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How do I Report a Viatical Settlement on My Tax Return
A self-assessed tax return can be a difficult task especially if someone is not familiar with tax laws and regulations, if you are a freelancer or running your own business, ensuring accuracy in your self-assessed tax returns is a crucial to stay away from penalties or any other complications. Most U.S citizens are unaware of the deadline given by the IRS i.e. 15 April, 2025 for the tax return of the year 2024, because of lack of knowledge most Americans face penalties and their taxes get overdue. If you are facing these difficulties or any penalties and you are having trouble with taxation hiring an accountant can be a wise choice.
When Can You Handle It Yourself?
If you’re comfortable with doing your own taxes, it’s possible to complete your self-assessment tax return on your own. The IRS and HM Revenue provide wide-ranging online tax guidance to help taxpayers accurately report their income and expenses ensuring minimum trouble.
When Should You Consider an Accountant?
Most people face difficulty when they are having multiple sources of income, usually have complication filing their own taxes, if you are unsure about your taxation responsibilities it advised to get a tax accountant. An accountant may assist with:
- Ensuring you submit your return correctly.
- It helps you calculate your taxes and understand how much tax is due.
- Avoiding errors that might trigger an IRS query.
Missing the January deadline or failing to send a tax return on time can result in a tax bill with over dues. If you owe a hefty amount, an accountant can guide you through tax relief options, resulting in giving you peace of mind.
Benefits of Employing an Accountant
Hiring an accountant goes beyond just getting your tax return filed. They can:
- Help you understand how to lower your income legally.
- Makes sure to compliance with IRS rules and regulations.
- Assisting in bookkeeping and organizing financial information.
- Helps to avoid tax overdue penalties.
- Use an accountant to identify potential allowable reductions.
An accountant’s knowledge ensures that you don’t overpay taxes. If you’re looking for an accountant, they can also represent you if the IRS conducts a check over your assets and liabilities.
How Much Does a Self-Assessment Accountant Charge?
In the U.S., it usually ranges between $200 to $300, depending on your situation of taxation. If you are dealing with multiple sources of income the price may vary.
What’s the correct procedure?
In the U.S., its compulsory for the citizens to declare their monthly and annual incomes to the Internal Revenue Service (IRS). This makes sure that all your taxable earnings are accordance with the Federal Laws.
How to File a Tax Return Online
Putting your tax return online in order is the fastest and easiest method. These are the steps:
Step 1: Get Registered with Internal Revenue Service (IRS)
If you are new to taxing or you are a freelancer, you need to get yourself registered with the IRS.
Step 2: Gather Your material information
To calculate your tax, you’ll need:
- Income and expenditure records.
- Receipts for permissible expenses.
- Any taxable investments.
Step 3: Use Accounting Software
Software like FreeAgent, TaxScouts, or the Internal Revenue Service (IRS) online system can help with reductions and remission of taxation calculations.
Step 4: Submit Your Return and Pay Any Tax Owed
Once you’ve figured out your income and details, submit your taxes before the April time limit. If you have any over dues, get them cleared first handedly.
What are the Deadlines for the 2024 Tax Year?
April 15, 2025: The 2024 income tax return deadline.
June 16, 2025: Income tax return for 2025’s second quarter assessed tax.
September 15, 2025: The third trimester, tax payment deadline for the year 2025.
October 15, 2025: Final deadline to do individual income tax returns for the 2024 tax year if an extension is granted.
January 15, 2026: Due date for the fourth trimestral estimated tax payment for the 2025 tax year.
All forms for filing tax return for U.S. Individuals
Form 1040: U.S. Individual earnings tax filing
Form 1040 is the standard government earnings tax Form used by the individuals mentioned above to report their annual or monthly earnings. It captures all the necessary details, like earnings and credits, and basically calculates all the taxes due and due. Depending on the source of earnings, required details may vary.
Form 1040-ES: Estimated Tax for Individuals
People whose income is not subjective to tax holding use this form to pay their calculated taxes.
