Intuit launches Quickbooks version for freelancers, independent contractors

Bizofcake.com writes: Intuit is scaling down its QuickBooks platform to create a new version of the accounting tool geared toward the self-employed.

Typically used by small business owners, QuickBooks offers a bevy of tools to control and monitor finances. With the aptly named QuickBooks Online Self-Employed iteration, all of the essential tools and services were rebuilt with the appropriate tax details and compliance requirements needed for the likes of freelancers and independent contractors.

For instance, the platform can be used to connect financial accounts, track deductions and calculate taxes. It can also be used to organize comingled business and personal finances.

"As the on-demand economy continues to expand, there will be unprecedented income opportunities for freelancers. But this work comes with a host of new challenges: confusing business expenses, quarterly and year-end tax headaches, and a general lack of visibility into their 'real income'," said Alex Chriss, VP and GM of Self-Employed Solutions at Intuit.

While the slice of the pie may seem small, Intuit is banking on the self-employed market to be a reliable driver of growth. According to data from its Intuit 2020 Report, the company predicts that 43 percent of the US workforce will operate as self-employed within five years.

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We made it easy for freelancers, contractors, home-based businesses, and entrepreneurs to organize tax-saving deductions all year round. You'll thank yourself at tax time.

Reduce Your 2014 Income Tax Liability…in 2015

Mcleod Tax & Consulting writes: With the end of 2014 comes the end of managing your 2014 tax situation. From the run-of-the-mill tax ideas such as timing deductions & income to the more interesting strategies such as restructuring or managing nexus, the prime time to work through your tax planning is during the year, preferably before year-end.

The good news is that there are still some moves that can be made. The ones listed here can even be done without necessarily effecting future years’ tax situations. Let’s take a look at some low-hanging fruit.

1. Health Savings Account contributions. If your health insurance plan fits the requirements, you’re eligible to make a maximum 2014 contribution per individual of $3,300 or per family of $6,550. The tax-deductible contribution for 2014 can be made all the way up until April 15, 2015. The tax and non-tax benefits of this not-to-miss gem are too numerous to list here. See a previous post here.
2. Retirement plans for the self-employed. A traditional IRA or SEP IRA can be setup and funded by April 15, 2015 to receive a 2014 deduction.
3. Retirement plan contributions for employers. Although most types of plans will require establishment before December 31, 2014, most allow for the tax-deductible employer contribution by the extended filing date of the 2014 business tax return (typically September 15, 2015). These include SEP IRAs, SIMPLE IRAs, 401(k), and defined benefit plans. You must extend your tax return to receive the extension of time to make the contribution.
4. Fully expense fixed asset purchases. If your business and purchases meet the requirements, varying degrees of initial year expensing (versus multi-year depreciation) are available under IRC Sections 179 and 168(k).
5. Tax credits. So much sweeter than mere deductions that reduce taxable income, credits directly offset the liability itself. Many credits require advance approval and calculations. However, there are some requiring no upfront work and who’s relatively easy calculations can be performed in conjunction with preparing your tax return. Consider individual income tax credits related to dependents, non-gas vehicles, and education. You know that pesky individual income tax organizer your CPA gives you every year? Among other things, it goes a long way to identify potential tax credits. Note: AMT can diminish or even negate the ability to claim certain credits.

Chat with your tax advisor to see if any of these strategies make sense for you. Just because you can implement one or more of these ideas, doesn’t mean doing so will be in the best interests of your short and long-term tax, business, and financial goals.

Health Care Law Brings Changes to IRS Tax Forms

This year, there are some changes to tax forms related to the Affordable Care Act. Along with a few new lines on existing forms, there will also be two new forms that will need to be included with some tax returns. While most taxpayers will simply need to check a box on their tax return to indicate they had health coverage for all of 2014, there are also new lines on Forms 1040, 1040A, and 1040EZ related to the health care law.

To help navigate these changes, taxpayers and their tax professionals should consider filing their return electronically. Using tax preparation software is the best and simplest way to file a complete and accurate tax return as it guides individuals and tax preparers through the process and does all the math. There are a variety of electronic filing options, including free volunteer assistance, IRS Free File for taxpayers who qualify, commercial software, and professional assistance.

Here is information about the new forms and updates to the existing forms:

Form 8965, Health Coverage Exemptions

• Complete this form to report a Marketplace-granted coverage exemption or claim an IRS-granted coverage exemption on the return.
• Use the worksheet in the Form 8965 Instructions to calculate the shared responsibility payment.

Form 8962, Premium Tax Credit

• Complete this form to reconcile advance payments of the premium tax credit, and to claim this credit on the tax return.

Additionally, if individuals purchased coverage through the Health Insurance Marketplace, they should receive Form 1095-A, Health Insurance Marketplace Statement, which will help complete Form 8962.

