Friday, November 30, 2007

Senado pide eximir de impuestos a tabasqueños

Picture of Head
El Senado, por unanimidad, exhortó a la Secretaría de Hacienda que exima del pago de impuestos a los tabasqueños afectados por las inundaciones.

Sería del periodo comprendido del 1 de octubre de 2007 al 31 de diciembre de 2008.

A propuesta del grupo parlamentario del PRI y con el aval de las demás fuerzas políticas, se acordó que se exima a los damnificados del pago del Impuesto Sobre la Renta, del Impuesto al Activo, del Impuesto Empresarial de Tasa Única y del Impuesto a los Depósitos en Efectivo.

También cancelar los adeudos de los productores con la Banca de Desarrollo y que los Fideicomisos Instituidos en Relación con la Agricultura renegocien con la banca privada los créditos descontados.

Además, autorizar un mayor acceso de los pequeños productores a créditos de avío y al seguro agropecuario.

Crude Oil Falls Below $90 on Concern Economic Growth Will Slow

Gas Station

Nov. 30 (Bloomberg) -- Crude Oil fell below $90 a barrel for the first time in a month on concern U.S. economic growth will slow, reducing energy demand.

Consumer spending in the U.S., the world's biggest oil user, rose less than forecast in October and incomes increased at the slowest pace in six months, the Commerce Department said in Washington today. Oil is heading for its biggest one-week drop in two years. Prices climbed to a record $99.29 a barrel on Nov. 21. Read on->

Thursday, November 29, 2007

IRS Tiene $2.2 Billones para Quienes No Presentaron Declaraciones de Impuestos para 2003

Pic of Men
IR-2007-51-SP, 6 de marzo, 2007 WASHINGTON — Reembolsos que no han sido reclamados sumando más de $2.2 billones están esperando a unas 1.8 millones de personas que no presentaron declaraciones de impuestos federales para 2003, anunció hoy el Servicio de Impuestos Internos (IRS). Continuar->

New Deloitte Tax Planning Guide Offers Tips to Help Reduce 2007 Tax Liability

New Deloitte Tax Planning Guide Offers Tips to Help Reduce 2007 Tax Liability

Nov. 29, 2007 -- "Plan now for your immediate tax liability and your future wealth" is the message delivered in the 2007 Deloitte Essential Tax & Wealth Planning Guide.

"While most Americans are thinking about turkey dinners and holiday gatherings with family and friends, they should also take some time to figure out their tax liability so that the only surprises are in shiny packages and not in their tax bill," says John Battaglia, a director in the Private Client Advisors practice of Deloitte. "Many Americans take time to figure out their holiday budget, but we find that not as many take time for year-end tax planning that can reduce their tax liability, which is one reason why Deloitte publishes this annual tax and wealth planning guide."

Battaglia stressed the importance of all taxpayers taking the time to do a tax liability calculation to determine their projected tax payment and identify tax savings to pursue. For instance, a few simple steps can help taxpayers determine where they fall in terms of marginal tax rates, and also decide if they should deter or accelerate income or expenses.

"It is estimated that more than four million taxpayers are going to be subject to the Alternative Minimum Tax in 2007 and many may not realize it," Battaglia said. "When the clock strikes New Year's on January 1, 2007, it's too late to redirect and minimize their tax liability." Read ON->

Bankers Plead Guilty in Enron Case

Tax Office
HOUSTON (AP) — Three British bankers who were set to go to trial for their roles in a fraudulent scheme with former Enron Chief Financial Officer Andrew Fastow changed their pleas to guilty Wednesday.

David Bermingham, Giles Darby and Gary Mulgrew had originally pleaded not guilty to seven counts of wire fraud for allegedly colluding with Fastow in a secret financial scam in 2000 to enrich themselves at their employers' expense. They were set to go on trial in January.

But during a court hearing before U.S. District Judge Ewing Werlein Jr., each pleaded guilty to one count of wire fraud as part of a plea agreement with federal prosecutors.
Read on ->

Wednesday, November 28, 2007

Countrywide faces foreclosure probe

Report says bankruptcy court regulator looking into whether mortgage lender is tacking on improper fees and charges to loans in foreclosure.

NEW YORK ( -- Countrywide Financial, the nation's leading mortgage lender, is facing a federal probe into its foreclosure practices, according to a published report.

The New York Times reported Wednesday that the U.S. Trustee, the federal agency monitoring the bankruptcy courts, subpoenaed its records to determine if two foreclosures in southern Florida represented abuses of the bankruptcy system by the lender.

