Back taxes are owed by taxpayers who have not paid their taxes for one or more previous years. Individuals and businesses with unpaid taxes will face various consequences, which, if not addressed promptly, can lead to more complex tax issues, such as levies. 

In today’s article, we’ll go over back taxes in more detail and how you can resolve back taxes and manage tax debt more effectively. 

Understanding Back Taxes

What Are Back Taxes?

Back taxes refer to tax debts that have not been fully paid when they were due. People often have back taxes for various reasons, including missed payments, incorrect income reporting, and incorrect deductions. 

The consequences of having back taxes vary and can be severe, depending on the specific situation, including the amount owed, the duration of the unpaid debt, and whether any actions have been taken to address the issue.

Common Reasons People Owe Back Taxes

Misreporting income or deductions: Misreporting income or deductions is a common cause of owing back taxes. While these errors may be unintentional at times, such as misinterpreting the qualifications of deductions, the IRS will remain firm in its assessment. Discrepancies in this matter may result in an audit and/or penalties being imposed. 

Unexpected tax bills from self-employment or side gigs: Back taxes can also result from tax bills from self-employment or side gigs. Unlike traditional employment, where taxes are withheld from paychecks, self-employment, such as freelancing or owning a small business, requires proactive tax compliance. Failure to do so may result in unexpected liability when annual returns are filed, leaving many unprepared.

Withholding errors from paychecks: Withholding errors occur when the amount withheld from your wages for taxes does not cover your entire tax bill. As a result, you will still owe the government money. Errors can occur when filing the W-4 form, such as claiming too many allowances or, on the employer’s side, miscalculating the amount withheld. 

Failing to file tax returns: One of the most common reasons taxpayers find themselves owing back taxes is failing to file their tax returns, often because they overlook this duty or assume the authorities won’t notice. However, that is not the case. When a return is not filed, the consequences are swift and can be detrimental to one’s financial well-being. 

How Back Taxes Impact Your Financial Future

Back taxes can add up quickly due to penalties and compounding interest. Furthermore, failing to resolve your tax issues, such as owing back taxes, can result in more complex problems, including wage garnishment, liens, or levies. 

Facing any of these issues will cause significant stress, as you will be under pressure to pay debts. If you are experiencing such complications, act promptly, as ignoring them will only lead to further problems. Explore the various options available to taxpayers and consult with a tax attorney to determine the best solution for your case. 

How to Resolve Back Taxes and Manage Tax Debt

The IRS provides several options for resolving back taxes and managing your tax debt effectively. One step taxpayers can take is to file past-due tax returns, even if paying them in full is not possible. Submitting returns can prevent some penalties and demonstrate goodwill toward the IRS. 

You can then explore other options for paying your debt, such as setting up a payment plan, like an Installment Agreement, which allows taxpayers to pay off debts over time. Another option to consider is an Offer in Compromise (OIC), which allows you to settle your debt for less than the amount you owe, provided specific requirements are met. 

Lastly, reviewing your tax debt with a professional can help you identify the problem, pinpoint errors, and uncover any deductions and credits you may have overlooked. 

Resources and Support for Tax Debt Relief

IRS Resources and Taxpayer Assistance Programs

Dealing with tax debt can feel overwhelming, but numerous resources and support options are available to help alleviate the financial strain. The IRS offers several free tools and programs to help you deal with tax debt, including ways to verify your outstanding balance. 

When to Seek Professional Tax Debt Help

If you are experiencing serious tax complications or have difficulty understanding or dealing with any tax issue, consult a professional tax attorney to help guide and resolve the problem. 

A tax attorney understands what is at stake in every tax situation, so they know precisely how to respond and what steps to take. Having a professional by your side can help you understand the options, choose the best solution, and avoid future issues. 

Avoiding Future Tax Debt Issues

Everyone should strive to avoid tax problems. To prevent future tax debt issues, file your tax return on time and fill out the correct form with accurate information. 

If you cannot pay your tax debt in full, consider the various options available and consult a professional to help you choose the best path for your situation. Remember that individuals and businesses are required to pay taxes, and avoiding taxes should never be an option because the longer you ignore your tax obligations, the more complicated the problems will become. 

