pay-taxes-smart

Pay Taxes the Smart Way

Everyone knows how to pay taxes, but what about paying them the smart way?

Tax season can be an unpleasant time of year for a lot of taxpayers, especially if you owe money to the IRS or State. The only thing you can do is make the most of it, prepare ahead of time, and pay taxes in the lowest amount allowed by law.

Whether you are due a refund or writing a big fat check to the IRS, there are some steps you should take after your return has been filed. Here are three critical steps to take once the tax filing deadline has come and gone.

1. Print Off Hard Copies of All Your Forms and Receipts

Even if you save all of your documents on the computer and in the cloud, it is a good idea to print off hard copies and store them in a safe place. From the 1099 forms detailing your interest and dividend payments to the receipts that back up your charitable donations and business expenses, you never know when you will need this information.

You will appreciate having those hard copies on hand if your computer crashes or your cloud storage service fails. It takes only a couple minutes of printing, and those couple minutes could save you weeks of hassle down the road when you go to file and then pay taxes.

2. Check Your Refund or Balance Due Before You Pay Taxes

Even if you file electronically, you cannot expect instant service on your tax refund. It is the IRS after all. Even so, you should see quick action on your return and a notice that it has been accepted. Keeping an eye on your tax refund is one of the best ways to protect yourself and make sure the money you are owed does not end up in the hands of identity thieves.

This is also true if you owe money to the IRS. There have been tax identity theft cases where someone else files a tax return with your social security number, leaving you to deal with the liability or adding on to the amounts you owe.

If you use a tax filing software package, you should receive a notice by email when your return is submitted to the IRS, and another when it has been accepted. Watch your email box carefully and follow up if you do not receive those notifications within a day or two.

Once a week has passed, be sure to check the Where's My Refund page at the IRS.gov website to see where your refund stands. This handy tool provides a real-time picture of your refund status, from the time it is received by the IRS to the minute the money hits your bank account.

If you end up having to pay taxes, log in to your IRS account here https://www.irs.gov/payments/view-your-tax-account and check the balance to make sure it lines up with what you know you owe. If there are discrepancies, contact a tax resolution firm ASAP.

Blackhawk Tax Solutions, LLC

lauren@blackhawktaxsolutions.com

(719) 694-5505

www.blackhawktaxsolutions.com

3. Prepare for Next Year

You just filed your taxes, and the last thing you want to do is think about filing for next year. Despite this trepidation, now is the perfect time to start getting your ducks in a row for the filing season to come.

Start by looking at your current year's return and think about ways you could have lowered your tax debt. Perhaps you could have given more to your favorite charity. Maybe you could have increased your retirement savings rate. Knowing what you did wrong this year will make it easy to adjust your strategy and save more money going forward.

Nothing can make filing taxes a truly pleasant experience, but dealing with the IRS is something every American needs to do. Now that your tax return has been duly filed and your 1040 form is on its way to the IRS, taking the right steps can save you money down the line, protect you from identity theft and make future tax dealings a little less stressful.

ABOUT BLACKHAWK TAX SOLUTIONS, LLC

Our firm specializes in tax resolution, even if you have years of unfiled tax returns, or owe the IRS over $10,000 we can help! If you want an expert tax resolution specialist who knows how to navigate the IRS maze, reach out to our firm and we’ll schedule a free, confidential tax resolution consultation to explain your options to permanently resolve your tax problem.

Blackhawk Tax Solutions, LLC

lauren@blackhawktaxsolutions.com

(719) 694-5505

www.blackhawktaxsolutions.com


IRS Help for Coronavirus

Coronavirus Paid Leave from IRS

Coronavirus Paid Leave from IRS  -  March 20, 2020

A public notice sent out from the IRS Newswire service stated the following about the Coronavirus measures:

Treasury, IRS and Labor announce plan to implement Coronavirus-related paid leave for workers and tax credits for small and midsize businesses to swiftly recover the cost of providing Coronavirus-related leave

WASHINGTON – Today the U.S. Treasury Department, Internal Revenue Service (IRS), and the U.S. Department of Labor (Labor) announced that small and midsize employers can begin taking advantage of two new refundable payroll tax credits, designed to immediately and fully reimburse them, dollar-for-dollar, for the cost of providing Coronavirus-related leave to their employees. This relief to employees and small and midsize businesses is provided under the Families First Coronavirus Response Act (Act), signed by President Trump on March 18, 2020.

The Act will help the United States combat and defeat COVID-19 by giving all American businesses with fewer than 500 employees funds to provide employees with paid leave, either for the employee’s own health needs or to care for family members. The legislation will enable employers to keep their workers on their payrolls, while at the same time ensuring that workers are not forced to choose between their paychecks and the public health measures needed to combat the virus.

