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Mark Everson Confirmed as IRS Commissioner

Mark W. Everson has been confirmed by the U.S. Senate to be the next Commissioner of Internal Revenue. Mr. Everson replaces Bob Wenzel who has been serving as acting commissioner since former commissioner Charles O. Rossotti's term came to an end last November. Mr. Everson is the 46th commissioner of the IRS.Mr. Everson is leaving his post as deputy director for management for the Office of Management and Budget (OMB), a position he has held for nearly a year. Previously he was controller of Federal Financial Management of the OMB. Before joining the Bush administration, Mr.
Tax

IRS Amnesty Plan Nabs 1,200 Taxpayers, $100 Million

The deadline has passed for the Internal Revenue Service's partial amnesty program, the Offshore Voluntary Compliance Initiative, designed to identify promoters and users of offshore banking and credit card accounts who are attempting to avoid paying income taxes. The amnesty program, which ended April 15, 2003, enabled taxpayers to come clean about their participation in such accounts and avoid civil fraud charges and criminal prosecution.
Tax

Court Date Set For $500 Billion Law Suit Against The IRS

It's a "go." Two national membership organizations that provide estate planning services will face the IRS in a courtroom next February. Heritage America and The Aegis Company filed a $500 billion lawsuit against the IRS in May, 2001, claiming the federal agency violated the civil rights of the 5,500 members of the two organizations when it raided the organizations' offices.
Tax

Important Tax Changes For 2003

There have been lots of changes in the tax rules. Many of them are mandated by indexing – that is, annual upward adjustments to provide relief from inflation, as measured by increases in the Consumer Price Index. What follows are the highlights of several changes that might affect you.PERSONAL EXEMPTIONSYou get a bigger break just for being you. Exemptions are worth $3,050 apiece for 2003, up slightly from $3,000 for 2002.
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IRS Wants Proof From Earned Income Credit Recipients

The Internal Revenue Service has devised a new program whereby certain recipients of the Earned Income Credit (EIC) will be required to offer proof of their relationship to the child that qualifies them for the credit as well as proof of the fact that the child lived with them for more than six months during the tax year.The EIC has been a thorn in the side of the IRS for years. The credit is confusing to the taxpayers who try to claim it, and evidence would suggest that it is equally confusing to professional tax preparers.
Technology

Colorado Proposes Posting Tax Delinquents on Internet

The State of Colorado moved one step closer last week to passing a law that calls for the Department of Revenue to post a list taxpayers who owe more than $20,000 in overdue taxes on the Internet. HB 1210, dubbed The Cyber Hall of Shame, passed in the state House and has been sent to the Senate for approval.Rep. Alice Madden (D-Boulder) sponsored the bill with the hope of helping the state recoup nearly $100 million in back taxes. The measure will target taxpayers who have ignored notices and phone calls asking them to pay what they owe.
Tax

Free File And IRS E-File Available Through Oct. 15

The Internal Revenue Service reminds taxpayers that Free File, the tax preparation and electronic filing service, remains available for people who received filing extensions. More than 2.7 million taxpayers used Free File during the regular filing season.A projected 8.5 million taxpayers were expected to request the automatic four-month extension, which would extend their filing deadline until Aug. 15. Those taxpayers with hardship situations can request a second extension for an Oct.
Tax

H&R Block Readies Refund to Peace-Seeking Taxpayers

H&R Block, the nation's largest preparer of income tax returns, has reached an agreement with the attorneys general in 41 states and the District of Columbia to reimburse certain Block customers who paid for a special insurance policy, the Peace of Mind, in connection with the preparation of their 2001 income tax returns.Block offers the Peace of Mind program for taxpayers who want an additional level of protection beyond the standard service guarantee.
Community News

Pennsylvania Judge OKs Lawsuit Against H&R Block

A Pennsylvania judge has given the green light for a class-action lawsuit to proceed against tax preparation firm H&R Block. The suit alleges that Block deceived its customers into paying for extra fees for filing tax returns electronically.According to the lawsuit, after Block prepared the taxes for the two plaintiffs in the case, the company led the plaintiffs to believe that their only option was to file the return electronically, at a cost of $30 to $40.
Tax