If you need help with your taxes, contact Greenberg Law Group. Don’t put off paying your taxes. There are deadlines to meet, and failing to do so will result in more trouble. Let us help you get on the right track and avoid any tax issues.

Scams are common in many industries, including taxes. While the IRS remains vigilant against tax scams, scammers continually seek new ways to defraud individuals, particularly those with high incomes. 

In this article, we will look at the different tax scams to be aware of and how to protect yourself from them.

Common Tax Scams to Be Aware Of

1. IRS Impersonation Scams

The first common tax scam to be aware of is scammers impersonating IRS agents and demanding payment of taxes. These impersonations are typically carried out via phone calls or notices, with threats of arrest or deportation used to pressure taxpayers into paying taxes as soon as possible. 

They also frequently demand payment via methods that are difficult to trace, such as wire transfers and debit cards. Furthermore, scammers are known to request social security numbers, which can lead to identity theft. 

If someone calls or sends you a notice on behalf of the IRS, always verify the information before sharing it or making any payments. Contact the IRS immediately to confirm the correspondence you have just received. It is important to note that the IRS typically contacts taxpayers via mail first and does not issue threats. 

2. Phishing and Email Scams

Email scams are another popular method scammers use to obtain personal and financial information. Clicking any links or responding to these scam emails may result in identity theft and unauthorized access to your finances. 

To distinguish between genuine IRS emails and scams, verify the domain (which should end with.gov) and pay attention to the tone and spelling errors. Be wary if the writing contains errors and the tone is especially urgent, demanding immediate action. 

The IRS does not initiate contact via email or text to request personal or financial information, except in rare cases such as criminal investigations, and only with your permission.

3. Charitable Remainder Annuity Trusts (CRAT)

A Charitable Remainder Annuity Trust (CRAT) is an irrevocable trust in which the donor establishes the trust and donates assets to it. The trust allows you to withdraw annual income from the trust for a specified period. 

Scams involving CRAT typically rely heavily on marketing to structure a CRAT with a “too good to be true” outcome, often promising taxpayers a magic tax eraser. CRATs are legitimate estate planning tools, but they do not eliminate taxes. Instead, reduce them while adhering to strict rules. Be wary of anyone offering to structure CRATs, as this can lead to IRS scrutiny and complex tax problems.

4. Monetized Installment Sales

A monetized installment sale (MIS) is another abusive tax scheme used by scammers to defraud taxpayers. An MIS is a tax strategy whereby you sell a property or a business, with most of the payments paid upfront and the rest agreed to be spread out in installments for tax purposes. 

This typically involves a third party, such as a financial company, that takes over collecting the installment payments. Scammers use monetized installment sales to lure taxpayers with promises of quick cash and tax savings, but the deals are structured in violation of IRS regulations, resulting in significant fines while the scammers walk away with a substantial sum of money. 

5. Art Donation Fraud

Tax evasion through art donation is a common fraud that targets high-income individuals. In this scam, the promoter persuades taxpayers to purchase artwork at a discounted price and then have it appraised by a shady appraiser working with them to raise the price. 

Taxpayers then donate the artwork to claim a tax deduction. The scammer could receive a cut for setting it up, while taxpayers are misled into believing they are getting a good deal and a legitimate tax deduction when, in fact, they are not. 

How to Protect Yourself from Tax Scams

Protecting yourself from tax scams requires diligence and vigilance. These scams often prompt taxpayers to take action immediately, and the deal is usually too good to be true. As a result, any correspondence that appears to be from the authorities should be treated with extreme caution. Take a step back and confirm with the IRS if you receive any suspicious messages. 

Recognizing red flags is also critical to avoiding scams. If you remember the warning signs of these scams, you will know how to keep the situation from escalating. Furthermore, report any scams you encounter to the authorities so that action can be taken. 

Always remember that the IRS has specific guidelines for communicating with taxpayers. The IRS will first contact you via mail sent by the United States Postal Service, and you will not receive an unsolicited email or phone call. 

