FAQS

  1. Am I required to file a tax return?
  2. How do I file?
  3. What if I’m a nonresident alien, i.e. from India?
  4. What are deductions?
  5. What is the difference between itemized deductions and the Standard Deduction?
  6. What if I am a nonresident alien and I wish to file for a dependent exemption on my tax return?
  7. How come I qualified for a lesser refund than my colleague even though we had the same income?
  8. My wife and kids (and other dependents) are from Canada and have a TN Visa but do not have Social Security and/or Tax ID numbers.  Can I still Efile my return and put them as dependents on my returns?
  9. I am a consultant/contractor throughout the year.  Am I required to pay any taxes during the year or just at tax time?
  10. What is the filing deadline for filing tax returns?
  11. Can I file an extension?
  12. Great, how do I get started with you guys?
  13. Okay, I have completed your Tax Questionnaire and have assembled all the necessary documents applicable to me for a complete tax filing.  Can I send them to you?

Am I required to file a tax return? 
There are most certainly very specific and definitive guidelines as to who is required to file.  That information is contained in IRS Publication 501 .  In that link you will find the income requirements as to who is required to file.  However, the key thing to remember here is that even though you may have not made enough money through US Sources to be required to file a US Individual tax return, you may still have had certain taxes that were withheld from your paychecks or estimated tax payments you may have made throughout the year which would be eligible to be refunded to you.  In other words, it is good idea to file a US tax return anyways even if you are not required to simply because you can get the taxes you paid refunded back to you, barring other circumstances.
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How do I file?
Every individual can file a return with the US Individual 1040 Tax Return, which is the most comprehensive and detailed personal tax return.  However, many people don’t have the type and amount of deductions, stock gains, real estate property, etc, to file such a lengthy form. So the simplest form to file in lieu of the 1040 is the 1040EZ.  The 1040A is another form taxpayers may file for those with some other qualified deductions.  However, if you’re not exactly sure as to which return is right for you and you’re not using a tax professional to assist you in filing a tax return, then your best bet is the 1040, as it is the most universal & most uniform form for every US Citizen/Resident (including some nonresident aliens) to fill out. 
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What if I’m a nonresident alien, i.e. from India?
If you are not from India, then you must find out if nationals from your country are allowed a standard deduction and standard exemption. If so, then you may have a choice of filing either a 1040NR or a 1040, depending on your Visa Status during the taxable year and the types of taxes withheld from your paychecks by your employer.  For e.g., in the case of Indian nationals, the US-India Tax Treaty allows for a standard deduction which most US taxpayers qualify for, and thus would be required to file in most cases, a 1040NR, which is a paper return (i.e., no availability of Efiling on this return).  As such, it makes very little difference if an Indian nonresident alien living in the US (or an Indian not living in the US but having US Income Sources) files either a 1040NR or a 1040 (which has Efile availability). The reason to file a 1040NR as opposed to a 1040 for an Indian nonresident alien (or any nonresident alien, if allowable) is when the desire exists to also file for a refund of Medicare and/or Social Security Taxes, which would have been mistakenly withheld form the taxpayer’s salary during the year in which the taxpayer was on an F1 Visa status.  If that describes you, then in that case you will file 3 forms (the 1040NR, the 843, and the 8316), which are all paper returns.  The one downside of all this is that since they are paper filings (you have to mail the returns in), your refund might take some time to be deposited in your bank account or mailed to you. The other downside is that you will not qualify for a tuition credit or education deduction against your income.  The upside is that if you had a scholarship and are not in need of the tuition credit or education expense deduction, you will qualify for the full refund of Social Security and Medicare Taxes. There are some nuances and particularities with this type of filing, so it is to your best interest to consult a tax professional knowledgeable about this matter.  We do many such filings.
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What are deductions?
Whichever tax return you file, you will report all US and World Income (if you are US Citizen or Greencard holder) or just US income if you are a nonresident alien.  The IRS however, allows you to subtract from your reportable income certain amounts on the tax return until you arrive at a number called “taxable income,” upon which a percentage tax is applied to arrive at your income tax bill.  That income tax is then subtracted by what you have already paid throughout the year via withheld amounts from your paychecks (or via estimated income tax payments) to arrive at a net number that is either a refund or a liability.  These “subtractions” are called deductions.  Some deductions are automatically applied and some are taxpayer-generated.  For e.g., in 2006 the Standard Deduction for Single taxpayers was $5,150.  Visit our deductions page to see some common taxpayer-permitted deductions.
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What is the difference between itemized deductions and the Standard Deduction?
Many people will have quite a bit of IRS sanctioned deductions which they may list on their tax return, namely mortgage interest, real estate taxes on US property, state income taxes, etc., which, when added together, are larger than the standard deduction amount for their particular filing status.  If that sum is indeed larger than the standard deduction allowed by the IRS, then that sum is allowed as a “subtraction” from your income before the tax percentage is multiplied against your net taxable income.  If that sum is not large enough, then simply the standard deduction is allowed.  It is either-or, not both standard and itemized as a choice for deduction type.
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What if I am a nonresident alien and I wish to file for a dependent exemption on my tax return?
