you can question or appeal the amount you owe.

If you detect this type of scam, report it to the Treasury Inspector General for Tax Administration, to the Federal Trade Commission, and to the IRS using the emal phishing@irs.gov, making sure to include in the subject line the words “IRS phone scam”.

More Tips About Taxes

Interested in learning more about taxes? Then you’ve come to the right place! Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

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 Facebook, Twitter, and LinkedIn to schedule a consultation or to learn more about our services.

Standard Deduction or Itemized Deductions: What Is the Difference?

By: UNIKO Media Group

February 24, 2021

Today, we talk about a basic tax topic: the difference between standard deduction and itemized deductions. Keep reading to learn more!

What Is the Standard Deduction

The standard deduction is an amount that reduces taxable income. This deduction is adjusted every year and varies according to your filing status.

You can benefit from the standard deduction if your standard deduction is larger than the total of your allowable itemized deductions.

To know how much is your standard deductions and to figure out whether you must detail your deductions, use this interactive assistant made by the IRS.

What Are Itemized Deductions?

In some cases, itemized deductions allow taxpayers to get a larger deduction, but to take advantage of this you must keep rigorous records of your expenses. Also, it’s important to keep in mind that some taxpayers are not allowed to use the standard deduction.

You ca benefit from itemizing your deductions if you:

Had large uninsured medical and dental expenses
Paid interest and taxes on their home
Had large uninsured casualty or theft losses
Made large contributions to qualified charities

Donations

Tax law changes allow taxpayers to deduct cash donations of up to $300 made by December 31, 2020, without having to itemize when they file their 2020 tax return.

If you need help deciding whether you should go for the standard deduction or itemized deductions, don’t hesitate to contact our experts at JT Tax Services. We’ll be more than happy to offer the knowledgeable assistance you need.

More Tips About Taxes

Interested in learning more about taxes? Then you’ve come to the right place! Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

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.

5 Mistakes to Avoid When Filing Your Tax Return

By: UNIKO Media Group

February 10, 2021

With tax season just around the corner, this is the perfect time to review five mistakes you should avoid to make tax filing easier, faster, and more accurate.

1. Basic Information That Is Wrong or Missing

Getting the basics right goes a long way toward filing a precise, error-free tax return. As you prepare your return, triple check to make sure that these fields are included and are accurate:

Social Security numbers: Every SSN on your tax return should appear exactly as printed on the Social Security Card.
Misspelled names: The same principle applies here—all names must appear as written on the Social Security card of the person.
Incorrect filing status: This information indicates whether you were married or single on December 31, 2020, and determines the amount of tax you should pay. To learn more about filing statuses, take a look at this previous post. You can also use the IRS Interactive Assistant to figure out your correct status.
Incorrect bank account numbers: Your routing and account numbers should be accurate, so you can get your refund as soon as possible.

2. Math Errors

Let’s admit it: Math is not everyone’s strong suit. That’s why you should pay special attention to the math on your tax return. Using tax software or working with a professional tax preparer greatly reduces this type of mistakes. However, every taxpayer should always double check the math on their return.

3. Mistakes Figuring Credits or Reductions

There have been many changes to tax law due to the COVID-19 pandemic, so the odds or making this type of mistake are higher than usual. With options available that include earned income tax credit, child and dependent tax credit, and recovery rebate credit, it’s advisable to seek assistance from a professional to determine which are the options you qualify for.

4. Unsigned Forms

This is particularly important because an unsigned tax return isn’t valid. There are some exceptions, as in the case of members of the armed forces or taxpayers with a valid power of attorney. But generally speaking, all taxpayers must make sure that their return is signed.

5. Expired ITIN

ITIN stands for Individual Taxpayer Identification Number, and as its name suggests, it helps the IRS keep track of every individual taxpayer. If your ITIN expired, the IRS will treat it as a return filed on time, but it won’t apply any exemptions or credits. Once you renew your ITIN, the agency will process your return normally.

More Tips About Taxes

Interested in learning more about taxes? Then you’ve come to the right place! Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

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.

