Tax Refunds & Advice

Do you moonlight to earn a bit of extra money in addition to your 9 to 5 job? If so, this is a great way to increase your earning power and maybe even find a new career. With that being said, this will definitely change the way that you look at your income tax situation. If you do not consider this extra income throughout the year, as well as during tax time, you are going to run into some major problems in the future.

First things first, you need to speak with a tax professional about your situation if you are going to start earning money through a second job; especially if you are going to be working for yourself. When you are employed by a company, they will be able to withhold the proper amount of taxes so that you are pretty much on track throughout the course of the year. But when you begin to earn extra money on the side, your situation will change quite a bit.

Take for example somebody who moonlights as a freelance web designer. Although you are not being paid by the same employer each month, you are earning money. For this reason, you have to pay taxes on the income; there are no two ways about it. If you attempt to hide this money and the IRS finds out about it, you will be in a lot of trouble. Your best bet is to speak with a tax professional that can set you up to make quarterly payments. This will allow you to pay the proper amount of taxes on the income from your second job, while keeping things the same at your primary position.

Remember, income from a side or second job is taxable. As long as you are aware of this and set things up accordingly, you will not have a tax liability at the end of the year. 

No matter who you are, if you have ever filed your own income tax return you have some knowledge of the way this works. Of course, some people have much more knowledge in this area than others. When it comes down to it, your tax knowledge will have a lot to do with the way that you move forward each year when it comes time to file. If you are not honest with yourself, you may end up running into more problems than you should.

The biggest mistake that you can make is thinking that you know more than you really do. If you get into this situation, you may talk yourself into thinking that you can do everything on your own. And when you do this, you will not call on the help of a true professional when you need it. In the end, mistakes can be made and a lot of time and money can be lost.

Testing your tax knowledge is not something that is easy to do. In other words, there is no test that tells you how much you know. Instead, this is something that you need to determine as you move forward.

People with simple income tax returns do not need as much knowledge as somebody who runs their own home based business. Obviously, the tax situation is different for both, and a more complicated return means that you need to know more about everything from deadlines to deductions.

Be honest with yourself when assessing your knowledge. If you know enough to file your own taxes and stay on top of everything, you should do so. But remember, there is nothing wrong with admitting that you need help and subsequently hiring a professional. 

If you are not careful, you could end up being scammed big time while waiting for your economic stimulus check to arrive. As soon as news reports confirmed that these checks would be sent out to millions of Americans, scammers began to work on plans to “profit” from this situation. In today’s day and age, the best way to do this is through the internet. And as many have already found out, scammers are hitting email accounts hard and more than likely achieving the desired results.

Generally speaking, the way that these scammers are working is quite simple. They send out hundreds of thousands of emails posing as the IRS. Within the email, the scammer tells you to click a link in order to “claim” your money. Of course, this link does nothing more than install spyware on your computer. So what, right? Wrong! Now that this spyware is downloaded on your computer, the scammer can see every move that you make. And this includes online banking information, credit card details, personal passwords, and much more.

To avoid these scams, stay smart and avoid any emails that are suspicious. Remember, the IRS is never going to email you for further information or to collect personal data. When you file your annual return they receive everything that they need.

And of course, you should never click on a link that you do not trust. You can open any email message that you want, but the moment that you click a link or download a file you are compromising the security of your personal computer.

You want to make sure that you are personally benefiting from your economic stimulus check; not somebody else.