One of the “subtractions” that is allowed as a deduction on your tax return is a standard figure for each and every person you wish to claim as a person who is either a qualifying child or a qualifying relative.  For e.g., if you have a wife and a child living here in the US, Canada, or Mexico, you may put their information (Social Security or Tax Identification Number and Name) on your tax return and qualify for an extra $3,200 (roughly) per person deduction against your income.  If you are a nonresident alien in this country (F1, H1B, J1, L1, B1, etc.), then most likely your family members who are living with you will not have the necessary nine-digit tax id number required for you to qualify them as dependent exemptions.  As such, you will be required to file something called a W7 concurrently with your tax return, along with certain notarized Visa and Passport copy documents.  This would be a paper filing.  If your parents or family members are not currently living with you, but have come to this country in the taxable year, interestingly enough, you may still qualify for and apply for a tax id number for them to be included as a dependent on your tax return.  The tax id number does not expire.  Visit our forms page or click here to access our ITIN Instructions page.  Our Tax Questionnaire also has the ITIN instructions as the last page of the questionnaire.  We do many of these filings during tax filing season.
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How come I qualified for a lesser refund than my colleague even though we had the same income?
There are a multitude of reasons for this.  First of all, your friend might be itemizing deductions, and those deductions could have summed to be a larger number than the IRS default Standard Deduction.  As such, your colleague’s taxable income figure would have been smaller before the tax percentage is applied, and thus he/she may have a smaller net tax bill.  However the reverse can also be true.  Your taxable income could have been smaller than your colleague’s taxable income even though your salaries and deductions were roughly the same. This may be the case due to you having requested your employer at the beginning of the year to withhold a smaller amount of income tax from you paychecks than your friend.  At the end of the year, though you and your colleague might have had similar amounts of income, filing statuses, and tax liability, your tax bill or refund might still be larger than your colleague’s because you withheld from your paycheck much less in income taxes throughout the year.  The plus to this would have been larger weekly or biweekly paychecks, comparatively speaking, throughout the year. The minus of course would have been that you now have to pay your comparatively larger tax liability during filing time.  Many people do not know why this may have occurred, but chances are that most people forget they incorrectly filed for the wrong amount of paycheck withholding exemptions on the W4 at the beginning of each year of employment.   (State W4s must also be filled out for a proper state withholding for your particular state). Many withhold less or more throughout the year as a tax planning tool, but it is best to consult a tax professional if you are not aware of the specifics of this particular tax strategy.
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My wife and kids (and other dependents) are from Canada and have a TN Visa but do not have Social Security and/or Tax ID numbers.  Can I still Efile my return and put them as dependents on my returns?
No, you may not Efile your return as you will be required to first apply for a tax id number for each and every dependent/family member you wish to put on your tax return. You may still qualify for the dependent exemption for them, however, you will be required to complete the ITIN Application, known as the W7, concurrently with your US Individual Tax Return.  Visit our Forms page to see the ITIN Instructions flyer for instructions on how to get the necessary paperwork ready.  We do many such filings for people applying for TIN numbers during tax season. 
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I am a consultant/contractor throughout the year.  Am I required to pay any taxes during the year or just at tax time?
If you are self-employed, you are required to make estimated tax payments throughout the year in a certain percentage both to the IRS and the state you are living in (if your state has income tax requirements).  Not paying the required estimated tax payments throughout the year can subject you to a withholding penalty from both the IRS and the state you are working/living in. Call us and we will advise you on this matter. 
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What is the filing deadline for filing tax returns?
Most people are not aware that if you do not owe the IRS for any particular calendar year, there is no set deadline for filing, in theory.  You still have to file a tax return if you are required to file, but if you do not file within a period of three years, the IRS may decide not to pay you your refund.  If you owe the IRS tax for the taxable year, then the deadline is April 15th.  If April 15th falls on a weekend, then the deadline is usually the first business day after the 15th.  So long as you either Efile or postmark your return on this day, you will qualify as filing by the deadline.  Corporate filings are due March 15th, or the first business day after that if the 15th falls on the weekend.  But remember, don’t stress about the deadline if you are not required to pay tax!
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Can I file an extension?
Yes you may.  In many cases taxpayers might not have certain documents (W2, real estate tax bill) ready until much later beyond the due date of the return.  As such, you may file for an extension for 6 months beyond the due date of the return; however, you will be required to pay a tax payment based on an estimated version of your tax return.  You can read our extension page, and calculate your own taxes so that you can go ahead and take the extension yourself. 
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Great, how do I get started with you guys?
Please fill out the Tax Questionnaire on our Forms page and send all the accompanying documents outlined in that questionnaire to us.
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Okay, I have completed your Tax Questionnaire and have assembled all the necessary documents applicable to me for a complete tax filing.  Can I send them to you?
Yes. Ideally, we like everything by fax.  You can send it to (847) 619-0966.  The next best alternative is to send it to our email address at info@vimlantax.com. During tax season, our normal turnaround time is 3-4 days.
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***If you have any other specific questions, or questions regarding our business/corporate services, please call (847) 619-0413. We will be more than happy to answer your them or address any of your concerns.**

