Tax FAQ's

What should I do if I made a mistake on my federal return that I have already filed?

It depends on the type of mistake that you made:

- Many mathematical errors are caught in the processing of the tax return itself so you may not need to correct these mistakes.
- If you did not attach a required schedule, the IRS will contact you and ask for the missing information.
- If you did not report all of your income or did not claim a credit, you should file an amended or corrected return using Form 1040X (PDF), Amended U.S. Individual Income Tax Return.

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How do I know if I have to file quarterly individual estimated tax payments?

You must make estimated tax payments for the current tax year if both of the following apply:

- You expect to owe at least $1,000 in tax for the current tax year, after subtracting your withholding and credits.
- You expect your withholding and credits to be less than the smaller of:
90% of the tax to be shown on your current year’s tax return, or
100% of the tax shown on your prior year’s tax return. (Your prior year tax return must cover all 12 months.)

There are special rules for:

Higher income taxpayers
Farmers and fishermen
Nonresident aliens
Estates and trusts

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For head of household filing status, do you have to claim a child as a dependent to qualify?

In certain circumstances, you do not have to claim the child as a dependent to qualify for head of household filing status; for example, a custodial parent may be able to claim head of household filing status even if he or she released a claim to exemption for the child.

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Are child support payments deductible by the payer or can the payer claim an exemption for the child?

Child support payments are not deductible by the payer.

- Child support payments are neither deductible by the payer nor taxable income to the payee.
- The payer of child support may be able to claim the child as a dependent.
- The parent with whom the child lived for the greater part of the year is the custodial parent for income tax purposes.
- Generally, the child is the qualifying child of the custodial parent, and the custodial parent is allowed an exemption for the child if the other dependency tests are met.
- The noncustodial parent may claim an exemption for the child if the custodial parent signs a Form 8332

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Can a husband and wife operate a business as a sole proprietorship or do they need to be a partnership?

Unless a business meets the requirements listed below to be a qualified joint venture, a sole proprietorship must be solely owned by one spouse, and the other spouse can work in the business as an employee. A business jointly owned and operated by a husband and wife is a partnership (and should file Form 1065 (PDF), U.S. Return of Partnership Income) unless the spouses qualify and elect to have the business be treated as a Qualified Joint Venture, or they operate their business in one of the nine community property states.

- A married couple who jointly own and operate a trade or business may choose for each spouse to be treated as a sole proprietor by electing to file as a “qualified joint venture.” Requirements for a qualified joint venture:

- The only members in the joint venture are a husband and wife who file a joint tax return,
- The trade or business is owned and operated by the spouses as co-owners (and not in the name of a state law entity such as an LLC or LLP),
- The husband and wife must each materially participate in the trade or business, and
- Both spouses must elect qualified joint venture status on Form 1040 by dividing the items of income, gain, loss, deduction, credit and expenses in accordance with their respective interests in such venture and each spouse filing with the Form 1040 a separate Schedule C (Form 1040), Schedule C-EZ (Form 1040), or Form 4835 (PDF) accordingly, and, if required, a separate Schedule SE (Form 1040) to pay self-employment tax.

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