FAQ - Connie Phillips Purcell CPA

FAQ

What do I need to bring when I am having my taxes prepared?

Following is a list of the more common items you should bring if you have them.

§ Wage statements (Form W-2)

§ Pension, or retirement income (Forms 1099-R)

§ Dependents' Social Security numbers and dates of birth

§ Last year's tax return

§ Information on education expenses

§ Information on the sales of stocks and/or bonds

§ Self-employed business income and expenses

§ Lottery and/or gambling winnings and losses

§ State refund amount

§ Social Security and/or unemployment income

§ Income and expenses from rentals

§ Record of purchase or sale of real estate

§ Medical and dental expenses

§ Real estate and personal property taxes

§ Estimated taxes or foreign taxes paid

§ Cash and non-cash charitable donations

§ Mortgage or home equity loan interest paid (Form 1098)

§ Unreimbursed employment-related expenses

§ Job-related educational expenses

§ Child care expenses and provider information

And any other items that you think may be necessary for your taxes.


How do I find out about my refund?

The best way is to use the Check Your Refund link from the Resources pages of our website! To look up the status of your federal or state refund, you will need your social security number, filing status, and exact amount you’re expecting back.



What is the child tax credit?
The child tax credit is a credit of $1000 per child from the IRS. In order to qualify the child must: 1. Be under 17 at the end of the tax year 2. Be a citizen of the United States 3. Be your child 4. Live with you for more than half the year 5. Not be treated as the qualifying child of someone else

What medical expenses are deductible?
A deduction is allowed only for expenses paid for the prevention or alleviation of a physical or mental defect or illness. Medical care expenses include payments for the diagnosis, cure, mitigation, treatment, or prevention of disease, or treatment affecting any structure or function of the body. Except for insulin, only prescription drugs are deductible. The cost of health insurance is deductible. You may also deduct the cost of traveling to and from the care provider. You can deduct only the part of your medical and dental expenses that exceeds 7.5% of your adjusted gross income.

I received tax statements from my employer or bank after I filed my tax return. What should I do?
If we filed your return, bring the new tax documents to our office. We will determine if it is necessary for you to file an amended return.

How should I keep records for my business driving?
Keep a log in your vehicle and record the purpose and mileage of each trip. You also need to record the odometer readings at the beginning and end of each year, as the IRS will ask you for total miles driven during the year. Keep your repair bills as these normally record odometer readings when the car is serviced.

My employer tells me I will receive a 1099. What does this mean for my taxes?
When you receive a 1099, it means you are considered an independent contractor. You will not have any withholding or payroll taxes deducted from your pay. You should keep track of all business expenses and a journal of your mileage driven for work. If the amount you expect to receive is substantial, you should probably be making estimated tax payments. Please contact us if you have any questions about this.

What is the difference between a C and an S corporation?
A C Corporation and an S Corporation are exactly the same in respect to liability protection. The difference is in how you are taxed. A C Corporation has what is referred to as a double taxation. First the corporation is taxed, and secondly the dividends are taxed on the shareholders’ tax returns. An S Corporation is not taxed at the corporate level, only at the shareholder level. Most small businesses are eligible to file as S corporations. But the appropriate election must be made.