IRS Gives One-Week Filing Extension to Taxpayers Whose Preparers Were Affected by Hurricane Irene | |
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September 04, 2011
Filing extensions from IRS and CT DRS...
October 26, 2010
New rule protects consumers from unscrupulous debt relief firms...
A new Federal Trade Commission rule meant to reign in the deceptive practices of for-profit debt relief services will take effect this week, The San Francisco Chronicle reported.
The Better Business Bureau has received more than 6,000 complaints about debt relief companies since December 2007. Many of these credit counseling, debt settlement and debt negotiation services advertise on late-night television and charge advance fees to cover their marketing costs, The Tulsa World reported.
Beginning Wednesday, the FTC will have the legal authority to ban debt relief firms from charging or collecting these upfront retainers until a debt has been settled and the customer has started to make payments. The new rule also requires these companies to:
* Back up their advertising claims
* Provide a written settlement agreement or debt management plan
* Tell customers how much their services cost
* List all potential penalties
* Explain how long customers will have to wait before seeing results - (more)
The Better Business Bureau has received more than 6,000 complaints about debt relief companies since December 2007. Many of these credit counseling, debt settlement and debt negotiation services advertise on late-night television and charge advance fees to cover their marketing costs, The Tulsa World reported.
Beginning Wednesday, the FTC will have the legal authority to ban debt relief firms from charging or collecting these upfront retainers until a debt has been settled and the customer has started to make payments. The new rule also requires these companies to:
* Back up their advertising claims
* Provide a written settlement agreement or debt management plan
* Tell customers how much their services cost
* List all potential penalties
* Explain how long customers will have to wait before seeing results - (more)
January 11, 2010
How One Woman Went to Tax Court and Won Deduction...
(Wall Street Journal)- A Maryland nurse accomplished two rare feats in her battle with the Internal Revenue Service: She defended herself against the agency's lawyers and won, and she got a ruling that could help tens of thousands of students deduct the cost of an M.B.A. degree on their taxes. The U.S. Tax Court handed Lori Singleton-Clarke her victory last month, saying the 47-year-old Bryantown, Md., woman had properly deducted nearly $15,000 in business school tuition. The Tax Court ruling should make it easier for many other professionals to deduct the expense of a Master in Business Administration degree. After getting word of the court decision, "I nearly yelled the roof off the house," Ms. Singleton-Clarke says. "I still can hardly believe it." The IRS's rules on deducting work-related tuition are complicated and onerous, ultimately preventing most students from deducting their tuition. But this case clarifies the rules and will likely lead to more taxpayers taking the deduction, tax experts say.- complete article
Disappearing Federal Estate Tax Could Be A Mirage...
(Hartford Courant)- For the first time since 1916, wealthy people who die can leave an unlimited amount to their children or grandchildren without the IRS's taking its piece. The 2010 hiatus from the federal tax — a quirk that no one ever expected would happen — could last all year, if Congress doesn't act on it. Or, the temporary death of the "death" tax could be a mirage, if lawmakers slap a levy on estates retroactive to Jan. 1 of this year.
The outcome is anyone's guess. For now, the federal estate tax — scheduled to return at a high level in 2011 — is a confusing morass affecting thousands of families with multimillion-dollar estates. It also stands at the heart of a broader debate about how government should raise money. That's nowhere sharper than in Connecticut, the nation's richest state, with many families with fortunes to protect, but also among the most liberal, with wealthy residents who say the tax is fair. In 2009 and into this year, the state's estate tax has been a political football in the contest over how to balance an out-of-whack budget. - complete article
But what's happened to the federal tax has taken political gridlock to new heights.
"No one would argue it's best to go from 45 percent to zero to 55 percent, and yet that's what we're doing," said Ben Harris, a senior researcher at the Brookings Institution, a Washington think tank.
The outcome is anyone's guess. For now, the federal estate tax — scheduled to return at a high level in 2011 — is a confusing morass affecting thousands of families with multimillion-dollar estates. It also stands at the heart of a broader debate about how government should raise money. That's nowhere sharper than in Connecticut, the nation's richest state, with many families with fortunes to protect, but also among the most liberal, with wealthy residents who say the tax is fair. In 2009 and into this year, the state's estate tax has been a political football in the contest over how to balance an out-of-whack budget. - complete article
But what's happened to the federal tax has taken political gridlock to new heights.