The IRS never threatens or requests immediate payment. They will give taxpayers time and options to meet their tax obligations. Payments requested will also be processed through official channels.

Steps to Take if You’ve Been Targeted or Scammed

If you have been targeted or scammed, please contact the IRS immediately and report the incident to them.

It is also critical to monitor your financial accounts regularly to detect suspicious activity. If you have been scammed, scammers may have your personal and financial details. If you notice any suspicious activity, notify your bank and freeze your account.  

Working with a tax attorney is one of the most effective ways to prevent and protect your finances from tax scams. A tax attorney can help you understand everything there is to know about taxes. If you want to reduce your tax burden legally, a professional can help you. 

The best way to avoid tax trouble is to understand your tax obligations and explore your options for managing taxes and addressing any issues that may arise. 

Why High-Income Filers Should Work with a Tax Attorney

If you are a high-income filer, tax scams are looking to target you. Remember that tax scams can result in substantial financial losses and potentially serious legal consequences. 

As previously stated, a tax attorney can help protect you from tax scams and ensure that your hard-earned profits are channeled through legitimate channels when fulfilling your tax obligations. 

Contact Greenberg Law to start protecting your tax processes and ensure a smooth tax experience!

Florida is known for being tax-friendly because it has no state individual income tax. Having said that, Floridians are still subject to state and federal taxes that must be paid as part of being a law-abiding citizen. So, what are they, and how do you pay Florida taxes owed? Let’s get right into it. 

Common Types of Florida Taxes You Might Owe

If you are a resident of Florida, you may have to pay the following taxes:

Sales and Use Tax: A sales tax is added to the price of taxable goods and services. When sales tax is not paid during the purchase, a use tax is levied on using or consuming taxable goods and services.

Florida has a state sales tax of 6%, with the following exceptions: retail sales of new mobile homes (3%), receipts from amusement machines (4%), rental or lease of commercial real estate (2%), and electricity (6.95%). 

Property Taxes: The state does not impose a property tax; local counties and municipalities administer property taxes based on real estate value. 

Tangible Personal Property Tax: A TTP tax, or tangible personal property tax, refers to goods and property other than real estate that an owner can physically possess and have intrinsic value, such as inventories and household items. The tax applies to anyone who owns a business (proprietorship, partnership, or corporation), self-employed individuals, or rental property. 

The rates are based on local mileage, which varies by county and municipality. 

Florida Corporate Income Tax: This applies to corporations, and Florida’s corporate income tax is set at 5.5%. 

Tourist Development Taxes: The ‘Bed Tax’ applies to tourism-related businesses such as rentals and accommodations that rent or lease their properties for six months or less. The tax rates vary by county. For example, Sarasota County’s rate is 6%. 

Steps to Pay Florida Taxes Owed

Step #1: Understand How Much You Owe

The first step in paying Florida taxes owed is determining which taxes apply to you and calculating the amount owed. You can check your tax bill with the Florida Department of Revenue (DOR) or a county tax collector. Once the amount has been confirmed, proceed to the second step of reviewing the available payment methods. 

Step #2: Review Payment Methods Available

Florida taxpayers have several options for paying their taxes. The first option is to pay online through the Florida Department of Revenue’s website. Note that some counties may only offer an online payment system. Therefore, check with your local counties for more information.

The second option is to pay via mail. Ensure you have the correct form and enter the correct information, such as the tax account number and address on your tax bill. 

If you prefer to pay your taxes in person, you can do so at the Florida Department of Revenue or county tax collector offices. Contact them to confirm which types of payment are accepted. 

Step #3: Set Up a Payment Plan if Necessary

Consider a payment plan if you cannot pay off your tax debt in full. A payment plan allows you to pay your tax debts periodically, which can help you manage your debts and finances. It is critical to understand that you should not sit back and do nothing if you cannot pay your tax debts. 

Consider the options provided, contact the IRS, or seek professional advice from a tax attorney. Ignoring to pay off your debt will result in increased scrutiny and complicated tax issues, such as enforcement actions and levies. 

