TurboTax 2012, 2013 Tax Refund Calculator

Allowable Federal Irs Medical Expense Tax Deductions

Although medical expenses are deductible, very few taxpayers get to deduct them. Why not? Because you get to deduct such costs only to the extent that unreimbursed expenses exceed 7-1/2% of your adjusted gross income.

So if your AGI is $50,000, for example, the first $3,750 ($50,000 x 0.075) effectively don't count. Before you go through all of your doctors' bills and prescription receipts, do a quick calculation based on your income to make sure your time will be well spent.

Deductible medical expenses include doctors' and dentists' fees, chiropractors' fees, lab fees, contact lenses, glasses, prescription drugs and medical supplies.

• If you have a question about a particular medical expense, consult IRS Publication 502, Medical and Dental Expenses.

You can deduct the premiums you pay for health insurance coverage, unless your employer pays for your coverage through a payroll deduction using pre-tax dollars. If so, you've already received a tax benefit for your premium payments, so don't deduct those premiums on your return.

Turbotax Online can help you with your medical expense deductions. It offers advanced tools to help you pay the least amount of tax possible. It also provides an extremely accurate tax return to file with the Internal Revenue Service (IRS).

Relief for Taxpayers Who Lose Their Homes Due to Foreclosure

For foreclosures in 2007, 2008, and 2009, debt forgiven in connection with a foreclosure, short sale, or loan restructuring will not be treated as income.

• This relief applies only to principal residences, that is, the home you live in. If a lender forgives debt after a foreclosure, short sale, or loan restructuring for a vacation home or investment property, for example, the general rule still applies: The amount of debt canceled is considered taxable income to you (unless you are in bankruptcy or insolvent).
  
  
• No more than $2 million of forgiven debt can be excluded from income.
  
  
• To be eligible for the break, the loan must be secured by your principal residence and the money must have been used to buy, build, or substantially improve the property. If part of the forgiven debt was a home equity loan or cash-out refinancing used for other purposes, that part would be considered taxable income.
  
  
• The tax basis of the home is reduced by the amount of canceled debt excluded from income.

Reduction in Itemized Deductions and Personal Exemptions for High-Income Taxpayers

Itemized deductions and personal exemptions are phased out (reduced) as your income rises. In 2008, the reductions are less painful. The cutback in itemized deductions occurs once your adjusted gross income exceeds $159,950, regardless of your filing status.

Your itemized deductions are reduced by 1% of the amount by which your AGI exceeds $159,950, but you can never lose more than 80% of your itemized deductions. Also, your medical expenses, investment interest deduction, deductible gambling losses and any casualty and theft losses are not subject to the cut.

Personal exemptions are reduced by 2% for each $2,500 of adjusted gross income over $239,950 for married filing jointly, $199,950 for heads of households and $159,950 for singles, but the reduction cannot exceed $1,167 per exemption.

Higher Income Limits for Deductible IRAs and for Roth IRAs

If you are covered by a retirement plan at work, you can take a full IRA deduction if your modified adjusted gross income is less than $85,000 (married filing jointly) or $53,000 (single or head of household).

A partial deduction is allowed until your adjusted gross income reaches $105,000 if you are married filing jointly or $73,000 if you are single or a head of household. Also, the opportunity to contribute to a Roth IRA is now phased out as your modified adjusted gross income rises between $159,000 and $169,000 if you are married filing jointly or $101,000 to $116,000 if you are single or a head of household.

Capital Gains Tax Rates to be Reduced in 2008

Prior to 2008, long-term capital gains from the sale of assets held longer than one year were taxed at a maximum rate of five percent to the extent the seller was in the 10 or 15 percent tax brackets. In 2008, the five percent maximum rate drops to zero percent through 2010. The 15 percent maximum tax rate on other long-term capital gains stays the same.

There is also a reduction in dividend tax rates

Similarly, in 2008, the special five percent maximum rate on dividends of taxpayers in the 10 and 15 percent tax brackets drops to zero percent through 2010.x rate on other long-term capital gains stays the same.

Tax Deduction For Alimony - Is Alimony Tax Deductible

If you have already divorced and are required to pay alimony, it is deductible. You do not have to have other itemized deductions greater than the standard deduction as it is treated as a direct deduction from gross income.

