Frequently asked questions

1040 Assistance: (800) 829-1040

IRS Refund Hotline: (800) 829-1954

Business & Specialty Tax Line: (800) 829-493

Options for tax payments:

Federal Payment: https://www.irs.gov/payments 

Virginia Payment: https://www.tax.virginia.gov/payments

Amended Return Status updates: https://www.irs.gov/filing/wheres-my-amended-return

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Current tax year returns are free of charge; any previous returns will be charged based on the year and the number of years required.

To check the status of a stimulus check, you must log in to your IRS accounts to see if you have received the previous stimulus checks. For a VA rebate, please see link to check eligibility/status: https://www.tax.virginia.gov/rebate


We do help clients with filling out certain tax forms; however, we need 2-3 business days to schedule a time for assistance. There may be an additional charge for filling out certain forms or applications.

That is a service only the IRS can provide; please use the link below: https://www.irs.gov/individuals/get-transcript You can create an account on IRS.gov to access them as well. Please see link: https://www.irs.gov/payments/your-online-account

We can register a business for clients. Tax Wise charges a fee of $200-$300 per business. Please contact us to get started.

It takes us at least 5-6 business days to provide the P&L and balance sheets. If you are currently not on a retainer, we charge a $150+ fee Renewing

We no longer provide these services.

Everyone takes a standard deduction amount on their tax return. The amount is fixed depending on their filing status. You will only file with itemized deduction if your Sch A deductions are higher than the standard amount. Your Sch A deductions include Mortgage Interest, Real Estate and state taxes (limited to $10K), large medical expenses (up to 7.5% of your AGI), and donations (limited up to 65% of your AGI). If you do not have these expenses or they are of a lower amount, you will file with the standard deduction as that would be more beneficial.

Please see our business and personal tax deductions list. If you have a 401k plan with your employer and your only/main source of income is through a W-2, maxing out the 401k plan will be a sufficient method to reduce taxable income and contribute to an HSA plan Business owners should also look into retirement plans to reduce taxes such as a SEP IRA.

https://www.fueleconomy.gov/feg/taxcenter.shtml

Use this link to search up VIN: https://afdc.energy.gov/laws/electric-vehicles-for-tax-credit

More than $12,950 earned income W-2 Income Or more than $1150 unearned income Investment Income

When adding a vehicle to a business, the business should be included in the title of the vehicle. You can use a personal loan to purchase the vehicle, but you need to make the payments through your business account. When selling a business vehicle, there is no action needed at the moment. When we are filing the tax return, you must report to us that the vehicle was sold so that we can disclose this on your tax return.

If the business income after expenses is reported as $60,000 or more, the client should consider filing their LLC as an S-Corp instead to save on the self-employment tax of 15.3%. When a client is filing as an S-Corp, they are required to issue a W-2 for themselves through the business as a method of paying themselves. We do not provide any type of payroll service but you may contact Adeel’s sister, Ayesha from AY Tax Corp for your payroll needs; her email is Ayesha.Mogo@AyTaxCorp.com.

All sales of stocks and crypto must be reported on the tax return. If the stock/crypto is held for less than one year, it will be subject to the short-term tax rate of 20% If the stock/crypto is held for over a year, the long-term tax rate is 15%. Sale of real estate property:

If the property was a primary residence (must have lived in the house for 2 years), the home will be exempt from capital gain taxes up to either $250,000 or $500,000 depending on the filing status of the individual. If it was a multi-use home meaning, the individual used the home as a primary residence for 2 years and then switched it to a rental property, if they sell it within 3 years of renting the property, the capital gain exclusion still applies. If the home is solely a rental/investment property and held for more than one year, it is subject to a capital gain rate of either 0%, 15%, or 20%, plus an additional 3.8% investment tax for individuals with higher income If the home is an investment property and is bought and sold within the same year, it can be subject to a capital gain tax of 37%.

The gift giver pays the tax, not the gift receiver A person may gift up to $17,000 a year per person to avoid the gift tax. If the amount is larger, it will be taxed at a 30% rate. We recommend clients to only give $17,000 a year or under to avoid this.

Submit an extension request before the filing deadline. Failure to pay by the deadline may result in penalties, such as a monthly late-filing fee of up to 5% (max 25%) of the unpaid balance and 0.5% monthly penalty for not paying taxes on time. If you miss the deadline without owing, there’s no penalty. To extend for 2023, you can file form 4868 by April 15, 2024. While no explanation is needed for the extension, estimated and paying expected taxes are crucial; the extension is for filing, not payment. Paying 90% of your tax liability by the deadline avoids late-payment penalties.

March 15: All Partnerships, S-Corporations, and Multi-member LLC’s must be filed unless an extension was filed. April 15: All C-Corporations and individual tax returns must be filed unless an extension was filed. September 15: This is the extension deadline for all Partnerships, S-Corporations, and Multi-member LLCs. October 15: This is the extension deadline for all C-Corporations and individual tax returns.

Visit irs.gov/payments.
Click on "Pay now with direct pay."
Select "Make a payment."
Choose "Extensions" as the reason for payment.
Ensure that the payment is applied to form 4868 (applicable for 1040, 1040A, 1040EZ), and specify the tax period as 2023.
Fill out the required information for identity verification.
Make a payment equivalent to 110% of last year’s balance due

The Internal Revenue Service announced that interest rates will increase for the calendar quarter beginning Oct.1, 2023

For individuals, the rate for overpayments and underpayments will be 8% per year, compounded daily.

Here is a complete list of the new rates:

8% for overpayments (payments made in excess of the amount owed),

7% for corporations

5.5% for the portion of a corporate overpayment exceeding $10,000

8% for underpayments (taxes owed but not fully paid)

10% for large corporate underpayments

For many this means we will recommend making a tax payment when filing for an extension in the coming year.

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