Remember: Tax Season Is Almost Here!

By: UNIKO Media Group

February 3, 2021

Tax season begins Friday, February 12! This means that starting from that date, the IRS will accept and process 2020 tax returns. Here are some tips you should keep in mind to ensure that your tax filing experience is smooth, agile, and stress-free.

General Tips

The IRS recommends that all taxpayers consider these tips as they prepare their tax return:

Combining electronic filing with direct deposit ensures that you get your refund as soon as possible.
Don’t count on receiving your refund by a specific date, especially if you plan to use that money to pay bills.
Remember that unemployment compensation is taxable

The Documents You Should Gather

This is the right time to get your tax records in order, so make sure to have all the documents that apply among the following:

Any receipts, canceled checks, and other documents that support an item on your return.
Forms W-2, Wage and Tax Statement
Form 1099-MISC, Miscellaneous Income
Form 1099-INT, Interest Income
Form 1099-NEC, Nonemployee Compensation
Form 1099-G, Certain Government Payments; like unemployment compensation or state tax refund
Form 1095-A, Health Insurance Marketplace Statements

Other Important Tax Dates to Keep in Mind

In addition to February 12, other important dates that taxpayers should keep in mind during 2021 include:

Thursday, April 15. Due date for filing 2020 tax returns or requesting extension of time to file.
Thursday, April 15. Due date for paying 2020 tax owed to avoid owing interest and penalties.
Friday, October 15. Due date to file for those requesting an extension on their 2020 tax returns.

More Tips About Taxes

Interested in learning more about taxes? Then you’ve come to the right place! Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

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, or through our social media accounts on Facebook, Twitter, and LinkedIn to schedule a consultation or to learn more about our services.

You May Receive Your Second Stimulus Payment by Credit Card

Some People Will Receive Their Second Stimulus Payment by Debit Card

By: UNIKO Media Group

January 20, 2021

Some people will receive their second stimulus payment by prepaid debit card. Read on to discover the aspects you should keep in mind.

In fact, this method was already used in some cases to deliver the first round of Economic Impact Payments, also known as stimulus payments.

Keep in mind that the form of payment may vary between your first and your second stimulus payment. If you received your first payment by paper check you could receive your second payment via prepaid debit card. Conversely, if you received your first payment by prepaid card, you may receive it now by paper check.

You can use the online tool Get My Payment to check whether your payment has been mailed.

The prepaid debit cards arrive in a while envelope that displays prominently the seal of the Department of the Treasury of the United States. The envelope displays the statement “Not a bill or an advertisement. Important information about your Economic Impact Payment.”

What You Can Do With Your Card

The name of the issuing bank, MetaBank, N.A., appears on the back on the card while the name Visa appears on the front. Your card will allow you to do the following without having to pay a fee:

Transfer funds to a personal bank account
Make signature or PIN-debit purchases anywhere Visa Debit
Cards are accepted — in stores, online or over the phone
Get cash back with a PIN debit purchase where available
Get cash from in-network ATMs
Get a replacement EIP Card, if needed
Check their card balance online, through a mobile app or by phone

More Tips About Taxes

Interested in learning more about taxes? Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

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.

How to Make Tax Filing Easier This 2021

By: UNIKO Media Group

January 14, 2021

With the holidays already behind us, this is the right time to start preparing for the upcoming tax season. Here are six tips to help you make tax filing easier this 2021.

1.- Get Your Form W-2. This form shows the amount of taxes withheld from your paycheck throughout the year and is essential to file your tax return. It’s worth keeping in mind that employers have until Monday, February 1, 2021, to file Forms W-2 and send their copies to their employees.

2.- Gather Forms 1099. You should receive these forms if you received payments as an independent contractor last year. Just like Form W-2, companies should send these forms by February 1, 2021.

3.- Verify Your Individual Tax Identification Number (ITIN) to make sure it’s still valid. Any ITIN NOT used on a federal tax return at least once in the last three years expired on December 31, 2020. Additionally, all ITINs issued before 2013 with middle digits of 88 (For example 9XX-88-XXXX) expired at the end of 2020. Those with middle digits 90, 91, 92, 94, 95, 96, 97, 98, or 99, that were assigned before 2013 and have not already been renewed, expired as well.

