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Tax preparation and filing are things both individuals and companies often find a challenge. While some of us have the knowledge and skills to maintain our monthly accounts, we often need assistance arranging our receipts, preparing our documents, and planning to ensure we save our hard-earned money.

If you have a business, considerable expenses, or are not proficient in filing your tax returns on your own, hiring a tax preparation specialist ensures your accounts are always in order, and you are never in danger of an audit from the IRS (Internal Revenue Service). However, unless you have used the services of an accountant and tax professional before, you have many questions that need answering before deciding on the best tax preparation firm.

To ensure you have your doubts cleared, 3 E Tax Solutions LLC wants to arm you with the most accurate tax preparation and filing information. To do this, we’ve answered some of the most frequently asked questions about taxes.

1. What is the Child Tax Credit for 2022

This year the Child Tax Credit will revert back to the program offered by the IRS before the American Rescue Plan expanded it in 2021. This means children under six will receive $3,600, and children over six years of age will be limited to $3,000.

2. Does Schedule C include self-employment tax?

Generally, your net earnings from self-employment are subject to self-employment tax. If you are self-employed as a sole proprietor or independent contractor, you usually use Schedule C to figure net earnings from self-employment.

3. Can I deduct charitable contributions if I don’t Itemize?

Individuals or single taxpayers who do not itemize can claim a deduction of up to $300 for cash contributions, while married individuals filing joint returns can claim up to $600.

3. Can I deduct charitable contributions if I don’t Itemize?

Individuals or single taxpayers who do not itemize can claim a deduction of up to $300 for cash contributions, while married individuals filing joint returns can claim up to $600.

4. Where do gambling losses go on my tax return?

You are allowed to list your annual gambling losses as an itemized deduction on Schedule A of your tax return. If you lost as much as or more than you won during the year, you generally wouldn’t have to pay any tax on your winnings. However, you can only deduct gambling losses up to your gambling income.

5. Do I have to pay social security and medicare tax on my self-employment income?

Yes, you do have to pay social security and medicare tax on your net income. The Taxes get reported on Schedule SE of 1040.

6. Where do I report my sale of stock on my 1040?

When you report a sale of shares on your tax return, you must complete IRS Form 8949 if the cost basis needs an adjustment, along with Schedule D. You submit both with your Form 1040 tax return. Form 8949 is where you list the details of each stock sale, using the information on Form 1099-B.

7. If I have a capital loss, how much of the loss can I carry over?

Capital losses that exceed capital gains in a year may be used to offset ordinary taxable income up to $3,000 in any one tax year. Net capital losses over $3,000 can be carried forward indefinitely until the amount is exhausted.

8. Where does other income get reported on my 1040?

Other income gets reported in line twenty-one, under other income.

If you have any more questions about bookkeeping, accounting, and tax services, get in touch with Greg at 3 E Tax Solutions LLC. With over twenty-five years of accounting, payroll, and tax preparation experience, he is a Registered Tax Preparer and New Jersey Reporting Agent. As a tax preparer, he prepares various types of tax returns, including individual, partnerships and corporations, and various state and local income tax returns. As a reporting agent, he has the ability to make electronic payroll tax payments and file quarterly and yearly payroll tax reports for clients. Also, he can discuss any filing discrepancies concerning payroll tax deposits and reports with the IRS.

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