If you are worried that tax time is around the corner, April 15th for most filers, keep these handy tips to play your part effectively and set sail into this tax season through calm and peaceful waters. This information was provided by the IRS in their tax time guide published on their website yesterday1. The IRS is responsible to Congress to obtain funding to keep the government running. How they do this is to ensure all taxes are collected and timely. What's your part, you ask? Keep reading.
What's your part?
Your part in this, let's call it, in the game of paying your taxes, is to report all the income which is not excluded from being reported to the IRS and to report that income in a timely and accurately manner.
How do you do play the part?
Hire our help or do it yourself. Either option is available to you. Choose wisely.
If you are a DIYer, here are some helpful guidelines from the IRS:
1. Include your earnings for side jobs. If you have a side job, you are part of the gig economy in IRS terms and must include all income you make.
2. Include your earnings from tips. Especially, and most importantly, if these tips are reported to the IRS by your employer. If the IRS has this report, then it will be added to your tax record. [If you are interested in learning more about what is on your tax record, watch our YouTube series called What Is An IRS Transcript and Why Should I Care?]
3. Include your virtual currency sales. There are still many who still hold these assets. At the least, mark "Yes" on your 1040 page 1, confirming that you own these assets? If you own them, trust me the IRS already knows you own them, it's best to validate this with your answer "Yes" on the first page.
4. Include foreign source income. Your broker may deal in foreign assets and currency for you. They will report this on your 1099B statement. You should have already received a copy by now. They are required to be mailed to you by January 31th, 2023. However, outside of brokerage firms, if you own foreign assets, property, etc. and they generate income then make sure to report the information on your tax return. Foreign assets and bank accounts values must be separately reported.
We hope you found this information helpful. If you need help with your taxes or with any tax-related service, visit our main site to get to know us and discover all the services we offer.
We'll keep it short for today's blog. Here's to the new tax season! Wishing you accurate and timely reporting.
Reference: