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5 Tips For The Upcoming Tax Season

5 Tips For The Upcoming Tax Season

5 Tips for Travelers Tax Filings

 We are now in the middle of tax filing season 2019. A lot has changed since tax reform, but the filing requirements have not. Here are 5 quick thoughts to help.

  1. Don’t Panic over the April 15 deadline

File an extension. Yes. File one and worry about this stuff when you are settled long enough to tackle it. The IRS has made it harder for taxpayers to receive all the documents they need early enough to file on time. For example, brokerage statements generally don’t arrive till late February and if you are a participant in an investment partnership, Trust, Estate or something outside of employment, you may not get your documents till late March. As a multi-state or cross border professional (travelers from other countries) you are constantly on the road so mail can be a hassle. Additionally, most tax professionals are already filing extensions when March arrives, and they are zombies by then anyway. Extensions will give you till October 15 to finish your returns. Penalties and interest only apply when you OWE except in lowly Vermont that will charge you $50 even if you have a state refund

  1. The forms are different

Tax reform promised “post card” returns, but the reality is that only applies to the cover page. 5 new Schedules have been added and it looks so different that some of our clients think we are playing a game when we send the forms.

  1. There is a big gap between the Federal return and the state returns

States do not have to sign on to the Federal tax reform changes and lots of them have cherry picked the new Federal laws. At least one state STILL has not made up its mind which of the Federal laws they will follow.

  1. Job expenses are gone till 2026, except in some states

Forget deducting CEUs, licenses, uniforms, travel expenses in excess of reimbursements. They are done for till 2026. Several states still allow them, but you need the right combination and most tax preparers just don’t follow states outside their own and border states. If you use a tax professional, make sure they are comfortable with EVERY state.

  1. Independent Contractors and Self Employed are BIG winners under the new laws

Whether its Uber drivers, nail techs, nurses, doctors or constructions workers, if you are Self Employed, provide services to a partnership or own part of an S Corp, you get to deduct 20% of your net income from these activities before computing taxes.

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