When are irs payments due

when are irs payments due

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Payments and Penalties

Congress sets the rules that the IRS must follow regarding the assessment of taxes. They have determined that funds you spend to satisfy IRS tax penalties or back taxes do not qualify as tax-deductible expenses. You may be assessed penalties when payments arrive late, your stated deductions were denied or your income has been inaccurately reported. If you must make payments to the IRS for either back taxes or penalties, you are prohibited from deducting these payments from future tax calculations.

Current Year Income Taxes

There are certain federal taxes that can be deducted when you prepare your taxes. The IRS stipulates that to be deductible, a tax must have been imposed on you and paid during your tax year. The most critical of these would be income taxes that you have paid either through payroll deductions or estimated quarterly payments. Effectively, they are prepayments of your tax liability. Such payments will be directly subtracted out of the taxes due, which is preferable to an indirect deduction of them from your income.

State, Local and Foreign Taxes

The IRS allows you to deduct a variety of non-IRS assessed taxes as itemized deductions on your

Form 1040, Schedule A. These taxes must have been imposed on you and paid during the tax year. These include state and local income taxes that have been withheld from your wages during the year and that appear on your Form W-2. Also deductible are any estimated taxes you paid to state or local governments and any prior year's state or local income tax you paid during the year. Generally, you can also take either a deduction or a tax credit for foreign income taxes imposed on you by a foreign country.

Property Taxes

Certain property taxes are deductible on your federal income taxes, and these would be listed on Schedule A of your 1040. These include real estate taxes and personal property taxes. Deductible real estate taxes are typically any state, local or foreign taxes paid on real property. Such taxes must have been charged uniformly against all property in a jurisdiction and must be based on an assessed value. Deductible personal property taxes are those based on the value of an item of personal property, such as a boat or car. Such a tax must be assessed and charged on a yearly basis, regardless of how often it is collected or paid.

Source: ehow.com

Category: Bank

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