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W-2 or W-4 Form: How Do They Affect My Taxes?

Are you confused on what a W-4 form is? How about a W-2?

You’re not alone.

The truth is, most of us don’t look at these complicated IRS forms on a daily basis, so when we do, we’re pretty lost!  However, it’s important to know the difference between a W-4  and W-2 as both impact  how much tax is taken from your paycheck and how big your refund may be when you file your taxes.

When do I need to look at these IRS forms?

W-4: You’ll receive a blank W-4 when you start a new job. As a new employee, you’ll be required to fill out this form.

W-2: Each year, at the end of January, you’ll receive a W-2 from each of your employers. You’ll refer to this form when preparing your tax return. Continue reading “W-2 or W-4 Form: How Do They Affect My Taxes?”

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Last Day to Claim a 2011 Tax Refund is April 15th!

Hurry – Wednesday, April 15th is the last day to claim a 2011 Tax Refund! 

April 15, 2015 is not only Tax Day for current year tax returns, it’s also the very last day to file a 2011 tax return and still claim a 2011 refund.

That’s because the IRS Statute of Limitations only allows filers three years from the April 15 deadline to claim a tax refund. So, it won’t matter whether you took a tax extension back in 2012.

So where does the unclaimed money go after the three years? You guessed it- the IRS keeps it!

Don’t hand over your hard earned money. File your 2011 tax return today and claim your refund! Continue reading “Last Day to Claim a 2011 Tax Refund is April 15th!”

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Does California Tax Income Earned in Other States?

Yes, California taxes income earned from ALL state sources.

If you’re a California resident, you’re no stranger to high tax rates. In fact, you pay the highest income tax in the country!

Here’s another fact: if you earned income working in another state, you’ll still be forced to pay the same, high California tax rate, even if that other state has a lower tax rate.

According to CA.gov, California residents  are “taxed on ALL income, including income from sources outside California.”

What About Income From a Non-Income Tax State?

If you earned income in one of the seven states that doesn’t assess income tax (Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming), or one of the two states that have no tax on wages (Tennessee and New Hampshire), you’re still required to pay tax on that income to the state of California.

So, let’s say you work remotely from your home in San Diego for a company located in Texas. When filing, you’ll report this income on your California tax return. You’ll also pay a chunk of CA tax on it.

The one piece of good news is that you won’t need to file a non-resident tax return to the tax-free state. You’ll only be required to file a resident return to California. Continue reading “Does California Tax Income Earned in Other States?”