Step #4: Pay Using Electronic Funds Transfer (EFT) for Large Balances

The Florida Department of Revenue (DOR) encourages businesses and individuals with large tax bills to pay using Electronic Funds Transfer (EFT). 

An EFT allows you to transfer funds directly from your bank account, which reduces processing time while ensuring secure and timely payments. This payment method is also recommended for those with recurring payments, such as installment agreements. 

Step #5: Pay Through the Florida Taxpayer Services Portal

The Florida Department of Revenue website provides an online payment system that enables taxpayers to pay their taxes directly through the portal. First, visit the website and select “make a payment.”  

Next, log in to your account and select the type of tax you need to pay. Then, choose a payment method and submit your request. The Florida Taxpayer Services Portal offers a secure and efficient payment method.   

How Greenberg Law Group Can Help You With Florida Taxes

If you require professional tax assistance, please contact our team at Greenberg Law Group. We provide individual and business tax services, including tax relief and resolution, advice on avoiding future tax issues, tax filing and submission preparation, IRS negotiation, and other tax-related services. 

Greenberg Law Group’s professional tax assistance will help you feel more confident and at ease when navigating and dealing with various tax issues and preventing future tax-related problems. Contact us today, and we’ll get to work right away. 

Are you scrambling over papers looking for information and worried about the consequences of owing more than $50,000 in taxes? Rightfully so. If you owe more than $50,000 in tax debt, this is not a minor issue and should not be overlooked. Read on to find out what you can do if you owe over $50,000 in tax debt.

Understand the Consequences of Large Tax Debt

Owing a large sum of money is not a good situation. Tax debt of more than $50,000 is considered a serious delinquency and may result in aggressive collection efforts.

The IRS can take a variety of steps to collect the amount owed: 

Tax lien: the IRS places a claim on your assets. 

Wage garnishments: A portion of your paycheck will be automatically withheld. 

Bank levies: The IRS seizes money directly from your account.  

Passport revocation: You may lose your passport privileges if you owe over $54,000. 

As you can see, owing more than $50,000 in tax debt is serious. To prevent the situation from escalating, immediate action is required. More about this later in the article. 

Review Your Tax Debt & Confirm the Amount

Instead of simply accepting the IRS’s tax debt amount, it is always a good idea to review and confirm it yourself to ensure its accuracy. 

How to Verify Your Tax Debt

First, check your mailbox for IRS letters or notices and understand their contents. Look for any official IRS correspondence indicating a balance due. It is critical to remember that if you receive an official letter from the IRS, do not ignore it. 

Next, access your IRS account by going to the IRS website and logging in. You can find your tax balance, payment history, and any outstanding liabilities here. 

You should also check your previous tax returns to ensure they were properly filed and paid. To identify discrepancies, compare the IRS figures to those on your filed returns.

Another option is contacting the IRS directly with any tax-related questions or clarifications. To make the process go more smoothly, have all your information ready, including your social security number and relevant tax documents.

The steps to verify your tax debt are a process in their own right, and accuracy and effective communication are critical. Hiring a tax attorney is vital in ensuring a successful verification process.

The benefits of seeking professional assistance include understanding the problem, identifying inaccuracies or discrepancies, communicating on your behalf, and exploring the best solutions.

Explore Your Tax Debt Resolution Options

The good news is that the many options available to taxpayers can resolve most tax issues.

Installment Agreement (Payment Plan)

An Installment Agreement (IA) is a payment option whereby taxpayers can pay off their debt in periodic installments (usually monthly). This way, you can manage your debt and ease your financial pressure. 

Note that there are many types of Installment Agreements. When you owe over $50,000, you can have a streamlined or non-streamlined installment agreement. 

Learn more by reading our piece about IRS Installment Agreements. 

Offer in Compromise (Settle for Less Than You Owe)

An Offer in Compromise lets you settle your tax debts for less than you owe. The IRS provides this program with many types of OIC designed to help taxpayers facing various financial issues.

For example, the Doubt as to Collectability (DATC) option is available if you cannot pay your entire tax debt. If the IRS finds reasonable doubt, you may be allowed to pay your debt for a lesser amount. 