If you are going through a divorce, now is an opportunity for some sound tax planning. While alimony can be deducted from your gross income for tax purposes, child support cannot. Of course, the trade off is that the spouse who receives alimony must recognize it as income - but often it is the case that the parties are better off from a tax stand point if alimony is paid instead of child support because the person paying the alimony is in a higher bracket than the person receiving it.

If you would be ordered to pay $500 per month ($6,000 per year) in child support but no alimony, it may serve everyone well if you agreed to pay even $625 per month ($7,500 per year) in alimony with no child support Then, if your federal and state taxes combine to take 40% of your income, you would end up saving $1,500 per year, and your ex-spouse could net more than the $6,000 that would have been paid otherwise. How?

A $7,500 deduction for alimony would reduce your tax liability by $3,000 ($7,500 * 40%), leaving your net costs at $7,500-$3,000=$4,500. If you had child support instead, it would have cost you $6,000 - with no tax deduction. If your ex-spouse is in a lower tax bracket, she may end up receiving more than the $6,000 she would have received in child support.

There is one important risk in this idea though - alimony is not usually reduced because of a drop in income while child support normally is.

There are many new tax questions a divorce presents.

You can go to TurboTax Online and get the latest and best updates for tax deductions such as alimony. When you prepare and file taxes online, you save money, get quick refunds and win all the way around.

Benefits of Calculating and Estimating Your Taxes in Advance

There are many good reasons to calculate or estimate the taxes you will have to pay for the year before you file your return. Below are two of the most common reasons you may want to do so.

Avoiding Too Much Withholding from Your Paycheck

If you are an employee with a steady job and your cash flow is tight, you may not want to have too much withheld from your paycheck. The withholding tables and schedules are set up to protect people from coming up on April 15 with a big tax bill due. So instead, they have an automatic overpayment cushion factored in when your taxes are withheld.

You can avoid this by simply increasing the number of withholding allowances you claim. This is entirely legal and appropriate and helps you avid making an interest free loan to the IRS that you can't collect until you file your taxes next year.

Getting Your Quarterly Installments Right

If you are in business for yourself, you know your business better than anyone else. You know whether cash flow varies or is steady throughout the year, and which seasons are more profitable than others.

Your business budget should give you a reasonable estimate of your profit or loss. From this budget, you can estimate how much tax you will owe. As each quarter goes by, you can recalculate your estimate for the year and determine which method of calculating what you pay for any quarter, e.g. prior year tax due, current year expected earnings, etc., in order to match up with your own cash flow and budget expectations.

Estimate Your Taxes Now to Make Sure You're On the Right Track!

Right now, you can click on TurboTax Online to calculate what you will owe for this tax year. TurboTax is the largest online tax service and provides you with calculations that are completely up-to-date on changes in the tax law and the latest information you will need.

Paying Self Employment Tax - Self Employed Tax Help

When you begin a new business endeavor, it may take some time before you are "in the black" earning taxable income form your efforts. Once you are, however, your earnings will be subject to self-employment tax, as well as income tax. Self-employment tax is the tax a business owner must pay on income that parallels FICA, the Social Security payroll tax.

FICA tax is paid only on employees. If you are a sole proprietor, or shareholder in an S Corporation of LLC, it is unlikely that you are treated as an employee. In these situations, the income you derive from your business is passed directly through the business to you as the owner, and you are not subject to payroll taxes. Instead, the IRS requires you to make up for this difference via the self-employment tax.

An exception to this requirement applies to owners of corporations, typically called "C-Corporations", that do not pass through income directly to their owners, but are taxed as a corporate entity. In this case, there is no self-employment tax. Income passed through a C Corporation to an owner is either in the form of a taxable dividend or to the owner as an owner-employee. In the latter case, payroll taxes must be withheld just as they are for any other employee. In either case, there is no self-employment tax to pay.

When self-employment tax is due, the tax is calculated as follows:

• Social Security: 12.4% of the first $97,000 of self-employment earnings;
• Medicare: 2.9%: on all self-employment earnings. There is no cap on the Medicare portion of the self-employment tax

To estimate what you are likely to owe for self-employment tax and your overall income tax, you can go to TurboTax Online and use their calculators for free. Then you can go ahead and use the TurboTax Online services to prepare your taxes as well.

How Does Paying Child Support and Alimony Affect Your Taxes

Child Support, Alimony and Taxes

Recently the IRS ruled that parents who pay child support would be allowed to consider their own children as dependents when it comes to Health Savings Accounts and Medical Savings Accounts. This is a step in the right direction!

