Income Tax Preparation: Do You Need It If You"re Unemployed?
If you're out of a job, it can be very difficult to make ends meet. Unemployment insurance or other payments received from Federal or state agencies can make it possible to continue living, making minimum payments, and performing other necessary functions even when you're not working. These benefits can be lifesaving, but just like virtually all other money that you receive, Federal and state governments often take a cut.
What To Expect
If you are presently unemployed and receiving compensation for that, you should receive a 1099-G form at the beginning of the next year. The 1099-G should provide exact details, including the amount that you received, as recorded by any sources that sent it to you. This is considered in the same fashion as most other sources of revenue.
Did You Receive Other Complex Revenue?
Many individuals who are unemployed try to pick up other jobs on the side, frequently working as an independent contractor. These positions are often temporary and can be good sources of quick cash, but can also incur liabilities and additional taxation that you may not know exist. These are typically reported on a 1099-MISC, and they can carry a very heavy burden (especially if you haven't been paying estimated taxes and are required to be doing so.)
Choosing A Form Of Income Tax Preparation
It can be tempting to choose the most inexpensive option regardless of the quality service that may be provided. But when you are unemployed, every penny is important, and an inexpensive service won't usually know how to maximize your deductions.
In general, it is best to first determine whether you're actually liable to pay anything. If you made very little (less than $1000) or were able to be claimed as a dependent, you may not even be required to file. However, that's a very uncommon situation: the vast majority of people are required to submit paperwork, even if they are not actually due to pay.
The Advantage Of Professional Assistance Without The Expense
Depending on your location, it may be possible to obtain professional advice or even total income tax preparation at little or no cost. The more urban your situation, the more likely you are to find such a resource: New York, Maryland, DC, San Francisco, Los Angeles, and New Jersey locations are usually the most promising.
Finding these opportunities is usually as simple as searching on the computer. If you don't have access to a computer or an internet connection at home, they are usually available free of charge at your local library. Just be sure not to enter any personal information €" that kind of connection is not secure.
What To Expect
If you are presently unemployed and receiving compensation for that, you should receive a 1099-G form at the beginning of the next year. The 1099-G should provide exact details, including the amount that you received, as recorded by any sources that sent it to you. This is considered in the same fashion as most other sources of revenue.
Did You Receive Other Complex Revenue?
Many individuals who are unemployed try to pick up other jobs on the side, frequently working as an independent contractor. These positions are often temporary and can be good sources of quick cash, but can also incur liabilities and additional taxation that you may not know exist. These are typically reported on a 1099-MISC, and they can carry a very heavy burden (especially if you haven't been paying estimated taxes and are required to be doing so.)
Choosing A Form Of Income Tax Preparation
It can be tempting to choose the most inexpensive option regardless of the quality service that may be provided. But when you are unemployed, every penny is important, and an inexpensive service won't usually know how to maximize your deductions.
In general, it is best to first determine whether you're actually liable to pay anything. If you made very little (less than $1000) or were able to be claimed as a dependent, you may not even be required to file. However, that's a very uncommon situation: the vast majority of people are required to submit paperwork, even if they are not actually due to pay.
The Advantage Of Professional Assistance Without The Expense
Depending on your location, it may be possible to obtain professional advice or even total income tax preparation at little or no cost. The more urban your situation, the more likely you are to find such a resource: New York, Maryland, DC, San Francisco, Los Angeles, and New Jersey locations are usually the most promising.
Finding these opportunities is usually as simple as searching on the computer. If you don't have access to a computer or an internet connection at home, they are usually available free of charge at your local library. Just be sure not to enter any personal information €" that kind of connection is not secure.
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