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

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 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

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

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

Happy New Year!

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

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

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...

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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

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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...

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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