Tax news

Tax

Plates' Excise Tax, Not Auto's Sales Tax, Is Deductible Expense.

Is sales tax paid on the purchase of a new automobile deductible on either state or federal forms? RPK, Indianapolis Not really'Years ago the IRS allowed a deduction for automobile sales tax on the federal form, but that deduction was removed over a decade ago'Indiana doesn't allow any such deduction.
Tax

Tax Increase On Tap For Year 2000

We've all heard about the tax reductions that keep coming our way from our friends in Washington, in the form of greater exemptions, higher standard deductions, credits for children, credits for sending children to school, credits for sending yourself to school, credits for having a job where you don't earn very much money, and so on'I just want to point out that, while one hand of the government seems to be reaching out to taxpayers, the other hand is quietly slipping in our back pockets and taking back what is so generously being handed out.
Tax

Even In The Giving Season, Tax Rules Do Apply

While you're busy wrapping packages, tying bows, and thinking merry thoughts this week, here are some merry tax thoughts to go with those gifts you are giving and the ones you hope you receive. Giving business gifts
Tax

IRS Clear On Subject Of Severance Pay

My wife is about to be eliminated in her job because the job is being eliminated and she's going to receive a 9-month pay settlement'I'm under the impression that there is a certain kind of account that she can put these funds in and she can defer the taxes on them until they are withdrawn on an interest only basis'Is that a possibility? M'D., Indianapolis
Tax

Income Averaging Provision Now Available Only To Farmers

I recall several years ago when I had experienced an unusually high one-year taxable income, I was able to reduce my Federal income tax liability by averaging my income over a five-year period'Is the Income Averaging provision still available to taxpayers? G.L., Indianapolis
Tax

Much-Maligned IRS Aims To Be Nicer, More Helpful

IRS losing in government popularity contest A recent survey designed to gauge citizen satisfaction with various government agencies determined that the IRS is the least popular of all government agencies that were examined'Of 29 federal agencies examined, the IRS came in dead last in the popularity contest'This, of course, has to be startling news to the folks at the IRS who thought their campaign to become a kinder, gentler IRS was going to be successful in changing public opinion of the agency.In response to the results of this American Customer Satisf
Tax

IRS Is COLTS Biggest Fan

I was told I needed to turn my column in early this week so that the Star could spend the weekend focusing on the important news, that being the fact that the Y2K disaster and global warming have conspired to provide Indianapolis with what seems to be a winning football team'Not since Jack Trudeau gave new luster to the term 'sack'has there been so much interest in our local football heroes'And so it seems only fitting that I too devote extra space to a commentary on the success of the Colts.
Tax

New Tax Credits Will Make Tax Returns Fun

Last week, President Clinton unveiled a wish list of new tax credits that he would like to see enacted by Congress'Congress, in the form of Bill Archer, chairman of the House Ways and Means Committee (the group responsible for writing our “simple” tax laws), replied that since 2000 is an election year, there probably wouldn’t be any major tax legislation passed for a while'After all, we wouldn’t want any of our elected representatives voting on controversial tax laws in a year when their constituents are actually paying attention to what they are doing.
Tax

Mortgage Deduction Only Useful On Itemized Return

We received a mortgage interest statement showing that we paid $3,800 in 1999'It's just the two of us and we file with the TeleFile'My question is, do we have to file any forms and if so, what forms should we use?
Tax

What Areas Are Ripe For IRS Audits In Your Market?

Help us build a list of the specific audit areas that the IRS is targeting this year in your community. Chances are if it's happening in one part of the country, it will hit your part of the country soon.Scroll down the page to view other readers' input.Simply click on the "Add Comments" button below to offer your own insight.With your participation we can make this an extremely valuable list this tax season!
Tax

IRS Opens Business Divisions to Pursue Tax Schemes

The IRS is getting serious about corporate tax schemes, according to a new report. The Service has opened its new Large and Mid-Size Business Division so examiners and agents can focus on illegal corporate tax shelters.The office also is designed to encourage companies to stop the shelters before they ever start by distributing information on the various schemes.
Technology

CCH Offers Low-Cost Online Filing Solution

Well-known tax knowledge provider CCH has developed an online tax filing solution designed exclusively for the small business and consumer markets.
Tax

IRS Sees Red in Unreported Income

A question posed by a taxpayer in the San Francisco Chronicle posed an interesting situation, especially for small business entrepreneurs: what happens when 1099 income from independent contracting does not match reported income on a taxpayer's 1040?Two scenarios exist. First, taxpayers may not be reporting income for payments received in December because they want to defer the income to the new year.
Tax

Tax News Covers Charitable Deductions

The latest tax news from MSNBC covers a variety of topics including news that taxpayers who do not itemize may be able to deduct charitable contributions.Approximately 70 percent of taxpayers do not itemize and do not write off any deductions currently. A legislative plan backed by President Clinton would allow deductions, and since this is an election year, it may be interesting to note that George W.
Tax

Measure Your Own Tax Advice Against These Tips

At this time of year, the Internet, newspapers and magazines are filled with sage advice on how to help reduce a tax liability.As a tax practitioner or accountant, see if you agree or disagree with the following recommendations provide by H&R Block: minimize personal income by converting income into non-taxable income, such as investing in tax-free instead of taxed investments; convert personal spending to qualified deductions, like the new home office rules that affect working at home on a part-time basis; take advantage of the various tax credits, including the ch
Tax

Tax Breaks for the Home Office

Good news is in store for clients who have a part-time home office. The IRS has changed their way of thinking in allowing anyone who does part of their work at home qualify for certain deductions.Before now, the Service was very strict in saying that the home office had to be the principal place of business--which had been interpreted as the only place of business.But in a move signaling again a paradigm shift for the Service, anyone who spends time in a home office doing paperwork or handling other matters may now qualify for at least some deductions.
Tax

E-filing Season Off To A Strong Start

The IRS reports that the fifteenth year of electronic tax filing is off to a strong start, recording a 27.7% increase in e-filing for this opening weekend of the tax season.The IRS expects one in four taxpayers will file electronically this year, representing over 33 million returns.
Tax

IRS Image Tarnished; Still Unpopular With Taxpayers

Throughout the year, AccountingWeb has presented a variety of stories on how the IRS has made attempts to shine its tarnished image by presenting a "kindler, gentler" outlook on pursuing audits, offering concessions to taxpayers and just being plain nice.A new ranking from the American Customer Satisfaction Index claims that the attempts were unsuccessful, and the Service still ranks as one of the most unpopular government agenices in the Americas.While some tax professionals have gone on record to say the IRS is, indeed, doing a better job, taxpayers are the heart of the concern, and on
Tax

IRS Simplifies Offers-In-Compromise Program

The Internal Revenue Service has announced a simplification of it's Offers-In-Compromise program, a program instituted in situations where individuals want to pay the tax they owe, but can't afford to make good on the entire liability.The IRS has indicated in a news release that it will offer taxpayers a new payment option providing for fixed monthly payments over the life of the agreement, which can run for as long as ten years.
Tax

Help Ensure That Affected Clients Get IRS Y2K Relief

The official position of the IRS is that it wants every individual and business taxpayer to do what they need to do in order to avoid Y2K problems which will cause them an inability to comply with tax laws.But if legitimate issue arise, the IRS will waive penalties and interest.Immediately after the new year begins, you will be checking your critical systems and you should also be checking your clients critical systems.

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