4.- Make sure you’ve withheld enough tax. You can do this by using the Tax Withholding Estimator on the IRS website. Take a look and determine whether you should adjust your withholding and submit a new Form W-4 to your employer.

5.- Did you receive an Economic Impact Payment? remember to keep your Notice 1444. The IRS mailed notice 1444 to the last known address of every person who received an Economic Impact Payment. This letter includes information about the amount of your payment, how it was made, and how to report any payment you didn’t receive.

6.- Did you change your address? You have to notify the IRS. You should notify the IRS about any address change using Form 8811 del IRS. If you change your name, remember that you must notify the Social Security Administration (SSA).

More Tips About Taxes

Interested in learning more tax tips to simplify things this tax season? Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

At JT Tax Services we have the experience, the knowledge, and the drive to assist you in the preparation of your taxes. We give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

This Important Tax Deadline Is Less Than One Month Away

By: UNIKO Media Group

January 8, 2021

The year has just begun, but an important tax deadline is already less than one month away. If you are an employer, don’t forget that you should issue and file wage statements by Monday, February 1, 2021. Keep reading to discover what are the statements and forms you should keep in mind.

Form W-2

Companies should complete and file a W-2 form for every employee to whom they pay a salary. Don’t forget that you should also send your employees copies of their W-2 forms by February 1, 2021, so that they can file their taxes before the due date (April 15, 2021).

Form W-3

This form (official name: Transmittal of Wages and Tax Statements) is a detailed summary of all the W-2 forms filed by your company. This form is used by the Social Security Administration (SSA) to keep track of the salaries, commissions, tips, and other compensations that employees receive throughout the year.

Form 1099-MISC

File a 1099-MISC Form for every person to whom you paid the following during the last year:

At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest.
At least $600 in:
- Prizes and awards.
- Other income payments.
- Medical and health care payments.
- Crop insurance proceeds.
- Cash payments for fish (or other aquatic life) you purchase from anyone engaged in the trade or business of catching fish.
- Generally, the cash paid from a notional principal contract to an individual, partnership, or estate.
- Payments to an attorney.
- Any fishing boat proceeds.

As is the case with Forms W-2, you should also send Forms 1099-MISC to recipients before February 1, 2021.

Form 1099-NEC

You should file Form 1099-NEC, Nonemployee Compensation, if all the following statements apply:

You made the payment to a person who is not your employee
The payment was for services in the course of your trade or business
You made the payment to an individual, a partnership, an estate, or a corporation
Payments were at least $600 during the year

Also in this case, keep in mind that recipients of Forms 1099-NEC should receive their copies by February 1, 2021.

More Tips About Taxes

Do you want to learn more about taxes and Economic Impact Payments? Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

The IRS Begins Delivering Second Round of Economic Impact Payments

By: UNIKO Media Group

December 30, 2020

The Internal Revenue Service (IRS) announced that it has begun delivering a second round of Economic Impact Payments (EIP) as part of the Coronavirus Response and Relief Supplemental Appropriations Act of 2021.

The agency began sending payments through direct deposit yesterday (Tuesday), and it will begin sending paper checks today.

Do I Have to Take Any Actions to Receive my Economic Impact Payment?

Economic Impact Payments are automatic. This means that no action is needed on the part of recipients. The IRS has requested taxpayers not to contact financial institutions or the IRS itself with payment timing questions.

Keep in mind that the delivery method may be different for the second stimulus payment. If you received the previous Economic Impact Payment, but don’t receive a direct deposit, then you will receive a check or a debit card.

On the other hand, if you were eligible but didn’t receive either the first or the second payment, you will be able to claim it when you file your taxes for 2020.

How Much is the Second Stimulus Check?