"No one would argue it's best to go from 45 percent to zero to 55 percent, and yet that's what we're doing," said Ben Harris, a senior researcher at the Brookings Institution, a Washington think tank.
November 11, 2009
More Roth IRA conversions allowed...
New tax rules allow more people to convert to a Roth IRA
By David Pitt, AP Personal Finance Writer
In retirement, your paycheck might go away, but taxes won't. Still your tax bill can be hard to predict. To have some control over how much you pay the government each year, you should have both taxable and non-taxable accounts from which to draw your retirement income. Imagine it this way. Perhaps early in retirement you choose to continue to work part time and supplement your income from retirement savings accounts. The combined income may put you into a higher tax bracket. However, if you take some money from a Roth IRA that year, because withdrawals are nontaxable, it could help keep you in the lower bracket.
In later years if you're not working and hitting the next highest tax bracket isn't an issue, you can pull more money from a traditional IRA or 401(k) account. This type of tax diversification is one of the primary reasons people choose to put some of their money in a Roth IRA, or convert to such an account. "It affords you the flexibility when the time comes to make a withdrawal from an account that lines up best with your current taxes," said Chris McDermott, a senior vice president at Fidelity Investments.
Thanks to a new rule that goes into effect in January, more people can convert assets from a traditional IRA or a 401(k) account, at a former employer, into a Roth IRA. As of Jan. 1, people making more than $100,000 may convert to a Roth IRA. Previously, only people who earned less than $100,000 could convert. - complete article
By David Pitt, AP Personal Finance Writer
In retirement, your paycheck might go away, but taxes won't. Still your tax bill can be hard to predict. To have some control over how much you pay the government each year, you should have both taxable and non-taxable accounts from which to draw your retirement income. Imagine it this way. Perhaps early in retirement you choose to continue to work part time and supplement your income from retirement savings accounts. The combined income may put you into a higher tax bracket. However, if you take some money from a Roth IRA that year, because withdrawals are nontaxable, it could help keep you in the lower bracket.
In later years if you're not working and hitting the next highest tax bracket isn't an issue, you can pull more money from a traditional IRA or 401(k) account. This type of tax diversification is one of the primary reasons people choose to put some of their money in a Roth IRA, or convert to such an account. "It affords you the flexibility when the time comes to make a withdrawal from an account that lines up best with your current taxes," said Chris McDermott, a senior vice president at Fidelity Investments.
Thanks to a new rule that goes into effect in January, more people can convert assets from a traditional IRA or a 401(k) account, at a former employer, into a Roth IRA. As of Jan. 1, people making more than $100,000 may convert to a Roth IRA. Previously, only people who earned less than $100,000 could convert. - complete article
September 03, 2009
New Tax Changes to Connecticut Personal Income Tax (Individuals)...
The new law increases the marginal personal income tax rate from 5% to 6.5% for:
• joint filers with taxable incomes over $1 million;
• heads of households with taxable incomes over $800,000; and
• single filers and married individuals filing separately with taxable incomes over
$500,000.
The legislation also increases the flat income tax rate for trusts and estates from
5.0% to 6.5%.
• joint filers with taxable incomes over $1 million;
• heads of households with taxable incomes over $800,000; and
• single filers and married individuals filing separately with taxable incomes over
$500,000.
The legislation also increases the flat income tax rate for trusts and estates from
5.0% to 6.5%.
August 04, 2009
IRS Alerts Public to New Identity Theft Scam...
WASHINGTON — The Internal Revenue Service reminds consumers to avoid identity theft scams that use the IRS name, logo or Web site in an attempt to convince taxpayers that the scam is a genuine communication from the IRS. Scammers may use other federal agency names, such as the U.S. Department of the Treasury.
In an identity theft scam, a fraudster, often posing as a trusted government, financial or business institution or official, tries to trick a victim into revealing personal and financial information, such as credit card numbers and passwords, bank account numbers and passwords, Social Security numbers and more. Generally, identity thieves use someone’s personal data to steal his or her financial accounts, run up charges on the victim’s existing credit cards, apply for new loans, credit cards, services or benefits in the victim’s name and even file fraudulent tax returns.
