It goes without saying that, when it comes to filing NY tax returns, there is never a shortage of questions that need honest, unbiased answers. As one of the most well-established, respected Rochester NY tax and accounting services, Flower City has created this NY Taxes FAQ guide to help you stay compliant, while making sure that you get the most from your return.
Many are shocked to learn of the lesser-known income sources that are non-taxed. A few of the most significant include: Cash gifts from family or friends, Bank loans and money borrowed from financial institutions, Inheritance' from friends or family members, or Money paid to schools or medical institutions.
It's no surprise that capital gain taxes continues to baffle so many individuals, families and businesses. There is a wide spectrum of assets included under the umbrella of capital gains, including many used for investment and income-generating purposes. This area also covers gains made when selling these assets, which need to be filed in order to avoid long-term losses. The business tax experts at Flower City Tax in Rochester can answer any questions you may have on how capital gain taxes affect you.
Taking an annual loss is never a pleasant prospect, though there are certain tax benefits available to C-corporations who incurred a financial loss. If your working deductions surpassed your corporate income, you have the option of filing a Federal Tax Refund Claim. Once you've finished completing you corporate tax return, fill out Form 1139 (Corporation Application for Tentative Refund). This form allows you to apply operating losses from previous years, while requesting a refund for applicable taxes you paid during said timeframe.
For those with mortgage interest, charitable contributions and medical expenses, individually itemizing your deductions can be a smart decision. Of course, it's generally only something worth doing if your deductible expenses are greater than the standard deduction. Working with a tax expert is a good place to start if you're unsure. Standard deductions are as follows: For individuals and those filing as Single, the standard deduction is $6,300. Those filing Jointly or married will have a standard deduction of $12,600.
If you provide over 50% of the living expenses for a relative(s), you could be entitled to a number of helpful tax credits. In the event that these expenses are being shared between two or more members of the family, you can file a multiple support agreement; allowing those who contribute more than 10% to benefit from the credit. Some of the most common available exemptions are: Head of household filings, Dependency exemptions, Dependent care tax credits and Certain medical deductions.
There are many tax perks for those who own a home and itemize their deductions. This includes the ability to claim mortgage interest, paid real-estate taxes, points paid on closing, and medical deductions for special equipment installs (such as those for handicap individuals, hospice, etc). We encourage every homeowner to work with a qualified tax professional, for expert advice on getting any and all deductions that you're entitled to.
Under federal tax law, adults who turned 70 during the previous year are required to take their first required IRA minimum distribution by April 1. Not doing so could result in a hefty 50% tax fine on the amount that was not taken. This also applies to other retirement plans, depending on whether or not you're actively retired. Call Flower City Tax in Rochester for expert assistance on retirement account and IRA tax preparation.
Parents are eligible for a $4,000 dependency deduction per child. Keep in mind that there are several other exemptions available, including deductions for health insurance and student loan interest. For households with an adopted child or eligible dependent in college, there are even more ways to help lower the amount of tax owed. For a complete listing of child tax credits, call Flower City Tax and speak with one of our family tax specialists.
For individuals and those filing Single, the standard 2015 AMT income exemption is $53,600. For those who are married or filing jointly, the standard exemption would be $83,400. If you're curious on how alternative minimum taxes apply to you, call Flower City Tax in Rochester and we'll be happy to answer your questions.
Contributions can be made to your IRA all the way up until April 18 filing deadline. If you're in a traditional IRA, contributions up to this date can also be claimed on your federal tax return. The maximum contribution (depending on your income) is $5,500, with an additional $1,000 exemption granted for those who are over the age of 50.
If you qualified for a tax credit under the Affordable Care Act, there are very important tax considerations that you need to be aware of. First, you're required to prepare and file a federal tax return (even if you've never filed one) in order to receive your healthcare subsidy benefits. The credit can be applied towards your monthly health insurance premiums, or you can claim it on your return. Keep in mind that if you don’t file a tax return, you may become ineligible for future health insurance tax credits.
Yes, there are some tax-reporting requirements for those who hold international and off-shore assets. When filing your federal return, locate the corresponding box in Section B to indicate that you have foreign assets to report. Depending on a number of personal and income criteria, you may also be required to fill out a Statement of Specified Foreign Financial Assets (Form 8938). This would be filed simultaneously with your 1040 form.
From the most general perspective, if you've given oven $14,000 in gifts throughout the course of a year, you may be required to complete Form 709, United Stats Gift (and Generation-Skipping Transfer) Tax Return. This form would be filed at the same time when preparing your federal tax return. For a complete definition of "gifts" feel free to call and speak with one the tax specialists at Flower City Tax in Rochester.
If you're unable to pay your federal taxes by the April filing deadline, you have the right to request more time to file. A six-month extension is available to anyone who formally requests it, without the need for a specific stated reason. It helps to first know your total tax liability, and this is something a professional tax consultant can assist you with.
At the foundation of any properly-planned federal tax return, is the Employee's Withholding Allowance Certificate, or Form W-4 as most people know it. Especially with the sweeping 2018 tax laws, it might be best if you consult with us as to what should be changed. As a rule of thumb, it never hurts to review the information on your W-4 each year before preparing to file your taxes in New York. This is especially true if you had a sizable tax refund the previous year, or owed a significant payment amount. If your household or income changed, be sure to make any needed adjustments on your W-4.