Great Concept of Clifton Park Small Business Accountant
Special tax preparation software packages are available that make the process very simple. These can be found on the internet and are free to download. They can also be purchased in stores. Visit us on Clifton Park Small Business Accountant. TurboTax, Quicken TurboTax, and Kiplinger Taxco are three of the most popular tax preparation programs. What is the best place for an individual taxpayer to deduct tax preparation costs? The obvious answer is that it’s a miscellaneous deduction on Schedule A of Form 1040. Is it true that all taxpayers can only deduct tax preparation fees on Schedule A? The answer is, thankfully, no. Because the total miscellaneous deductions must exceed two percent of the taxpayer’s adjusted gross income to provide any benefit, deducting tax preparation fees on Schedule A will provide little or no benefit for most taxpayers. Furthermore, in order to receive a tax benefit, the taxpayer’s total itemized deductions must typically exceed the standard deduction amount. In Rev. Rul. 92-29, the IRS ruled that taxpayers can deduct tax preparation fees related to a business, a farm, or rental and royalty income on the schedules where the taxpayer reports such income. For example, a self-employed taxpayer can deduct the portion of tax preparation fees related to the business, including schedules such as depreciation schedules, on Schedule C of Form 1040 as a business exclusion. The taxpayer saves income tax and self-employment tax by deducting the tax preparation fees on Schedule C. On Schedule F of Form 1040, a farmer who is self-employed can deduct the portion of his or her tax preparation fees that are related to the farm. The taxpayer saves income tax and self-employment tax by deducting the tax preparation fees on Schedule F. A taxpayer who has rental and/or royalty income on Schedule E of Form 1040 can deduct the portion of the tax preparation fees that are related to the rental and/or royalty income.