by Leif Jensen | Jun 28, 2011 | General |
I prepare the payroll for one of my clients along with my other responsibilities. As I was doing their weekly bank reconciliation I noticed that a bonus check had not been cashed. Now it wasn’t a huge amount, but it was a noticeable amount. So I contacted the...
by Leif Jensen | Jun 26, 2011 | General |
The IRS is increasing the standard mileage allowance upward for business vehicle usage. The new rate will be 55.5¢ a mile for the final six months of 2011, The mileage rate also increases for medical and moving expenses also increases by 4.5¢ to 23.5¢ a mile. But the...
by Leif Jensen | Jun 26, 2011 | General |
According to the Tax Court, a preparer’s omission of income from a return won’t excuse a penalty. A couple had hired a preparer fill out their complex return, they gave him more than 160 information returns. The final completed return was 115 pages long and showed...
by Leif Jensen | Jun 26, 2011 | General |
Apparently the IRS needs to do a better job of tracking its own employees’ compliance. According to Treasury inspectors the computer program used to detect workers who didn’t timely file or pay taxes or who understated their taxes, allowed over 100 employees who were...
by Leif Jensen | Jun 26, 2011 | General |
Internet Crime Complaint Center Highlights Of the complaints involving financial harm that were referred to law enforcement, the highest median dollar losses were • found among investment fraud ($3,200), overpayment fraud ($2,500), and advance fee fraud ($1,500)...
by Leif Jensen | Jun 24, 2011 | General |
51% of households owed no federal income tax for 2009! According to a study by the nonpartisan Joint Tax Commission. In fact, about 30% of all households got back a check for their full income tax bill and more due to refundable tax credits…the earned income credit,...
by Leif Jensen | Jun 23, 2011 | General |
Not paying income taxes shown on filed returns won’t preclude bankruptcy relief. Unpaid taxes can still be discharged in bankruptcy, according to an Appeals Court: in the case of a doctor who timely filed returns showing the proper amount of tax due but didn’t send in...
by Leif Jensen | Jun 23, 2011 | General |
The IRS has issued information on disclosure of uncertain tax positions: The agency isn’t planning on extending the regime to pass-through entities, an IRS official says. So partnerships, limited liability companies and S corporations don’t have to worry about filing...
by Leif Jensen | Jun 23, 2011 | General |
Owners of unreported foreign accounts can get a disclosure extension, according to the IRS. Under the agency’s most recent voluntary disclosure program, taxpayers generally have until Aug. 31 to fess up about their offshore accounts to qualify for lesser penalties...
by Leif Jensen | Jun 14, 2011 | General |
I had lunch the other day with a couple of bankers. It was a lively discussion and one of the topics was the benefits of investing in a traditional IRA or a 401K plan verses a Roth IRA or just non qualified savings. We were discussing the current and future tax...
by Leif Jensen | Jun 14, 2011 | General |
The IRS is issuing new rules are coming for preparers of returns with the earned income credit. Preparers are going to have to file a due diligence checklist along with the returns,according to a key IRS official. The checklist will detail the procedures the preparer...
by Leif Jensen | Jun 14, 2011 | General |
The IRS is reaching out to assist unemployed workers. The new IRS Publication 4128 covers the basics on common tax issues, such as retirement plan payouts, unemployment compensation, severance pay and deducting job hunting expenses. But there is a problem tapping an...
by Leif Jensen | Jun 14, 2011 | General |
WASHINGTON – A federal court has permanently barred a Chicago tax preparer from preparing any additional federal tax returns for others, the Justice Department announced. The civil injunction order, to which consented without admitting the allegations against...
by Leif Jensen | Jun 14, 2011 | General |
“The Dirty Dozen represents the worst of the worst tax scams,” IRS Commissioner Doug Shulman said. “Don’t fall prey to these tax scams. They may look tempting, but these fraudulent deals end up hurting people who participate in them.” The IRS works with the Justice...
by Leif Jensen | Jun 14, 2011 | General |
According to the Tax Court, a student loan settlement leads to taxable income. After his college graduation, a taxpayer fell behind on his student loan. After trying to collect, the lender let him pay off the debt at a $28,000 discount. This amount is discharge of...
by Leif Jensen | Jun 14, 2011 | General |
The hammer has fallen and the IRS has revoked the tax-exempt status of 275,000 charities that didn’t file their tax returns for three consecutive years. A list of these unfortunate organizations are published on the IRS website. Small groups with annual gross...
by Leif Jensen | Jun 14, 2011 | General |
An independent contractor who is reclassified as an employee runs into difficulties. The contributions he made to his SEP account are declared nondeductible and has been hit with a penalty, by the Tax Court. As an employee, he cannot contribute to a SEP (he would be...
by Leif Jensen | Jun 14, 2011 | General |
The Internal Revenue Service, continues to move aggressively to collect more taxes from small businesses. They are telling companies being audited to turn over exact copies of the electronic records (QuickBooks, Peachtree, etc. files) kept in their business-software...
by Leif Jensen | Jun 14, 2011 | General |
The IRS is getting ready for competency testing of unlicensed tax preparers. These are preparers of individual returns who aren’t lawyers, CPAs or enrolled agents. According to new IRS regulations unlicensed preparers who’ve already registered with IRS have until the...
by Leif Jensen | Jun 14, 2011 | General |
There is a new backup withholding easing for payment networks such as PayPal. If a payee doesn’t give a valid tax ID number, 28% backup withholding will be required after 2011, but only if the payee has more than 200 transactions. The rules for 1099s are different. ...