Currently Not Collectible (CNC) Status

Currently Not Collectible (CNC) Status is available for those who cannot afford to pay off debts without causing significant hardship. For example, if you cannot fulfill basic living expenses, the IRS can put you on a CNC, delaying any collection process. 

However, it is essential to remember that qualifying for a CNC does not mean your debt goes away. 

Penalty Abatement & Interest Reductions

If you fail to pay or file by the deadline, you may be able to reduce or eliminate penalties based on your situation.

For example, if you have a clean record and a good compliance history, you may be eligible for the first-time abatement program, which reduces or eliminates your interest payments. If you qualify, this type of debt relief can be applied regardless of the size of your penalty.

Other options include Reasonable Cause Penalty Relief, which waives certain penalties if there is reasonable cause, such as serious illness that impairs your ability to file or pay taxes, natural disasters, or civil disturbances that prevent you from filing a return or making a tax payment, and inability to determine the amount of tax due for reasons beyond your control.

Bankruptcy (Last Resort Option)

Filing for bankruptcy can discharge certain tax debts. However, the requirements are strict. For example, the debt must be at least three years old, and the tax return must have been filed at least two years ago. 

Bankruptcy should only be used as a last resort to resolve tax debts. This is because filing for bankruptcy can have long-term financial consequences, such as a negative impact on your credit, difficulty obtaining loans, employment challenges, etc. 

Why Hiring a Tax Attorney is Crucial

If you owe over $50,000 in tax debt, you should resolve the issue immediately and get everything right the first time. This includes thoroughly understanding the problem and the available options, selecting the best options, and accurately applying for the best solution.

In these cases, hiring a tax attorney is an excellent option. As an expert in the field, a tax attorney can assist you at each stage. For example, a tax attorney can effectively negotiate with the IRS to reduce debt and halt aggressive collection efforts. 

Furthermore, professionals can help you determine the best resolution strategy for your situation, ensure that all steps are taken according to IRS requirements, and avoid future tax issues. 

A tax attorney is your best resource for defending your rights and financial interests. If you have complex tax problems, seek professional help. 

Hire Greenberg Law Group, P.A. Today!

Greenberg Law Group recognizes that certain tax issues, such as owing more than $50,000 in tax debt, are serious matters. Because we understand the complex issue, we know that it must be addressed effectively and timely. 

Greenberg Law Group can guide you through responding to the IRS, contracting and negotiating with the authority, and selecting the best resolution that meets your needs and end goals. Do not wait until it is too late. Contact Greenberg Law Group today, and let’s start resolving this issue!

The IRS has the obligation to ensure that all taxpayers comply with the country’s current tax regulations. In doing so, it’s given the authority to pursue tax debt owed by taxpayers through various means, including freezing your assets. 

So, how does the IRS go about doing this? And what kinds of situations prompt the tax authorities to do so? Keep reading to learn more. 

How the IRS Can Impact Your BankAccount

What Does It Mean for the IRS to Freeze Your Bank Account?

Can the IRS freeze my bank account? Yes, they can. A bank account freeze or levy is when the IRS places a legal hold on your account, preventing you from accessing your funds until they are lifted—usually when you have agreed with the authority to settle your debt. Sometimes, the IRS may use your bank funds to cover your debts. 

Why Would the IRS Freeze My Bank Account?

The IRS can freeze your bank account for a variety of reasons. The most common trigger is unpaid taxes. If taxpayers fail to pay their debt, collection action may begin, including freezing a bank account. 

Failure to respond to IRS requests may also result in a levy. When a taxpayer has unpaid taxes, the tax authority sends numerous notices, reminding the taxpayer of the problem and offering various options for settling the debt. Ignoring these notices and not complying with the requests will result in scrutiny.  

Noncompliance with payment agreements is another reason the tax authority may freeze your bank account. If you fail to pay the debt by the agreed-upon deadline, further action, such as a levy, may be imposed.

How the IRS Can Legally Freeze Your Bank Account

The IRS must follow certain procedures before conducting levies. First, it will send several notices informing taxpayers of the problem, demanding payment, discussing available options, and outlining what actions can be taken if they refuse to comply. 

