Tax Services in Oxnard California Archives

What Is a Limited Liability Company (LLC)?

September 12, 2023

One of the most popular business structures, especially for small business owners, is a Limited Liability Company, or LLC for short. If you’re unfamiliar with what an LLC is or how it operates, don’t worry! This guide will provide you with a comprehensive overview of what an LLC is, how it works, and why it might be the right option for your business.

What is an LLC?

A limited liability company, or LLC, is a legal structure that combines the benefits of a partnership or sole proprietorship with those of a corporation.

Essentially, it’s a way to structure your business that offers both personal liability protection and flexibility.

By forming an LLC, you are creating a separate legal entity that can own property, enter into contracts, and conduct business.

However, unlike corporations, there are no shareholders or boards of directors to answer to – instead, owners of an LLC are referred to as members and can manage the company themselves.

How does an LLC work?

To form an LLC, you will need to file paperwork with your state’s Secretary of State and pay a registration fee.

Typically, this involves providing basic information about your company, such as its name, address, and the names of its members.

Once your LLC is registered, you’ll need to draft an operating agreement, which outlines how the business will be run, how profits and losses will be divided among members, and other important information.

An LLC is typically taxed as a pass-through entity, meaning that the profits and losses are reported on the individual tax returns of members and not at the business level.

Why choose an LLC?

There are several benefits to choosing an LLC as your business structure.

One of the most significant advantages is that LLCs provide personal liability protection to their owners. This means that if your business is sued or incurs debt, your personal assets (such as your home or car) cannot be used to satisfy those debts.

Additionally, LLCs offer flexibility in terms of management structure, and there are typically fewer formalities required than with a corporation. This means that you can operate your business more informally while still enjoying the legal benefits of being a separate entity.

LLCs: What You Need To Keep in Mind

While LLCs offer many benefits, there are also some potential drawbacks to consider.

One of the most notable is that LLCs can be more expensive to form and maintain than sole proprietorships or partnerships.

Additionally, the process of forming an LLC can be complex, and it may be beneficial to work with a lawyer or tax professional to ensure that you’re complying with all applicable laws and regulations.

Finally, while LLCs provide personal liability protection, there are limits. For example, members can still be held personally liable if they engage in fraudulent or illegal activities on behalf of the company.

Wrapping It Up

Overall, a Limited Liability Company is a popular legal structure for entrepreneurs looking to start a business.

It offers personal liability protection, flexibility, and a relatively easy process to set up and maintain.

However, there are also some potential drawbacks to consider, such as the cost of formation and maintenance.

By understanding how an LLC works and weighing the pros and cons, you can make an informed decision about whether it’s the right structure for your business.

JT Tax Services: Taxes Made Easy

When it comes to taxes, knowledge is power. That’s why at At JT Tax Services, we give you the peace of mind that comes with knowing that you are working with experienced professionals with in-depth knowledge of all applicable tax laws and 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. Feel free to contact us today!

What Is a C Corporation and How Does It Work?

By: UNIKO Media Group

September 8, 2023

When starting a new business, it’s important to choose the right structure for your company. One popular option is a C Corporation. But what are they, exactly? Read on to learn more about C corporations, from a basic definition to their pros and cons.

Definition of a C Corporation

A C Corporation is a type of business structure in which the company is owned by shareholders who have limited liability for the company’s debts and obligations.

The corporation operates as a separate legal entity that can conduct business, own assets, and enter into contracts.

This means that the corporation can sue and be sued, enter into agreements, and pay taxes separately from its owners.

How a C Corporation Works

A C Corporation is managed by a board of directors who are elected by the shareholders.

The board of directors is responsible for making major business decisions, such as choosing the company’s officers, approving budgets, and setting corporate policies. The officers of the corporation, such as the CEO and CFO, are responsible for the day-to-day operations of the business.

C Corporations issue stock to shareholders, which represents their ownership in the business. Shareholders are not involved in the day-to-day operations of the business and do not have liability for the debts and obligations of the corporation.

Advantages of a C Corporation

One of the main advantages of a C Corporation is that it offers limited liability to its shareholders.

This means that the personal assets of the shareholders are protected from the corporation’s debts and obligations. Additionally, the corporation can raise capital by issuing stock to investors, which can help the business grow and expand.

Another advantage of a C Corporation is that it can deduct certain business expenses, such as salaries, benefits, and property taxes. This can help reduce the company’s tax liability and increase its profits.