The scams may take place through e-mail, fax or phone. When they take place via e-mail, they are called “phishing” scams. The IRS does not discuss tax account matters with taxpayers by e-mail. The IRS urges consumers to avoid falling for the following recent schemes:
In an identity theft scam, a fraudster, often posing as a trusted government, financial or business institution or official, tries to trick a victim into revealing personal and financial information, such as credit card numbers and passwords, bank account numbers and passwords, Social Security numbers and more. Generally, identity thieves use someone’s personal data to steal his or her financial accounts, run up charges on the victim’s existing credit cards, apply for new loans, credit cards, services or benefits in the victim’s name and even file fraudulent tax returns.
The scams may take place through e-mail, fax or phone. When they take place via e-mail, they are called “phishing” scams. The IRS does not discuss tax account matters with taxpayers by e-mail. The IRS urges consumers to avoid falling for the following recent schemes:
September 06, 2008
New IRS guidelines for teachers who spread salary through the summer...
School Districts Deal with IRS Rule Change by WebCPA staff
Teachers and other school employees returning from summer vacations are dealing with the prospect of an IRS rule change on deferred compensation that could see their taxes increase by 20 percent if they aren't careful. The rule involves deferred compensation and applies to school districts that offer employees who work for 10 months but are paid over a 12-month period the option of having their payments spread out throughout the year, as many school districts do.
However, the IRS has proposed newer rules that it hopes will alleviate some of the worries. The IRS has released Notice 2008-62, which provides that no deferral income will occur if both of the following conditions apply.
The Treasury Department and the IRS anticipate that these rules should exclude from coverage most arrangements for public school teachers and other school-year employees under which they are permitted to annualize school-year compensation, whether or not they are given individual elections. - complete article
Teachers and other school employees returning from summer vacations are dealing with the prospect of an IRS rule change on deferred compensation that could see their taxes increase by 20 percent if they aren't careful. The rule involves deferred compensation and applies to school districts that offer employees who work for 10 months but are paid over a 12-month period the option of having their payments spread out throughout the year, as many school districts do.
However, the IRS has proposed newer rules that it hopes will alleviate some of the worries. The IRS has released Notice 2008-62, which provides that no deferral income will occur if both of the following conditions apply.
| * The arrangement does not defer payment of any of the recurring part-year compensation beyond the last day of the 13th month following the beginning of the service period. For example, if the service period begins in August 2008, all compensation must be received by Sept. 30, 2009. * The total amount deferred is less than a dollar amount provided under Section 402(g)(1)(B) of the Tax Code for that year. For 2008, this amount is $15,500. |
The Treasury Department and the IRS anticipate that these rules should exclude from coverage most arrangements for public school teachers and other school-year employees under which they are permitted to annualize school-year compensation, whether or not they are given individual elections. - complete article
August 31, 2008
IRS Warns Taxpayers of New E-mail Scams...
A scheme in which a tax refund form is e-mailed, supposedly by the Taxpayer Advocate Service (a genuine and independent organization within the IRS which assists taxpayers with unresolved problems), is particularly blatant in the amount and type of information it requests. The top of the form tells the recipient that they are eligible for a tax refund for a specified amount. The form asks for name, address and phone number and a substantial amount of financial information, such as bank account number, credit card number and expiration date, ATM PIN number and more. It also asks for mother's maiden name (frequently used by many people as an account security password). At the bottom is a phony name and signature, claiming to be that of the Taxpayer Advocate. The implication is that the taxpayer must fill in and submit the form to receive a tax refund. In reality, taxpayers claim their tax refunds through the filing of an annual tax return, not a separate application form. - complete article
August 30, 2008
Careful before you believe those TV ads about eliminating IRS debt...
Missouri AG Sues Tax Resolution Firm
The Missouri attorney general has filed suit against tax representation chain JK Harris & Co., saying the firm did not provide the services promised to resolve its clients' state and federal tax problems. The Missouri lawsuit follows on the heels of a $1.5 million settlement by the chain with 18 other state attorneys general in June, and a $6 million settlement of a class-action lawsuit last year (see Tax Debt Firm to Pay $1.5M in Restitution). The AG's suit is seeking full restitution from JK Harris for Missouri customers who paid up to $4,500 for the services they did not receive.
