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The 12 Days of Tax Tips Part 2

 

The 12 Days of Tax Tips - Part 2

As the year comes to a close, we have collected 12 IRS lists with tax tips for year-end planning, safekeeping, reporting, and giving.

 

Also, read: "12 Days of Tax Tips - Part 1"

 

Part 2 Table of Contents:

  1. • Six check-up questions for end-of-year withholding
  2. • Five steps to remember when making a charitable donation
  3. • Four tips for the IRS’s Select Check tool
  4. • Three rules to reporting hobby activities
  5. • Two types of IRS audits
  6. • And an IRS Interactive Tax Assistance
  1. • Six check-up questions for end-of-year withholding
    1. 1. Was a large tax refund received in prior years?
    2. 2. Was a large tax owed in the prior year?
    3. 3. If I work two jobs during the year will the withholding tax cover the combined income?
    4. 4. Was there a new job during the year and will the withholding cover both the old and new jobs?
    5. 5. Have I made all the estimated tax payments needed for the year?
    6. 6. Has the right amount of tax been withheld for the year?
  1. • Five Steps to remember when making a charitable donation
    1. 1. Donate to qualified charities
    2. 2. Obtain a receipt for donations over $250
    3. 3. Subtract from a donation deduction the value of any items received in return
    4. 4. Limit deductions for donated non-cash items to its fair market value
    5. 5. Itemize the deduction by filing it on Form 1040, Schedule A
  1. • Four Tips for the IRS’s Select Check tool
    1. 1. Search organization’s legal name, not its “doing business as” or “d/b/a names”
    2. 2. Search tax exempt and eligible organizations by Name, EIN, or State
    3. 3. Search by less common words
    4. 4. Don’t panic if your church, group ruling orgs or government entities are not listed, they might not have to be.
  1. • Three rules to reporting hobby activities
    1. 1. Hobby expenses can be deducted against hobby revenue
    2. 2. Hobby expense deductions are reported on 1040 Schedule A
    3. 3. Hobby losses can only be deducted against hobby income
  1. • Two types of IRS audits
    1. 1. Field audits or examinations typically include an appointment for onsite review
    2. 2. Office or correspondence audits typically are conducted through the mail or fax
  1. • And an IRS Interactive Tax Assistance
    1. 1. Interactive Tax Assistant - can I deduct my charitable contributions?

Blue & Co.’s Tax Department is happy to assist with any topic listed above. Please contact Amber Kocher, CPA at akocher@blueandco.com for any tax-exempt questions or concerns.



Resources:
End-of-Year Withholding Check-Up
Five Facts about Charitable Contributions
IRS Select Check Tool
Things to Remember about Hobby Income and Expenses
Charity and Nonprofit Audits
Interactive Tax Assistant by Topic

 


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