While filing your taxes, whether state or national income tax return, you can hire a professional to prepare you filing or you can do it on your own. Out of these two, you can choose to file your tax your own way; however, you’d have lot of questions before filing your tax return. You cannot rely only on general tax information as the tax laws and tax forms vary from one state to another. If you need more information on tax filing and tax relief programs, you should get in touch with your local or sate government.
When you’re filing your tax return, you’d need to fill lot of information in tax forms. Every information that you fill in tax forms have its own significance however, the most important part is where you fill in your filing status and tax identification number. If you fill your status incorrectly, you’ll miss out on deductions provided by the IRS. The incorrect information may also lead to IRS auditing. Therefore, just be alert while filling the forms; because correct information will not only provide proper deductions but also allow you to stay away from auditing.
It could be possible that you might fall under a status, in which you do not need to file any taxes. However, you should check the latest tax laws thoroughly before making decision of not filing the tax. Generally, you’d need to use the status to file taxes that you had on the last day of the year. As per the IRS, single, married filing separately, single married filing jointly, qualifying widow or widower with dependent child and head of the household are five filing statuses. You can use any of these to file your taxes.
If you’re not married or legally separated and no longer married, then you’d use single status to file your taxes. Remember, if you’re filing tax with single status tax rates will be on a higher side and deductions will be very low. There are some cases when married people file their taxes separately. There could be several reasons however; the most common is when one of the partners has some issues with taxes. And if they file tax jointly, it could lead to paying high amount of tax to IRS. Sometimes, paying separately provide good amount of deductions. You can decide after going through the details and results, what will be more fruitful to you; filing separately or filing jointly.
Married people file their taxes jointly because; if they file separately they are least likely to get tax credits provided by the IRS. One of these tax credits is Earned income credit. There are some deductions and credits that are available only to people who are married and filing their taxes jointly. If you’re a single parent and want to reduce your taxable income, file your taxes under head of house hold as with this status you’ll get higher deductions and tax rate will become low. Qualifying widow or widower is also entitled for tax deductions, if they have a child dependent on him.