The IRS will also provide timeframes for action. For example, if you’ve received a final notice, you typically have 30 days to respond before the IRS can legally levy your bank account. A Federal Tax Lien may also be issued to legally claim your asset and notify creditors. As previously stated, the authority may use your bank account funds to secure the debt. 

How to Prevent the IRS from Freezing Your Bank Account

Tip #1: Respond to IRS Notices and Communications

Responding promptly to any IRS notices and communications is crucial to preventing a bank freeze. Pay attention to the details in the message and ensure your response meets the IRS’s requirements and is completed by the specified deadlines.

Tip #2: Pay Your Tax Debt in Full or Set Up a Payment Plan

The best way to avoid problems with the tax authorities is always to pay your tax debt on time. The IRS will not look for trouble if none exists. If you cannot fully pay your debt, options like a payment plan are available. 

You can pay in installments or reduce your tax debt, depending on your situation. Understand the various options and what requirements must be met to ensure a smooth and successful process.  

Tip #3: Apply for an Offer in Compromise

An Offer in Compromise (OIC) is one good option for those having trouble paying off their full tax debts. With an OIC, a taxpayer can settle the debt for less than what is owed. To qualify for an OIC, one must demonstrate that they cannot repay the debt or that doing so would cause significant economic hardship.

Read our Offer in Compromise piece here for a more in-depth look at an OIC. 

Tip #4: Request a Collection Due Process Hearing

Taxpayers have the right to a Collection Due Process (CDP) hearing. If you disagree with the IRS decision, whether the amount of debt imposed or the decision to levy, you have the right to challenge it. 

Submit IRS Form 12153, Collection Due Process Request, within 30 days of receiving the Final Notice of Intent to Levy. This will immediately halt the levy process until the dispute is decided. Ensure you don’t miss the 30-day deadline, as this is a very strict requirement, and you risk losing your right to a CDP. 

Tip #5: Demonstrate Financial Hardship

If a taxpayer can demonstrate genuine financial hardship, the IRS can offer options such as a Currently Not Collectible (CNC) status, which immediately pauses collection actions. 

For example, the levy will be lifted if the IRS freezes your bank account and causes immediate economic hardship, such as preventing you from paying rent, utilities, or food.

However, your tax debt will remain if you qualify for a CNC and the levy is lifted. During the pause, explore the payment options to manage your tax debt and prevent the issue from escalating.

What to Do If the IRS Freezes Your Bank Account

Contact Your Bank and IRS Immediately

If the unfortunate event of a bank freeze occurs, contact your bank and the IRS immediately. Call the bank to confirm the situation and ensure that any actions are legally compliant. 

Communicate with the IRS about your situation and choose one of the options available to you. Don’t wait in this dire situation. The longer you wait, the more trouble you’ll get in. If you’re unsure what to do or how to communicate, seek professional help. 

Seek Professional Tax Help

Communication with the IRS requires the right language and accurate responses. Solving a complex issue, such as tax problems, can be daunting and, if not done correctly, can lead to additional trouble and stress. 

Contact a tax attorney to assist you with any tax issues to ensure proper communication, requests are fulfilled and completed accurately, and the outcome is as desired. This is where contacting Greenberg Law Group becomes the best option. Our legal team can effectively guide you through this complex situation.

One of the most common reasons taxpayers get in trouble with the IRS is making mistakes when filing their returns. If not addressed promptly, these errors can lead to more complex tax issues, which taxpayers should strive to avoid at all costs. In this article, we’ll discuss the four mistakes to avoid when filing taxes and how to prevent them so that you can stay out of trouble and remain compliant with the current tax regulations. 

Mistake 1 – Filing Taxes Late

Why Filing Late is a Problem

Once the deadline has passed, penalties and interest will start immediately. These fees can accumulate quickly and become a significant financial burden. The penalty is 5% of the unpaid taxes for each month (or part of a month) that your return is late, with a maximum penalty of 25%.

