Tax news January 2007

Tax

IRS Site Adds New State Sales Tax Calculator

A new online tool has been added by the Internal Revenue Service (IRS) to assist individual taxpayers in determining if they would benefit if they elect to deduct their state and local general sales tax when filing their returns. "The Sales Tax Calculator is another interactive tool the IRS.gov web site designed to help make it easier for taxpayers to figure their taxes," said Mark W.
Tax

2006 Tax Return Filing Deadline Extended to April 17

The Internal Revenue Service (IRS) has announced that taxpayers across the country will have until Tuesday, April 17, 2007, to file their 2006 returns and pay any taxes that are due."This year, taxpayers have additional time to file and pay beyond the traditional April 15 deadline. As we always do, we encourage taxpayers to get an early start on their taxes to make sure they have plenty of time to accurately prepare their return," said IRS Commissioner Mark W.
Tax

FDIC Says Taxpayers Can Save More of Their Refunds

As the tax season begins, low-and moderate-income taxpayers are being encouraged by the Federal Deposit Insurance Corporation (FDIC) to take advantage of the Internal Revenue Service (IRS) programs and bank services that can aid them in saving more money."Low-and moderate-income consumers should take advantage of every opportunity to save money on their tax preparation, qualify for tax credits, and use direct deposit to put a part of their refunds into a savings account where it can grow," said FDIC Chairman Sheila C.
Tax

No Foul Play Suggested, But IRS Tapes Still At Large

Kansas City officials are hot on the trail of 26 missing tapes containing sensitive taxpayer data. The tapes were provided by the IRS to aid in the city’s collection of its 1 percent earnings tax, a tax that is assessed on people living or working in the city. The 26 tapes were delivered last August and were supposed to be returned to the Treasury Department, but the return was never made.
Tax

Early Plan Needed to Exit Retirement Accounts

Now, before retirement, is the time to act on forming a plan to exit IRA accounts to avoid tax ramifications and government plan regulations that cost investors considerable amounts of money and a revolutionary plan may assist investors who are looking to secure their retirement funds and limit distribution costs. Young workers, or those who are closer to retiring, who are looking for an IRA Exit Strategy have a unique opportunity to prepare now, before their options are limited. Good advice is crucial in estate planning and retirement saving for the growth of assets.
Technology

Online Tax Preparation and E-Filing Service Offered

An online service for tax preparation is hard at work trying to ease the stress and costs for taxpayers this tax season. TaxEngine.com has recently announced free tax preparation and electronic filing for any person with a 2006 adjusted gross income of $30,000 or less. The TaxEngine.com free filing offer is available for the federal 1040 tax returns and the company also offers the free filing of state taxes for 17 states. "We decided to do something that would really help our customers this year.
Tax

New Website Offers Business Owners Property Tax Cut Routes

In early January 2007, the Niagara County, New York, Industrial Development Agency (IDA) granted a history-making Payment in Lieu of Taxes (PILOT). Henry Sloma, Chairperson of the Niagara County IDA (NCIDA), and Kevin Pierce, Vice President and Director of the AES NY, LLC, signed allegedly legal paperwork that removes the profitable coal fired power plant, locally known as AES Somerset, from the tax rolls. Industrial Development Agencies normally grant tax cuts to companies in the form of Payment in Lieu of Taxes for two reasons: 1.
Tax

Tax Tune-Ups Filter Tax Errors In Divorce Agreements

By Eva Rosenberg, MBA, EA Despite a divorce agreement that specifically said that neither party shall pay or receive alimony, Divorced in New York was hit with a tax bill from the Internal Revenue Service for $5,000 on phantom alimony. Even though IRS was given the divorce agreement, the Service insisted on assessing the taxes. Why? Simply because this woman’s ex-husband could present canceled checks to prove he made payments to her in the amount reported as alimony. IRS didn’t really care that it wasn’t alimony. What were the payments?
Tax