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2017 Annual Adjustment Amounts: Tax Rates, Deductions, & Exemptions;


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2016 Annual Adjustment Amounts: Tax Rates, Deductions, & Exemptions;

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2015 Annual Adjustment Amounts: Tax Rates, Deductions, & Exemptions;

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2014 Annual Adjustment Amounts: Tax Rates, Deductions, & Exemptions;

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Questions & Answers on NII & Additional Medicare Tax

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Are you living abroad and a dual citizen?? Click here.

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"OVDI" (Offshore Voluntary Disclosure Program) Remains Open For Those With Undisclosed Foreign Income/Assets;

Other Options other than OVDP remain open too, like Streamlined Procedures.

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DNA India, a leading Mumbai daily, quotes Vimlan Tax Services. Click here...

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Mileage Rates for 2016 are here..

  1. 54 cents per mile for business miles driven (down from 57.5 cents in 2015);
  2. 19 cents per mile driven for medical or moving purposes;
  3. 14 cents per mile driven in service of charitable organizations;


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Mileage Rates for 2015 are here..

  1. 57.5 cents per mile for business miles driven (up from 56 cents in 2014);
  2. 23 cents per mile driven for medical or moving purposes;
  3. 14 cents per mile driven in service of charitable organizations;


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International Income Tax Liability...


Worldwide Income Reporting and Foreign Accounts

Most people filing US tax returns know if they are a US Citizen or a Greencard holder, but most do not know if they are a US "tax" resident. You may read the April 2011 E-newsletter we put out which explains the classifications mentioned above or call our office to request an appointment with a qualified tax advisor to discuss your case. Our December 2015 E-newsletter is out as well.