Tag Archives: Income tax

The Truth About the New Mortgage Tax for High Credit Borrowers

Could it be said that you are stressed over another home loan charge for high credit borrowers? Get current realities and see whether this is truly occurring in this enlightening post about a New Mortgage Tax for High Credit Borrowers.

There have been tales circling about another home loan charge that unreasonably focuses on those with high FICO ratings. But are these assertions accurate? We’ll take a closer look at the facts in this post to help you figure out what’s really going on.

What is the new home loan charge for high credit borrowers?

There is no new mortgage tax that targets borrowers with high credit scores specifically. The mortgage interest deduction, which enables homeowners to deduct the interest they pay on their mortgage from their taxable income, has been the subject of reform proposals. These plans would limit the amount of mortgage interest that can be deducted, which could have an impact on borrowers with excellent credit who have larger mortgages. It’s critical to keep up with any changes to tax laws that could affect your finances.

Who will suffer as a result of this tax?

There is no new home loan charge explicitly focusing on high credit borrowers. However, high-credit borrowers with larger mortgages may be impacted by proposals to reform the mortgage interest deduction. Some homeowners may face higher taxes as a result of a cap on the amount of mortgage interest that can be deducted from their taxes if these proposals become law. It’s vital to remain informed about any expected changes to burden regulations that could influence your funds.

What will the tax cost?

There is no new home loan charge for high credit borrowers. However, the amount of mortgage interest that can be deducted under proposals to reform the mortgage interest deduction could be affected, which could result in higher taxes for some homeowners. The specifics of any proposed changes to tax laws will determine the precise amount of the potential tax increase, which is unknown. To know how any potential changes could affect your finances, it’s important to stay informed and talk to a financial advisor.

Is this tax in effect right now?

No, there is not yet a new mortgage tax for borrowers with high credit scores. However, there have been plans to change how the mortgage interest deduction is calculated, which could have an impact on the taxes of some homeowners. It’s critical to remain informed and talk with a monetary consultant to comprehend what any potential changes could mean for your funds.

What can borrowers with excellent credit do to prepare for this tax?

As there is at present no new home loan charge for high credit borrowers, there is compelling reason need to plan for it. But it’s always a good idea to keep up with any changes to tax laws and talk to a financial advisor about how they might affect your finances. You can also help ensure that you are in a strong financial position regardless of any potential changes to tax laws by maintaining a good credit score and paying your mortgage on time.

Turbotax Deluxe vs Premier

Turbotax Deluxe vs Premier: Turbotax Deluxe is the best option for people who are not self-employed or have rental properties. It’s also a good option if you’re not eligible for the free version.

Turbotax Deluxe vs Premier

TurboTax Free Edition

Turbotax free edition is designed to allow low income families and individuals with qualifying incomes to file their taxes for free.

The qualifications for the Turbotax free edition are:

  • You must have a qualifying income
  • You must be a U.S. citizen or resident alien
  • You must not be eligible to use the other Turbotax editions

1099 Income

When someone is paid as an independent contractor, they are not considered an employee. This means that they are not entitled to benefits like healthcare or retirement. The person who hires them pays their taxes instead of the government.

This type of income is called 1099 income because the IRS form for it is 1099-MISC and it’s a miscellaneous income. It’s also called contract work, and you can receive this type of payment from any number of sources including clients, customers, or employers.

The 1099 form is used to report all the money received by a business for services rendered in which the client does not withhold taxes from the payer’s wages or other compensation.

TurboTax Premier is the best option if you’re self-employed with 1099 income, have rental property income/expenses, or are eligible for the free version of TurboTax Freedom Edition.

TurboTax Comparison

TurboTax Deluxe is a software that is designed to make filing taxes easier. It includes the most popular tax forms and provides the basic features for simple tax returns. TurboTax Premier, on the other hand, includes all the features of TurboTax Deluxe and also offers more complex features like audit assistance, cost of home ownership and investment income.

Audit Assistance

Audit assistance is a service that helps with the process of auditing. This is usually done by an external professional, but it can also be done by someone inside the company who has been trained to do so. Audit assistance can be provided in many different ways:

  • Internal audit assistance: this is when the company hires someone internally to provide audit assistance. This person would work both on their own as well as in conjunction with other employees to complete audits. They might also be tasked with training new employees on how to do audits.
  • External audit assistance: this is when a company hires an external auditor to help them with their audits and ensure that they are being completed correctly.
  • Audit consulting: this is when a company hires an outside consultant who helps them find solutions for any problems they are having related to their auditing process, such as how often they should be doing them or how best to go about doing them.