Disadvantages of a C Corporation

One of the main disadvantages of a C Corporation is that it is subject to double taxation. This means that the corporation pays taxes on its profits, and then the shareholders pay taxes on any dividends they receive. This can result in a higher overall tax liability for the company and its shareholders.

Another disadvantage of a C Corporation is that it requires more formalities and paperwork than other business structures, such as a sole proprietorship or partnership. This can result in higher administrative costs and more time spent on compliance.

JT Tax Services: Taxes Made Easy

How Long Will It Take for the IRS to Process My Amended Return?

By: UNIKO Media Group

June 1, 2023

If you had to amend your tax return, chances are that you are wondering how long it will take for the IRS to process it. Well, wonder no more, because in today’s post we give you the inside scoop on this useful tax topic.

What Is an Amended Return?

First, let’s understand what an amended return is and why you might need to amend your tax return in the first place.

Simply put, an amended return is a tax return you file to correct errors in a previously filed tax return.

Some common reasons to amend your return include mistakes in reporting your income, or inaccuracies in deductions, credits, or filing status.

How Long Will It Take for the IRS to Process My Amended Return?

The duration of time it takes for the IRS to process your amended return and issue depends on several factors.

For example, the previous estimated time to process an amended return was 16 weeks. However, under the current circumstances, the IRS estimates that it takes more than 20 weeks to process an amended return, regardless of whether you file electronically or on paper.

The reason is that, according to the agency’s information, the IRS has 1.43 million unprocessed 1040-X Forms which are being processed in the order they were received.

We know: 20 weeks is a long time. However, you can check the status of your amended return using the tool Where’s My Amended Return on the IRS website. Note that it can take up to three weeks after you mail or file your amended return electronically for it to show up on the system.

For more tax tips, be sure to check out our previous blogs: “Filing Status: What Is It And Why It Matters?” and “How To Organize Your Tax Records”

JT Tax Services: Taxes Made Easy

Will Tax Refunds Be Bigger in 2023?

By: UNIKO Media Group

January 25, 2023

Tax season 2023 has officially started, and with it come all types of questions. For example, will tax refunds be bigger in 2023? In today’s blog post, we answer this question and provide some useful tips for the filing season.

Will Tax Refunds Be Bigger in 2023?

Unfortunately, the answer is no: it is unlikely that your tax return will be bigger in 2023 than in the last two years. One of the main reasons is that there were no Economic Impact Payments for 2022

Additionally, some tax credits (such as the child tax credit) that were extended to offer economic relief during the pandemic have reverted to their 2019 levels.

To sum it up, many of the tax incentives that were deployed over the last two years to help Americans deal with the impact of COVID-19 are being rolled back. For many taxpayers, this return to normal will translate into a smaller tax refund in 2023.

Regardless of the size of your return, there are some things you can do speed up the process:

File as early as possible (while making sure that all the information in your return is accurate)
File electronically
Choose direct deposit for your tax refund

What You Need To Keep in Mind

Federal tax season 2023 began on January 23. The deadline to file your federal taxes this year is April 18, 2023

However the IRS has given victims of the storms that hit California an extended May 15 deadline to file federal individual and business tax returns and make the related tax payments.

If you need help filing your tax return, contact JT Tax Services. Our team will answer all your questions and ensure that you get your maximum tax refund.

For more tips on how to navigate the 2023 tax season, check out our previous blog “Reminder: Tax Season Begins January 2023.”

Have Questions? at JT Tax Services, We Have Answers

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.

What You Need to Know About Education Tax Credits

By: UNIKO Media Group

January 19, 2022

If you or someone included on your tax return are pursuing higher education, we encourage you to consider two little-known tax credits: the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC), two tax breaks that can reduce the amount of tax you owe.

Education Tax Credits: What You Need to Know

The purpose of the AOTC and the LLC is to help with the cost of higher education by lowering the amount of tax you owe.

Regardless of the differences between these credits (we’ll touch on that later), three conditions must be met in order to qualify for any of them:

You, your dependent, or a third party pays qualified education expenses for higher education.
An eligible student must be enrolled at an eligible educational institution.
The eligible student is yourself, your spouse, or a dependent you list on your tax return.