Filing late will also delay refunds. The IRS processes tax returns on a first-come, first-served basis, so if you file late, your return will likely be placed at the back of the line. By filing on time, you can avoid all of these unnecessary expenses and receive a timely refund. 

How to Avoid Filing Late

Preparing early and effectively organizing your schedule and documents are the keys to avoiding filing late. 

One method of ensuring that you know the critical dates and avoid filing your taxes late is to mark the various tax deadlines on your calendar. Another crucial step is to prepare your documents in advance. This will help you locate the appropriate documents and organize them in a manner that is easy to locate when it is time to file your taxes.

If, for some reason, you won’t be able to file your taxes on time, consider applying for an extension by filing form 4868. If the application is approved, you’ll be granted an extension to file your tax return without incurring penalties, with a new deadline (typically October 15). 

Mistake 2 – Incorrect or Missing Information

The next mistake to avoid when filing taxes is submitting returns with incorrect or missing information. While some of these errors may appear minor, they can have serious consequences. 

For example, a misspelled name or an incorrect social security number can cause the IRS to reject your return, further delaying the process. Errors such as incorrect filing status or missing income from multiple sources may also result in audits. Therefore, double-check all information before submitting or seek professional assistance to ensure it complies with the most recent regulations. 

Mistake 3 – Claiming Ineligible Deductions or Credits

Misunderstanding Deductions and Credits

Deductions and credits are ways for taxpayers to reduce their tax liability. Claiming these benefits when you aren’t eligible is one of the most serious mistakes to avoid when filing taxes, as it can result in major tax issues. 

For example, claiming a home office deduction when the space is unused for business or claiming the child tax credit when the dependent does not meet the IRS’s requirements. Possible outcomes include repayment, in which taxpayers must repay the deduction or credit plus interest and penalties, or IRS audits, where the authorities will investigate your finances further. 

How to Correctly Claim Deductions

Claiming deductions can help lower your taxable income, but following the requirements is vital to do so correctly to avoid penalties and other tax problems. 

First, understand the different deductions and credits available (standard and itemized deductions). Next, review the criteria to verify your expenses are eligible. Keep records of your invoices, receipts, and other documents as proof of your deductible expenses. And finally, stay updated with the latest regulations so you don’t miss out on crucial information, as tax laws often change. 

Mistake 4 – Not Seeking Professional Help When Needed

Filing taxes can be complicated, let alone dealing with tax issues. Professional assistance can greatly improve your chances of achieving the desired result. Tax attorneys possess the necessary knowledge and experience to navigate the complexities and intricacies of tax regulations. 

Aside from assisting you in managing your taxes, ensuring that there are no errors, and avoiding problems, professionals can help determine whether you are eligible for any deductions or credits, allowing you to reduce your tax liability and save money. By seeking professional assistance, you increase your chances of a successful outcome while reducing the stress of dealing with tax codes and communicating with the authorities. 

Why Choose Greenberg Law

Greenberg Law Group has successfully assisted clients in managing and dealing with various tax issues, from simple tax filing to more complex matters requiring effective communication with the IRS. 

Greenberg Law Group is confident that we can guide you in the right direction, develop a personalized strategy, and work hard to achieve the best possible outcome for your tax needs.

Contact us today to start sorting out your taxes and resolving any tax issues you may have! 

Tax season is the time of year when taxpayers prepare to meet critical tax deadlines, fulfill their obligations, remain compliant with the law, and avoid potential problems. 

So, when is tax season? Continue reading to learn all about tax season, how to prepare effectively, and how to avoid costly mistakes and penalties while achieving the best possible results. 

What is Tax Season?

Tax season is a period when individuals and businesses prepare and file their taxes before the tax authorities, such as the Internal Revenue Service (IRS), close the deadline. During this crucial tax season, taxpayers must get their tax filings right and ensure proper compliance with all tax regulations in the country. 

Understanding Tax Season Basics

When is tax season? Individuals and businesses must report their prior year’s income every new year. This window of time, which typically runs for three months, is known as tax season. During this time, taxpayers gather documents, file tax returns, and address any payments owed or refunds due based on their calculated tax liability.

