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tax revolution

Debunking Common Misconceptions about Domestic Taxes

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Taxes are a ubiquitous part of our financial landscape, yet many misconceptions surround them, leading to confusion and missed opportunities for taxpayers. In this article, we’ll shine a light on some prevalent myths about domestic taxes and set the record straight. Better yet, we’ll introduce eTaxService.com as your trusted guide to debunking these myths and navigating the complex world of taxes.

Misconception #1: “I Don’t Need to File if I Earn Below the Taxable Income Threshold”:

One common misunderstanding is that individuals with incomes below the taxable threshold are exempt from filing taxes. In reality, filing requirements depend on various factors, including your filing status, age, and income sources. eTaxService.com’s experts can guide you on whether you need to file and help you maximize potential credits.

Misconception #2: “Tax Refunds Are Bad – It Means I Overpaid”:

Receiving a tax refund doesn’t necessarily mean you overpaid; it may indicate that you over-withheld throughout the year. We can help you adjust your withholding to align with your actual tax liability, preventing overpayment and ensuring you keep more of your hard-earned money.

Misconception #3: “I Can’t Afford Professional Tax Help”:

Contrary to the belief that professional tax assistance is unaffordable, eTaxService.com offers accessible and cost-effective solutions. Our platform connects you with experienced tax professionals who can provide personalized guidance without breaking the bank, ensuring accuracy and compliance with tax laws.

We Are Here To Help:

Don’t let misconceptions about domestic taxes cloud your financial judgment. eTaxService.com is here to debunk myths, provide accurate information, and support you with expert guidance. Visit our Contact Page or call 734-285-5528 to connect with our Tax Agent. As you navigate the complexities of domestic taxes, trust us to be your reliable partner, ensuring that you make informed decisions and optimize your financial situation. Say goodbye to tax confusion, and embrace clarity and confidence with us by your side.

Taxpayers Should Check Their Tax Withholding Status

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Avoid negative tax surprises by reviewing tax withholdings. Taxpayers should monitor their returns and make sure withholdings are adjusted properly. Luckily, there is still time to adjust withholdings in 2022 and check to see next year’s return benefit. Adjustments made now can help taxpayers avoid paying penalties. ETax Services has the information taxpayers need to avoid tax hang-ups.

The following circumstances can require a taxpayer to adjust withholdings

  • Marriage or divorce
  • Newborn children
  • Purchase a new home
  • Tax law changes

Life can be unexpected, and the IRS understands that situations change. Visit our contact page to connect with a tax expert to review your adjustments.

How to Pay Taxes

Taxpayers usually pay throughout the year. Payment intervals can be withheld from the salary, quarterly, or a combination of both. The IRS reports that over 70% of taxpayers withhold too much resulting in a refund for them.

Other Impactful Items

As stated previously, unforeseen situations occur and can impact withholding amounts. These other qualifying life events include:

  • Coronavirus Relief for Taxes: This includes tax help for businesses, taxpayers, tax-exempt businesses, and others impacted by COVID-19.
  • Natural Disasters: This includes wildfires, hurricanes, tsunamis, and other disasters. If a location is declared a disaster area by the federal government, the taxpayers in that location will have to adjust their withholdings.
  • Lay off or Loss of Employment: This unfortunate circumstance can impact tax information though the IRS allows adjustments.
  • Gig Economy Transition: Taxpayers in the gig economy can prevent penalty payments by reviewing estimated tax payments. People who earned a certain amount in one year may have to file documents such as the 1099 NEC.

Etax has the best tax updates and information for taxpayers. Visit our contact page to book an appointment with an expert tax agent.

The US Flat Tax Revolution

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One thing that divides the United States of America is the various tax rates. In other words, only some states have the flat tax rate implemented while others use a graduated tax rate. A flat tax is a single fixed rate on income while a graduated tax rate is a percentage that varies based on the level of an individual’s income. 5 states have already adopted the flat tax rate in 2022. Since more and more states are seemingly following this trend, it is safe to assume that America is experiencing a Flat Tax Revolution.

The first states to implement the flat tax were Wisconsin in 1912 followed by Massachusetts in 1917. The other states that hopped in the flat tax band wagon include Colorado in 1987, Utah in 2007, North Carolina in 2014, Kentucky in 2019. These states are now joined with the states that already had a flat tax rate: Indiana, Illinois, Massachusetts, Pennsylvania, and Michigan.

States that are transitioning from graduating tax rates to a flat tax include:

  • Iowa at a rate of 3.9 % by 2026
  • Mississippi at a rate of 4% by 2026
  • Georgia at a rate of 5.49% then to 4.9% by 2023
  • Arizona at a rate of 2.5% by 2024

More states including Idaho, Missouri, and Oklahoma will also be adopting the flat tax soon. People in favor of the flat tax flaunt this policy as a benefit of living in the state. The advocacy for the flat tax may inspire the rest of the country to follow suit.

For more of the best information concerning tax rates, deadlines, and other tax factors, visit www.etaxservice.com to connect with our team of experts.