1 / 22

Taxes

Taxes. 1040. Single Individuals Must File Tax Returns If:. Individuals Must File Tax Returns By:. Your Total Income is $10,000 (this amount changes) or more Earned Income Unearned Income OR Self-Employed & your Total Profit is More Than $400.

rex
Download Presentation

Taxes

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Taxes 1040

  2. Single Individuals Must File Tax Returns If: Individuals Must File Tax Returns By: • Your Total Income is $10,000 (this amount changes) or more • Earned Income • Unearned Income OR • Self-Employed & your Total Profit is More Than $400 • April 15th unless that date falls on a weekend or holiday Individuals Must File Federal Tax Returns Using: • 1040 EZ OR 1040 A OR 1040

  3. Earned Income is Taxable & Includes: Earned Income is Generally Shown on a Form W-2 Or 1099 • Wages or salaries • Commissions • Tips • Fringe benefits and stock options • Paid Sick, Holiday & Vacation Days • Bonuses • Health & Life Insurance • Retirement Contributions • Workman’s Compensation

  4. Unearned Income is Taxable & Includes: • Interest from a Savings Account • Interest from Bonds • Dividends from Stock • Gains from Selling Investments • Income from Rental Property • Money from Retirement Fund • Gifts & Inheritance • Royalties • In-Kind & In-Cash Transfers • Prizes Unearned Income is Generally Shown on a Form 1099

  5. Income Adjustments • Moving Expenses if Related to Your Present Job or Starting a New Job • Retirement Account Investments • Tuition and Fees • Student Loan Interest Money Spent/Invested That Lowers a Tax Payers Total Income Examples:

  6. Adjusted Gross Income (AGI) • Total Income – Income Adjustments

  7. Exemptions—Qualifying Child For Tax Purposes? • Who’s a Dependent? • Someone Who Lives with You More Than ½ the Year & • Under 19, or 24 if student & • Did Not Provide Over Half his/her own Support & • Is Not Filing a Joint Return unless only for a refund

  8. Exemptions Worth $3,900 (this amount changes) For Each: • Tax Payer • Dependent • Over 65 • Blind NOTE: • Exemptions Lower AGI (Adjusted Gross Income)

  9. Income is Lowered Also By: • Standard Deduction (amounts change) • $6,100 for Single • $12,200 for Married Filing Jointly OR • Itemized Deductions—Schedule A NOTE: • Use whichever is Larger

  10. Itemized Deductions-Schedule A-Examples • Medical & Dental Expenses (Limited) • Real Estate Taxes Paid • Vehicle Taxes from Registration • Donations of Money or Goods • Safe Deposit Box Fees • Union Dues • Losses Due to Theft, Vandalism, Fire, Storm (Limited) • Cost of Special Tools, Uniforms, or Protective Clothing (Limited) • Business Use of Home (Home Office) (Limited)

  11. Tax Credit • Lower Tax Amount • If Tax Amount is Zero, Can Give a Refund More Valuable Than Deductions You owe $1,003 in tax. You are eligible for either a $1,000 tax deduction or a $1,000 tax credit. Which would you choose? Tax Credit

  12. Tax Credits are More Valuable Than Deductions-How? $1000 Deduction—If your Original Income was $9,480, your tax is $1,003 When you deduct the $1000, $9,480 - $1,000=$8,480 is your new income Your new tax is $853 so you saved $150 $1003-$853=$150

  13. Tax Credits are More Valuable Than Deductions-How? $1,000 Credit—These are taken AFTER you calculate your tax Your tax on $9,480 is $1003 When you take a $1,000 credit Your new tax is $3 $1,003 - $1,000=$3 Which is a savings of $1,000

  14. Tax Credit Examples • Child Care Expenses • American Opportunity Credit for College • Children Under 18 Who Live With You • Home Energy Savings • First-Time Homebuyer • Lower Income Families

  15. Federal Taxes Used For: • National Defense (Wars) • Social Security • Medicare/Medicaid • Interest on the National Debt • President , Senators and House Representatives • All White House Workers • Agriculture • Foreign Affairs • Veteran Benefits • Environmental and Natural Resources

  16. State & Local Taxes Used For: • Education • Public Transportation • Fire Fighters & Police Officers • Road & Traffic Light Repair • Capitol & Government Building Maintenance • Congress, Governors, Mayors, State Representatives • All Government Workers • Garbage Collecting • Healthy Drinking Water

  17. One of Most Controversial Issues For Citizens • How Tax Money is Used Best Way to Voice Opinion • Vote

  18. Federal Income Tax History • Created in 1913 • 16th Amendment Gave Congress the Power to Tax

  19. Income Tax Fun Fact • In 1916, Congress changed the text of the income tax law, removing the word "lawful" from "lawful business" • Now ALL income, whether attained by legal means or not, was taxable. • Because of this, many criminals who were guilty of other infractions were sent to prison for tax evasion.

  20. Types of Taxes • Income • Payroll • Unemployment State & Federal • ½ of Medicare & Social Security • Sales • Real Estate • Personal Property

  21. Tax Preparation or Help • Certified Public Accountant (CPA) • H & R Block • IRS • Tax Programs If you have a professional complete taxes, make sure they sign off on the return. If they make a mistake, the will at least cover your penalty and interest.

  22. Why Do You Have a Social Security # • Social Security Administration keeps track of your earnings to determine benefits you will get when retire, become disabled, or die and survivors get. • IRS uses it to identify you

More Related