Accounting
IN THIS LESSON
Learn the critical differences between cash and accrual accounting methods and how they affect your financial statements and tax reporting.
Every module is created to help you focus on what matters most to you. It’s not just about gaining knowledge—it’s about moving forward with purpose.
Based on the information regarding tax forms and filing, here is a study plan to help you understand the key concepts discussed:
Module 1: Self-Employment and Business Structures
Net Income Reporting: Learn how net income from a business flows into Schedule SE for self-employment tax calculation.
Self-Employment Tax: Understand that as a self-employed individual, you are responsible for both the employee and employer portions of Social Security and Medicare taxes.
Business Entity Comparison:
Schedule C (Sole Proprietorship): Review the standard form for initial self-employment income.
S-Corp (1120-S): Study how an S-Corp is taxed separately and how owners receive a K-1 to report their portion of profits or losses on their personal 1040.
Module 2: The Form 1040 Basics
Personal Information: Identify the required fields for name, address, and Social Security numbers.
Filing Status: Analyze how different statuses (Single, Married Filing Jointly, Married Filing Separately, Head of Household, or Qualifying Survivor) impact tax brackets and standard deductions.
Dependents: Review the criteria for claiming dependents, including the necessity of birth certificates, social security numbers, and proof of residency.
Module 3: Deductions and Credits
Standard vs. Itemized Deductions:
Understand what a standard deduction is and how it reduces taxable income based on filing status.
Compare the standard deduction amounts for Single ($12,000), Head of Household ($18,000), and Married ($28,000) statuses.
Learn why most taxpayers now use the standard deduction instead of itemizing.
Tax Credits: Study how filing status and income levels can phase out certain credits.
Module 4: Specialized Income and New Regulations
Digital Assets: Understand that the IRS now requires reporting on cryptocurrency and other digital assets.
Investment Income: Review how tax-exempt interest (municipal bonds), qualified dividends, and capital gains (Schedule D) are reported.
International Income: Learn about the requirement to report total global income and how foreign tax credits work.
Future Planning: Note that certain tax regulations are scheduled to change or "sunset" in 2026.
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