One of the headaches created by not using a tax professional is the do-it-yourself hassle of dealing with the IRS when questions or problems arise.

Throughout history income taxes have been a stressful topic. Even one of our nation’s founding fathers thought so:

“It would be a hard government that should tax its people one-tenth part of their income.”
Benjamin Franklin, Poor Richard’s Almanac

Income taxes seem complicated because they can be. Even one of the greatest thinkers of the 20th century agreed:

“The hardest thing in the world to understand is the income tax.”
Albert Einstein

This is why having an expert tax preparer on your side is important.

Here’s one of those tax breaks that most of us hardly ever think about, but it is there for the taking for young people just starting out or those with incomes less than $30,000. It’s called the Saver’s Credit and it doesn’t require any long and drawn out tax forms to attach to your Form 1040. It is a tax credit of up to $200 that is deducted right off of your tax bill. All you have to do is contribute to an IRA or 401-k retirement account. Not only does it help you toward planning for your retirement, but it puts a little money in your pocket now. Maybe this information could be used to encourage your younger friends and working children to begin that savings’ habit now.

As we’ve come to expect from our leaders in Washington, they battled down to the wire again to pass a bill to help us avoid the “fiscal cliff” on January 1st. As many had predicted, the temporary payroll tax break of 2% on the employee FICA tax went away causing that rate to climb back to 6.2%. One major surprise to me was that the $1,000 Child Tax Credit survived their scrutiny because there had been much speculation that the credit would be reduced to $500 per child. As you read through the article from MarketWatch, you’ll see some of the other changes that have become part of the tax code.