Tax news

Tax

IRS OKs Redesignation of Estimated Payments

The Internal Revenue Service has issued announcement 2001-112, Redesignation of Estimated Tax Payments, which provides relief to corporations that pay estimated income tax payments.It has come to the attention of the IRS that many corporations will report income substantially less than previously expected because of economic disruptions resulting from the September 11, 2001 terrorist attacks.
Tax

Tax Professionals Offer Assistance to Attack Victims

The National Association of Tax Professionals (NATP) has coordinated volunteers among its members who are willing to provide assistance with disaster relief and tax issues to taxpayers who are seeking guidance and information on tax issues arising from the terrorist attacks in September.NATP has posted free information on its Web site that can help victims get their tax issues resolved quickly.
Tax

Employees: Trade Days Off For Cash Donations

The IRS has announced that programs allowing workers to swap unused leave time for financial contributions from their employer for terrorism relief do not constitute gross wages or income of an employee.For workers, such arrangements will be a non-issue on tax returns. The IRS says it won't view the programs as giving workers any taxable benefit from their employer.
Tax

IRS Hosting 'Problem Solving Day' on Saturday November 3

The Internal Revenue Service will hold a Problem Solving Day on Saturday, November 3, especially for taxpayers who need to resolve federal tax issues and can’t take advantage of weekday problem-solving service.“This is a special day for taxpayers who need help,” said IRS Commissioner Charles O. Rossotti. “It’s one more way the IRS goes the extra mile to help taxpayers.” Nationwide, 43 IRS Taxpayer Assistance Centers will be open from 9 a.m. to 3 p.m.
Tax

House Passes $100B Economic Stimulus Bill

A razor-thin 216-214 vote in the House of Representatives Wednesday clears the way for President Bush's Economic Stimulus package to find an even less friendly audience in the US Senate.The desire to kick-start the economy as a result of slowdowns since September 11 is shared by all, but Democrats disagree with the approach and claim the package is back to "partisan politics at its best."Highlights of the Economic Stimulus Package (costs are ten year estimates from the Joint Committee on Taxation):IndividualsGive rebates of up to $300 for individuals, $500 for heads
Tax

Senate Considers 50% Bonus Depreciation Legislation

Senator Orrin Hatch, R-UT, a member of the Senate Finance Committee, has introduced legislation that would provide a temporary 50% bonus depreciation deduction for all businesses that purchase fixed assets during the period between September 11, 2001, and July 1, 2002.The Economic Stimulus Through Bonus Depreciation Act of 2001, Senate bill 1553, offers businesses the 50% first-year bonus depreciation in addition to the normal depreciation deduction, computed as if the bonus depreciation did not exist.
Tax

IRS Clarifies 401(k) Catch-Up Rules

New proposed Treasury Regulations expected to be published in today's Federal Register will clarify certain areas of confusion regarding the age 50 catch-up rules for 401(k) plans that were introduced as part of last year's tax act.The new tax act provides that employees who are 50 or older are entitled to make catch-up contributions totaling $1,000, in addition to their regular maximum contributions, to a company-sponsored 401(k) plan.
Tax

IRS Launches New Program to Nab Professionals

The IRS is using state professional licensing agencies to help identify taxpayers who have current licenses and are therefore probably working and earning a living. Matching names with IRS computer records to determine if these professionals are filing tax returns, the IRS hopes to zero in on millions of tax evaders.Working with the Minnesota Revenue Department, the IRS has begin matching W-2 information and data from 1099 and 1098 forms with names of professionals with active state licenses, including lawyers, real estate brokers, accountants, insurance agents, and others.
Tax

2002 Social Security Wage Base Announced

The Social Security Administration has announced the new wage base for application of Social Security tax withholding, effective January 1, 2002. The taxable wage base will increase 5.6% from $80,400 to $84,900.This increase will have the effect of raising the amount of Social Security tax paid by individuals making at least the maximum in Social Security taxable wages by $279, bringing the total tax to $5,263.80.
Tax

Depreciation Rules Change Due to Terrorist Attacks

The IRS has issued Notice 2001-70 on Disaster Relief From Application Of Mid-Quarter Convention in Tax Code Depreciation Rules. In this notice, the IRS relieves taxpayers from using the mid-quarter convention for computing depreciation expenses.Recognizing that since the September 11, 2001 terrorist attacks many taxpayers may have encountered difficulty completing acquisitions and placing in service of property in accordance with plans made earlier in the year, the IRS has decided to soften the rules regarding the mid-quarter convention.
Tax

