TAX PREPARATION

Every person liable for income tax must maintain books and records sufficient to establish the amount of his gross income. The Secretary of the Treasury is authorized and has great latitude in reconstructing income in accordance with any reasonable method that accurately reflects actual income.

There are scores of deductions and credits that taxpayers can qualify for, including the earned income tax credit, child tax credit, and deductions and credits for college education.

As a general rule of thumb, married people should file jointly, because it is generally advantageous, as married filing jointly is the most advantageous tax bracket. If you are single, but are taking care of a dependent child, you should file as head of household tax rates are lower than filing a single return.

 

MORE TOPICS IN: Money & Investments