Turner Broadcasting Consolidates Tax Provision Work

Turner Broadcasting System, Inc. (TBS, Inc.), a Time Warner company, has chosen to implement the Tax Provision & Data Collection functionality of Longview Performance Management Platform, according to the announcement by Longview Solutions.Longview Solutions is a leading provider of corporate performance management software and Longview Tax is expected to be implemented and fully operational by end of Q1/07 and will be used by TBS, Inc.
Tax

IRS Begins Busy Season Amid Changes

The 2007 Internal Revenue Service (IRS) season promises to be a busy one, with a new refund deposit feature, the telephone excise tax refunds and the recently enacted tax breaks that will require extra attention from tax preparers. "Taxpayers will have a number of new tax benefits and features available this year," said Mark Everson, IRS commissioner. "We encourage taxpayers to take a few minutes to review these changes, particularly those involving the recently enacted tax law provisions.
Tax

Most Taxpayers Face Additional Fees for IRS Installment Requests

Ever since the kinder and gentler IRS eased the restrictions on its installment agreement request and made the process automatic, it’s not uncommon for taxpayers to add their federal tax liability to the list of debts they pay over time. There has always been a fee associated with creating an IRS installment plan. Until now, the up-front fee has been a flat $43, and that fee has remained unchanged since the program was enacted in 1995.Effective January 1, 2007, the new IRS fee for entering into an installment agreement for paying a federal tax liability over time is $105.
Tax

Celebrities Treasures Tarnished: IRS Taxes Gifts & Goodie Bags

Oscar presenters this year each walked off with over $35,000 worth of gifts in their goodie bags, including four nights at Honolulu's Halekulani Resort, with a 24-hour butler valued at $25,000. What’s in your goodie bag? The new Sierra Leone Fund, launched on September 10th in Washington, DC with a gala celebrity fundraiser. Their goodie bags for folks like Angelina Jolie, Kanye West, and Isaiah Washington, included t-shirts, sarongs and other clothing items to jewelry, high-tech gifts, accessories and more.
Tax

A Conversation With TaxMama on Special Employer Credit

Tomika in North Carolina is at her wit’s end trying to get answers from the IRS about child-care credits or benefits. She asked TaxMama.Dear TaxMama,I have been on the phone with the IRS for 45 minutes and transferred to at least ten departments to get the answer to this question. Which to my dismay I still don't have an answer so I decided to go to the PRO. I have an employer that wants to offer dependant care assistance to only ONE employee. The type of business is a daycare provider.
A&A

Use Safe Harbors to Navigate Manufacturing Deductions

From The Tax Strategist, http://thetaxstrategist.netAt this point in the year, you’ve probably figured out which business clients qualify for the Section 199 “manufacturing deduction.” But a tax law enacted last year changed the way the annual limit is imposed on business entities.Visit www.microsoft.com/forecaster for more information.
Tax

Remember These Key Tax Changes, Credits and Deductions

As taxpayers begin gathering their financial documents for the 2006 filing season, Ernst & Young offers its 2007 Tax Guide that is filled with reminders on new credits and deductions.Personal Tax Credits for the Purchase of Residential Energy-Efficient Property — A non-business credit of up to $500 is available for certain energy-efficient improvements, such as insulation, or exterior doors and windows.
A&A

Small Companies Lead Pack of Restatements

Smaller companies more often restated their financial results through the third quarter of 2006 than the largest companies, a financial research firm has found.Glass, Lewis & Company, which tracks the number of restatements by U.S. companies, said companies with market capitalizations of less than $75 million filed the most restatements in the first nine months of 2006, compared with the same period in 2005.
Tax

Touchdown for Stadium Seat Tax Breaks

Rose Bowl Shmose Bowl – Michigan Moves Forward with Tax-Favored ExpansionThe big game could have gone better for the Wolverines (final score, USC 32, Michigan 18), but for now, the renovation of The Big House, Michigan’s 100,000-plus seat football stadium in Ann Arbor, is surging ahead with the momentum of an unblockable touchdown run.Since 1988, college sports have received a forward pass from the IRS to offer alumni and other supporters of the athletic programs a cushy tax write-off to go with their cushy luxury seats.

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