KEY TAKEAWAYS:

  • Paid Sick Leave for Workers
    • For COVID-19 related reasons, employees receive up to 80 hours of paid sick leave and expanded paid child care leave when employees’ children’s schools are closed or child care providers are unavailable.
  • Complete Coverage
    • Health insurance costs are also included in the credit.
    • Employers face no payroll tax liability.
    • Self-employed individuals receive an equivalent credit.
    • Employers receive 100% reimbursement for paid leave pursuant to the Act.
  • Fast Funds
    • An immediate dollar-for-dollar tax offset against payroll taxes will be provided
    • Where a refund is owed, the IRS will send the refund as quickly as possible.
    • Reimbursement will be quick and easy to obtain.
  • Small Business Protection
    • Employers with fewer than 50 employees are eligible for an exemption from the requirements to provide leave to care for a child whose school is closed, or child care is unavailable in cases where the viability of the business is threatened.
  • Easing Compliance
    • Requirements subject to 30-day non-enforcement period for good faith compliance efforts.

Need More Info?

For more information on the support and regulations from the IRS regarding the Coronavirus, please visit https://www.irs.gov/coronavirus

Need Tax Relief?

If you or someone you know is struggling with tax debt or IRS issues, please reach out to us!

Blackhawk Tax Solutions, LLC

(719) 694-5505

info@blackhawktaxsolutions.com

www.blackhawktaxsolutions.com


One Debt Solution We Love

One Debt Solution We Love

Do you have debt on your mind?

Now that the tax season is in full swing, we’re hearing a lot of different statements from clients.

Things like how their tax refunds are going to be used to pay down credit card bills or other debts.

I’ve heard that for years and, honestly, I think that was the biggest “negative” for taxpayers last year when the new tax bill went into effect…

In many cases, they did not owe as much, but the return they had come to expect was smaller or nonexistent, so it felt like they paid more.

So if you're one of the millions of taxpayers who try to use their refund to help sort out debt, I want to share another way you can work through that challenge.

The Debt Strategy

Now, I can’t claim this is my own idea – I heard about it years ago watching an interview with Dave Ramsey.  He calls it his “snowball” strategy and it basically works like this:

(And bear in mind, there is a far larger-reaching strategy at play here for those of you who really want to pursue Mr. Ramsey’s strategies)

To start with, you’ll list ALL of your debts, from smallest to largest.  This might be as easy as one or two credit cards, then the car notes, then the mortgage.  Just get it on paper.

Next, with respect to all of those debts, you’ll make the minimum payment on all of them EXCEPT for the smallest.  This one, you’ll pay down as much as you can that month.

Wash, rinse, and repeat.  Month after month, until the smallest debt is paid off, then move on to the next smallest.

Essentially, the idea is that by concentrating on one challenge, you’ll take care of it faster, and this will give you momentum (and extra money) to pay off the next smallest one.

Kinda like how a snowball grows larger and larger as it rolls down the hill.

Take Back Control

Last year was a very challenging one for many taxpayers, as they “lost – at least on paper – a financial windfall many had come to rely on every year.

The good news is there are still a lot of ways to save money and limit debt.

Is tax debt a major issue for you? Schedule a free, tax resolution consultation with us to explore your resolution options.

Blackhawk Tax Solutions, LLC

(719) 694-5505

lauren@blackhawktaxsolutions.com

www.blackhawktaxsolutions.com


cryptocurrency tax resolution

Cryptocurrency Holdings & Tax Resolution

In this week's post, we'll discuss why the IRS cares about your cryptocurrency holdings, and why now is the time to come clean.

After years of flying under the radar, taxpayers who hold Bitcoin, Ethereum, Litecoin and other cryptocurrencies are finally getting their fair share of scrutiny from the IRS. The tax agency has figured out that cryptocurrency is here to stay, and that the mind-boggling returns early adopters have enjoyed could be a boon for government coffers.

The tax agency has also figured out that many holders of cryptocurrency could owe a lot on these ethereal assets. The currency may be virtual, but to the IRS the taxes due are all too real.

NOTE: we encourage all readers in need of IRS tax resolution to contact us for a free, no-obligation tax resolution consultation.

Blackhawk Tax Solutions, LLC

lauren@blackhawktaxsolutions.com

(719) 694-5505

www.blackhawktaxsolutions.com

If you think you might owe back taxes on your cryptocurrencies, contact us today.

The Illusion of Anonymity

If you have been failing to report your cryptocurrency holdings, you might want to rethink your strategy. After years of taking a largely hands off approach, the IRS is catching up in a big way. The tax agency is pulling out all the stops to recover the money the government is owed.

Many holders of cryptocurrency are under the impression that their transactions are totally anonymous. They think that there is no way for the IRS, or anyone else, to tell how much they hold or how they use their virtual coins. That may be a soothing fiction, but the reality is far different.

The truth is the IRS has a wide range of options at its disposal, from official form filings to subpoenas and legal documents, to find the real world identities of cryptocurrency holders.

Did You Get a 1099-K? So Did the IRS

In some cases, holders of cryptocurrency are finding tax forms in their mailbox. If you receive such a form, you can be sure the IRS received a copy as well.

When you file your taxes, automatic matching programs will compare the amount you claimed with the amount on these automatically generated forms. If there is a mismatch, you will be hearing from the tax agency.

