Passive income includes earnings from sources such as rental properties, limited partnerships, or other enterprises in which you’re not actively involved. Reporting passive income properly is crucial because failing to do so can result in IRS penalties, audits, or other legal issues. This guide will help you understand the basics of passive income, how to […]
How to Fill Out a W-4
When taxpayers report smaller refunds, more often than not, they can be credited to an outdated Form W-4. Unbeknownst to some, a W-4 needs to be updated whenever certain life changes occur. If it’s outdated, you may not have enough tax withheld during the year. This basically results in a smaller refund at tax time. […]
Avoid IRS Penalties: Key Tax Deadlines!
Taxpayers who unknowingly fail to pay their tax burden to the IRS could wind up drowning in additional interest and penalties that are tacked on to their overall tax balance. CEO David King and Lead Tax Attorney Philip Hwang provide helpful insight on upcoming tax due dates and how taxpayers can resolve their tax liability […]
How to File Back Taxes
Filing back taxes may seem overwhelming, but catching up is essential to avoid penalties, interest charges, and potential legal consequences. Whether due to an unexpected financial crisis, oversight, or miscalculation, owing back taxes isn’t uncommon. This article will guide you through what back taxes are, the consequences of ignoring them, and actionable steps to file […]
Can the IRS Take My Social Security?
Social Security benefits provide a crucial lifeline to millions of Americans, particularly retirees, disabled individuals, and others who rely on these payments for their basic needs. But when you have unpaid taxes, many beneficiaries fear that the IRS could step in and take a portion of their much-needed Social Security payments. It’s an unsettling thought, […]
Ask Phil: Important 1099-K Update for Small Businesses
Today, Optima Tax Relief Lead Tax Attorney, Phil, discusses an important tax update for small businesses and self-employed individuals coming in 2025. If you receive payments through platforms like PayPal, Venmo, Shopify, Etsy, or other payment services, you will receive a 1099-K form for tax reporting purposes. Form 1099-K report payments made to merchants and […]
What is the IRS Collection Statute of Limitations?
They say that death and taxes are the only two certainties in life. However, taxes are only collectible for so long. The IRS Collection Statute of Limitations is a critical aspect of tax law that often confuses taxpayers and professionals alike. This statute dictates the timeframe within which the IRS can collect unpaid taxes. While […]
How Much Should I Offer in Compromise?
When facing substantial tax debt, an Offer in Compromise (OIC) can be a potential lifeline for resolving outstanding liabilities. The OIC allows taxpayers to settle their debt with the IRS for less than the full amount owed. However, determining the right amount to offer requires a careful evaluation of your financial situation. In this article, […]
Roth IRA Penalties: What Are They & How Do I Avoid Them?
Roth Individual Retirement Accounts (IRAs) are popular investment vehicles that offer tax advantages for retirement savings. However, it’s crucial for account holders to be aware of Roth IRA penalties to make informed financial decisions. This article will explore the various penalties associated with Roth IRAs, helping readers navigate the potential issues and optimize their retirement […]
I Overstated My Tax Deductions. Now What?
It’s easy to make mistakes when filing taxes, especially when it comes to deductions. You might accidentally overstate your tax deductions, either due to a misunderstanding of tax laws, incorrect records, or an inadvertent miscalculation. The IRS takes incorrect tax returns seriously, so it’s essential to understand what happens when you overstate your deductions and […]