Traditionally there have been few if any tax benefits from paying support. Now, however, the IRS has begun to recognize that parents - usually fathers - will be more diligent about paying support obligations if they also receive a tax benefit when they do. Under current tax law, alimony is deductible, child support is not.

How fair is this? Think about these issues:

1. Child support is paid by "non-custodial parents", who do not have tax exemption or child tax credit benefits for their own children. They get double hit when they now have the added cost of paying child support they cannot deduct.

2. Meanwhile the other parent gets the extra income from child support, but also has the benefit of taking the tax exemptions and child tax credits for having the children in her home.

3. Usually alimony is only paid by someone who has made lots of money and can afford it - yet they still get a tax deduction. The tax system is regressive in this way as lower income taxpayers paying child support cannot deduct their payments, but higher earners can deduct alimony - and may be able to use that as a bargaining chip to pay little or no child support.

To be sure you take full advantage of the deductions that are available to you, use a tax service such as TurboTax Online to calculate and prepare your taxes. Be sure you don't miss out on any benefits you're entitled to receive!

TurboTax Online lets you use their software and calculators for free. The only time you are asked to pay is if you decide to print or efile.

List of 10 Allowable Personal Tax Deductions Tips

As you prepare to file your taxes, you're likely thinking about how you can keep that final tax bite as small as possible. Take a minute to take stock, mentally and through your records, to be sure you haven't missed deductions that have the potential to reduce that bite significantly.

Below are ten I have found to be most worthy of taking a few extra minutes to make sure you're getting all you can from them

1. Car and Truck Expenses

There are so many costs associated with vehicles and the ways you use them, you don't want to overlook the benefits that are out there for the taking. Mileage for business, charitable purpose, moving from one home to another, etc., and/or lease costs or depreciation, interest on loans, maintenance, and in some cases, fuel costs are all available to consider.

2. Travel

Include any travel costs: hotels, airfare, meals, tips, cabs, etc. for any ordinary and necessary trip.

3. Early Withdrawal Penalties

If you incurred penalties for early withdrawal at a bank, you can deduct that penalty.

4. Educator Expenses

Professional educators are allowed to deduct expenses for teaching courses. This is a wide and generous deduction if you are an educator.

5. Moving Expenses

While the rules can be tricky, if you're moving for work related reasons, you're entitled to a deduction for your expenses, including mileage, storage, overnight stays, etc.

6. Health Savings Account Deduction

A newer deduction in the code, this is an alternative to traditional health insurance and has long term tax benefits if you use them.

7. Alimony Paid

Court ordered spousal support, "alimony", is fully deductible. Child support is not.

8. Job Search Expenses

This deduction is easily forgotten, but in a weak economy it is also very important. Don't forget costs of printing, copying, travel, phone usage, etc. as you calculate this deduction.

9. Student Loan Interest Deduction

An easily overlooked deduction that doesn't apply to everyone, but is very valuable to those who are still owe on student loans.

10. Self Employment Taxes

For business owners, this is often a large deduction that helps offset the burden of all the taxes you are forced to pay as a business owner.

Tax deductions can create a maze of issues you may need help working through. TurboTax Online lets you use their software and calculators to figure your deductions for free. The only time you are asked to pay is if you decide to print or efile.

Getting Organized to File & Prepare Your 2008, 2009 Tax Return Online

Have you ever come to that fateful day early in the year when it's get your taxes done - and had a feeling on anguish over whether you have what you need to get it done?

It doesn't matter if you're filing your taxes online, having them done by a paid preparer, or even doing them by hand, the burden of having everything together you will need to get the taxes filed as you need them, falls squarely on your own shoulders, and you have to be prepared to make it happen.

So what should you do now, and what should you be doing as tax deadlines approach?

First, don't panic. One of the great benefits of the increasing use of technology is that much of the documentation of your income and expenses is maintained online now. Bank account charges and credit card expenses can all be found by setting up your account access online.

Also, wages, salaries, interest, dividends, 401(K) and IRA distributions, and many other forms of income are required to be documented on W-2's or 1099 forms that will be mailed to you, usually in January, before you file your taxes.

With these items in hand, you have the vast majority of the documentation you need. Things like mileage logs, home office calculations, etc. are items you need to create and maintain yourself, however, and these can be very important as they can save you large amounts of money when you file. Keeping a log of mileage on your home computer or notebook even daily is a good idea, and calculating the square footage that you use for a home office is a simple process, and one you can maintain as long as you stay in the same home.