On the other hand, you CANNOT claim these credits if someone else (such as your parents) lists you on their tax return; if your filing status is married filing separately; if you already claimed or deducted another higher education benefit using the same student or same expenses; or if you or your spouse were a non-resident alien for any part of the year and did not choose to be treated as a resident alien for tax purposes.

Differences Between AOTC and LLC

One of the most relevant differences between these two credits is that the AOTC, applies only when the student hasn’t completed four years of post-secondary education before 2021. Plus, the student must be pursuing a degree or other recognized education credential and must have no felony drug convictions as of the end of 2021.

By contrast, it’s possible to qualify for the LLC with all years of post-secondary education and for courses to acquire or improve job skills. Additionally, the student does not need to be pursuing a degree or other recognized education credential. Finally, the requirement of no felony drug convictions does not apply in this case.

Another important difference is that the AOTC is a partially refundable tax credit (40%), while the LLC is not refundable. This distinction is worth keeping in mind because not refundable tax credits cannot be used to increase your tax refund or to create a tax refund when you don’t have one.

If you are interested in learning more about education tax credits, contact us today. We’ll be glad to help you make sense of these tax breaks and determine if you qualify for any of them.

Need Help With Your Taxes? Contact the Experts at JT Tax Services

Do you need assistance with personal or business taxes? JT Tax Services is here to help! 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.

When Is Tax Day in 2022?

By: UNIKO Media Group

December 31, 2021

New Year’s is almost here! But before you turn the page on 2021, make sure to mark this important tax date on your calendar for 2022.

When Is Tax Day in 2022?

Tax Day is the deadline to submit your federal tax return. This day is usually April 15 or the Monday after if the 15 falls on Saturday, Sunday, or a Festivity.

The Federal Tax Day next year will be April 18, 2022, because April 15 is Emancipation Day, a regional government holiday observed in Washington D.C.

In 2020 and 2021, Tax Day was moved due to the COVID-19 pandemic. The IRS deemed it necessary to give taxpayers more time to file their taxes given the disruptions caused by the COVID-19 pandemic.

However, there are no official plans to push Tax Day to a different date in 2022, so it’s a good idea to begin gathering any supporting documents you may need and contact a tax expert if you have any questions.

When Is the First Day to File Your Taxes?

Each year, during the first days of January, the IRS issues a statement announcing the first day to file taxes. Stay tuned to learn when you can begin filing, as well as other useful tips from our experts.

Once you are ready to file, you can do it either by mail or using electronic filing (or e-file). E-file is usually the most convenient option, as it helps you get your tax refund faster.

Finally, keep in mind that this information (including the April 18 deadline) applies only to federal taxes — the dates and processes for state taxes may be different. Contact your local tax agency or a tax expert you trust to ensure you file and pay all your taxes on time.

Need Help With Your Taxes? Contact the Experts at JT Tax Services

What You Need to Keep in Mind About Amended Tax Returns

By: UNIKO Media Group

October 27, 2021

Can you amend a tax return? All tax returns containing errors must be amended? Keep reading to discover the answers to these and other questions about amended tax returns.

What You Need to Keep in Mind About Amended Tax Returns

Although everyone tries to be as precise as possible when it comes to filing their taxes, mistakes happen.

Now, the fact that your tax return contains errors doesn’t automatically mean that you should file an amended return. The IRS catches many math or clerical errors and sends you a letter to notify you about any adjustment.

Similarly, the IRS may accept returns without certain required forms. If you forget to attach a form to your return, don’t file an amended return just yet; wait until the IRS sends you a letter requesting any missing documentation.

On the other hand, these are some cases where you usually DO have to file an amended return:

You entered your income incorrectly
You didn’t claim credits for which you are eligible
You claimed deductions incorrectly

Some Useful Tools

To simplify things, the IRS has created some usuful online tools to help those who need to file an amended return or want to know if they have to file one.

For example, this online assistant can help you determine whether you have to file an amended return.

Those who already filed an amended return can check their status of their return using the online tool Where’s my amended return? To use the tool you will need some basic personal details such as date of birth, Social Security Number (SSN) and ZIP code.

If you have other questions about amended tax returns, or need to file one, don’t hesitate to contact us at JT Tax Services. We are here to answer your questions and provide you with high-quality tax assistance you can trust.

Contact the Experts at JT Tax Services

Scammers are always on the lookout for new victims. Luckily, when it comes to tax scams, there’s a simple step that will help you avoid most of them. Keep reading to learn more.