Pricing

TurboTax Premier has a higher price than TurboTax Deluxe because it offers more advanced features which are not necessary for everyone. The Premier version has some additional features and benefits that make it worth the price tag. If you need to deduct investment expenses or get a refund on past-year over-payments, then you should choose this version instead of Deluxe.

Past Year Over-Payments

When a taxpayer overpays their taxes in one year, they are entitled to get that money back in the form of a refund.

Many taxpayers think of past-year over-payments as refunds, but they are not. When a taxpayer overpays their taxes in one year, they are entitled to get that money back in the form of a refund.

Optimize Savings On Your Tax Return

It’s always difficult to be caught up in a mad rush at the end of the tax season to get your federal taxes filed on-time. Filing at the last minute is bound to be particularly stressful this year due to the scaled back phone support from the IRS and the additional requirements set by the Affordable Care Act. Here are some tax changes to take note of now so you are not surprised down the stretch with your 2014 Tax Return.

Tax Breaks

Sales tax can be deducted once again thanks to the last minute efforts in Congress. The primary beneficiaries of this measure are resident of states that have no income tax, as well as those living in states will considerably low income taxes. There is an IRS Sales Tax Deduction Calculator online to help assess the amount covered.

Mortgage insurance premiums may also be deducted in some cases. Only people with a 2014 gross income that is less than $109,000 and who took out the loan after 2006 are eligible for the tax break. Programs like TurboTax Online will make the calculation for you automatically when you enter your income and your mortgage insurance paid.

Seniors are also going to get a couple additional breaks this year thanks to Congress. Those who are 70 and a half years of age may transfer as much as $100,000 from their individual retirement account (IRA) to a qualified charity. This will not be included in the gross income but instead count as the required minimum distribution. This may reduce taxes on Social Security benefits and avoid the Medicare high income surcharge.

Note that these tax breaks are only for the 2014 tax return. Congress has not made them permanent and the changing political landscape is likely to affect their renewal for the following year. Make sure to check several online tax resources next tax season to make sure they were renewed again.

Investment Income Tax

Single taxpayers with adjusted gross incomes in excess of $200,000 and married taxpayers with $250,000 or more may have to pay 3.8% surtax on their investments. Tax-exempt interest is not covered by the surtax.

Does Your Corporation Qualify For A Small Business Deduction?


Photo by laverrue

The small business deduction is one of the most advantageous income tax benefits for company owners in Canada. The deduction lowers the amount of the Part 1 tax otherwise required of business owners. As of the first of January, adjusted tax rates allow a small corporation to qualify at the tax rate of 4.5% in the province of Ontario. Others will still need to pay the standard tax rate of 11.5%. Owners of Canadian businesses are encouraged to examine the tax guidelines to see if they qualify for this lower rate. A useful tool for this purpose is TurboTax Canada.

The Canada Tax Agency has released a chart detailing the varying rates of corporate taxes for different types of businesses. Data is listed for all provinces except Quebec and Alberta, which are exempt from corporate taxes. To qualify for this lower rate, Canadian companies need to meet certain criteria. Each needs to be a Canadian-controlled private company and must meet all the rules set forth in the T4012-T2 Corporate Tax Guide. Each corporation needs to have been incorporated in Canada after the first of June 1971 and must operate fully in the country for all of the given tax year. The CEO of each corporation must also be a full-time Canadian resident. Shares of each qualifying corporation must also not be traded in overseas stock exchanges.

Related articles

Get Ready For The April 15th Tax Deadline With TurboTax


Stay Ahead of the April 15th Tax Deadline

You may be surprised at how many people wait until close to the tax deadline to finish and file their taxes. This may have nothing to do with pure procrastination and everything to do with feeling overwhelmed about the process.

Many people may be focused on the prospect of dealing with penalties for improper filing, but following the good advice from TurboTax can eliminate these types of fears.

File Electronically

Electronic filing is safe and straightforward with TurboTax, and your return will be received much faster than if you mail a paper income tax return. The Internal Revenue Service will inform you within 48 hours whether or not your income tax submission has been accepted.

No Income Tax! (Photo credit: sjrankin)

You can receive a tax refund by a traditional paper check, but selecting direct deposit is quicker and safer as well. Electronic filing and direct deposit eliminates the potential for lost documents, lost checks, and longer waiting due to document delivery time. TurboTax even has free Federal tax filing options for qualifying income tax filers.

File Now, Pay Later

You should file your taxes as soon as possible even if you end up owing the government. The IRS will let you submit your income taxes and set up a payment for a later date, and you may set up an automatic withdrawal. You can pay through your bank account, debit card, or credit card without penalty as long as you make your payment by the April 15th deadline.