If you’re doing your own taxes this year, this guide will help you determine which form you should be using to make it easy to file your taxes.
Posts tagged "taxes"
Five Ways to Keep More of Your Tax Refund
About 75 percent of taxpayers are expected to receive a federal income tax refund this year. If you’re one of them, here are five ways to help you keep more of the money you’re getting back from the Internal Revenue Service (IRS):
- Automatically deposit your savings. Use IRS Form 8888 (PDF) to automatically deposit your refund into up to three accounts. You have the option to deposit some of your refund into your checking account and some into your savings account. You can also use the form to deposit refunds into retirement accounts, mutual funds, or U.S. Savings Bonds. All you need are your account numbers and routing numbers. Contact your financial institutions if you need assistance locating these numbers.
- Use free filing services. Store-front tax preparers can charge you hundreds of dollars to file your taxes. But many taxpayers can use the IRS’s FreeFile service to complete and file their taxes free online.
- Compare instant refund offers to direct deposit. Many commercial tax preparation companies market “free filing” or “instant refunds.” But these offers may come with hidden fees and strings attached.
- Be sure to claim all credits or deductions. A tax credit lowers your tax bill dollar for dollar. A deduction lowers your taxable income, so the amount you save will depend on your tax bracket. Knowing which credits and deductions you qualify for can be complex and you may want to find a qualified tax preparer to help. Although a qualified tax preparer will generally charge for their service, if you qualify for the earned income tax credit, have children, have a mortgage, contributed to a retirement plan, or paid tuition, the added tax savings may be worth the extra effort and cost.
- If you qualify for the Earned Income Tax Credit, contact your local VITA site for free help. There are more than 12,000 Volunteer Income Tax Assistance (VITA) sites across the United States. These sites offer you free tax preparation and assistance by trained volunteers if you meet the income limits. Call 1-800-906-9887 to find the VITA site nearest you. To learn more about the VITA program, visit the IRS website.
Learn more about how you can keep more of your tax refund from the Consumer Financial Protection Bureau.
Asked by Anonymous
What is the fica tax rate for employee and emplorer for 2012
When you work for an employer or are self-employed, you must pay payroll taxes that fund Social Security. These taxes are collected under the authority of the Federal Insurance Contributions Act (FICA) and commonly called FICA contributions.
The FICA tax rate is set by law. From 1990 to present, the total tax rate paid by employees and employers is 7.65%. This is made up of a 6.2% contribution to the Old-Age, Survivors, and Disability Insurance (OASDI) program and a 1.45% contribution to Medicare’s Hospital Insurance (HI) program.
Self-employed workers currently contribute 12.4% to OASDI and 2.9% to HI.
In 2011 and the first two months of 2012, the OASDI tax rate is reduced by 2% for both employees and for self-employed workers.
Learn more about Social Security and Medicare tax rates or FICA.
There are many free tax resources available to U.S. taxpayers, including help online, by phone and in person.
Find Out If You Qualify for the Earned Income Tax Credit
The earned income tax credit is a federal tax credit specifically for low-income workers. It was approved by Congress to help offset the burden of social security taxes and to provide an incentive for people to work.
According to the IRS, the credit provides an important financial boost to the economy since many families use it to pay living expenses and to save for future needs. Last year, four out of five people eligible for the credit filed for it.
Millions of workers will qualify for EITC for the first time this year, according to the IRS. Workers move into and out of eligibility based on changes in their marital, parental and financial status.
The amount of the credit is based on several factors, including the amount of an individual’s earnings from wages, self-employment or farming.
Last year, over 26 million workers received nearly $59 billion in EITC.
