Frequently Asked Questions
Here are the answers to some of the most Frequently Asked Questions our firm receives.
Q. Can I deduct student loan interest?
A. Since personal interest is generally non-deductible, it must meet several tests: You must be the person liable on the debt and the loan must be for education only. Your income cannot exceed $130,000 on a married, filing jointly return or $65,000 on a single, head of household, or qualifying widow(er) return. Married couples, filing separately, cannot deduct student loan interest. You cannot deduct if you are claimed as a dependent on someone else's return. The deduction ceiling is $2,500 for 2004.
Note that many States apply additional tests before allowing you to deduct student loan interest on their State return. The above tests apply to IRS tax returns.
Q. Do we service clients outside of Maine?
A. Our practice is primarily focused in Maine but we service clients in many other states and have tax software to prepare returns in all states.
Q. Do you work with Start-up Companies?
A. Yes. Many of our clients are just starting business. We will lead you through the necessary governmental forms. Through our networking, we can also assist in finding you other necessary professionals to deal with (lawyers, insurance agents, mortgage brokers, etc.) throughout the state.
Q. Can I ever save tax by filing a separate return instead of jointly with my spouse?
A. You sometimes may benefit from filing separately instead of jointly. Consider filing separately if you meet the following criteria: One spouse has large medical expenses, miscellaneous itemized deductions, or casualty losses. The spouses' incomes are about equal. Separate filing may benefit such couples because the adjusted gross income "floors" for taking the listed deductions will be computed separately.
Q. Should I keep my old tax returns? If so, for how long?
A. Yes, you should keep your old tax returns for at least 7 years. When a return contains information pertaining to the basis of property owned, it should be kept until that property is sold. If you do throw out an old return you may fill out IRS Form 4506, Request for Copy of Tax Return, and send it to the IRS Service Center where you filed your return.
Q. What pieces of paper do I need to keep in order to do my taxes?
A. Keep detailed records of your income, expenses, and any other information you report on your tax return. A good set of records can help you save money when you do your taxes and will be a trusty ally in case you are audited.
Q. Do you do Rapid Refund Loans?
A. We have chosen not to do tax refund loans. We do provide e-filing and with direct deposit the refund is usually in the account within10 to 14 days.