Tax Faq Answers To Basic Questions About Taxes

Tax Faq Answers To Basic Questions About Taxes



Tax FAQ: Answers to​ Basic Questions About Taxes
* What is​ a​ W-2 form?
The W-2 is​ a​ form that an​ employee receives from his or​ her employer once a​ year .​
It is​ also sent to​ the​ IRS at​ the​ end of​ every year .​
The total annual wages paid and the​ taxes that the​ employer withheld from each paycheck are shown on​ the​ W-2 form .​
Federal law states that the​ W-2 form must be mailed by January 31st of​ each year.
It consists of​ six copies:
Copy a​ – Submitted to​ the​ Social Security Administration from the​ employer.
Copy B – Sent to​ the​ employee to​ be attached to​ the​ federal income tax return when it​ is​ filed.
Copy C – Sent to​ the​ employee to​ be kept for their records.
Copy D – Retained by the​ employer for their records.
Copy 1 – Sent to​ the​ employee to​ be filed with the​ state or​ local tax if​ required.
Copy 2 – Also sent to​ the​ employee to​ be filed with the​ state or​ local tax return if​ required.
* What is​ a​ W-4 form?
The W-4 form is​ usually filled out by an​ employee whenever he or​ she starts a​ new job .​
It tells the​ employer the​ right amount of​ tax to​ be withheld from each paycheck and paid to​ the​ government.
You should review your federal and state withholding information (shown on​ the​ W-4 form) at​ least annually to​ ensure that it​ reflects your current tax situation .​
If you​ get married,​ separated,​ divorced,​ or​ have a​ child,​ then you​ need to​ update your W-4 form.
* What records do I​ need to​ fill out my tax forms?
Below are some forms you​ might need to​ fill out:
- If you​ are self-employed earning more than $400,​ or​ if​ you​ are a​ church employee,​ you​ must fill out Schedule SE.
- If you​ are an​ employer you​ must pay an​ employment tax.
- If you​ have manufacturing business,​ you​ will be paying excise taxes.
* Whom can I​ claim as​ a​ dependent?
You can claim a​ dependent if​ the​ person is​ a​ qualifying child or​ a​ qualifying relative .​
When claiming children,​ he or​ she must be your child,​ stepchild,​ adopted child,​ foster child,​ brother,​ sister,​ grandchild,​ niece or​ nephew .​
The dependent should be living with you​ for more than 6 months of​ the​ year and should also be under the​ age of​ 19 at​ the​ end of​ the​ year,​ or​ under age 24 and a​ full-time student for at​ least five months of​ the​ year,​ or​ any age and totally,​ permanently disabled.
* What if​ I​ do not file my taxes on​ time?
If you​ forget to​ file on​ or​ before the​ due date (usually April 15 of​ every year) you​ should file as​ soon as​ you​ can .​
Not filing on​ time costs you​ penalties and interest .​
Usually a​ 5% interest on​ taxes not paid will be added onto your tax until it​ accumulates to​ 25% .​
Also,​ there is​ usually a​ separate charge if​ you​ do not file on​ time .​
If you​ fail to​ file a​ tax return at​ all (when you​ owe taxes) you​ can go to​ jail.




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