Tax news

Tax

IRS Reminds Some Refinancing Costs May Be Deductible

The Internal Revenue Service reminded taxpayers who took advantage of this year’s low interest rates to refinance their mortgages that they may be eligible to deduct some costs associated with their loans.Generally, taxpayers who itemize may deduct the “points” paid to obtain a home mortgage as interest.
Tax

Freddie Mac May Face $30 Million Tax Bill

Freddie Mac, the nation’s No. 2 mortgage finance company, has estimated it will owe as much as $30 million in back taxes, the Wall Street Journal reported.That figure is just a fraction of the $4.5 billion the company expects to report in income when it restates earnings. Freddie Mac board member George Gould said in a letter to U.S. Rep. Christopher Shays (R-Conn.) that the back taxes won’t materially affect earnings.
Tax

GAO Releases Study Showing Improvement in IRS Performance

During the tax filing season, millions of taxpayers file their returns and seek assistance by calling or visiting IRS’s offices or Web site. The Government Accounting Office was asked to assess IRS’s 2003 filing season performance in five areas: processing returns, refunds and remittances; electronic filing; telephone service; walk-in assistance, and Web site.
Tax

States Band Together on Tax Authority For Online Purchases

Dozens of states have joined together to persuade Congress to allow them to force out-of-state Web and catalog merchants to collect sales taxes on goods shipped into their states.Many catalog and online retailers believe they shouldn’t be forced to collect sales taxes, pointing to the complexity and variety of state and local tax laws, which number in the thousands. Thirty-four states responded by agreeing to adopt a highly uniform tax system to simplify management for remote vendors.For state and local governments, billions of dollars in taxes on Internet sales are at stake.
Tax

Rolling Renewal Schedule For Enrolled Agents Delayed

The IRS recently announced a delay in the implementation of the new rolling renewal schedule for enrolled agents to renew their enrollment. Under Circular 230, as amended July 26, 2002, approximately one-third of all enrolled agents will renew their enrollment each year pursuant to a rolling renewal schedule.
Tax

House Bill Aims to Grow Jobs, Cut Corporate Taxes and Avoid Sanctions

By a vote of 24 to 15, the House Ways and Means Committee moved a bill forward Tuesday that supporters hope will generate new jobs for American workers in the form of a $128 billion corporate tax cut."The American Jobs Creation Act does just that—creates jobs for American workers," said Bill Thomas (R-CA), Chairman of the Committee on Ways and Means and sponsor of the bill, in a release issued by the Committee. "We will protect and expand jobs for hard-working Americans."H.R.
Tax

New Jersey Gay Couple Sues to File Joint Tax Return

A gay couple who were united in a civil ceremony in Vermont three years ago are now suing their home state of New Jersey to allow them the option of filing a joint state tax return.While Vermont law allows for same-sex couples to file joint tax returns, New Jersey does not."New Jersey is linked by law to the federal tax laws, which do not recognize this form of filing and we are bound by federal policy," said Tom Vincz, a spokesman for the state Department of Treasury.George DeCarlo and Ryan Reyes are fighting for the right to make a determination - as heterosexual couples do - on the
Tax

IRS Refund Checks - Over 200,000 Are Undeliverable

IRS Commissioner Mark W. Everson reminded taxpayers they have until Dec. 5 to claim 115,744 undelivered checks from this summer’s advance child tax credit. After the December cut-off, taxpayers cannot claim the checks until they file their tax returns next year.These undelivered checks are among nearly 24 million issued this summer and fall for the advance child tax credit. In all, more than $14 billion in child credit checks have been issued.“Time is running out to get an advance child credit check,” Everson said.
A&A

Social Security Beneficiaries Get Increase

According to CCH, a leading provider of tax and payroll law information and software, Social Security beneficiaries in 2004 will see a moderate increase in their monthly checks.
Tax

Offers in Compromise Application Fee Begins November 1

Beginning November 1, 2003, the Internal Revenue Service will begin charging, with some exceptions, a $150 application fee to process offers in compromise.
Tax

