What Documents You Need to Complete Taxes

Being organized with your tax papers is important for a couple of reasons. Number one it will ensure you file your tax return correctly. Secondly, when you receive that dreaded  IRS letter, your CPA can readily handle it with minimal stress on your end.

This article by MainStreet offers a complete explanation and list of items, receipts and documents to bring.

For a free consultation, contact me, Elizabeth (tambien hablo espaƱol) at 305-860-9903.

Let's simplify your life so you have time to enjoy it!

"I Survived an IRS Tax Audit"

This recent new story from CNN.com shares the personal story from a woman who received a letter from the IRS and was audited even though it regarded her EX husband's business. Notice the trigger points of who is listed first on the tax return and the amount of deductions.

This is where having a CPA can represent you, much like having a lawyer. 

Another helpful tip, with advanced techonology, consider scanning your tax returns and saving a pdf file, especially when you own a business.

Give me a call, let's simplify your life.
Elizabeth 305-860-9903

About Elizabeth

My name is Elizabeth Andrade and I am a Certified Public Accountant with over 30 years experience. Numbers and accounting are my passion.

After working with clients of all income levels, I have witnessed first hand the struggles of many individuals and families especially the middle class. While I work full-time as a Sr. Accountant for a major national company, I decided I wanted to do more and help the average person, the business owner, the divorced single parent, really anyone who needed help with tax returns. I decided to offer my services for below a CPA firm rate, below H&R Block and Jackson Hewitt rate. Yes my rates are very competitive. It's my way of giving back a little. 

The tax system is complicated in this country and that is why certified accountants are required to take intensive and extensive classes to keep up with changing tax laws.  A valuable lesson my clients will share with you is that if they had doubts about doing their taxes correctly, 99% of the time there was an error. Every tax payer will be audited by the IRS at least once in their life.  If you are not 110% confident in your tax preparation, more than likely you will have to correct it and refile. Responding to the IRS, digging through years of papers, files, receipts, documents is daunting.  A tax consultant is a big help, a huge relief to simplify the process and knows "tax lexicon". 

Feel free to contact me for a consultation. My clients are from around the country and even a few foreign residents who also have residency in the U.S. 

Keep in mind it is tax season and I work full-time, evenings, and weekends so please allow me 24-48 hours to answer your message. You may reach me by phone. Please leave a message on my home phone at 305-860-9903. Miami, Florida. Be sure to speak up, clearly, and slowly. Also, I am bilingual in English and Spanish.

Tax Changes for 2010

Hurray! Just what you have been waiting for--the official day to begin filing your tax return. Why Today? Well Congress took extra time in finalizing new tax laws. Thanks to the Tax Relief Act in December,  your 2010 may be less complicated, but there are still a number of changes that may get you in trouble if you're not up to date or understand its meaning.

Lawmakers’ agreement to extend the Bush-era tax cuts means many of the tax provisions you’ve come to know and love are still in place — and the Form 1040 is similar to last year.

But there’s bad news for some taxpayers. For instance, in 2009 unemployed workers could exclude up to $2,400 of unemployment benefits from income; that provision did not get extended for 2010. This will come as a surprise to most taxpayers.

Other tax breaks are gone, too, such as the three extra standard deductions — for real-estate taxes, taxes on a new-car purchase and disaster losses — that non-itemizers could use to lower their bill in 2009.

Still, other than the disappearance of Line 40b to claim those extra standard deductions, Form 1040 is essentially the same as last year.

The Tax Relief Act, among other perks, resuscitated the deduction for state and local sales taxes — a boon to taxpayers in income-tax-free states — and the above-the-line deductions both for student tuition and fees, up to $4,000, and for teachers’ classroom expenses up to $250.

And, for high-income filers, the new law extends through 2012 the Bush-era provision repealing the income limits on itemized deductions and personal exemptions. Before, taxpayers above certain income levels lost part or all of their exemptions and itemized deductions. Those limits were slowly phased out; 2010 is the first year they’re gone completely (separate income limits still apply on some deductions).

Plus, Congress extended the alternative-minimum-tax patch, preventing millions of taxpayers from losing access to a number of tax breaks under that parallel system. The AMT exemption amount in 2010 for single filers is $47,450 and for married-filing-jointly filers it’s $72,450.

A big perk, for eligible families: The adoption credit is now refundable, and worth up to $13,170 in 2010 and 2011. In 2012, it drops down to $12,170 and won’t be refundable, according to CCH.

Confused? Another change this year is that you get an extra weekend to sort it all out. The tax deadline is April 18, thanks to a holiday in Washington on April 15.

Your IRA
Also thanks to the new law, people 70 1/2 or older can donate up to $100,000 to an eligible charity directly from their IRA, count it as a required minimum distribution, yet still avoid an income-tax hit on that money (but they can’t deduct it as a charitable donation). And they get until Jan. 31 this year to make such a contribution for 2010. The tax break is also available in 2011. See this IRS page for more on what qualifies as an eligible charity.

Meanwhile, if in 2010 you took advantage of the ability to roll money from a traditional IRA to a Roth IRA — income limits on such transfers no longer exist — you can choose to pay the income tax on that conversion over two years, half in 2011 and half in 2012.

Or, you can include that income on your 2010 return. If you want to pay the tax now — maybe you’re in a lower tax bracket in 2010 than you expect to be this year — be sure to check the appropriate box on Form 8606.

If you were unemployed in 2010, had low income and anticipate you might be in a higher tax bracket in 2011 and 2012, it might make sense for you to pay the tax in 2010.

Homeowner Tax Breaks
Are you eligible to claim the home-buyer tax credit on your 2010 return? You won’t be able to e-file. The IRS wants you to snail-mail information with your return.

The credit is worth up to $8,000 for first-time home buyers and $6,500 for long-time homeowners who lived in their home for more than five years. Read the rules for the first-time home buyer tax credit on IRS.gov.
If you claimed the credit in 2008, you are among the unfortunate group that must pay the credit back over the next 15 years — and 2010 is the year your first bill comes due.

Also, if you claimed the home-buyer credit in 2008 or 2009 and then moved out of the house, you may have to pay back the credit. Check out Form 5405 for the details. (Did you know that doing a Google search of “Form 5405” — plug in any IRS form number — will get you the IRS page you need?)
If you’ve had a problem with so-called “corrosive drywall” in your home, the IRS may let you treat that as a casualty loss. See this IRS page for more.

But, bad news for homeowners who didn’t jump on the tax credit for energy-efficient home improvements, such as new doors and windows: That tax break got trimmed for 2011. Still you can take it for 2010 if you made the eligible energy-efficient upgrades by the end of the year.

You probably have many questions swirling in your head. Call me, let's discuss and simplify your life.