For some, tax filing is an easy process. However, for many, it can be a hassle and a stressful journey. The IRS offers tips on filing your taxes effectively, such as during tax season.

Why Tax Season Matters

Tax season matters because it gives you time and opportunity to maintain compliance with the country’s current tax regulations. By preparing well, filing taxes accurately, and adhering to deadlines, you can avoid penalties, interests, and other serious tax problems such as levies. This is why investing time, focus, and effort during tax season is crucial for a smooth, stress-free tax filing process.

When Does Tax Season Begin and End?

January: Tax season typically starts in late January. For example, in 2024, tax season started on January 29 and ran through April 15. As the window opens, the IRS starts processing returns and sending out W-2 and 1099 forms. 

For those with an AGI (Adjusted Gross Income) of $84,000 or less in 2024, the IRS has begun accepting tax returns through the Free File system on January 10. 

February-March: Most taxpayers begin preparing and filing their tax returns between February and March. This includes filling out forms and gathering receipts for deductions and credits. 

April 15: The standard deadline for filing personal tax returns is April 15. If this date falls on a weekend or holiday, the deadline is moved to the following business day. You can request an extension if you can’t file by the deadline.

Extension Deadlines: If you file for an extension, the new filing deadline is usually October 15. However, this extension period is only for filing tax returns. It doesn’t apply to paying your taxes. Therefore, penalties may apply if you fail to pay taxes by the deadline. 

How to Prepare for Tax Season

Organize Your Tax Documents

The most important step during tax season is to be well-prepared. This entails having all necessary and correct documents and keeping them well organized. These documents can include income forms, records of expenses, investment information, and other papers to support credits or deductions. 

Review Changes in Tax Laws for 2025

Tax laws frequently change. As a result, staying current with the changes is critical for ensuring regulatory compliance. Failure to understand new updates will result in incorrect filing and numerous tax problems. You can get the most recent update from authorized sources or consult a tax attorney. 

Determine Filing Status and Tax Liabilities

The amount of taxes you pay is determined by your tax bracket. And this depends on your filing status (single, married, head of household, etc.). Use the tax bracket to estimate your tax liability and calculate whether you will owe money or receive a refund. 

Consider Your Refund or Payment Plan

If you expect to receive a refund, consider how you intend to spend the money. For example, you can save, invest, or use it to pay off debt. If you owe money, choose the best payment plan for your situation to make paying it off easier and avoid stress and the escalation of the problem. 

Common Tax Filing Mistakes to Avoid

Incorrect Information on Tax Forms

Incorrect information, such as a wrong social security number or filing status, can cause delays and get you in trouble with the authorities. Be thorough and double-check everything before filing your tax returns. 

Missing Deductions or Credits

Missing deductions and credits can lead to higher tax liabilities. In contrast, taking advantage of eligible deductions allows you to save money. Ensure you understand these deductions and which ones are eligible for you. Charitable donations, education credits, and energy-efficient improvements are among the most frequently overlooked items. 

Filing Late or Not Filing at All

Late or non-filing can result in serious tax issues. Taxpayers who don’t follow the rules risk paying large fines and facing other legal consequences. Make sure you meet all the deadlines, and if you can’t, request an extension and learn about your options. 

Should You Hire a Tax Professional or File Yourself?

While you can complete all of the steps for gathering documents and filing tax returns yourself, hiring a tax attorney has many advantages. 

Having professional assistance to help you prepare and file for tax season will provide you with extra eyes to detect errors or incompletions, someone with extensive knowledge to guide you through the entire tax filing process, and help you figure out deductions and credits, allowing you to save more money. 

This is exactly what our team at Greenberg Law Group, P.A. sets out to do. With our assistance, you won’t have to worry about mistakes or missed opportunities. We have the knowledge and experience to make the best of any tax situation, ensuring our clients get the best possible outcome.

If you need assistance with tax preparation and filing during this critical tax season, do not hesitate to contact Greenberg Law Group, P.A. We understand the complexities of tax regulations and have the knowledge and experience to make the tax filing process easier and avoid tax issues.