"JK Harris promises it can help consumers who are having tax problems, but the Missourians who complained to my office told a different story - one of unreturned phone calls, lost paperwork and a worse financial situation than when they started," said Missouri AG Jay Nixon in a statement. - complete WebCPA article
The Missouri attorney general has filed suit against tax representation chain JK Harris & Co., saying the firm did not provide the services promised to resolve its clients' state and federal tax problems. The Missouri lawsuit follows on the heels of a $1.5 million settlement by the chain with 18 other state attorneys general in June, and a $6 million settlement of a class-action lawsuit last year (see Tax Debt Firm to Pay $1.5M in Restitution). The AG's suit is seeking full restitution from JK Harris for Missouri customers who paid up to $4,500 for the services they did not receive.
"JK Harris promises it can help consumers who are having tax problems, but the Missourians who complained to my office told a different story - one of unreturned phone calls, lost paperwork and a worse financial situation than when they started," said Missouri AG Jay Nixon in a statement. - complete WebCPA article
February 10, 2007
The 13 Most Overlooked Tax Deductions....
by Kevin McCormally (Kiplinger)
Every year, the IRS dutifully reports the most common blunders we taxpayers make on our returns. And every year, at or near the top of the list is forgetting to enter a Social Security number or making a mistake when entering the nine digits that identify us to IRS computers.
Before you bemoan such stupidity, ask yourself a simple question: Is that the most common error? Or just the most easily noticed goof? Tax time is a dangerous time. It's all too easy to miss a trick and pay too much. Years ago, the head of the IRS told Kiplinger's Personal Finance magazine that he figured millions of taxpayers overpaid their taxes every year by overlooking just one of the money-savers listed below.
Without further ado, here are The Unlucky 13, a baker's dozen of the most overlooked tax deductions. Claim them if you deserve them...and cut your tax bill to the bone. - complete article here
Every year, the IRS dutifully reports the most common blunders we taxpayers make on our returns. And every year, at or near the top of the list is forgetting to enter a Social Security number or making a mistake when entering the nine digits that identify us to IRS computers.
Before you bemoan such stupidity, ask yourself a simple question: Is that the most common error? Or just the most easily noticed goof? Tax time is a dangerous time. It's all too easy to miss a trick and pay too much. Years ago, the head of the IRS told Kiplinger's Personal Finance magazine that he figured millions of taxpayers overpaid their taxes every year by overlooking just one of the money-savers listed below.
Without further ado, here are The Unlucky 13, a baker's dozen of the most overlooked tax deductions. Claim them if you deserve them...and cut your tax bill to the bone. - complete article here
January 11, 2007
Tax-issue result: End of Globe swag bags...
By SANDY COHEN, AP Entertainment Writer
The Golden Globe gift basket is no more. The Hollywood Foreign Press Association, which presents the annual Golden Globe Awards, announced Wednesday that it had reached an agreement with the Internal Revenue Service to satisfy past tax obligations on the plush gift packages given to awards-show presenters. - complete article
The Golden Globe gift basket is no more. The Hollywood Foreign Press Association, which presents the annual Golden Globe Awards, announced Wednesday that it had reached an agreement with the Internal Revenue Service to satisfy past tax obligations on the plush gift packages given to awards-show presenters. - complete article
January 07, 2007
Dems look at tax cuts for middle class
By JOHN HEILPRIN, Associated Press Writer
Democrats are not ruling out raising taxes for the wealthiest people to help pay for tax cuts for middle-income families, House Speaker Nancy Pelosi said. She spoke of pursuing an estimated $300 billion that people owe in back taxes, eliminating deficit spending and reducing wasteful federal spending. "As we review what we get from ... collecting our taxes a reducing waste, fraud and abuse, investing in education and in initiatives which will bring money into the treasury, it may be that tax cuts for those making over a certain amount of money, $500,000 a year, might be more important to the American people than ignoring the educational and health needs of America's children," Pelosi, D-Calif., said in an interview aired Sunday. - complete article
Democrats are not ruling out raising taxes for the wealthiest people to help pay for tax cuts for middle-income families, House Speaker Nancy Pelosi said. She spoke of pursuing an estimated $300 billion that people owe in back taxes, eliminating deficit spending and reducing wasteful federal spending. "As we review what we get from ... collecting our taxes a reducing waste, fraud and abuse, investing in education and in initiatives which will bring money into the treasury, it may be that tax cuts for those making over a certain amount of money, $500,000 a year, might be more important to the American people than ignoring the educational and health needs of America's children," Pelosi, D-Calif., said in an interview aired Sunday. - complete article
January 01, 2007
October 25, 2005
IRS looking for owners of undelivered refunds
WASHINGTON — The Internal Revenue Service is seeking 84,290 taxpayers whose income tax refund checks could not be delivered in 2005. Checks totaling approximately $73 million can be reissued as soon as taxpayers correct or update their addresses with the IRS. In some cases, a taxpayer has more than one check waiting. The average amount owed to each taxpayer is $871.