IRS Publishes CPE Material for Tax Exempt Bonds

For the past eight years, the IRS has published articles of interest to the tax exempt bond community in its annual publication, "Exempt Organizations Continuing Education Technical Instruction Program."Now the IRS is taking its program of disseminating information one step further and launching a continuing professional education program which will meet the technical needs of the IRS's Tax Exempt Bonds personnel and the municipal bonds community in general.
Tax

Jobs Available at IRS

The IRS is searching for accountants who are interested in becoming IRS Criminal Investigation Special Agents. Job openings for 300 new agents have been announced and applicants may apply online.Candidates selected for the special agent positions will attend a comprehensive training program at the Federal Law Enforcement Training Center (FLETC) in Glynco, Georgia. Training begins with a one-week orientation program sponsored by the National Criminal Investigation Training Academy.
Tax

IRS To Begin Docking Social Security Benefits

In an attempt to step-up collection of past due income taxes, the IRS has announced that it will begin withholding up to 15% of Social Security benefits from certain taxpayers.An estimated 232,000 taxpayers currently receiving Social Security benefits have unsettled income tax accounts. These taxpayers owe an average of $1,350 each. The program will not only target taxpayers currently owing back taxes, but will go forward to collect outstanding income taxes in the future by withholding Social Security benefits.
Tax

Quarterly Tax Payments Meet the Computer Age

The Electronic Federal Tax Payment System (EFTPS), the program that allows business and individual taxpayers to make electronic tax payments by telephone and Internet, offers a program whereby taxpayers can make quarterly estimated tax payments electronically. Those quarterly payments can be set up for the year and payments will be made automatically on the dates you specify.The EFTPS provides an option for online users of the service to review tax payment history and print out a confirmation of payment.
Tax

Virginia Man Just Loves to File Tax Returns

Twenty-five year old Barry A. Johnson, of Virginia Beach, VA, has been accused of creating false tax returns. Lots of false tax returns.At last count, Mr. Johnson has been found to have used the names and Social Security numbers of other people to file 174 tax returns (presumably in addition to his own, legitimate tax return), hoping to receive a total of $270,000 in tax refunds. The actual amount of refunds received by Mr. Johnson is approximately $40,000.Mr. Johnson has been filing tax returns on behalf of others since 1998 and may face up to five years in prison if he is convicted.
Tax

IRS Closes Office After White Powder Scare

The Internal Revenue Service office in Covington, Kentucky was closed Tuesday after a mailroom employee said she saw a cloud of white powder come from an envelope after it was opened.The office was closed for six hours. The mailroom employee who opened the envelope was decontaminated by hazardous materials personnel and then taken to a nearby hospital for observation, however the employee did not exhibit any signs of illness.
Tax

Michigan Joins Multi-State Sales Tax Pact

Michigan Governor John Engler signed legislation that allows Michigan to join 19 other states in the Streamlined Sales Tax Project, a multi-state tax simplification pact that will ease the rules for sales tax collection on Internet sales.
Tax

NATP President Voices Concern Over Proposed OIC Fee

Larry Gray, President of the National Association of Tax Professionals (NATP), played a key role in voicing the concerns of tax professionals with regard to the IRS's effort to restructure the Offer in Compromise (OIC) program.Mr. Gray met with senior IRS personnel, including Robert Wenzel, IRS Deputy Commissioner and Kevin Brown, Assistant to the Commissioner, in Washington DC, to discuss the cost of streamlining the collection process and improve communications with the IRS. "Our goal is to improve the communications with the Service.
Tax

Online Tax Sessions Offer CPE Credit

The IRS-sponsored Q&A forum, Tax Talk Today, is now offering CPE credit for those who view the archives of previous sessions.Participants may view the archived programs online or may order a video of past sessions. Video tapes of previous sessions sell for $24.95. To earn credit, a test and evaluation form must be completed.Prices for the self-study CPE are $25 per credit hour, however volume discounts are available.
Tax

House Bill Would Allow Disclosure of Taxpayer Information

House Bill H.R. 2975, the Patriot Act of 2001, if made into law, will authorize disclosure of taxpayer information to the Justice and Treasury departments, federal law enforcement, as well as federal intelligence agencies that are investigating terrorist organizations and related activities.Some tax practitioners have voiced a concern that such a bill will weaken important restrictions on disclosing tax information.

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