Welcome to Selfmade Finance School, our new money series with Block Advisors to help small business owners with their tax, bookkeeping, and payroll needs year-round. This week, we recap some major learnings to remember during tax season and give helpful tips for you to know before you file.
Over the past two months, I have taken you on a full tax journey. We talked about the pandemic, whether you should hire a tax professional (you should), new tax jargon that is now impressing all of your friends, and so much more. But the time has now come to put 2020 to bed, file your taxes and focus on the future. Even though the federal tax filing deadline has been pushed back by a month to May 17, go ahead and cross tax filing off your list now! But before you officially file, you should double check to make sure everything is in good order. Here are some final tips before you file:
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Should You File An Extension?
If it is tax day and you still haven't filed your taxes, you should probably consider filing an extension so you don't mess anything up. For more info on this, please check this piece. Remember that just because you are filing an extension does not mean you don't have to pay your tax liability if you have one. Generally, you must pay at least 90% of your tax liability to avoid the 'failure-to-pay' penalty. Also, states have different rules on filing extensions. Many states require you to file a state extension in addition to a federal extension.
Double Check Your Math
My son's second-grade teacher is always reminding him to check his work. It's a good life lesson. This should be applied to checking all your documents before you officially file your taxes. According to the IRS, they found approximately two million math errors each year between 2015 and 2017. Depending on the type, an error might impact the size of your refund. If the IRS fixes a math error on your tax return, it will send you a notice indicating what was corrected and how it impacts your tax return and your refund. Depending on the size of your error, it could change the size of your refund, or result in a tax liability when you were expecting a refund. If you disagree with them, you will need to go through an appeal process which slows down your return and your refund.
"You can avoid this worry by filing your small business taxes with Block Advisors," said Cathi Reed, Regional Director, Block Advisors. "We guarantee 100% accuracy in our taxes, bookkeeping and payroll services and will reimburse you for penalties and interest if we make an error on your return."
Pay Close Attention To Instructions
Taxes and the forms that go along with filing your taxes are incredibly confusing. Also, make sure your basic information—such as your name, Social Security number and filing status—is correct and that financial information is reported on the right line. Always proofread and check for typos.
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A Few Other Common Errors to Avoid (according to the IRS)
Check for missing or inaccurate Social Security numbers. Also, make sure you spelled your name right, and remember to match your name exactly as it appears on your Social Security card. Finally, double-check that you've entered the right bank account numbers. Taypayers who are due a refund and choose direct deposit need to make sure they use the correct routing and account numbers on their tax return.
Sort Out Your Refund
Also, check to ensure you have told the IRS how you want your refund handled. If you overpaid your taxes and are due a refund, be proactive about where you want that money to go. If you do nothing, the IRS will send you a check in the mail. To expedite this, you can add your bank account information (account number and routing number) so that refund will be deposited directly into your account. You can also use your refund towards next year's taxes.
Finally make sure you keep a copy of your signed return, along with proof of filing (an acknowledgement that your e-filed return has been accepted by the IRS or a certified receipt for a paper return sent by mail). Having this proof will protect you from any claims by the IRS that you filed late or not at all. Also, keeping this copy readily available will help you get ready for next year's filing.
If you have been following along on this tax journey with me, you will know by now that my most important piece of advice is to hire a tax professional to help you with your filing. I also recommend that if you have a growing business or feel like you are over your skis in terms of optimizing your tax situation, you should hire someone to help you throughout the year. Block Advisors is a great option! They understand that most small business owners started their business to pursue a passion, not to crunch numbers. They'll take care of your tax filing and financial tasks so you can focus on what you love. I hope you are filed and are now sitting on a big refund. And I hope you have a great 2021.
*All details were sourced from IRS.gov and blockadvisors.com
The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor with regards to your individual situation. Comments concerning the past performance are not intended to be forward looking and should not be viewed as an indication of future results. Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. O'Keeffe Financial Partners and any other entity listed herein is not affiliated with Kestra IS or Kestra AS Investor Disclosures: https://bit.ly/KF-Disclosures
The words “Nevertheless, she persisted” have become something of a mantra for feminists, revolutionaries, and Elizabeth Warren supporters. They were hurled as an accusation against Warren when she was silenced for reading Coretta Scott King’s 1986 letter, detailing concerns about Jeff Sessions’ history of racist judgments, during his Attorney General confirmation debate. Now, they are seen instead as an accolade, a mark of pride at how much Warren has been able to get under the political establishment’s skin. In her new biography of the first female senator elected in Massachusetts, Antonia Felix argues for Warren’s legacy beyond that phrase — which in itself has a more complex background than its current use, having started in a debate about race.
“I stood at the entrance of the U.S. consulate in Calcutta in 1982. In 1965, American immigration laws had been rewritten to allow for a greater number of non-Europeans to enter the country. Not only were Indians and other Asians considered unwanted newcomers before 1965, even naturalization-the process by which a foreign-born immigrant becomes a U.S. citizen-was disallowed for most who were not white until the 1950s. I knew little of this history when I entered the consulate with my parents. I did not even know I had something called race. Race as a category had not been part of the Indian census since 1951. I was about to move to a nation where nearly every official form had a section in which I would be offered an array of racial categories and expected to pick one.”
Phyllis Chesler was a major player in Second Wave Feminism. Daughter of a working-poor Orthodox Jewish immigrant and his American wife from a Polish family, Chesler grew up a rebel. Now an emerita Professor of Psychology at the College of Staten Island (CUNY), she taught one of the very first college courses in women’s studies, eventually turning it into a minor and a major, and co-founded the Association for Women in Psychology. Writer of influential works from 1972’s Women and Madness, about the double standards that plague gendered mental health care, to 2005’s The Death of Feminism and 2011’s Mothers On Trial: The Battle for Children and Custody, her consultations have been integral to several landmark legal cases.
