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Prep for an IRS audit using your 2017 tax return info
An IRS audit is kind of like a flat tire. It's inconvenient and frustrating, and if you're lucky you may never have to experience one. But if you do, you'll be sorry if you aren't prepared.
Fortunately, you can use the information you've already collected (or will collect) for your 2017 tax return to prep for an audit.
Go ahead and use the following as a checklist of items to keep on hand:
- A copy of your signed tax return and all supporting documents
- Copies of any worksheets that support your return
- Forms W-2
- Forms 1099 (all forms)
- Forms 1095 (to support having valid health insurance)
Time to go through your tax records? Consider this
Chances are you're a little confused about what to keep and what to throw away when it comes to tax and financial records. No worries. It's time to sort through what you've got and keep only the important stuff. Here's what to keep in mind:
• Keep records that directly support income and expense items on your tax return. For income, this includes W-2s, 1099s and K-1s. Also keep records of any other income you might have received from other sources. It's also a good idea to save your bank statements and investment statements from brokers.
• The IRS can audit you within three years after you file your return. But in cases where income is underreported, they can audit for up to six years. To be safe, keep your tax records for seven years.
2018 tax reform changes: At a glance
Some of the most significant tax changes since the 1980's recently took effect with the passing of the Tax Cuts & Jobs Act. In brief, below are the revisions:
- Reduces income tax brackets. The bill retains seven brackets, but at reduced rates, with the highest tax bracket dropping to 37 percent from 39.6 percent.
- Doubles standard deductions. The standard deduction nearly doubles to $12,000 for single filers and $24,000 for married filing jointly. To help cover the cost, personal exemptions and most additional standard deductions are suspended.
Trump signs sweeping tax overhaul
The Tax Cuts and Jobs Act was signed into law by President Trump on December 22. It is considered the most significant overhaul of the U.S. tax code in 30 years.
This historic Act calls for lowering the individual and corporate tax rates, repealing countless tax credits and deductions, enhancing the child tax credit, boosting business expensing, and more. The bill also impacts the Affordable Care Act, or Obamacare, effectively repealing the individual shared responsibility requirement.
Click Here to learn more about how these tax changes will impact you as an individual or business owner.
4 smart ways to cut business costs
Keeping costs under control is crucial in today's challenging business environment. Without a doubt, one of the quickest ways for a business to cut costs is through staff reduction. But cutting jobs is not always the best cost-cutting strategy. Drastic job cuts can lead to a vicious cycle of reduced productivity, followed by even slower growth and decreased profitability. Replacing skilled workers when times improve may be difficult, leaving your company to struggle longer still.
Take a look at some alternative cost-control strategies: