Ask TaxMama Issue 488 – Ethics vs Power and Confidence
January 27, 2009 by Tax Blog
Filed under Questions & Answers
Dear Family,
Don’t you love to start the day with someone telling you – “You were right!”? That’s what happened yesterday, when Andrew came to work. Naturally, I know that I am often right (and sometimes wrong) – but what was I right about this time?
Ah yes, it was all over the news – Obama re-taking the oath of office.
Clearly, during the Inauguration ceremonies, it was somewhat mangled. Chief Justice John Roberts re-administered the oath, simply as a cautionary measure.(Right after the swearing in, I happened to say – well, that’s going to have to be corrected – very soon. I didn’t expect it to turn into a media spectacle. But that does make sense.)
I was wondering about the documents President Obama had signed, and the Cabinet members he’d had sworn in, etc. before the oath. But if you read the MSN article above, the administration and legal advisors didn’t think that much caution was necessary. But we all know, someday, someone will be unhappy with something and sue that something that was done or signed or decided before the re-taken oath isn’t valid. Sigh. Makes me tired. But I bet that will happen.
We had a bit of excitement this week as the confirmation hearings were going on. This hubbub over proposed Secretary of the Treasury really has the tax professional community in an uproar. At first, I thought his tax errors were simply an oversight. But, reading the documents that the Committee has gathered about Geithner’s tax history (i.e. things he SIGNED), and his own comments that he understood his responsbilities, but made a mistake. Read my – Accountingweb.com blog
But once I saw the documents, it became quite clear that this was a serious breach of ethics. And he just brushes it all aside. Essentially, his bold, strong, confident position vis-a-vis the Senate Committee panel is, forget it. Let’s move on to more important things. Whew! This fellow will be overseeing the IRS?
Oh, don’t worry, Geithner WILL get confirmed. He will be the new Treasury Secretary. After all, people like Paul Volker, Barack Obama and many legislators and others insist that he’s the only man who can do this job at this time.
There is this Fox News article by Glenn Beck that touches on this in an amusing and sarcastic fashion.
But that’s not what I want. I really wish that someone would spell out for me WHY? What are his special skills, or his brilliant vision that make him the ONLY Man? I am not being sarcastic. I’d just like to see an outline of his accomplishments and skills that make him so uniquely qualified. He’s going to be the one overseeing my professional ethics and career – and your tax liability and collections. I’d just like to feel more enthusiastic about him. Wouldn’t you?
In the meantime, everyone’s hard at work in Washington, DC.
In IRS News today, there’s an outline of the Economic Recovery Package from the House Ways and Means Committee; we get guidelines for bartering, and learn how to let IRS know when you move.
http://taxquips.com/index.php?cat=IRSNews
Today’s Money Funny we look at someone who felt the need to change his profession due to the recession…and other career considerations.
http://taxquips.com/index.php?cat=MoneyFunnies
In TaxQuips this week, we get a lesson about old laws on the books in some states about cohabitation; we learn (for federal purposes) whether a boyfriend can claim his girlfriend on his tax return; we deal with an interesting twist to the Stimulus Rebate situation; get into quite a heated discussion about s corporation ‘draws’; and learn that even after many years, and many miles, far away states can reach out and garnish your paycheck for unpaid taxes. Or may they?
http://taxquips.com/index.php?cat=TaxQuips
And finally, our Job Advice of the week gives you an e-book which is a Guide to a Six-Figure Job Hunt 101.
http://taxquips.com/index.php?cat=JobAdviceoftheWeek
Incidentally, Monday is Bubblewrap Appreciation Day. Click on the graphic at the top of today’s issue. It will take you a whole work of bubblewrap games and fun. Could be addicting!
As always, we love your feedback, opinions and ideas.
You are what makes all this fun – and interesting!
Please use the Comments link online.
http://taxquips.com/index.php?id=1091
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www.TaxMama.com
www.TaxQuips.com
www.IRSExam.com
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TAX CALENDAR 2009
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01.02.2009 File Form 2290 – Heavy Highway Vehicles
01.15.2009 4th Estimated Payment Due
Farmers and fishermen. Estimated tax for 2008 Due
01.15.2009 Employers Make Monthly Payroll tax deposit
01.31.2009 Furnish W-2s/1099/1098s to recipients
01.31.2009 File Quarterly/Annual Payroll/Sales Tax Returns
01.31.2009 Individuals – Filing personal return and pay all taxes
Without Penalty if January 15, 2009 estimated payment missed
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- Ask TaxMama :: Where taxes are fun and answers are free
- www.TaxQuips.com :: The number ONE free tax podcast online
- Money Funnies :: http://taxquips.com/index.php?id=1087
- IRS News :: Guidelines for Bartering, proposed tax law changes, change of address
- Job Advice of the Week :: Guide to a Six-Figure Job Hunt 101
- The 100% Home-Based Business Tax Solution :: The evolving e-book and Tax MiniMiser
- Prepare your own tax return :: $19.95 includes IRS, State, e-filing and tech support
When will I be receiving my IRS stimulus check?
January 20, 2009 by Tax Blog
Filed under Questions & Answers
I e-filed through turbo tax for direct deposit. Does this make me fall into the group of people receiving theirs by May 9th? I wasnt sure if there was a difference between e-filing through turbo tax and the IRS website.
Free IRS E-File: Getting Started
Click on the “ Start Now” button on the Free File home page to review the list of tax software companies and select one that best suits your needs. Once you select a company link from the list, you will be notified you are leaving the IRS.gov Web site and you will be taken directly to that company’s Web site to begin preparation of your federal income tax return.
You may qualify for Free File if you have an Adjusted Gross Income (AGI) of $52,000 or less.
If you used Free File in past filing seasons, you might not qualify for the free services for your tax year 2007 income tax return. Participation in the Free File program is limited to taxpayers with an Adjusted Gross Income (AGI) of $52,000 or less.
Members of the tax software industry (i.e., Free File Alliance, LLC) provide these free tax preparation and electronic filing services – not the IRS. Once you choose a particular company, you will be sent directly to the company’s commercial website. Any questions about a particular service or company should be directed to the company providing the free service and not the IRS. Please contact the company to resolve your particular income tax issue. To find out how to contact the company, please refer to the company’s website for more information about their customer service options. Companies associated with the Free File Program are affiliated with the Free File Alliance, LLC, a not for profit organization. IRS does not promote or endorse any specific programs or products associated with this program.
You may determine after you start preparing your tax return with a particular company you are not eligible for the company’s free service and you may be subject to a fee.
If this notification occurs you have the following options:
1. Return back to the IRS’ Free File homepage and review the list of companies and their services and select another company you may qualify for;
2. Choose a company to complete your return but take note of the fee displayed on the company’s website; or
3. Visit the IRS.gov web site, “e-file Partners for Individual Taxpayers”, for additional low-cost e-file opportunities.
For example, if you select a company whose free services are provided to individuals with an Adjusted Gross Income (AGI) of $26,000 or less and, based on your tax data, the company determines your AGI exceeds the $26,000 limit, you will be notified you may be subject to a fee. It is important you understand each of the company’s eligibility criteria before selecting a company.
Easy Ways to start your Income Tax Return – Reccomended by IRS
Gather and organize (particularly important for businessmen) your records in advance. Make sure that you have all activity records and receipts that you will need, such as W-2S and 1099s. To be safe more truly than sorry, make a copy of all your records.
Tips for Filing your Tax Return
Don’t let the upcoming tax season fill you with dread. With a little preparation, you can learn to navigate the tax return preparation maze with confidence. To get you started, here are the basics of what you need to know when filing your tax return:
There are two ways in which to file your tax return, by IRS e-file or by mailing a paper return to the IRS.
Electronic Filing
IRS e-file is the electronic transmission of your tax return to the IRS. As a result, the processing of IRS e-file returns is more accurate than the processing of paper returns. You must have a valid Social Security number for every person included on the return to qualify for electronic filing.
If you e-file, your return is considered filed on time if the authorized electronic return transmitter postmarks the transmission by the due date. The electronic postmark is a record of when the authorized electronic return transmitter received the transmission of your electronically filed return on its host system. The date and time in your time zone controls whether the electronically filed return is timely.
