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Tax returns feature new forms

On Behalf of | Mar 21, 2019 | Income Taxes

Georgia residents may need to get familiar with a series of new forms when they complete their tax returns this year. This may apply to those who are self-employed and made more than $400 from such activity. If so, they will need to pay self-employment tax and report it on line 57. However, the actual calculation of that tax takes place on Schedule SE.

For employees, their employers are required to withhold and pay FICA taxes on their behalf. However, if this doesn’t happen, it will be necessary to report unreported taxes on line 58. The same is true if an individual receives tips that aren’t reported as part of an employee’s income. Individuals who hire someone to work around the house could owe taxes depending on who was hired and how much that person made.

Individuals who take early withdrawals from a retirement plan before age 59 1/2 will likely owe taxes on that money. In addition to paying income taxes, there may be an early withdrawal fee imposed. Other taxes may need to be reported for exceeding contribution limits or failing to take distributions as required. That information will be reported on line 59 of a tax return.

Those who fail to pay income taxes may face an audit from the IRS. In addition to paying the balance owed, the agency may assess fees and other penalties. Individuals who are facing an audit are encouraged to contact the IRS as soon as possible to address the issue. It may also be worthwhile to contact an attorney for assistance.