One of the most common forms used to report cryptocurrency holdings and transactions is the 1099-K. For sellers on eBay and some freelancers, this form will already be familiar, but it is being extended into the virtual world as well. If you receive a 1099-K form this year, it is time to come clean with your cryptocurrency holdings.

The Cryptocurrency Question and Your Tax Form

Until now, cryptocurrency holders could, and often did, plead ignorance. They could claim they did not realize their Bitcoin, Ethereum and other virtual holdings were taxable, and they could back up that assertion by saying the IRS never asked them about these assets.

The validity of that excuse may have been questionable, but with the 2020 tax year even that thin veil of supposed ignorance will be gone. Starting in 2020, taxpayers will be asked directly if they bought, sold, transacted or otherwise acquired any cryptocurrency. They will be expected to answer that question in a truthful manner.

The wording of this question means anyone who holds any type of cryptocurrency would be required to answer in the affirmative. Even so, simply holding virtual coins in a cryptocurrency wallet does not necessarily mean any taxes will be due. Someone who simply holds cryptocurrency but makes no transactions should not owe any taxes, just as a holder of stock does not owe taxes until those shares are sold.

Clearly, the IRS is getting serious about cryptocurrency. This was drawn by a combination of past returns, unreported taxes and increased exposure of these alternative forms of payment. For holders of Bitcoin, Ethereum and other forms of cryptocurrency, the days of flying under the radar are over. So make this the year you come clean, so you can enjoy your cryptocurrency without worrying about the IRS.

Our firm specializes in tax resolution and our experts can also help with cryptocurrency tax questions. If you want an expert tax resolution specialist who knows how to navigate the IRS maze, reach out to our firm and we’ll schedule a no-obligation confidential consultation to explain your options to permanently resolve your tax problem.

Blackhawk Tax Solutions, LLC

lauren@blackhawktaxsolutions.com

(719) 694-5505

www.blackhawktaxsolutions.com


Tax Resolution: Stay Safe!

Tax Resolution: Stay Safe!

To handle any tax resolution case, filing and staying in compliance is a key factor. This means that tax season, and the hot topics surrounding it, are important topics to stay updated on.

Just like clockwork, all sorts of notices from the IRS have been sent out regarding the latest schemes to take advantage of taxpayers and while some of 2020’s scams are simply modernized versions of traditional cons, there are some alarming twists.

  • "Pennies-On-the-Dollar" Settlements 

    Have you ever seen those ads and commercials saying that you can settle your tax debt for "pennies on the dollar"? While that is an legitimate option for tax resolution, (it's called an Offer In Compromise), not everyone qualifies for that route. In reality, those deals make up the minority of the cases the IRS handles. Often times, people will get bate-and-switched into thinking they can get an OIC, but they just pay extra money to get the same installment agreement they would've gotten in the first place. This is why it pays off to hire a tax resolution professional to get rid of your tax debt correctly and permanently.

  • “The Bureau of Tax Enforcement”

    In this one, an official-looking letter arrives,  claiming to be from the “Bureau of Tax Enforcement.”  In some cases, it’s mentioned the IRS, but in most, it simply states this bogus bureau is the collection arm of the IRS. It is designating where taxpayers can call to pay over the phone or where they can send payment for purported shortages owed to the United States Treasury.   Obviously, it’s a fraud, but the impressive-looking delivery and legitimate-sounding verbiage of the letter has duped many people thus far.

  • IRS Impersonators

    This is a very old scam with a modern twist. An email or phone call, claiming to be from the IRS is received with incredibly detailed instructions regarding a taxpayers’ refund.  In the message, the taxpayers is directed to visit a certain website to view their refund progress. What happens next? You guessed it! That site gathers the taxpayer’s information and sets up a situation where their identity is stolen.

  • Ghost Tax Preparers

    This is an old one, too, but until recently, was only a problem for a small percentage of taxpayers.  It works like this:  a taxpayer pays someone to prepare and file their return and that preparer (generally) makes certain guarantees regarding the size of the return.  In exchange for a “maximum” return, the taxpayer will pay a premium – up to $1,000 – for the service, but the actual person who prepared the tax return will never sign the return (as they legally must do).  The results?  The taxpayer is “on the hook” for monies owed, is often audited, and the tax preparer?  They effectively defrauded both the taxpayer and the government.

There are tons of different ways these and countless other scams are carried out, but the basic way to fight ALL of them?  Simple – have a professional prepare your taxes and handle your tax resolution case.  Make sure they have a “real” office, not some sketchy set up that opens in January in an empty strip mall and is closed on April 16th.

Call us today to set up a free tax resolution consultation.  (719) 694-5505 .

Blackhawk Tax Solutions, LLC

(719) 694-5505

lauren@blackhawktaxsolutions.com

www.blackhawktaxsolutions.com

 

 

Want to avoid common mistakes when filing your taxes? Check out our past article below.

http://blackhawktaxsolutions.com/taxes-mistakes-avoid/