“Our goal is to get this money back in the hands of the people it belongs to," IRS Commissioner Mark W. Everson said. "Visiting IRS.gov makes it easy for taxpayers to see if they've missed a refund." - complete article
Where is my 2004 income tax refund?
Find federal refund
Find CT refund
“Our goal is to get this money back in the hands of the people it belongs to," IRS Commissioner Mark W. Everson said. "Visiting IRS.gov makes it easy for taxpayers to see if they've missed a refund." - complete article
Find federal refund
Find CT refund
September 09, 2005
IRS increases mileage rate until Dec. 31, 2005
WASHINGTON — The Internal Revenue Service and Treasury Department announced today an increase to the optional standard mileage rates for the final four months of 2005. The rate will increase to 48.5 cents a mile for all business miles driven between Sept. 1 and Dec. 31, 2005. This is an increase of 8 cents from the 40.5 cent rate in effect for the first eight months of 2005, as set forth in Rev. Proc. 2004-64.
“This is about fairness for taxpayers,” said IRS Commissioner Mark W. Everson. “People are entitled to deduct the real cost of operating a vehicle. We’ve responded to the recent gas price increases by making this special adjustment so taxpayers get the tax benefit they deserve.” In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2005. The IRS normally updates the mileage rates once a year in the fall for the next calendar year. - complete announcement
“This is about fairness for taxpayers,” said IRS Commissioner Mark W. Everson. “People are entitled to deduct the real cost of operating a vehicle. We’ve responded to the recent gas price increases by making this special adjustment so taxpayers get the tax benefit they deserve.” In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2005. The IRS normally updates the mileage rates once a year in the fall for the next calendar year. - complete announcement
December 31, 2004
2004
Client tax letter
Shortly, it will again be time to prepare your 2004 individual federal/state income tax returns. If you are a current client, we have printed your income tax organizer and retained it at our office. If you would like to use it to help assemble the information required to prepare your tax return, just call or email our office and we will mail it to you immediately. Otherwise, we will use it in the tax preparation process. more...
Tax organizer
If you would like a blank organizer for help in your 2004 individual income tax preparation, clink the links below and print out:
Page 1 - Page 2 - Page 3 - Page 4
Tsunami contributions
A new law allows taxpayers who itemize to deduct on their 2004 tax returns certain contributions to charities to aid the victims of the tsunami even if the contribution was made during January 2005. More...
Sandra Block (USA Today):
Your Money - Not all tax preparers created equal, so do some checking
If your idea of a truly terrifying Fear Factor is one in which contestants are forced to do their own tax returns, you'll find no shortage of people happy to do the job for you. Competition for tax returns has gotten so intense that tax-preparation companies are offering everything from free pizza to double-your-refund contests to get those 1040s in the door.
Prior years' information/links that are still relevant:
Jobs/Growth Tax Relief Reconciliation Act of 2003
Shortly, it will again be time to prepare your 2004 individual federal/state income tax returns. If you are a current client, we have printed your income tax organizer and retained it at our office. If you would like to use it to help assemble the information required to prepare your tax return, just call or email our office and we will mail it to you immediately. Otherwise, we will use it in the tax preparation process. more...
Tax organizer
If you would like a blank organizer for help in your 2004 individual income tax preparation, clink the links below and print out:
Page 1 - Page 2 - Page 3 - Page 4
Tsunami contributions
A new law allows taxpayers who itemize to deduct on their 2004 tax returns certain contributions to charities to aid the victims of the tsunami even if the contribution was made during January 2005. More...
Sandra Block (USA Today):
Your Money - Not all tax preparers created equal, so do some checking
If your idea of a truly terrifying Fear Factor is one in which contestants are forced to do their own tax returns, you'll find no shortage of people happy to do the job for you. Competition for tax returns has gotten so intense that tax-preparation companies are offering everything from free pizza to double-your-refund contests to get those 1040s in the door.
Prior years' information/links that are still relevant:
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