Tax news January 2006

Tax

Taxing Vehicles: Business and Personal

The ads are everywhere. “Walk in with your W-2, drive out with a new car,” or some variation on that theme. But before walking in, a little thought is in order.“We find a number of people who get in trouble when they expect a certain amount and they don’t get that amount,” Mike Cherry of the Consumer Credit Counseling Services told KOLR 10.
Technology

IRS Oversight Board Wants e-Filing Goal Extended to 2011

The Internal Revenue Service (IRS) Oversight Board released its Electronic Filing Annual Report to Congress on Monday and acknowledged that the IRS will not meet the goal of 80 percent of all returns filed electronically mandated by the IRS Restructuring and Reform Act of 1998. The Board credited the 2007 deadline with pushing the IRS to increase the number of taxpayers who e-file their returns to 52 percent in 2005, and projects, based on their analysis of current trends, that four out of five taxpayers will file electronically by 2011.
Tax

Computer Virus Turns 20 Amid New IT Security Scares

This month marks the twentieth anniversary of the first personal computer virus attack. What better way to celebrate than with the release of additional studies confirming that businesses’ high technology endeavors operate in a minefield of new viruses, worms and other security threats?The Federal Bureau of Investigation (FBI) found that 87 percent of businesses it surveyed suffered attacks that affected their computer security last year.
Technology

In Personal Finance Software, Style Rules

In the world of personal finance software: two rivals, Microsoft Money and Intuit's Quicken, dominate.Both can help organize tax information and all personal accounts, pay bills online, create budgets, handle investments and make financial forecasts. Both are connected to their websites. Features are similar in both programs, so style and personal preferences could be the determining factor as to which one to use.
Tax

IRS, Prosecutors Crack Down on Tax Evasion, Tax Fraud

Questionable Refund Program. “We will announce plans in the very near future to institute notification procedures as well as significant processing improvements to minimize the number of taxpayers whose refunds are frozen unnecessarily,” Everson said. Senators of both parties had requested the review following congressional testimony by the National Taxpayer Advocate, Nina Olson, New York Times reports.The IRS said that members of Congress and the National Taxpayer Advocate had raised legitimate issues regarding the length of delay and lack of notification for refund claims.
Community News

A Look Inside the Encyclopedia of Taxation & Tax Policy

This collection of almost 250 essays, written by more than 150 tax experts, is being called a “must-have” reference for tax professionals and anyone involved in public policy and public administration.
Tax

Publications Detail Hurricane-Related Tax Law Changes

On Tuesday, the Internal Revenue Service (IRS) issued the lasted in a series of publications explaining changes to tax laws and relief provisions for those affected by Hurricanes Katrina, Rita, and Wilma.
Tax

Data Storage Systems at Risk: Symantec, EMC Acknowledge, Correct Product Flaws

In a sign that virtually all bastions of business data security are vulnerable to attack, the vendors of two data storage systems -- a product type often implemented to provide an added layer of defense against hackers, have each just admitted to security flaws in separate high-profile products and have issued correctional patches.EMC Corporation of Hopkinton, Massachusetts, has issued separate patches for it Legato NetWorker system versions 7.2.1, 7.14 and 7.3, while Symantec Corp.
Technology

Income Limits for Free File: Preparing for Business E-file

Individual taxpayers who enter the Internal Revenue Service (IRS) web site looking for access to free tax software on their Free File page may be surprised when they find that many companies are no longer offering that service to taxpayers with adjusted gross incomes of $50,000 or more.
Tax

Rules for 'Head of Household' Get Stricter

Claiming a dependent child on a federal income tax form may sound like a straightforward matter, but some taxpayers have been bumping up against confusing definitions for years.Congress, last year, brought together the five different definitions of the term “dependent child,” tightening the
Tax

Tax Tip: Gift Taxes

Taxpayers who have given gifts exceeding $11,000 in value to a single individual must report the total gift amount to the Internal Revenue Service (IRS). The giver may owe taxes on the gifts.
Tax

Cities, States Float Sales Tax Ideas

Taxpayers around the country are facing a mixed bag of state and local sales tax proposals.New York Governor George E. Pataki, for one, is proposing tax breaks and rebates amounting to billions of dollars, but when it comes to sales taxes, he is calling for at least one increase, the New York Times reported. State cigarette taxes outside New York City would go up to $2.50 from $1.50 per pack.
Community News

Towards a Uniform National Sales Tax System

The nationwide effort to create a uniform sales tax system is under way and gaining steam, as 13 states, so far are cooperating to create a streamlined collection process.The Streamlined Sales and Use Tax Agreement is a multi-state initiative meant to simplify the varying sales tax laws for businesses that sell their products in multiple states.Forty-four states agreed, in November 2002, to participate in the program. The agreement officially took effect last October, when the 13 states became full members.
Tax

Do You Know Where to Send Your Tax Return?

Some taxpayers may be sending their tax returns to different tax centers this year, according to the Internal Revenue Service (IRS).
Tax

Deadline Nears for Abusive Transaction Settlement

The Internal Revenue Service (IRS) announced last week that taxpayers have until January 23, 2006 to file an election form to take part in the global settlement program for 21 specified transactions, and there will be no deadline extension.
Tax

Keeping Personal & Business Tax Records

This is an important task for everyone. The Ventura County Star describes the organization of tax records like exercise. You might not always have fun, but it is necessary.A good recordkeeping structure is a solid start. The Ventura County Star recommends you make a list of your important assets and then organize your files in the same order. This provides for easy document retrieval. Ensuring that all your records are filed will help you at tax time.
Tax

Delay Louisiana State Income Tax Filing to February 1

The Louisiana Department of Revenue has asked state residents to delay their tax filings until after February 1. The state has also announced that the printing and production of state income tax forms would be delayed by about two months. This filing delay affects both paper and electronic filers.“Whenever the Legislature makes changes that impact taxation, new forms have to be designed and tested to make sure everything matches up,” Byron Arthur, Department of Revenue Communications Director, told the Times-Picayune.
Tax

Mark Your Calendar: Lessons from SAS 99 Webinar

Almost as long as there has been business, there has been fraud. Today’s regulatory environment, especially in relation to Section 404, makes it even more critical that public companies of all sizes recognize and manage risk more effectively. On Thursday, January 19, 2006, at 2:00 p.m. Eastern, Dr.
Tax

IRS Taxpayer Advocate Lists Biggest Tax Issues

Suspecting fraud, the Internal Revenue Services blocked tax refunds sought by 120,000 poor Americans, the IRS' taxpayer advocate told Congress Tuesday.The taxpayers, however, were not told that their returns were labeled fraudulent, advocate Nina E. Olson said. Her staff examined a sample of the questionable returns, finding suspicions on one in five–at the most. Under the Questionable Refund Program, run by the IRS Criminal Investigation office, a computer screens for potentially fraudulent returns, and the refunds are frozen, possibly for years.
Tax

Combating Corporate Fraud

The number of companies around the world that reported incidents of fraud increased 22 percent in the last two years, according to the 2005 biennial survey by PricewaterhouseCoopers (PwC), which interviewed more than 3,000 corporate officers in 34 countries. In England, a recent Ernst & Young survey of the Times Top 1000 indicated the average cost of each fraud exceeded $200,000. But fraud is not the only problem. There's also misconduct, unethical behavior, lying, falsification of records, sexual harassment, and drug and alcohol abuse.

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