Frequently Asked TAX Questions (select category)

1. What is an individual tax return?
An individual tax return reports your income, credits, and tax payments to determine a refund or balance due.

2. What form is used for personal tax filing?
Form 1040.

3. Who must file a tax return?
Anyone earning income above the IRS filing threshold or eligible for refundable credits.

4. What documents are needed to file?
Your ID, Social Security number, W-2 forms, 1099s, and prior-year return.

5. Do I need to file if I worked part-year?
Yes, if your income meets filing requirements.

6. What if I don’t have all my forms yet?
Wait until everything arrives to avoid errors.

7. Can I claim dependents?
Yes, if IRS dependency rules are met.

8. How do refunds work?
Refunds occur when your tax payments exceed your tax liability.

9. How long does a refund take?
Typically 7–21 days when e-filed.

10. What happens if I file late?
Possible penalties or interest if you owe.

11. Do I need to file if I receive Social Security?
Maybe — it depends on your total income.

12. Must I report 1099 income?
Yes — all income must be reported.

13. Are tax credits available?
Yes — eligibility varies.

14. Is unemployment taxable?
Yes, unemployment benefits are taxable.

15. What if my employer withheld too little?
You may owe tax when filing.

16. Can I file electronically?
Yes — e-file is fast and secure.

17. Should I file with no income?
Only if required or claiming credits.

18. Can I prepare my own return?
Yes, but a professional reduces errors.

19. What if I moved during the year?
Report income from each state as required.

20. Can someone else file for me?
Yes, if authorized.

1. What is itemizing?
Listing eligible deductions instead of using the standard deduction.

2. Who should itemize?
Those with deductible expenses higher than the standard deduction.

3. What expenses qualify?
Mortgage interest, medical expenses, state taxes, property taxes, and charitable donations.

4. Can renters itemize?
Yes — itemizing is not based on homeownership.

5. What documents do I need?
Receipts, statements, proof of payments, and donation records.

6. Are medical expenses deductible?
Yes, beyond AGI limits.

7. Are charitable donations deductible?
Yes, with proper proof.

8. What is the SALT deduction limit?
A capped deduction for state and local taxes.

9. Can I deduct mortgage interest?
Yes — on qualified loans.

10. Can I deduct student loan interest here?
No — it's an adjustment to income, not itemized.

11. Are work uniforms deductible?
Only if required and not suitable for daily wear.

12. Are HOA dues deductible?
No — unless related to rental or business activity.

13. Is homeowners insurance deductible?
Not for personal residence.

14. Can I itemize without receipts?
No — documentation is required.

15. Can I itemize and take the standard deduction?
No — you must choose one.

16. Does itemizing increase audit risk?
Only if amounts are unusually high or unsupported.

17. Should a professional help me itemize?
Yes — itemizing can be complex.

18. Can itemizing increase my refund?
Yes, when deductions exceed the standard deduction.

19. Can married couples itemize separately?
If one itemizes, the other must too.

20. When should I not itemize?
When the standard deduction is higher.

1. What is Schedule C?
The form for reporting self-employment income and expenses.

2. Who must file Schedule C?
Freelancers, gig workers, and sole proprietors.

3. What is self-employment income?
Income earned outside a W-2 job.

4. Can I deduct business expenses?
Yes — if ordinary and necessary.

5. What are common deductions?
Mileage, supplies, advertising, insurance, and home office expenses.

6. Do I owe self-employment tax?
Yes — for Social Security and Medicare.

7. What records do I keep?
Receipts, statements, invoices, and mileage logs.

8. Can I deduct cell phone or internet?
The business-use portion may qualify.

9. What is the home office deduction?
A deduction for exclusive business use.

10. Do I need a license?
Depends on your city, not IRS rules.

11. Can I have W-2 and 1099 income?
Yes — both are reported on your return.

12. Do I need estimated tax payments?
Often yes, if taxes are not withheld.

13. Can I deduct vehicle mileage?
Yes — with proper tracking.

14. Can I deduct equipment purchases?
Yes — via depreciation or Section 179.

15. Are meals deductible?
Some business meals may qualify.

16. Do I need an EIN?
Not required but recommended.

17. Can I deduct startup costs?
Yes — within IRS limits.

18. What if my business loses money?
Losses may offset other income.

19. Does self-employment affect retirement?
Yes — special plans may apply.

20. Do I need a tax professional?
Highly recommended due to complexity.

1. Do LLCs and S-Corps file taxes the same way?
No — LLCs may be taxed as sole proprietors, partnerships, or corporations; S-Corps have distinct filing rules.

2. Do I need a separate tax return for my LLC?
Single-member LLCs may file on Schedule C; multi-member LLCs file Form 1065.

3. What form does an S-Corp file?
S-Corps file Form 1120-S along with shareholder K-1 forms.

4. What is a K-1?
A schedule showing each owner’s share of income, deductions, and credits.

5. What is pass-through taxation?
Business income passes to owners and is taxed on their personal returns, not at the corporate level.

6. Do I need an EIN for my business?
Yes — corporations and multi-member LLCs must use an EIN.

7. What expenses can a business deduct?
Ordinary and necessary business expenses, including payroll, insurance, equipment, rent, and advertising.

