Q&A for How to Do Your Own Taxes

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What are common mistakes when filing your taxes?

Ara Oghoorian, CPA
Certified Financial Planner & Accountant
Ara Oghoorian is a Certified Financial Accountant (CFA), Certified Financial Planner (CFP), a Certified Public Accountant (CPA), and the Founder of ACap Advisors & Accountants, a boutique wealth management and full-service accounting firm based in Los Angeles, California. With over 26 years of experience in the financial industry, Ara founded ACap Asset Management in 2009. He has previously worked with the Federal Reserve Bank of San Francisco, the U.S. Department of the Treasury, and the Ministry of Finance and Economy in the Republic of Armenia. Ara has a BS in Accounting and Finance from San Francisco State University, is a Commissioned Bank Examiner through the Federal Reserve Board of Governors, holds the Chartered Financial Analyst designation, is a Certified Financial Planner™ practitioner, has a Certified Public Accountant license, is an Enrolled Agent, and holds the Series 65 license.

Ara Oghoorian, CPA

Certified Financial Planner & Accountant

Expert Answer

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Question

What are hardship withdrawals and what do they have to do with taxes?

Keila Hill-Trawick, CPA
Certified Public Accountant
Keila Hill-Trawick is a Certified Public Accountant (CPA) and owner at Little Fish Accounting, a CPA firm for small businesses in Washington, District of Columbia. With over 15 years of experience in accounting, Keila specializes in advising freelancers, solopreneurs, and small businesses in reaching their financial goals through tax preparation, financial accounting, bookkeeping, small business tax, financial advisory, and personal tax planning services. Keila spent over a decade in the government and private sector before founding Little Fish Accounting. She holds a BS in Accounting from Georgia State University - J. Mack Robinson College of Business and an MBA from Mercer University - Stetson School of Business and Economics.

Keila Hill-Trawick, CPA

Certified Public Accountant

Expert Answer

So hardship withdrawals, depending on the type of account that you're pulling from, are essentially a way for you to avoid additional penalties when you take money out. Outside of a pandemic, this would normally be reserved for things like medical emergencies or trauma. With COVID, there are new rules for this, so check in with your bank or call the state where you live to learn more.

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Question

How do I file schedule C?

Darron Kendrick, CPA, MA
Financial Advisor
Darron Kendrick is an Adjunct Professor of Accounting and Law at the University of North Georgia. He received his Masters degree in tax law from the Thomas Jefferson School of Law in 2012, and his CPA from the Alabama State Board of Public Accountancy in 1984.

Darron Kendrick, CPA, MA

Financial Advisor

Expert Answer

Schedule C should be completed and included as a supporting document to your form 1040. The total income reported on your Schedule C will appear on line 12 and on Schedule SE, line 2.

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Question

Does this information apply to doing taxes for a business?

Michael R. Lewis
Business Advisor
Michael R. Lewis is a retired corporate executive, entrepreneur, and investment advisor in Texas. He has over 40 years of experience in business and finance, including as a Vice President for Blue Cross Blue Shield of Texas. He has a BBA in Industrial Management from the University of Texas at Austin.

Michael R. Lewis

Business Advisor

Expert Answer

While the process for filing business and individual taxes is similar, this article deals solely with the latter. Review wikiHow's How to File Taxes for a Home-Based Business or How to Pay Tax as an Independent Contractor or Freelancer

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Question

How do I file my state return when I have two different state wages combined on one W-2?

Darron Kendrick, CPA, MA
Financial Advisor
Darron Kendrick is an Adjunct Professor of Accounting and Law at the University of North Georgia. He received his Masters degree in tax law from the Thomas Jefferson School of Law in 2012, and his CPA from the Alabama State Board of Public Accountancy in 1984.

Darron Kendrick, CPA, MA

Financial Advisor

Expert Answer

In this situation you would need to determine the wages earned in each state where income was earned. File returns in both of those states using your allocated amount for each state. You may take a credit in your home state for any taxes withheld in your non-resident state. A statement attached to your return explaining why you reported this could help reduce confusion.

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Question

I did not work in 2016, but I received an early distribution lump sum retirement payment. How do I file this?

Darron Kendrick, CPA, MA
Financial Advisor
Darron Kendrick is an Adjunct Professor of Accounting and Law at the University of North Georgia. He received his Masters degree in tax law from the Thomas Jefferson School of Law in 2012, and his CPA from the Alabama State Board of Public Accountancy in 1984.

Darron Kendrick, CPA, MA

Financial Advisor

Expert Answer

You will likely want to consult with a professional to determine the tax status of your retirement proceeds. Depending on your age, any contributions you made to the plan, and the plan itself, your taxes could either be significant or little at all.

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Question

How much would I owe if I make 15 grand?

Darron Kendrick, CPA, MA
Financial Advisor
Darron Kendrick is an Adjunct Professor of Accounting and Law at the University of North Georgia. He received his Masters degree in tax law from the Thomas Jefferson School of Law in 2012, and his CPA from the Alabama State Board of Public Accountancy in 1984.

Darron Kendrick, CPA, MA

Financial Advisor

Expert Answer

How much you would pay depends on your age, filing status, and whether or not you have dependents.

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Question

I don't work in US. My living allowances come from retirement funds of a company based overseas. That company did not provide me with the W-2 form. How can I do my taxes?

Darron Kendrick, CPA, MA
Financial Advisor
Darron Kendrick is an Adjunct Professor of Accounting and Law at the University of North Georgia. He received his Masters degree in tax law from the Thomas Jefferson School of Law in 2012, and his CPA from the Alabama State Board of Public Accountancy in 1984.

Darron Kendrick, CPA, MA

Financial Advisor

Expert Answer

You should consult a tax professional for help sorting out your situation. If you are a US Citizen, you are taxed on all of your income regardless of its source unless a specific exemption applies. Furthermore, depending on your situation and the structure of your retirement plan, you may not have to pay taxes on all of your retirement income.

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Question

How do you handle filing taxes in two states?

Michael R. Lewis
Business Advisor
Michael R. Lewis is a retired corporate executive, entrepreneur, and investment advisor in Texas. He has over 40 years of experience in business and finance, including as a Vice President for Blue Cross Blue Shield of Texas. He has a BBA in Industrial Management from the University of Texas at Austin.

Michael R. Lewis

Business Advisor

Expert Answer

Review wikiHow article How to File Taxes if You Worked in 2 Different States

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