- For Head of Household filing status, do you have to claim a child as a dependent to qualify?
In certain circumstances, you do not have to claim the child as a dependent to qualify for head of household filing status; for example a custodial parent may be able to claim head of household status even if he or she released a claim of exemption for that child.
-What should I do if I made a mistake on my federal return that I have already filed?
It depends on the type of mistake that you made: Many mathematical errors are caught in the processing of the tax return itself so you may not need to correct these mistakes. If you did not attach a required schedule, the IRS will contact you and ask for the missing information. If you did not report all of your income or did not claim a credit, you should file an amended or corrected return using Form 1040X, Amended U.S. Individual Income Tax Return.
-Is there an age limit on claiming my child as a dependent?
To be claimed as your dependent , your child must meet the qualifying child test or the qualifying relative test. To meet the qualifying child test, your child must be younger than you and , as of the end the calendar year , either younger than 19 years old or be a student and younger than 24 years old. There is no age limit on claiming your child as a dependent if the child meets the qualifying relative test.
New Corporation Formation:
-What are the benefits of incorporating?
A corporation has continual existence. Contrast this against a sole proprietorship or partnership ends when a partner or owner dies. Thus, if the surviving spouse or heirs of a partnership owner want to continue the business in their own names, it will be considered a new/different business. A Corporation on the other hand enjoys a continual existence even if the owners pass away.
Ease of maintaining control of your business. By distributing stock, the Shareholder of a corporation may share profits of the business without giving up control. This is obtained by keeping a majority of stock of the issued stock or by issuing differing classes of stock, such as voting and non-voting stock.
Raising Capital tax free. A corporation may raise capital by selling stock or borrowing money and most importantly, a corporation does not pay taxes on money it raises by the sale of stock.
Other tax advantages. The following advantages are only available to corporations: Losses/expenditures are fully deductible for a corporation whereas an individual must prove there was a profit motive before deducting a loss. Dividends do not endure a corporate tax at the federal or state level if the owner chooses to elect to be a sub chapter s corporation. Tax differed trusts may be set up for the owners retirement plan. Medical insurance for your family may be deductible.
Credit Repair:
-What is a credit score and why is it important to me?
A credit score is a number usually between 350 and 850 that is calculated by a mathematical formula that evaluates many types of information on your credit report.
The higher your score the better. This score helps lenders and others decide how likely you are to repay your debts. Credit scores do matter. They affect whether you can get credit, your interest rate or credit limit on a credit card, auto loans, mortgages, and even the types of jobs and rental housing available to you.
2. How is my credit score evaluated?
Scores under 500 = Bad Score.
Scores 500 - 600 = Poor Score.
Scores 600-650 = Fair Score.
This usually results from late payments, collections and charge- offs. You will most likely be charged the highest interest rate allowed by law in your state or you could be turned down completely.
Scores 650-700 = Good Score.
As long as your debt to income ratio is low you will be approved and will likely pay a lower interest rate on your loan.
Scores 700 + = Great Score.
You are considered a "prime borrower" and will be able to obtain favorable financing terms.
