Glossary

A CP22A Notice from the IRS informs you of a change to your tax account, usually related to a credit or deduction. It's important to understand and respond appropriately.

The CP32A Notice is an official communication from the IRS, usually indicating they've identified a potential issue with your tax return or account, often related to unapplied payments. Understanding this notice is crucial for resolving the matter correctly.

A CP49 notice from the IRS is a notification that you've overpaid on your taxes, and they're explaining how that overpayment is being handled. It typically means your refund was used to cover another tax debt.

A CP71A notice is a letter from the IRS informing you that they have applied an overpayment from a prior year to a tax liability you owe. Understanding this notice is crucial for managing your tax obligations.

Willful tax evasion is a serious crime involving intentionally failing to pay taxes, unlike accidental errors. It carries severe consequences, including hefty fines and jail time.

The W-4 form is a critical IRS document you fill out with your employer. It tells them how much federal income tax to withhold from each paycheck.

Year-end tax planning involves taking steps before December 31st to minimize your tax liability for the current year. It's a proactive approach to saving money on taxes.

A 1099 form is an IRS information return that reports payments made to individuals or businesses who are not employees. It helps the IRS track income and ensure taxes are paid.

The 401(k) contribution limit is the maximum amount of money you can put into your 401(k) retirement account each year. Understanding this limit is key to maximizing your retirement savings and taking advantage of tax benefits.

A 529 plan is a tax-advantaged savings plan designed to help families save for future education expenses. It's a great tool for anyone looking to make college or other qualifying education more affordable.