CONSIDERING DIVORCE? THINK ABOUT YOUR TAX FILING STATUS

If you're thinking about divorce, you should also be considering what tax filing status you should choose. Here's why.

WHY A BUSINESS APPRAISAL MAY BE YOUR BEST FRIEND

There are a lot of ways a business appraisal can help business owners. Take a look at why you should consider getting one.

DON'T LET SCANT TAX RECORDS BE YOUR DOWNFALL

Tax records should be kept year-round, not hastily assembled just for your annual tax appointment. Without tax records, you can lose valuable deductions or have unsubstantiated items disallowed if you're audited.

 

Generally, returns can be audited up to three years after filing. However, if income is underreported by more than 25 percent, the IRS can collect underpaid taxes up to six years later. In other words, you need good records to verify what you report on your tax return, and you should hang on to those records for seven years

MAKE SURE YOUR TAX WITHHOLDING IS RIGHT FOR YOU

If you receive a sizable refund of your 2017 taxes, it may be time for you to check your withholding. Reducing your withholding is as simple as filing a new Form W-4 with your employer. The form comes with a worksheet to figure out how many allowances you should claim. Don't forget to allow for other taxable income besides wages, such as dividends or investment gains.

DON'T FORGET TO DOCUMENT YOUR SPRING CLEANING DONATIONS

If spring cleaning has left you with items that you want to donate to charity, remember that donations of used clothing and household items must generally meet certain requirements to be tax-deductible. First, such items must be in "good used condition or better." Second, a receipt from the charity is required. If a receipt is not available (such as at unattended drop-off locations), reliable written records are still required.

HOME EQUITY LOAN INTEREST DEDUCTIBILITY HAS CHANGED

Congress cracked the whip on home equity interest tax deductions in 2018. Now, only loans used to buy, build or improve your home will be deductible. That means if you used a home equity loan to consolidate debt or fund a purchase that was not related to your home, you can no longer deduct the interest.

DON'T GET HOOKED BY A PHISHING SCAM

This year, the IRS ranked email phishing schemes as a top tax scam to make the yearly Dirty Dozen list. This type of scam targets taxpayers as well as tax professionals by using fake emails and bogus websites to collect sensitive taxpayer information.

The best way to avoid scams now and throughout the year is to keep in mind that the IRS doesn't initiate contact with taxpayers via email, phone or text to request personal or financial information. If you get unsolicited email from what appears to be the IRS or an organization related to the IRS, report it by sending it to phishing@irs.gov.