Senate Panel Investigating Tax Shelter Abuses

The U.S. Senate Permanent Subcommittee on Investigations has launched an investigation into the potentially abusive tax shelter schemes marketed and sold by Big Four firms Ernst & Young and KPMG. The agency has requested documents from the firms relating to the shelters.The investigation follows on the tails of a similar investigation into the validity of tax shelters being conducted by the Internal Revenue Service.
Tax

KPMG Survey Results Show R&E Credit Not Successful

Congress created the Research & Experimentation credit program in the 1980s to provide an incentive for companies to engage in research and to level the international corporate playing field.
Tax

Citizen Groups Target Corporate Offshore Tax Shelters

Two prominent online citizen-action groups have launched a media and grassroots campaign to end corporate offshore tax shelters. MoveOn.org and WorkingforChange.com say that big corporations aren’t shouldering their share of the tax burden and are deserting the country at a time of need.
Tax

Some Out-of-State 529 Plans Face Taxes

Parents confounded by the over abundance of ways to save for college may face a new hurdle as out-of-state College 529 Plans become subject to income taxes in some states. The 529 funds, often exempt from state taxes, have become a popular way to save for college since up to $250,000 can be put away for education-related expenses, with the earnings exempt from federal taxes.A new trend shows that more states are levying income taxes on those who earn dividends on plans outside of their home states.
Tax

IRS Tightens Loans to Pay Estate Taxes

When an entrepreneur dies, heirs must sometimes sell the family businesses to pay the estate taxes. Recognizing this burden, the Internal Revenue Service (IRS) allows qualified businesses to use a low-interest installment plan. Even so, some businesses take advantage of the financing arrangement, often failing to make their payments. Now, the IRS is getting tough, requiring installments loans to be secured with a bond or lien, according to an April 17th article in Business Week Online. Section 6166 of the Internal Revenue Code gives businesses up to 14 years to pay estate taxes.
Tax

Washington Accounting Firm Closed in IRS Investigation

Port Orchard, Washington-based Pat's Accounting Inc. was raided by the Internal Revenue Service on one of the busiest days of the year for accountants, April 15. The IRS was acting on information provided by a former employee that Richard Peirce, son of the owner of Pat's, was intentionally preparing and personally benefiting from fraudulent income tax returns.The IRS investigation centers around a tip that Mr.
Tax

IRS Releases Industry Issue Resolution Guidelines

The Internal Revenue Service has published revised procedures for the Industry Issue Resolution (IIR) Program. Under the revised procedures, business taxpayers, industry associations and other interested parties can submit frequently disputed or burdensome business tax issues at any time for possible resolution under the program.In past years, issues have been submitted by industry associations and others representing both small and large business taxpayers. These submissions have resulted in tax guidance that has affected thousands of taxpayers.
Technology

E-Filing Sites Easily Handle Tax Deadline Crunch

Online tax filing went without any hitches this year, according to Gomez, Inc., a research organization that helps companies measure and improve their customers' online experience.In an April 18 article in E-Commerce Times, John Lovett, a senior performance analyst at Gomez, reported that tax preparation sites were prepared for last-minute filers and as a result there were few glitches — even on April 15. Mr. Lovett said that his firm monitored a group of leading tax sites, noting response time and site availability.
Tax

Congress to Debate Changing Tax Filing Date

Maryland Congressman Roscoe Bartlett (R-6-MD) has introduced legislation that would change the annual filing date for income tax returns from the current April 15 to the first Monday in November, the day before Election Day."I think it's just common sense that the price we pay for our government - which is taxes - should be a top priority when Americans go to the polls to select their members of Congress," said
Tax

Some Taxpayers Withhold Payment in Protest of War

With the April 15 tax deadline as a backdrop, dozens of tax season protests, organized by the National War Tax Resistance Coordinating Committee, occurred across the country this past week. Protesters came out to voice their concern about tax funds being used for the war. Additionally, thousands of Americans are finding another way to protest the Iraq war and it doesn’t involve marching in the streets or picketing the White House.
Tax

Study Shows IRS Prosecutions Down

In a season when many Americans are paying their dues to the IRS, the agency is taking a few knocks as the result of a study released last week by Syracuse University's Transactional Records Access Clearinghouse (TRAC).The study found that IRS criminal tax prosecutions are down about 50 percent from what they were a decade ago. The IRS led the prosecution on 1,064 tax cases in 1993, a number that had fallen to 512 by 2002. TRAC predicted about 360 prosecutions for 2003.

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