Tax Tips

Every year, IRS-certified volunteers help people file their tax returns. This volunteer opportunity is ideal for individuals seeking to expand their knowledge of tax preparation, earn continuing education credits, or contribute to their community.

The IRS offers the Volunteer Income Tax Assistance (VITA) program and the Tax Counseling for the Elderly (TCE) program. VITA offers free help to people earning $67,000 or less, people with disabilities, and limited English-speaking taxpayers. TCE is primarily for people aged 60 or older. Although the program focuses on tax issues unique to seniors, most taxpayers can get free assistance.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS⁹

Footnotes and Sources

9. ^{IRS.gov, April 1, 2025}

Just like how Goldilocks had to try the porridge that was too hot and then the one that was too cold before she found one that was just right, you need to find the amount of tax withholding that’s not too much or too little for your circumstances. No one wants a nasty surprise when Tax Day comes, and proper withholding can help you manage these surprises.

You should especially check your withholding after a significant life change, such as marriage, divorce, the birth of a child, a move, or changes in tax law.

How much should you withhold? The Tax Withholding Estimator on the IRS website can help determine if you have too much income tax withheld and how to adjust it.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS⁸

Footnotes and Sources

8. ^{IRS.gov, May 16, 2025}

Giving back to others feels good and is a great way to support your community and those in need, but it also may have tax advantages. According to the IRS, most charitable contributions, including cash and property contributions, are deductible as an itemized deduction when you file your taxes.

Some contributions aren’t tax-deductible, so check the current tax law or talk to your accountant before deducting charitable gifts from your tax return. You can even use the Interactive Tax Assistant on the IRS website to see if your charitable contribution is deductible.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS⁹

Footnotes and Sources

9. ^{IRS.gov, May 30, 2025}

An Offer in Compromise is an agreement between a taxpayer and the IRS that settles a tax debt for less than the total amount owed; this is a genuine service offered by the IRS. The problem arises when “OIC mills” promise things they can’t do.

These OIC mills encourage people to hire their company to file an OIC application, even though the taxpayer may not qualify. They often charge significant fees and waste your time and money.

Taxpayers who qualify for an OIC can get the same deal working directly with the IRS without the extra fees. Before hiring a company to file an OIC on your behalf, check the IRS website to see if you pre-qualify for an OIC. The site also provides resources to help you understand the process.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS¹⁰

Footnotes and Sources

10. ^{IRS.gov, May 22, 2025}

Well-organized recordkeeping makes it easier to prepare your tax return and provide evidence of tax deductions. According to the IRS, you’re encouraged to keep records, such as receipts, canceled checks, and other documents that support an item of income, a deduction, or a credit appearing on a return, as long as they may become material in the administration of any provision of the Internal Revenue Code. Depending on the assessment, these limitation periods can range from 3 to 7 years.

There are also periods of limitations for refund claims, which range from 2 years to 7 years. The IRS encourages keeping records of property, healthcare insurance, and business income and expenses, among other categories.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS¹⁰

Footnotes and Sources

10. ^{IRS.gov, August 20, 2024}

Business travel deductions are available when employees travel away from their tax home or principal place of work for business reasons. The travel period must be substantially longer than an ordinary day’s work, and there must be a need for sleep or rest to meet the demands of the work while away. Most often, one bills these expenses to the company, but there is some flexibility if they are not.

Some examples of deductible travel expenses include:

• Airline, bus, or train tickets or mileage rates to drive
• Fare for taxes or other types of transportation between an airport to a hotel and from a hotel to a work location
• Baggage fees
• Lodging
• Dry cleaning or laundry

If you are self-employed, you can deduct your travel expenses using Schedule C (Form 1040), Profit or Loss From Business (Sole Proprietorship).

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS⁹

 

Footnotes and Sources

 

9. ^{IRS.gov, December 5, 2024}

Lots of questions can come up about income taxes after one has retired. Some common types of taxable income include military retirement pay, all or part of pensions and annuities, all or part of individual retirement accounts (IRA), unemployment compensation, gambling income, bonuses and awards for outstanding work, and alimony or prizes. A few examples of non-taxable income are veteran’s benefits, disability pay for certain military or government-related incidents, worker’s compensation, and cash rebates from a dealer or manufacturer of an item you purchased.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS¹⁰

 

Footnotes and Sources

10. ^{IRS.gov, March 30, 2025}

Backup withholding is when a taxpayer must withhold at the current rate of 24%, taken from any future payments, to help the IRS receive the tax due on this income; this can happen for many reasons, including failing to provide a correct taxpayer identification number (TIN) or failing to report or underreport interest and dividend income.

Many types of payments are subject to backup withholding, and you can view the complete list on the IRS’ website, but some include:

• Interest payments
• Dividends
• Rents, profits, or other gains
• Commissions, fees, or other payments for work you do as an independent contractor
• Royalty payments

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS⁸

Footnotes and Sources

8. ^{IRS.gov, October 8, 2024} 

If you hire an independent contractor for your business, you are generally not responsible for withholding income taxes, Social Security, or Medicare taxes from their compensation. However, by law, business taxpayers who pay nonemployee compensation of $600 or more must report these payments to the IRS.

You can report these payments using Form 1099-NEC, Nonemployee Compensation. Generally, Form 1099-NEC is due by January 31. The compensation you report is subject to backup withholding if your business has not provided a Taxpayer Identification Number to the payer or the TIN doesn’t match. It’s important to be aware of this rule regarding nonemployee compensation because employees and contractors are taxed differently, but you need to note if your payments exceed the $600 limit.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS⁹

Footnotes and Sources

9. ^{IRS.gov, July 29, 2024}

Did you know an independent organization within the IRS is fighting for your rights as a taxpayer? The Taxpayer Advocate Service (TAS) protects taxpayers’ rights, allowing all taxpayers to be treated fairly and know and understand their rights under the Taxpayer Bill of Rights. Here are some things to know about TAS:

• TAS can help taxpayers resolve problems they haven’t been able to settle with the IRS on their own.
• The service is free.
• TAS helps all taxpayers and their representatives, including individuals, businesses, and exempt organizations.
• If taxpayers qualify for TAS help, an advocate will be with them at every turn and do everything possible to assist throughout the process.
• TAS also handles large-scale problems that affect many taxpayers.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS⁸

Footnotes and Sources

8. ^{IRS.gov, December 27, 2024}