With Tax Day just around the corner, many people are scrambling to get their taxes in order. It can be a stressful time, but luckily, we have David Perez, CEO of Tax Maverick, to answer some of the most trending tax-related questions. As an enrolled agent and best-selling author, Perez has a wealth of knowledge and experience when it comes to taxes. So let’s dive in and see what he has to say.
Question 1: What is the deadline for filing taxes this year?
David Perez: The deadline for filing taxes this year is April 15th, 2021. However, due to the ongoing pandemic, the IRS has extended the deadline to May 17th, 2021. This gives taxpayers an extra month to file their taxes without incurring any penalties or interest.
Question 2: Can I still file for an extension if I can’t make the May 17th deadline?
David Perez: Yes, you can still file for an extension if you are unable to file your taxes by May 17th. The extension deadline is October 15th, 2021. However, it’s important to note that an extension only gives you more time to file your taxes, not more time to pay any taxes owed. So if you think you will owe taxes, it’s best to estimate and pay them by May 17th to avoid any penalties or interest.
Question 3: Are there any changes to the tax laws this year?
David Perez: Yes, there are a few changes to the tax laws this year. The standard deduction has increased to $12,400 for single filers and $24,800 for married couples filing jointly. The child tax credit has also increased to $2,000 per child. Additionally, there are changes to the tax brackets, so it’s important to consult with a tax professional or use tax software to ensure you are filing correctly.
Question 4: Can I deduct my home office expenses if I have been working from home due to the pandemic?
David Perez: Yes, you can deduct your home office expenses if you have been working from home due to the pandemic. The IRS has introduced a simplified method for calculating the deduction, which allows you to deduct $5 for every square foot of your home used for business, up to a maximum of 300 square feet. However, if you prefer to use the traditional method, you can still do so.
Question 5: What are some commonly overlooked deductions that taxpayers should be aware of?
David Perez: Some commonly overlooked deductions include charitable donations, medical expenses, and state and local taxes. Many people forget to keep track of their charitable donations throughout the year, but these can add up and be deducted on your taxes. Medical expenses can also be deducted if they exceed 7.5% of your adjusted gross income. And for those who live in states with high income or property taxes, it’s important to keep track of these payments as they can also be deducted.
Question 6: What should I do if I can’t afford to pay my taxes?
David Perez: If you can’t afford to pay your taxes, it’s important to still file your tax return on time. You can then work with the IRS to set up a payment plan or negotiate an offer in compromise. It’s important to communicate with the IRS and not ignore the issue, as this can lead to penalties and interest.
Question 7: Is it worth hiring a tax professional to file my taxes?
David Perez: It depends on your individual situation. If you have a simple tax return with only a few sources of income, you may be able to file your taxes on your own using tax software. However, if you have a more complex tax situation, it’s worth considering hiring a tax professional. They can help you maximize your deductions and ensure you are filing correctly, potentially saving you money in the long run.
Question 8: What are some red flags that could trigger an audit?
David Perez: Some red flags that could trigger an audit include claiming a high amount of deductions compared to your income, not reporting all of your income, and consistently reporting losses on a business. It’s important to be honest and accurate when filing your taxes to avoid any potential audits.
Question 9: What should I do if I receive a notice from the IRS?
David Perez: If you receive a notice from the IRS, don’t panic. The first step is to carefully read
