The 2012 income tax season proved to be as hectic as any other season in previous years, with people scrambling for documents and anxiously awaiting their money. The IRS calculated that the estimated refund average was $3,000, totaling $174 billion after issuing 59.2 million refunds in as of March 10th, according to Today news online.
Jumping five percent from 2011, income tax returns are increasing as the years pass. Ensuring that your income tax return is handled with professionalism requires consulting a certified personal accountant (CPA). A CPA will eliminate problems with the IRS by implementing federal regulations toward your tax return and properly reporting deductions that may otherwise be questionable.
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For a maximum income tax return for your convenience, contact the Weslaco tax accountants of Gonzalez & Arrambide, Inc. at 956-447-9009.
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The expiration of the payroll tax cuts as well as rising food prices, both expected within January, will play a huge roll in tax hikes in 2013. This will cause about 0.8% in a cut in economic growth for the year. According to a poll conducted by Reuter’s, the US economy is expected to expand only 2% in 2013 compared to 2012’s 2.1%. Consumer groups’ advice for Americans? Cut back on debt, closely monitor your retirement savings and conserve gas whenever possible.
JP Morgan economists predict that a 2% cut in the payroll tax, which is expected to expire in January, would most likely reduce household spending by around $125 billion. The cut would also lower the nation’s GDP (gross domestic product) by .6% in 2013. Congress plans on working hard to limit the impact of the oncoming tax hikes. If no action is taken, the United States could experience the largest tax increases since those used to fund the Vietnam War in 1969.
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If you would like more information about the process of growing taxes and how to prepare for them, contact McAllen’s accounting experts at Gonzalez & Arrambide, Inc. at 956-447-9009.
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In 2010, Congress enacted the Payroll Tax Holiday, meant to help boost consumer spending by adding an average of $19 per paycheck over the past two years. The downside to the tax is that it places a dent in social security for aging baby-boomers, despite the intention of the outcome to be the opposite. The Obama Administration has allowed the tax to expire by the end of 2012, a move that has garnered bipartisan support from both sides of the political aisle. In allowing the tax to expire, the economy could see a substantial boost in revenue next year. However, payroll taxes will increase, thus, lowering the median pay in a person’s paycheck. Analysts, however, believe the change will go unnoticed by the American people.
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If you have any questions regarding the payroll tax or any other tax-related issues, contact Gonzalez & Arrambide, Inc. at 956-447-9009. Visit us at 415 S. International Blvd., Weslaco, TX 78596.
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Attending college is very expensive. College students are more in debt even before they receive their degrees. Congress enacted a new college tuition tax credit for 2010-2012:
The American Opportunity Tax Credit
Worth up to $2,500
For single filers with income below $80,000 and joint filers with incomes below $160,000
100% of the first $2,000 in qualified tuition and related expenses; and
25% of the next $2,000 in qualified tuition and related expenses
For the parents of a dependent student or for the student if not claimed as a dependent
40% of the credit ($1,000) is refundable
This tax credit is designed to alleviate some of the stress caused by high tuition and college expenses.
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For more information on tax credits, call the McAllen Accountants at Gonzalez & Arrambide Inc. at 956-447-9009.
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According to the Internal Revenue Service, if Congress cannot come to an agreement about th budget, as many as 100 million U.S. households may not be able to file their tax returns until March 2013.
The alternative minimum tax is scheduled to affect about 32 million households. Congress’s inability to come to a decision will also prohibit the IRS to reprogram its computers to adjust to the new changes.
U.S. households will have even more questions than last year about filing so the IRS is preparing for the high volume of calls. Tax filers should wait and see if a decision is made before filing in order to avoid having to amend later. Without a “patch” to the AMT, 80% of households with incomes between $80,000 and $200,000 would owe extra taxes.
Congress must come to an agreement hopefully before the New Year.
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For more information about filing your taxes, contact the tax experts of Gonzalez & Arrambide, Inc. at 956-447-9009.
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