Paper Returns
If you do not e-file your tax return, you can mail your return in the envelope provided with your tax form package. If you do not have an addressed envelope or you moved during the year, mail your return to the appropriate Internal Revenue Service Center listed for your state in your IRS tax form package.
Your paper return is filed on time if it is mailed in an envelope that is properly addressed and postmarked by the due date. If you send your return by registered mail, the date of the registration is the postmark date. The registration is evidence that the return was delivered. If you send a return by certified mail and have your receipt postmarked by a postal employee, the date on the receipt is the postmark date. The postmarked certified mail receipt is evidence that the return was delivered.
If you use a private delivery service designated by the IRS to send your return, the postmark date generally is the date the private delivery service records in its database or marks on the mailing label. The private delivery service can tell you how to obtain written proof of this date. IRS designated private delivery services are listed below:
* Airborne Express (Airborne): Overnight Air Express Service, Next Afternoon Service, and Second Day Service
* DHL Worldwide Express (DHL): DHL Same Day Service and DHL USA Overnight
* Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx International Priority, and FedEx International First
* United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A.M., UPS Worldwide Express Plus, and UPS Worldwide Express
Filing Late
If you do not file your return by the due date, you may be subject to a failure-to-file penalty and interest. To avoid penalties and interest, file for an extension by before this date. If you were due a refund, but you did not file a return, you must file within three years from the date the return was originally due to obtain that refund.
Filing an Extension
When you file an extension, you can postpone filing your return until October 15. However, if you do not pay any tax owed by the due date, you will accrue penalty and interest charges. Complete Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, to file for a six-month extension. If you estimate that you have a balance due, include this payment with the form.
For example, James and Sally Gaylord are married and file a joint return. Their home was damaged by a tornado and they have contacted their investment company to resend them Forms 1099 so they can file their tax return. It does not appear that they will have this information by April 17, so they decide to ask for an extension by filing Form 4868. James and Sally estimate that their total tax liability for 2006 will be $1,843. Their Forms W-2 indicate that a total of $1,215 of federal income tax has been withheld. To avoid late payment penalty and interest, James and Sally must pay $628 with their Form 4868.
E-filing Extensions
The IRS offers e-filing of extension applications. The IRS will process Form 4868 through the original due date of your tax return. By filing an extension, you postpone the filing date of your return until October 15; however, any tax due on the return will be subject to interest and penalties if not paid by the due date.
Installment Agreement
If you are not in bankruptcy and have a balance due, but cannot pay your full tax liability by the due date, you should consider the IRS installment plan. To request an installment agreement, complete Form 9465, Installment Agreement Request, and attach it to the front of your tax return or include it with an e-filed return. You can also request an Installment Agreement after you file your tax return by filing Form 9465 by itself to the address shown in the form instructions or by e-filing Form 9465 by itself. If the IRS approves the request, you will be charged a fee and interest on any unpaid balance. The fee has been increased in 2007 to $52 for agreements to pay direct debit and to $105 for all others. Although you generally may have up to 60 months to pay, you should make the payments large enough so that the balance due will be paid off by the due date of your next return. Before requesting an Installment Agreement, you should consider less costly alternatives, such as a bank loan.
Record Keeping
It is a good idea to keep your previous tax returns, as well as other important documents that have affected your income and deductions, for at least three years. If you need a copy of a prior- year return, you can obtain it for a fee from the IRS by filing Form 4506, Request for Copy of Tax Return. This can take up to 60 calendar days.
Change of Address
Are you planning a move before the end of the year? The IRS has an official change-of- address form, Form 8822, Change of Address. If you complete and mail this form to the appropriate IRS Service Center, you should receive your tax booklet at your new address.
For more tax tips and information on tax preparation, please visit the Tax Resource Center at http://www.jacksonhewitt.com.
About the Author
R.L. Fielding has been a freelance writer for 10 years, offering her expertise and skills to a variety of major organizations in the education, pharmaceuticals and healthcare, financial services, and manufacturing industries. She lives in New Jersey with her dog and two cats and enjoys rock climbing and ornamental gardening.