Best Debt Companys

162 Companies 4,141 Real Customer Reviews

Preventing a Tax Disaster Next Year

Posted By:  |  August 28, 2014  |  0 Comment(s)

tax relief from Tax Defense Network

This is the first installment of the short “Intro to Tax Relief” series, presented by Tax Defense Network. You can learn more about them by reading their full review.

Benjamin Franklin once said, “An ounce of prevention is worth a pound of cure”. It’s uncertain whether Ben had taxes on his mind at the time, but it’s certainly applicable. What you do throughout the year will ultimately affect the outcome of your tax return. People often worry about filing because it’s the sum of all fears; the mad dash to review the previous twelve months before hitting the “send” button and crossing their fingers. A little attention early on, though, can prevent a lot of stress come April 15th.

Depending on your professional and personal circumstances, there are specific items you can address to ensure tax season doesn’t ruin the rest of your year. If you’re already dealing with a tax issue, such as paying back a debt in an installment agreement, there are additional concerns to prevent complications when you file your next return. No matter what your situation, though, you have plenty of incentives to take control of your taxes now:

Tax Withholding

An essential consideration in forecasting what to expect for tax season is what you’re withholding from each paycheck. Reserving the appropriate amount from your earnings will prevent having to make up the difference and pay in April. This is especially true for 1099 employees, who may need to estimate their taxes and pay them throughout the year. Calculating the correct amount can be tricky, so it might be helpful to enlist an accountant or a licensed tax professional to ensure you’re on target.

Record Keeping

You may be unaccustomed to hanging onto receipts or paystubs, but anything going on your tax return should have supporting documentation. If you plan on taking a deduction for a work expense – say, gas bills spread over eight months – you should have the corresponding receipts. Again, if you’re self-employed, all of the little deductions will truly add up when you file your taxes…but shouldn’t be taken unless you can verify each one. The reason for this preventative maintenance is simple; in the event that you’re audited for your deductions, you won’t have any cause for concern. If you try to write something off without supporting records and get called out on it, you may be liable for the difference in the form of a tax debt.

Verify That Your Address is Up to Date

It might sound like a minor detail, but ensuring your address and other information is current can prevent serious complications. First, your employer(s) should know where you’re getting your mail, if for no other reason than tax time. If you’re self-employed and receive 1099’s – particularly if you’re working for multiple parties – it could be easy to miss part of your income after tax documents get sent to the wrong address. When your employer reports your income to the IRS and you don’t send in matching information, you may end up being audited and charged penalties and interest, in addition to the tax debt. Also, the IRS should also have your current address. If they need to reach you, or were to send you a letter about a liability, the problem will only get worse if they can’t locate you.

Review Your Current Situation

If you typically don’t have any trouble during tax season, you’re probably already on the right track and won’t need to put forth too much effort. On the other hand, if you’re already paying a tax debt, it’s important to proceed carefully. Should you incur a new tax debt next year, your current agreement may be in jeopardy. It’s important to make sure that any mistakes which led you to your current predicament aren’t repeated, so reviewing many of these details on a regular basis is definitely advisable. Also, correspondence from the IRS is more important than ever if you’re working through a tax problem, so be sure they know how and where to reach you.

Special Circumstances

If you find that your taxes are too difficult to handle on your own, it’s smart to get professional tax advice. There’s no sense in making a mistake that will only lead to a mess when you have to file your return. Also, if you have an IRS agreement that’s compromised by a newly acquired tax debt, you’ll definitely want to confer with a licensed tax professional. He or she can help ensure that any additional liability will be handled and see that you remain compliant with the government. As long as you address any problems early on, you shouldn’t have much reason to worry next tax season.

At BestDebtCompanys.com, you can find reviews for all the best debt relief companies in the industry.

*Written by Christopher Wiggins, Content Writer for Tax Defense Network.

Poll

  • How important is it to you for a debt consolidation company to offer financial education resources?
  • Takes your existing debt and try to settle with your creditors for a lower amount. If you pay off the settled amount, your debt will be considered paid in full.
  • Negotiates with your creditors on your behalf.
  • Fee based on a percentage of your total starting debt or a percentage of the debt they save you.
  • Most settlement companies have you create a separate "escrow" account where you will make monthly contributions over a certain amount of time to contribute to your settlement. Once there is a substantial amount of funds to show your creditors, the settlement company will try to negotiate a lower amount of debt.
  • Combines all your debts and creditors into one monthly payment.
  • Allows you to pay one monthly payment to the consolidation company, instead of multiple payments to different creditors.
  • You no longer owe your original creditors; instead you pay one monthly payment to your consolidation company.
  • Consolidation companies can help negotiate lower interest rates on your debts and help lower your total debt payment in the long run. A lower interest rate will lower the amount you owe in the end.
  • Allows you to consolidate all your different debts into one personal loan that can be paid off over time.
  • Can offer borrowers a lower interest rate with a longer payback term (compared to high-interest credit cards or medical bills). This will lower the amount of money required to pay off the loan over time.
  • Personal loan debt consolidation can be an effective way to raise your credit score quickly (within 3-6 months).
  • Borrowers can receive funds from their loan within only a few days.

Recently Reviewed:

Trending Blog Post:

Want us to review a company?

If there is a debt company that you don't see on our site, and would like us to review, please contact us.

Real Reviews (yes they’re real)

With so many debt relief companies out there, and a lack of sites willing to bring you the HONEST breakdowns of each company, what source can you turn to for the real information you can trust?

We are dedicated to bringing the truth out, and rank debt relief companies as they should be. Through our investigation, and experience with each company, we rank each company, and bring you our honest, unbiased opinion. We also include authentic user reviews by past customers of each company that are moderated and verified.

Like many sites, we are compensated through affiliate relationships with each company we review, however all of our rankings are based on our 11-Point Ranking Criteria.

All reviews are subject to moderation and approval. Any reviews that may resemble false information, or competitors of another company will need to be verified by our staff before being approved and published. We reserve the right to approve or deny any reviews left on this site.