8. Can my business hire employees?
Yes — businesses must follow payroll tax rules for wages and withholding.

9. Can I pay myself from the business?
LLC members take draws; S-Corp owners must take a reasonable salary.

10. Do businesses pay estimated taxes?
Yes — most pass-through entities require quarterly estimated payments.

11. Can my business deduct vehicles?
Business-related vehicle costs may be deductible using standard mileage or actual expenses.

12. Do S-Corps pay self-employment tax?
Not on distributions — only on salaries, which can save taxes when structured properly.

13. Are home office expenses deductible for businesses?
Yes — if used exclusively for business.

14. Can businesses depreciate equipment?
Yes — through depreciation or Section 179 deductions.

15. Can I change my tax classification later?
Yes — LLCs can elect S-Corp status if it benefits the business.

16. Do business owners need payroll software?
Recommended — payroll compliance is strict and errors are costly.

17. Can my business take out loans?
Yes — loans are not income, but interest may be deductible.

18. What happens if my business loses money?
Losses may offset other income subject to IRS limits.

19. How long do I keep business tax records?
At least 7 years for tax protection and audit support.

20. Should a professional file my business return?
Yes — business returns are complex and mistakes affect multiple tax years.

1. What is Schedule E used for?
Schedule E reports income and expenses from rental properties, including homes, units, or Airbnb properties.

2. Who needs to file Schedule E?
Any taxpayer earning rental income from real estate they personally own.

3. Is rental income taxable?
Yes — rental income is taxable and must be reported to the IRS.

4. What expenses can I deduct for a rental property?
Mortgage interest, property taxes, insurance, repairs, utilities, HOA fees, depreciation, and management fees.

5. What is depreciation?
A yearly deduction based on the wear and tear of a rental property over time.

6. Can I deduct improvements?
Improvements must typically be depreciated, not deducted all at once.

7. Can I deduct repairs immediately?
Yes — repairs that restore something to working condition are deductible in the year paid.

8. Can I live in my rental property part-time?
Yes, but personal use may limit some deductions based on IRS vacation home rules.

9. Do I need to keep receipts for rental expenses?
Yes — documentation supports all deductions and reduces audit risk.

10. What if my rental shows a loss?
Losses may offset income, but passive loss rules apply and may limit deductions.

11. Are security deposits taxable?
No — unless kept because the tenant breaks the lease or damages property.

12. Can I deduct travel to my rental property?
Yes — business-related travel may be deductible with proper records.

13. Do I need to report Airbnb or short-term rental income?
Yes — platforms may issue 1099 forms, and income must be reported.

14. Can I deduct home office expenses for managing my rentals?
Possibly — if you materially participate and meet IRS eligibility.

15. Are utilities deductible?
If you pay utilities on behalf of the rental, they are deductible.

16. Can I deduct rental-related legal fees?
Yes — legal and professional expenses tied to rental activity are deductible.

17. What is passive income?
Income from rentals is generally passive unless you materially participate.

18. Can I claim depreciation even if my property increased in value?
Yes — depreciation is based on structure cost, not market value.

19. What happens if I sell my rental property?
You may owe taxes on gains and depreciation recapture.

20. Should I hire a tax professional?
Yes — rental tax rules are complex and improper reporting can lead to penalties.

1. What is an amended tax return?
A corrected tax return filed when a previously submitted return has errors or missing information.

2. Why would I need to amend a return?
To fix mistakes, add income, claim missed deductions or credits, change filing status, or address IRS notices.

3. What form is used to amend returns?
Form 1040-X.

4. Can amended returns be filed electronically?
Yes — many amended returns can now be e-filed, depending on the year.

5. How long do I have to amend a return?
Generally three years from the original filing date or two years from paying tax owed.

6. Can I amend if I forgot a W-2 or 1099?
Yes — missing income is one of the most common amendment reasons.

7. Will an amendment delay my refund?
It may — amended returns take longer to process than original returns.

8. Will amending trigger an audit?
Not automatically — corrections reduce audit risk when done properly.

9. What if my amendment results in more tax owed?
You should pay as soon as possible to avoid penalties and interest.

10. Can I amend a return someone else prepared?
Yes — any erroneous return can be corrected.

11. Can I amend a return for multiple years at once?
Each year requires a separate 1040-X.

12. Can I amend to claim credits I missed?
Yes — many taxpayers amend to claim overlooked deductions and credits.

13. Can I amend to change dependents claimed?
Yes — if IRS dependency rules were misunderstood or documentation has changed.

14. Can I amend to fix filing status?
Some filing statuses may be changed; rules vary by situation.

15. Can I amend a return if I used the wrong SSN?
Yes — incorrect identifying information must be corrected.

16. Can I amend if the IRS already processed my refund?
Yes — processing doesn't prevent amendments.

17. How long does it take to get results from an amendment?
Often several months — amended returns are manually reviewed.

18. Can I track my amended return?
Yes — the IRS has a tool called “Where's My Amended Return?”

19. Should I file an amendment even if it doesn't change my refund?
Yes — accuracy protects you from penalties and audit issues.

20. Should a professional prepare my amended return?
Yes — amendments involve technical corrections best handled by a tax expert.