The Simple Step That Will Help You Avoid Most Tax Scams

By: UNIKO Media Group

August 25, 2021

Scammers are always on the lookout for new victims. Luckily, when it comes to tax scams, there’s a simple step that will help you avoid most of them. Keep reading to learn more.

How to Avoid Most Tax Scams

As the old saying goes, knowledge is power. So it’s no coincidence that knowledge is the best way to prevent falling prey to a tax scam.

Knowing how the IRS interacts with taxpayers will help you notice more easily the odd behaviors that are the hallmark of scammers. Remember:

The IRS doesn’t normally initiate contact with taxpayers by email. Don’t reply to emails from people claiming to represent the IRS. And remember oficial IRS email addresses end with “irs.gov”
The IRS will never get in touch with you by text message or social media. If you receive this tye of message, don’t respond; someone is trying to scam you.
Private debt collectos may contact taxpayers for the collection of certain tax liablities, but only after the taxpayer has received a written notice.
IRS officers and agents may visit the home or place of business to discuss tax liabilities or delinquent tax returns. However, remember that payments will never be requested to a source other that the Treasury Department.
If you are visited by an IRS representative, don’t forget to ask for credentials. IRS officers and agents can provide two types of credentials: a pocket commission and a Personal Identity Verification Credential.

Knowing this information will help you avoid most tax scams. In case you have further questions, or need assistance navigating any process related to tax collection or tax liabilities, don’t hesitate to contact a tax expert for more information.

Contact the Experts at JT Tax Services

Do you need help preparing your taxes? Did you receive a letter from the IRS? JT Tax Services is here to help! We give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

A Simple Tip to Make Tax Filing a Lot Easier

By: UNIKO Media Group

June 22, 2021

Filing your taxes takes focus and great attention to detail. And while this may sound complex, it can be really easy if you follow a simple tip. Keep reading to learn more.

How to Make Tax Filing a Lot Easier

Filing your tax return becomes a breeze when you keep records of all your tax documents.

Efficient recordkeeping helps you identify sources of income, keep track of your expenses and support the information of your tax return. All in all, keeping comprehensive records makes tax filing an easier, simpler, and more precise task.

The Documents You Should Make Sure to Keep

Below is a list of the documents you should make sure to keep.

Tax-related documents. This includes wage and earning statements, dividend statements, bank interests, and some government payments, such as unemployment compensation, or virtual currency transactions. You should also keep any receipts, canceled checks, and other documents that help support income, a deduction, or a credit reported on your tax return
Letters from the IRS and prior year tax returns. Make sure to keep copies of prior year tax returns, as well as any letter from the IRS. This includes adjustment notices and Economic Impact Payment Notices, among others.
Property records. Pay attention to keep all records relating to any property your dispose of or sell.
Businesses income and expenses. Taxpayers who own a business must come up with a recordkeeping method that reflects accurately their gross income and expenses. If you have employees, don’t forget that you must keep all employment tax records for at least four years.
Health insurance. Keep records of all the documents related to health insurance for you or your family. You will need that information if you want to claim the premium tax credit.

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.

Did You Receive Unemployment Compensation in 2020? You May Qualify for a Tax Refund

By: UNIKO Media Group

June 17, 2021

If you received unemployment compensation in 2020 then you may qualify for a tax refund.

The IRS is reviewing the tax returns filed before the American Rescue Plan became law in March of this year to determine the taxable amount of unemployment compensation.

The American Rescue Plan excluded up to $10,200 in unemployment compensation per tax payer from taxable income paid in 2020. Please note that this is only the limit of taxable unemployment compensation, not the refund you would receive.

This adjustment is important, because a record number of Americans applied for unemployment benefits in 2020 due to the coronavirus pandemic.

Depending on their individual situation, some taxpayers will receive refunds, while others will have the exceeding amount applied to taxes due or other debt. For some taxpayers there will be no change.

Other Adjustments

Taxpayers may also have their return corrected for other credits that were also affected by the American Rescue Plan: the earned income tax credit, the premium tax credit, and the recovery rebate credit.

You don’t have to take any action to benefit from these adjustments. The IRS will review your return to calculate the correct taxable amount.

If the IRS adjusts your tax return, you will receive a letter from them within about 30 days. The letter will detail what adjustments were made to your return as well as the amount of the adjustment.

And by the way, here’s an extra tip to keep in mind: don’t forget to keep for your records any letter from the IRS.