Frequently Asked Questions

1.  When is my Individual Tax Return Due?

    April 15, 2003

2.  What is the Mileage Rate for business use?

    For tax year 2002, the rate is 36.5 cents per mile.

3.  What if I can't file on time?

    You can get an automatic four month extension by filing Form 4868 by April 15, 2003.  You can also file an extension electronically by contacting your tax professional.

4.  Do I have to file a tax return?

    If you are a single person under age 65, you must file a return if your gross income was at least $7,700, or your self-employed net income was $400 or more, or you owe special taxes such as Social Security/Medicare on tips, alternative minimum taxes, recapture taxes or penalty tax on qualified account distributions.  (Higher gross income levels apply to other filing status.)

5.  Who can be a foster child?

    A foster child can be a child you cared for as your own child, and is related to you as a sibling, i.e. brother, sister, stepbrother or stepsister; or as a descendant, i.e. a child or adopted child of your brother, sister, stepbrother or stepsister; or a child placed with you by an authorized placement agency.

6.  How long should I keep my tax return?

    You should retain your tax return and reporting documents (W-2's, 1099's, etc.) for 3 years from the date the return was due or filed, or 2 years from the date the tax was paid, whichever is later.  However, property records should be retained until after three years from the due date of the tax return reporting the disposal of the property.  Also it may be advisable to retain business returns, including sole proprietors (Schedule C files) for six years or longer.

7.  What is IRS e-file?

    IRS e-file is the fastest, most accurate way to file!  It is electronic transmission of data, but there are many options:

    a.  Use of an authorized e-file provider using Form 8453 or paperless filing.
    b.  E-file through your personal computer using a software program or direct filing through a website.
    c.  Telefile dial-up, completely paperless, but limited to the 1040 EZ form.

8.  Is bartering of services taxable?

    Yes, to the extent of the fair market value of the property or services received in barter arrangements.

 


Financial and Tax Planning, Inc.

This Page Last Updated on Tuesday, March 11, 2003
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