The Blog

The Taxpayer Advocate Service (TAS) is altering the measures it uses to accept cases from taxpayers that are having difficulty dealing with the Internal Revenue Service to lighten its caseload. The TSA has restricted its case admission criteria as budget cutbacks are taking a toll on the IRS. The IRS sent a recent email to tax professionals. “The Taxpayer Advocate Service is designed to be a “safety net” for taxpayers who are experiencing problems with the IRS. However, because TAS cannot help all six million to twelve million taxpayers who may be having problems at any given time, it must focus on cases where it can add the most value.” The email was then linked to a document listing four categories the TAS plans to … Continue reading →

The IRS has now made some new changes in its letter -forwarding services.  Under this new approach, the IRS has recently stated that they will not provide letter –forwarding services to locate a taxpayer that may be owed assets from an individual, company, or organization.  This is important news for missing taxpayers that may be entitled to a retirement plan or other financial benefits. From now on the IRS expects individuals and companies to use the internet, such as missing person locator services, to find missing tax payers. Due to current budget constraints, the IRS has decided to halt the letter-forwarding program “AKA –free detective services.” “Since the release of this revenue procedure in 1994, several alternative missing person locator resources, including the internet, have … Continue reading →

    An audit can be both an alarming and bothersome time for a business. Here are some simple and helpful steps from the Commissioner of the IRS to make the process go as smoothly as possible. These suggestions are especially useful to small and medium sized businesses. How to Maneuver the Audit Process: 1. Gather your Workplace Organization – Upon receiving the notice, immediately meet with your employees, tax professionals/CPA, and other involved groups. Also, thoroughly examine all documents. It is vital to be prepared in a timely and organized fashion for your first meeting. First impressions can be critical. 2. Courtesy to the Agent – Keep in mind IRS agents have a challenging job. If the agent is treated respectfully, they are more … Continue reading →

The bipartisan tax code signed by President Reagan in 1986 set both income tax and capital gains rates at 28 percent. Since that time, increases in income tax rates together with reductions in capital gains rates have resulted in the 20 percent margin between the two rates that exists today. The capital gains tax rate is scheduled to increase on January 1, 2013 which will reduce that margin to 15 percent. President Obama is in favor of this increase while presidential hopeful, Mitt Romney, is against it. In addition, Obama is in favor of raising ordinary income tax rates while tax settlements Romney is in favor of decreasing them. Any of these proposed changes will be significant and are certain to be taken in to … Continue reading →

As unemployment and the economy continue to loom over America, you may be tempted to cheat on your taxes since what you owe seems like too much to pay. This is never a good idea. With penalties, fees, interest, and in extreme cases, jail time as possible consequences, cheating on taxes is simply not worth it. If you do have issues with paying and need tax settlement help, consulting a professional on a legally maximizing your deductions or setting up payment plan is a far safer option. Here are 5 common tax deduction cheats that the IRS looks for: Commuting Costs associates with going to and from work can never be deducted, even if your workplace is hours away. The burden of an expensive commute … Continue reading →

The first step in resolving an outstanding tax liability should be to verify that the amount of the tax debt being reported by the IRS or State Tax Agency is correct. Because tax law is so complex, important tax deductions or tax credits are often missed when returns are completed by individuals who lack the professional knowledge and experience to determine which ones apply. Often a missed deduction, a missed tax credit, a change in filing status or an overlooked income adjustment will result in a tax amount owed that is greater than it would have been if the item had been claimed on the return. That being the case, the filing of an amended return is sometimes the simplest and most cost effective way … Continue reading →

In 2010, taxpayers filed more than 144 million tax returns to the tune of about $1.2 trillion in gross collections according to the IRS. Nearly 60% of the returns were handled by professional tax preparers. Since all tax specialists are not equal, picking the right tax settlement professional can mean the difference between getting your maximum tax refund and getting audited. Here are 3 ways you could be scammed by a tax preparer: You’re promised a big refund. If you are promised a big refund before any of your financial records have even been seen, chances are that you are being scammed. If the focus is a large refund, the tax specialist could be muddling your deductions and numbers, which could set you up for an IRS review … Continue reading →

It’s the day after taxes were due, April 18th, 2012. What do you do if you still haven’t filed your tax return? The IRS has some guidelines for what happens with returns that are past due. If the IRS doesn’t hear from you and you don’t file a return: The IRS will increase your taxes as they assess penalties and interest. A substitute return will be filed for you from the IRS, based only on information they have from sources other than you. Therefore, you would not get any additional exemptions or deductions you could be entitled to and your tax liability could be overstated. After the IRS assesses your taxes, the IRS will begin the collection process. They could place a levy, which is … Continue reading →

The IRS recently released statistics showing that while more taxpayers have filed earlier this year, the tax return refund amount they are getting back will be less on average and most likely received through direct deposit. According to the IRS, 75.3 million Americans have already been sent their refunds as of March 30, 2012, compared to 75.2 million last year at the same date. While more taxpayers have filed early this year, the average refund has dropped from $2,922 in 2011 to $2,826 in 2012. Last year, a payroll tax cut allowed workers to pay 2% less into Social Security and Medicare, which could partly explain the change. However, the total taxable income for these workers also increased. More taxpayers are requesting direct deposit this … Continue reading →