The amounts of the second stimulus payment will be determined as follows: up to $600 for individuals; up to $1,200 for married couples filing jointly: and up to $600 for every qualifying child

Generally, if you have adjusted gross income for 2019 up to $75,000 for individuals and up to $150,000 for married couples filing jointly and surviving spouses, you will receive the full amount of the second payment.

How Can I Check the Status of My EIP?

You will be able to check the status of your payment using the online tool Get my Payment. The service is offline at the moment as the information is being updated. However, the IRS expects that the tool will be available again shortly.

More Tips About Taxes

Do you want to learn more about taxes and Economic Impact Payments? Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

We are located in Oxnard, California. Contact us today by email, telephone, or through our social media accounts on Facebook, Twitter, and LinkedIn to learn more about our services.

This Christmas, Beware of Hacking Attempts

By: UNIKO Media Group

December 24, 2020

Christmas is the merriest season of the year, but it also offers ideal conditions for hacking attempts. Keep reading to learn why you should be especially careful these days, and what steps you can take to protect your data.

Why Are Hacking Attempts Common During the Holidays?

The holidays, and in particular the days around Christmas, have become a hunting ground for hackers looking to steal personal information. This phenomenon is caused by a combination of circumstances that favor cyber-criminals:

Many employees are on vacation, which means that many companies have to let their guard down.
People are more willing to open unsolicited emails, especially if they promise holiday deals/discounts.
The holiday season offers myriad opportunities to trick unsuspecting victims through email: virtual greeting cards, invitations, and other holiday-related content.

How to Protect Yourself

In order for most hacking attempts to succeed, you must be tricked into performing certain actions, such as clicking on a link or downloading a file. This means that being cautious when you use the internet is your best line of defense. Other steps you can take include:

Use safe passwords. Choose passwords of at least eight characters that include a mix of upper and lower case, special characters and numbers.
Use multi-factor authentication. When available, use this feature, where a website asks you for two pieces of information before granting access. This is not a silver bullet but makes hacking attacks less likely.
Be extremely careful with links and attachments. These are the resources that hackers use more often, so don’t click on a link or download an attachment unless you know the sender.
Backup your data. In itself, this doesn’t prevent hacking attacks, but it can make all the difference if you can’t access your data after a breach.

More Tips About Taxes

Learning more about taxes is always a smart move, as it helps you avoid fines and missed deductions. Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

Need help preparing your taxes? At JT Tax Services we have the experience, the knowledge, and the drive to assist you. 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, telephone, or through our social media accounts on Facebook, Twitter, and LinkedIn to learn more about our services.

3 New Things to Consider When You File Your 2020 Tax Return

By: UNIKO Media Group

December 18, 2020

This year has been out of the ordinary from every point of view, including taxes. There are some new things you should consider when you file your 2020 tax return. Keep reading to learn more.

Recovery Rebate Credit

You may be able to claim this credit if you met the eligibility requirements for an Economic Impact Payment in 2020 and one of the following applies to you:

You didn’t receive an Economic Impact Payment in 2020.
You are single and your payment was less than $1,200.
You are married, filed jointly for 2018 or 2019 and your payment was less than $2,400.
You didn’t receive $500 for each qualifying child.

Refund Interest Payment

If you received a federal tax refund in 2020, keep in mind that interest payments are taxable and must be returned on your 2020 federal tax return. Next January, the IRS will send a form to any person who received interest payments of at least $10 during the last year.

New Charitable Deduction

If you don’t itemize your deductions, you can take this year a new charitable deduction of up to $300 for donations made during 2020 to qualifying institutions. If you are interested in this deduction, check out this previous post where we take a closer look at this interesting topic.

Finally, remember that you shouldn’t rely on receiving your refund by a certain date. This is particularly important if you are planning to make a big purchase or pay important bills. While the IRS processes tax returns as soon as possible, some returns require more time, so your refund may take longer than you expect.

More Tips About Taxes

Learning more about taxes is always a smart move, as it helps you avoid fines and missed deductions. Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

We are located in Oxnard, California. Contact us today by email, telephone, or through our social media accounts on Facebook, Twitter, and LinkedIn to learn more about our services.