The IRS has a free program for anyone who wants to learn about taxes. “Understanding Taxes” is available 24/7 on IRS.gov. It was designed by the IRS and teachers to help you learn the “how’s” and “why’s” of taxes. The program can make learning about federal taxes as easy as A-B-C.
o Accessible (web-based)
o Brings learning to life
Here are six more reasons to study up on it:
1. Lessons on IRS.gov. Teachers and students will find that the nearly 40 lessons on IRS.gov are easy, relevant and fun!
2. User friendly site map. You can quickly look through the program and skip to the part you want.
3. Tutorials, tests and more. A series of tax tutorials guide you through the basics of tax preparation. Another feature is a chance to test your knowledge through tax trivia. There’s also a glossary of tax terms.
4. Customize to fit your style. If you’re a teacher, you can make the interactive program fit your style. Use your own lesson plans and plan your own activities. It’s easy to add to your school’s curriculum.
5. No need to register. You don’t need to register or login to use the program. You can take a break and return to where you left off whenever you choose. Just take note of the page and lesson number before you leave the page.
6. The how’s and why’s of taxes. Learn the basic concepts of taxes. Self-paced modules offer a step-by-step approach to tax preparation. The lessons are also a great way to learn about the history and theory of taxes in the USA.
You may use the program anytime during the year. Visit IRS.gov and type “Understanding Taxes” in the search box. The application contains lessons and practice problems based on 2014 tax law.
For more current tax law training, visit Link and Learn Taxes on IRS.gov. The IRS will update this program later this year. The Web address is http://apps.irs.gov/app/vita/. You can also find it if you type “Link and Learn” in the search box.
Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.
When you need tax help, the IRS has many online tools that are easy to use. You can e-file your tax return free, check your refund’s status or get your tax questions answered. Use our tools on IRS.gov any time of day or night. Here’s a list of popular self-help tools that millions have used to get free tax help:
• IRS Free File. You can use IRS Free File to prepare and e-file your federal tax return for free. Free File will do much of the work for you with brand-name tax software or Fillable Forms. If you still need to file your 2014 tax return, Free File is available through Oct. 15. The only way to use IRS Free File is through the IRS website.
• Where’s My Refund? Checking the status of your tax refund is easy when you use Where’s My Refund? You can also use this tool with the IRS2Go mobile app.
• Direct Pay. Use IRS Direct Pay to pay your tax bill or pay your estimated tax directly from your checking or savings account. Direct Pay is safe, easy and free. The tool walks you through five simple steps to pay your tax in one online session. You can also use Direct Pay with the IRS2Go mobile app.
• Online Payment Agreement. If you can’t pay your taxes in full, apply for an Online Payment Agreement. The Direct Debit payment plan option is a lower-cost hassle-free way to pay your tax each month.
• Withholding Calculator. Did you get a larger refund or owe more tax than you expected the last time you filed your tax return? If so, you may want to change the amount of tax withheld from your paycheck. The Withholding Calculator tool can help you determine if you need to give your employer a new Form W-4, Employee’s Withholding Allowance Certificate. The tool can also help you fill out the form. Give the new form to your employer to make the change.
• Interactive Tax Assistant. If you need to know about 2014 taxes, you should try the Interactive Tax Assistant tool to get what you need. If you do not have qualifying health insurance coverage, the tool can help. For instance, you can find out if you must make an individual shared responsibility payment or if you are eligible for an exemption, when you file your income tax return. You can also use the tool to find out if you are eligible for the premium tax credit.
• IRS Select Check. If you want to deduct your gift to charity, the organization you give to must be qualified. Use the IRS Select Check tool to see if a group is qualified.
• Tax Map. The IRS Tax Map gives you a single point to get tax law information by subject. It integrates your topic with related tax forms, instructions and publications into one research tool.
The health care law contains tax provisions that affect employers. The size and structure of a workforce – small or large – helps determine which parts of the law apply to which employers. Calculating the number of employees is especially important for employers that have close to 50 employees or whose work force fluctuates during the year
The number of employees an employer has during the current year determines whether it is an applicable large employer for the following year. Applicable large employers are generally those with 50 or more full-time employees or full-time equivalent employees. Under the employer shared responsibility provision, ALEs are required to offer their full-time employees and dependents affordable coverage that provides minimum value. Employers with fewer than 50 full-time or full-time equivalent employees are not applicable large employers.
For more information on these and other ACA tax provisions, visit IRS.gov/aca.
