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Learn More about the Economic Stimulus Package and your "Rebate" at: http://www.irs.gov/irs/article/0,,id=177937,00.html
Q. Where's My Refund?
A. Access the following link to the IRS Web-Site.
http://www.irs.gov/individuals/article/0,,id=96596,00.html
Access the following link to the Wisconsin Department of Revenue Web-Site.
http://prd2p.it.state.wi.us/dor/faqs/inquiry.html
Q. Why would I have to report my state refund as income?
A. In computing itemized deductions on your federal income tax return, you are allowed to deduct state income taxes paid during the year. Most people deduct the amount of state income tax withheld, as shown on Form W-2, plus any Wisconsin estimated tax payments made during the year. Since this deduction reduces federal taxable income, if any part of the state tax deducted on the federal return is later refunded, that amount has to be reported as taxable income for the year in which the refund is issued. Use the State and Local Income Tax Refund Worksheet in the Federal Form 1040 Instructions to determine whether your Wisconsin tax refund must be reported as taxable income on your federal return.
Note: Since Wisconsin does not allow a deduction for state income taxes paid, the refund should not be included in Wisconsin taxable income.
Example: Assume you deducted $5,000 in state income tax on your 2002 federal return, based on the Wisconsin income tax withheld from your wages. When you filed your Wisconsin return, you found that you were entitled to a refund of $500, which was issued on April 30, 2003. This means that you paid only $4,500 in state income taxes for 2002, rather than the $5,000 you claimed. Therefore, you must report the difference of $500 (the amount of your refund) as income on your federal return for 2003. You should not report the $500 as income on your 2003 Wisconsin return.
Q. Can I deduct the cost of my work clothes?
A. Know what's deductible
Q. Am I required to pay taxes? My friend says taxes are unconstitutional.
A. The IRS differentiates between legal tax protestors and illegal tax evaders. Tax evasion, not filing and not paying federal income tax, is subject to both civil and criminal sanctions. Under the banner of “the tax protestor movement,” naive and uninformed individuals are being persuaded that not filing tax returns and not paying federal income tax is legal and wise tax planning. ....More
Q. Can I pay my income tax liability by credit card or direct debit?
A. Yes, if you e-file, you may, at the time your return is prepared, choose to pay the amount you owe by using direct debit from your bank account.
Q. What is the statute of limitations for filing a claim for an overpayment of income tax?
A. Generally, a claim for refund (or credit) must be filed by the taxpayer within three years of the date the return was due, or within two years from the date the tax was paid, whichever period expires later.
Have a question? Please call us (608-756-5354), email us, or visit the IRS website FAQ Page
Q. Are all CPA's "Accountants"? What is the differnece between a CPA and an Accountant?
A. There is a vast difference between a CPA and an accountant. A CPA is certified in the state. An accountant is an individual who practices accounting but has not passed the CPA exam. A practicing CPA is required by law to keep abreast of the changes in the accounting profession by taking Continuing Professional Education. In order to get the most qualified and professional service, choose a CPA. Every year, over 130,000 candidates sit for the Uniform CPA Examination, but only ten percent pass all four parts of the test the first time out. You DO NOT have to be a CPA to practice public accounting. In fact many "accountants are not CPA's at all.
Q. What is a CPA?
A. CPA's (Certified Public Accountants) are trusted and relied upon by both businesses and individuals because of their extensive training and experience in areas such as, objectivity, analytical ability and decision-making. They are professionals widely recognized and trusted because of their dedication to servicing their clients with the highest level of integrity.
A professional who meets the following requirements:
(1) Completed a program of study in accounting at a college or university - the AICPA recommends at least 150 hours of study.
(2) Passes the Uniform CPA Examination graded by AICPA.
(3) Obtains a certain amount of professional work experience in public accounting - this is required in most states.
At Summit Accounting Group, Inc. we have two full time CPA's on staff. Call us today at 608-756-5354
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