Can you explain each of the areas in the "Tax Details" screen in TaxTouch?

Providing these details will make your tax estimate more accurate. 

Filing Status

Your filing status determines which tax schedule your estimate will be based on. Your marital status on the last day of the tax year (December 31) is your marital status for the entire tax year.

  • Single If you are not married, divorced or legally separated according to state law.
  • Married Filing Jointly.  Married couples who are filing their taxes together on a joint return.
  • Married Filing Separately.  If a married couple decides to file their returns separately, each person’s filing status would be Married Filing Separately.
    Head of Household.  If you are not married and have paid more than half the cost of maintaining a home for yourself and a qualifying person.
  • If you are Qualifying Widow(er) with Dependent Child, choose Married Filing Jointly. The calculations are the same.

Deductions

    1. Loan Interest

Enter a $ amount of the interest you paid on your home mortgage.  This usually found on the Form 1098 provided by your bank in the beginning of the year.

    2. Exemptions

Taxpayers are allowed to claim exemptions on their tax returns that reduce their amount of taxable income. There are two main types of exemptions: personal exemptions and exemptions for dependents.  Generally you claim one exemption for yourself and one for each dependent.  To qualify for an exemption your dependent must either be a relative or a member of your household for the entire year.

For more information see IRS web site Dependents & Exemptions

    3. Annual W-2 Income

If you earn income from a full time job, that income may put your Self Employed income into a higher tax bracket. Entering additional W-2 Income here may increase the estimated tax on your Self Employed income.

    4. Home Office Size

The simplified home office deduction method allows you to deduct the square footage of your home office at $5 per square foot up to a maximum $1,500 annually. Please choose the size of the room you use for your home office.

 

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