If you are in the U. S. Armed Forces, special tax breaks may apply to you. For example, some types of pay are not taxable. Certain rules apply to deductions or credits that you may be able to claim that can lower your tax. In some cases, you may get more time to file your tax return. You may also get more time to pay your income tax. Here are the top 10 IRS tax tips about these rules:
1. Deadline Extensions. Some members of the military, such as those who serve in a combat zone, can postpone some tax deadlines. If this applies to you, you can get automatic extensions of time to file your tax return and to pay your taxes.
2. Combat Pay Exclusion. If you serve in a combat zone, certain combat pay you get is not taxable. You won’t need to show the pay on your tax return because combat pay is not part of the wages reported on your Form W-2, Wage and Tax Statement. If you serve in support of a combat zone, you may qualify for this exclusion.
3. Earned Income Tax Credit or EITC. If you get nontaxable combat pay, you can include it to figure your EITC. Doing so may boost your credit. Even if you do, the combat pay stays nontaxable.
4. Moving Expense Deduction. You may be able to deduct some of your unreimbursed moving costs. This applies if the move is due to a permanent change of station.
5. Uniform Deduction. You can deduct the costs of certain uniforms that you can’t wear while off duty. This includes the costs of purchase and upkeep. You must reduce your deduction by any allowance you get for these costs.
6. Signing Joint Returns. Both spouses normally must sign a joint income tax return. If your spouse is absent due to certain military duty or conditions, you may be able to sign for your spouse. In other cases when your spouse is absent, you may need a power of attorney to file a joint return.
7. Reservists’ Travel Deduction. If you’re a member of the U.S. Armed Forces Reserves, you may deduct certain costs of travel on your tax return. This applies to the unreimbursed costs of travel to perform your reserve duties that are more than 100 miles away from home.
8. ROTC Allowances. Some amounts paid to ROTC students in advanced training are not taxable. This applies to allowances for education and subsistence. Active duty ROTC pay is taxable. For instance, pay for summer advanced camp is taxable.
9. Civilian Life. If you leave the military and look for work, you may be able to deduct some job search expenses. You may be able to include the costs of travel, preparing a resume and job placement agency fees. Moving expenses may also qualify for a tax deduction.
10. Tax Help. Most military bases offer free tax preparation and filing assistance during the tax filing season. Some also offer free tax help after April 15.
For more, refer to Publication 3, Armed Forces’ Tax Guide. It is available on IRS.gov/forms at any time.
If you are a small employer, you might be eligible for the Small Business Health Care Tax Credit, which can make a difference for your business. To be eligible for the credit, you must:
- have purchased coverage through the Small Business Health Options Program – also known as the SHOP marketplace
- have fewer than 25 full-time equivalent employees
- pay an average wage of less than $50,000 a year
- pay at least half of employee health insurance premiums
For tax years beginning in 2014:
- The maximum credit increases to 50 percent of premiums paid for small business employers and 35 percent of premiums paid for small tax-exempt employers.
- To be eligible for the credit, you must pay premiums on behalf of employees enrolled in a qualified health plan offered through a Small Business Health Options Program Marketplace or qualify for an exception to this requirement.
- The credit is available to eligible employers for two consecutive taxable years. Even if you are a small business employer who did not owe tax during the year, you can carry the credit back or forward to other tax years. Also, since the amount of the health insurance premium payments is more than the total credit, eligible small businesses can still claim a business expense deduction for the premiums in excess of the credit. That’s both a credit and a deduction for employee premium payments.
There is good news for small tax-exempt employers, too. The credit is refundable, so even if you have no taxable income, you may be eligible to receive the credit as a refund so long as it does not exceed your income tax withholding and Medicare tax liability. Refund payments issued to small tax-exempt employers claiming the refundable portion of credit are subject to sequestration.
Finally, if you can benefit from the credit even if you forgot to claim it on your 2014 tax return; there’s still time to file an amended return. Generally, a claim for refund must be filed within three years from the time the return was filed or two years from the time the tax was paid, whichever of such periods expires later. For tax years 2010 through 2013, the maximum credit is 35 percent of premiums paid for small business employers and 25 percent of premiums paid for small tax-exempt employers such as charities.
You must use Form 8941, Credit for Small Employer Health Insurance Premiums, to calculate the credit. For detailed information on filling out this form, see the Instructions for Form 8941. If you are a small business, include the amount as part of the general business credit on your income tax return.
If you are a tax-exempt organization, include the amount on line 44f of the Form 990-T, Exempt Organization Business Income Tax Return. You must file the Form 990-T in order to claim the credit, even if you don’t ordinarily do so.
For more information about the credit, visit the Small Business Health Care Tax Credit page on IRS.gov/aca.
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When determining if your organization is an applicable large employer, you must measure your workforce by counting all your employees. However, there is an exception for seasonal workers.