To find complete guides, calculators, checklists and other helpful ways of getting organized, go to TurboTax Online today. The only time you are asked to pay is if you decide to print or efile.

Getting the Most From the Mileage Tax Deduction & Write Off For 2008

The Mileage Tax Deduction Can Save You a Lot of Money

How often are you driving for work, as a volunteer or perhaps even moving? Would you say that nearly all of your driving is done for one of these reasons? If not, consider, the times you leave the office for business reasons, or if you work from home, leave and return home for business reasons. What about those trips you take if you haul the kids' baseball team somewhere - or help out at your church?

All of these miles that you drive are deductible for tax purposes. As of July 1, 2008, the standard rate is also increased to $0.585 per mile ($0.19 for volunteer and moving miles). The IRS does require logs of miles to be kept for your records - and in case of an audit. You may find that by keeping logs up-to-date, at the end of the year you will have significantly more miles accounted for deduction purposes than if you are more lax in your record keeping.

The cost of driving a vehicle has skyrocketed in the past few years. Gasoline costs alone carve into business and household budgets in ways you could not have expected in the past. The driving you do to earn a living is a significant cost and Congress has recognized the importance of this deduction as a vital means for people to continue to pursue their incomes.

The tax code requires only that expenses are ordinary and necessary. It is not required that you show that the specific reasons for the expense are also ordinary and necessary - only that the expenses are both. So, for example, if you work from home and will be needing new paper for your printer in the near future, but decide to pick it up while you are out grocery shopping, both the expense for the paper itself, and driving to where you purchase it are deductible - wow!

Since the mileage expense to drive to the office supply store is ordinary and necessary, the mileage is deductible - in spite of the personal purchases you made while shopping. You have just converted an otherwise non-deductible trip to the store into a fully deductible business trip. There are many other opportunities available to you that you may not have thought about to take advantage of this deduction.

The mileage tax deduction, like many others deductions, can be calculated for free at TurboTax Online. The only time you are asked to pay for the service is if you decide to print or efile.

TurboTax Tax Return Calculator for 2012, 2013

Whether you want to know how much your tax refund will be, how much you'll pay in taxes, which deductions you can take or how much your home mortgage will save you in taxes, TurboTax has you covered.

You can use these Free Tax Calculators from TurboTax to calculate your 2012, 2013 income taxes.

Tax Refund Estimator - How much will your tax refund be this year?

Changes in your life—like a salary or job change, new house or car, or additions to your family—might affect your refund. This tax calculator helps you determine how much you are likely to pay in taxes for 2012—or how big your refund will be. The latest changes to the Alternative Minimum Tax (AMT) are factored in for increased accuracy.

W-4 Salary Calculator - Try the New W-4 Calculator and see how many withholding allowances you should take to boost your tax refund—or your take-home pay.

Tax Rebate Calculator - Will you get a IRS Federal stimulus tax rebate check from the U.S. government this spring?

The government will not automatically send you a stimulus check if you qualify. You must claim this rebate on your 2012 tax return. This could be a huge potential credit for many tax payers that have been laid off or hit hard by the current economic situation.

Average Tax Rate Calculator - What's my average tax rate amount?

Want to know the average tax rate you'll pay on your income? Plug in your income figures and this handy tax calculator will show what percentage of your income will go to taxes.

Home Loan Tax Saver - How much will my mortgage save me in taxes?

If you paid interest or points on a home loan, chances are you can deduct those payments from your income taxes. This tax calculator can help you find out how much your mortgage will save you on your taxes.

Payroll Withholding Tax Calculator for Employers

You can calculate your employees paychecks instantly. Federal & States taxes are calculated for you, then pay employees with our free direct deposit, or print checks & stubs on your own printer. Quickbooks Online Payroll Calculator. Try it for Free!

Paycheck Tax Withholding Calculator - How much will I take home after tax withholdings?

Are you withholding enough—or too much—from your paychecks? This valuable tool looks at your entire tax situation, including your other income and expenses, and figures out what you'll actually owe on your taxes for the year. The calculator then determines how much you should have withheld to cover what you'll owe for the year, without giving Uncle Sam a big loan.

Deduction Finder - Am I claiming all the deductions I deserve?

Are you missing out on deductions you deserve to claim? Use this tax calculator to help identify over 350 tax credits and deductions available and which ones you are eligible for.

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