Form W-4: U.S. Employee’s Withholding Certificate
In order to deal for an individual to correctly pay your Federal Income Tax from your income, use this form.
Form W-9: Request for Taxpayer Identification Number (TIN) and Certification
This form is used to request a Taxpayer Identification Number so the person can report the paid amount of their taxes.
Form 4506-T: Request for Transcript of Tax Return
This form is used to order a transcript or other return information free of charge.
Form 941: Employer’s Quarterly Federal Tax Return
Employers are responsible for paying the employer’s share of social security or Medicare taxes, otherwise charges will be deducted from the employer’s salary.
Form W-2: Wage and Tax Statement.
Employers must file a Form W-2 for each employee from whom Income, social security, or Medicare tax was withheld.
Form 9465: Installment Agreement Request
This form is used to request a monthly installment plan if you can’t pay the full amount, the amount will be shown on your tax return
Form SS-4: Application for Employer Identification Number (EIN)
This form is used to apply for an Employer Identification Number (EIN).
Form W-7: Application for IRS Individual Taxpayer Identification Number
This form is used in order to get or renew your Individual Taxpayer Identification number (ITIN) of IRS for federal tax purposes if you are not qualified for a social security number.
Form A: Itemized reductions
U.S. Taxpaying citizens use Form A to itemize allowable presumptions against earnings, such as medical costs, mortgage profit, donation-based contributions, and state and local taxes. Otherwise, taxpayers may choose to take a fixed reduction.
Form B: profit and Ordinary Dividends
This Form is used to report profit and dividend earnings of an exceptional $1,500 from all sources or if the individual had certain foreign accounts.
Form C: Profit or deficit from enterpriseÂ
Sole proprietors report earnings and costs related to self-employment using Form C. It details the profit or deficit from enterprise operations and is essential for those running unincorporated businesses.
Form D: Capital Gains and Losses
Form D computes capital gains and losses incurred during the tax year from the sale or exchange of capital assets such as stocks, bonds, or real estate.
Form E: Supplemental earnings and deficit
This Form reports earnings and costs arising from rental real estate, sovereigns, companies, companies, estates, trusts, and remaining interests in REMICs.
Form SE: Self-Employment Tax
freelancer individuals use Form SE to calculate the self-employment tax due on earnings from self-employment, which covers Social Security and Medicare taxes.
Form 1: Additional earnings and Adjustments to earnings
Form 1 is used to report additional earnings such as unemployment compensation, prize or award money, and reductions like student loan profit and educator costs.
Form 2: Additional Taxes
This Form captures other taxes due, including the alternative minimum tax and excess advance premium tax credits.
Form 3: Additional Credits and Payments
Form 3 is used to claim nonrefundable credits, such as the foreign tax repayment, and other payments like extra Social Security tax.
Form 8812: Qualifying Children and Other Dependents
Taxpayers use this Form to calculate the Child Tax rebate and the rebate for Other Dependents.
What You Can Expect from Their Services
- Reviewing financial information and ensuring your invoice records are accurate.
- Assisting with real-time tax calculations.
- Helping with tax relief claims.
- Providing support with IRS queries through a support team.
What If You Can’t Pay Your Tax Bill?
If you owe more taxes than expected, the IRS allows payment plans through their Time to Pay service. It is beneficial for those in a higher-rate tax bracket. If you want to submit a payment plan request, an accountant can help with this process.
Avoiding Common Mistakes
To prevent errors when you file your return, ensure:
- All taxable income is reported.
- Your deduction claims are legitimate.
- Your receipt records are well maintained.
- You adhere to accountancy best practices to avoid a rebate delay.
Let’s Get Your Taxes Right!
Whether you’re a freelancer, landlord, or business owner, getting your paper tax return or tax return online submitted correctly is crucial. If you’re notoriously bad at tax paperwork, using an accountant can ease the process. Contact us today for professional tax advice and ensure that your part of our service helps you remain compliant.
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