If an employer’s workforce exceeds 50 full-time employees for 120 days or fewer during a calendar year, and the employees in excess of 50 who were employed during that period of no more than 120 days were seasonal workers, the employer is not considered an applicable large employer.
A seasonal worker for this purpose is an employee who performs labor or services on a seasonal basis. For example, retail workers employed exclusively during holiday seasons are seasonal workers.
The terms seasonal worker and seasonal employee are both used in the employer shared responsibility provisions, but in two different contexts. Only the term seasonal worker is relevant for determining whether an employer is an applicable large employer subject to the employer shared responsibility provisions. For this purpose, employers may apply a reasonable, good faith interpretation of the term seasonal worker.
To learn more about this topic and about when the definition of a seasonal employee is applicable, see our Questions and Answers page.
See the Determining if an Employer is an Applicable Large Employer page on IRS.gov/aca for details about counting full-time and full-time equivalent employees.
June 1 marks the start of hurricane season. When a hurricane or other disaster strikes, the IRS wants you to know you can count on us for help. We can help you prepare for, and recover from, the destruction it causes. Here is some of the key disaster-related help and assistance you can get 24/7 on our IRS.gov website:
• Make a plan. Check out our IRS.gov page Preparing for a Disaster. It’s dedicated to help you plan before a disaster hits.
• Federally declared disasters. Special tax law provisions apply when the federal government declares a major disaster area. These rules can help victims recover financially after a disaster. For instance, the IRS may grant more time to file tax returns and pay tax.
• Faster refunds possible. You may be able to get a faster refund from losses suffered in a federally declared disaster area. You can claim losses related to the disaster on the tax return for the previous year. You make the claim by filing an amended return in most cases.
• Disaster declarations. Refer to Tax Relief in Disaster Situations. That page has a list of the latest disaster declarations and any related disaster tax relief.
• Around the Nation. The Around the Nation section of IRS.gov provides local tax news. It primarily includes IRS tax relief that applies to major disasters.
• Disaster relief. The IRS has many resources to help those who provide disaster relief. For more on that topic visit our page Disaster Relief Resources for Charities and Contributors.
Most employers have fewer than 50 full-time employees or full-time equivalent employees and are therefore not subject to the Affordable Care Act’s employer shared responsibility provision.
If an employer has fewer than 50 full-time employees, including full-time equivalent employees, on average during the prior year, the employer is not an ALE for the current calendar year. Therefore, the employer is not subject to the employer shared responsibility provisions or the employer information reporting provisions for the current year. Employers with 50 or fewer employees can purchase health insurance coverage for its employees through the Small Business Health Options Program – better known as the SHOP Marketplace.
Calculating the number of employees is especially important for employers that have close to 50 employees or whose workforce fluctuates throughout the year. To determine its workforce size for a year an employer adds its total number of full-time employees for each month of the prior calendar year to the total number of full-time equivalent employees for each calendar month of the prior calendar year, and divides that total number by 12.
Employers that have fewer than 25 full-time equivalent employees with average annual wages of less than $50,000 may be eligible for the small business health care tax credit if they cover at least 50 percent of their full-time employees’ premium costs and generally, after 2013, if they purchase coverage through the SHOP.
All employers, regardless of size, that provide self-insured health coverage must file an annual information return reporting certain information for individuals they cover. The first returns are due to be filed in 2016 for coverage provided during 2015.
For more information, visit our Determining if an Employer is an Applicable Large Employer page on IRS.gov/aca.
The Affordable Care Act contains several tax provisions that affect employers. Under the ACA, the size and structure of a workforce – small, or large – helps determine which parts of the law apply to which employers.
The number of employees an employer had during the prior year determines whether it is an applicable large employer for the current year. This is important because two provisions of the Affordable Care Act apply only to applicable large employers. These are the employer shared responsibility provision and the employer information reporting provisions for offers of minimum essential coverage.
An employer’s size is determined by the number of its employees.
- An employer with 50 or more full-time employees or full-time equivalents is considered an applicable large employer – also known as an ALE – under the ACA.
- For purposes of the employer shared responsibility provision, the number of employees a business had during the prior year determines whether it is an ALE the current year. Employers make this calculation by averaging the number of employees they had throughout the year, which takes into account workforce fluctuations many employers experience.
- Employers with fewer than 50 full-time or full-time equivalent employees are not applicable large employers.
- Calculating the number of employees is especially important for employers that have close to 50 employees or whose work force fluctuates during the year.
To determine its workforce size for a year, an employer adds the total number of full-time employees for each month of the prior calendar year to the total number of full-time equivalent employees for each calendar month of the prior calendar year. The employer then divides that combined total by 12.
For more information, visit our Determining if an Employer is an Applicable Large Employer page on IRS.gov/aca.