Tax Shelters Once Again Under Scrutiny by Senate, PCAOB

A KPMG senior manager testified at a Senate Finance Committee hearing on Tuesday that his refusal to sign off on an audit client’s questionable tax transactions hurt his career at the Big Four firm. Michael Hamersley, a five-year KPMG employee, filed suit against the company in June and the case is pending.
Tax

Estate Tax Debate May Reach Compromise

Acknowledging that they may never be able to totally do away with the always-controversial “death tax,” Senate Republicans have been secretly considering a compromise. They are anxious to push the bill forward while they hold control of Congress and the White House.With the federal budget deficit soaring and President Bush’s economic policies increasingly coming into question, Sen.
Tax

Wealthy Art Collectors Forced to Pay Up For Avoiding Sales Tax

More than 100 collectors of art, jewelry and antiques have been forced to pay $16.2 million in unpaid sales taxes and interest in an investigation into tax avoidance in New York’s art world. The inquiry has resulted in five New York dealers pleading guilty to failure to collect sales taxes in recent months.
Tax

Senate Hears Testimony on Tax Shelter Schemes

Saying that Congress can’t write laws fast enough to keep up with those who find ways around them, Sen. Charles Grassley, chairman of the Senate Committee on Finance, took aim at those promoting and selling tax shelters at a hearing on Tuesday.
Tax

Law Firm Ordered to Turn Over Tax Shelter Client List

With Congress' attention turned squarely on trying to curb tax shelter abuse, the IRS has won permission from a federal court to force a law firm to reveal the names of their clients who have invested in tax shelters that may be abusive.Sidley Austin Brown & Wood, a Chicago-based law firm, was served a summons to turn over their client lists. The firm is only the second law firm that has been ordered to cooperate with the IRS in its tax shelter investigations.
Tax

Setback For IRS is Win for KPMG

In a blow to Justice Department attorneys seeking to better protect consumers from promoters of risky tax shelters, a U.S. Magistrate has ruled that KPMG LLP has grounds to withhold documents it says are privileged from Internal Revenue Service investigators. KPMG, the nation’s fourth largest audit firm, has been strongly criticized over its tax-shelter practice and the aggressive legal strategy it has used to defend it. The firm handed over hundreds boxes of documents to the IRS, but withheld those the firm said were privileged. Retired U.S.
Tax

2004 Standard Mileage Rates Set — 800,000 More Businesses Eligible

The IRS has released the optional standard mileage rates to use for 2004 in computing the deductible costs of operating an automobile for business, charitable, medical or moving expense purposes.To reduce a recordkeeping burden, the IRS also announced that taxpayers who use no more than four vehicles at the same time for business purposes may use the standard mileage rate, starting in 2004.
Tax

IRS Announces Pension Plan Limitations For 2004

The Internal Revenue Service today announced cost‑of‑living adjustments applicable to dollar limitations for pension plans and other items for Tax Year 2004. Section 415 of the Internal Revenue Code provides for dollar limitations on benefits and contributions under qualified retirement plans. It also requires that the Commissioner annually adjust these limits for cost‑of‑living increases.Many of the pension plan limitations will change for 2004.
Tax

Witching Hour Approaches for Florida Tax Amnesty Program

At midnight October 31, Florida closes the doors on its popular tax amnesty program and those who did not participate will face the wrath of the Florida Department of Revenue."This department will engage in a very substantial enforcement program for those that did not take advantage of this period," said Jim Zingale, director of the Florida Department of Revenue.The program, which was offered to Florida individuals and businesses, has raked in $35 million in back taxes and interest since it began on July 1, 2003.
Tax

IRS Cautions 'Quick Fixes' From Credit Counseling Organizations

The Internal Revenue Service, the Federal Trade Commission and state regulators issued a consumer alert for those seeking assistance from tax-exempt credit counseling organizations.Paying bills is never easy, but job loss, divorce or unexpected medical bills can be devastating to a consumer. Many consumers seek help from non-profit credit counseling organizations in managing their debt or "repairing" damaged credit.

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