Form 1040

• Line 46: Enter advance payments of the premium tax credit that must be repaid
• Line 61: Report health coverage and enter individual shared responsibility payment
• Line 69: If eligible, claim net premium tax credit, which is the excess of allowed premium tax credit over advance credit payments

Form 1040A

• Line 29: Enter advance payments of the premium tax credit that must be repaid
• Line 38: Report health coverage and enter individual shared responsibility payment
• Line 45: If eligible, claim net premium tax credit, which is the excess of allowed premium tax credit over advance credit payments

Form 1040EZ

• Line 11: Report health coverage and enter individual shared responsibility payment
• Form 1040EZ cannot be used to report advance payments or to claim the premium tax credit

For more information about the Affordable Care Act and filing your 2014 income tax return visit IRS.gov/aca.

Tax Time Gets New Ritual: Proof Of Health Insurance

Michelle Andrews for NPR.org writes: In addition to the normal thrills and chills of the income tax filing season, this year people will have the added excitement of figuring out how the health law figures in their 2014 taxes.

The good news is that for most folks the only change to their filing routine will be to check the box on their Form 1040 that says they had health insurance all year.

"Someone who had employer-based coverage or Medicaid or Medicare, that's all they have to do," says Tricia Brooks, a senior fellow at Georgetown University's Center for Children and Families.

But for others, there are several situations to keep in mind.

If you were uninsured for some or all of the year

If you had health insurance for only part of 2014 or didn't have coverage at all, it's a bit more complicated. In that case, you'll have to file Form 8965, which allows you to claim an exemption from the requirement to have insurance or calculate your penalty for the months that you weren't covered.

On page 2 of the instructions for Form 8965 you'll see a lengthy list of the coverage exemptions for which you may qualify. If your income is below the filing threshold ($10,150 for an individual in 2014), for example, you're exempt. Likewise if coverage was unaffordable because it would have cost more than 8 percent of your household income or you had a short coverage gap of less than three consecutive months. [snip, the article continues @ NPR, click here to continue reading......]

IRS Estimated Taxes Due Dates 2015

MyMoneyBlog.com writes: If you have self-employment or other income outside of your W-2 paycheck this year, you may need to send the IRS some money before the usual tax-filing time. Here are the due dates for paying quarterly estimated taxes in 2015; they are supposed to be in four equal installments. This is for federal taxes only, state and local tax due dates may be different.

(Note: January 15th, 2015 is the last day to make an estimated tax payment for 2014. See bottom of post for fast payment options. This will prevent any penalty for late payment of the last installment. You do not have to make this Q4 payment if you file your 2014 tax return (Form 1040) and pay the tax due by February 2nd, 2015. If you miss these dates, file your return and pay as soon as possible to minimize penalties.)

IRS Estimated Tax Payment Calendar for Individuals

Tax Year / Quarter	Due Date
2015 First Quarter	April 15, 2015 (Wednesday)
2015 Second Quarter	June 15, 2015 (Monday)
2015 Third Quarter	September 15, 2015 (Tuesday)
2015 Fourth Quarter	January 15, 2016* (Friday)

 

* You do not have to make the Q4 payment due January 15, 2016, if you file your 2015 tax return by February 1st, 2016.

Who needs to pay estimated taxes?

In general, you must pay estimated tax for 2015 if both of the following apply:

1. You expect to owe at least $1,000 in tax for 2015, after subtracting your withholding and refundable credits.
2. You expect your withholding and credits to be less than the smaller of
   • 90% of the tax to be shown on your 2015 tax return, or
   • 100% of the tax shown on your 2014 tax return. Your 2014 tax return must cover all 12 months.

If you forget to pay (like I’ve done before), then you should make a payment as soon as possible even though it is late. This will minimize any penalty assessed.

How do I pay? When does the payment count?

• By check. Fill out the appropriate 1040-ES voucher (last page of the PDF) and send to the indicated address. The date of the U.S. postmark is considered the date of payment.
• By online bank transfer. You can link your bank account and pay via electronic funds transfer at EFTPS.gov or call 1-800-555-4477. No convenience fees. It takes a little while to set up an online account initially, so you’ll need to plan ahead. The date of payment will be noted online.
• By debit or credit card. Here is page of IRS-approved payment processors. Pay by phone or online. Fees will apply, but the payment will count as paid as soon as you charge the card.

I usually pay online at EFTPS.gov for both convenience and to avoid fees. However, right now the lowest fee for a credit card payment is 1.87% from providers like PayUSATax.com, which I’ve used. Meanwhile, you can earn up to 2% cash back from a credit card like the Citi Double Cash card. So you can actually clear a small profit by making your tax payment with the right credit card, and it will officially count as paid to the IRS immediately.

Sources: IRS Pub 505, IRS Pub 509, IRS Form 1040-ES [pdf].