The agency, a part of the Justice Department, announced an effort to move against mortgage servicing companies that file false and inaccurate claims in foreclosure cases.

IRS Announces 2008 Standard Mileage Rates; Rate for Business Miles Set at 50.5 Cents per Mile

IR-2007-192, Nov. 27, 2007

WASHINGTON — The Internal Revenue Service today issued the 2008 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.

Beginning Jan. 1, 2008, the standard mileage rates for the use of a car (including vans, pickups or panel trucks) will be:

* 50.5 cents per mile for business miles driven;
* 19 cents per mile driven for medical or moving purposes; and
* 14 cents per mile driven in service of charitable organizations.

The new rate for business miles compares to a rate of 48.5 cents per mile for 2007. The new rate for medical and moving purposes compares to 20 cents in 2007. The rate for miles driven in service of charitable organizations has remained the same.

¿Debere impuestos al vender mi casa?

Hipotecas Refinanciamiento Vivienda Deberé impuestos al vender mi casa? La respuesta es "probablemente no". La lee......matrimonio gane hasta 500.000 dólares en la venta de su vivienda principal sin la obligación de pagar impuestos, mientras que las personas solteras pueden ganar 250.000...

Tuesday, November 27, 2007

¿Debo Presentar Declaración de Impuestos?

Usted debe presentar declaración de impuestos si sus ingresos sobrepasan cierta cantidad. La cantidad varía, dependiendo del estado civil para efectos de la declaración, su edad, y la clase de ingreso que recibe.

Por ejemplo, una pareja de menos de 65 años de edad, generalmente no tiene la obligación de presentar declaración de impuestos hasta que su ingreso combinado ascienda a $16,900. Sin embargo, individuos que trabajan por cuenta propia deben presentar declaración de impuestos si sus ingresos netos exceden $400.

Revise la sección ¿Debo Presentar una Declaración de Impuesto Federal? en la página de español en o consulte las instrucciones para los formularios 1040, 1040A o 1040EZ para detalles específicos que pueden indicarle si tiene la obligación de presentar una declaración de impuestos al IRS este año.

Aunque usted no tenga la obligación de presentar una declaración de impuestos, le pudiera ser ventajoso hacerlo, para recibir un reembolso, si le fueron retenidos impuestos federales sobre el ingreso, o si califica para alguno de los siguientes créditos:


Companies Use Debit Cards to Pay Workers

A New York company is promoting a new option: plastic.

Payoneer Inc. is issuing prepaid cards through MasterCard. After obtaining the card, the recipient gets subsequent payments instantly and electronically. As any debit card can, Payoneer cards can be used to buy things or withdraw cash from ATMs in a local currency. And ATM fees, the company says, are often lower than wire transfer fees, and some employers will subsidize new costs their workers incur.

Getty Images Inc.'s iStockphoto is among the early customers and plans to make the Payoneer cards an option for paying photographers commissions on images sold through its site.

"They are in every country in the world just about now, and it has been difficult to get money to those people effectively and inexpensively," said Kelly Thompson, executive vice president for iStockphoto.

Market research firm Mercator Advisory Group estimates that about $11.3 billion in U.S. wages were paid through prepaid cards last year. But until now, they were largely aimed at lower-income individuals who don't have bank accounts.

Payoneer Chief Executive Yuval Tal said he decided to extend the concept to foreign workers and contractors because of the growth in Internet businesses that must pay people worldwide.

Companies remain responsible for any tax withholdings for employees, while contractors and freelancers still make their tax payments. Recipients need a PIN number or a signature to use the cards, and lost and stolen cards can be replaced, along with the funds.

© Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

IRS Oversight Board Voices Grave Concerns over AMT Delay

Nov. 27, 2007 -- In a letter to the leadership of the Senate Finance and the House Ways and Means Committees, the IRS Oversight Board voiced "grave concerns about the serious risks to the 2008 filing season if legislation to change the Alternative Minimum Tax (AMT) is delayed."

"The Oversight Board believes the Treasury Department and IRS are both committed to doing what they can to mitigate the effects of possible AMT tax law changes. However, there is a limit to actions they can take," the Board says in its letter.

Should legislation be enacted, the IRS must re-program and thoroughly test its systems before it can process electronic and paper tax returns. This process will take approximately seven weeks, according to the IRS. The Oversight Board estimates that a late filing season start date of January 28, 2008, will result in $17 billion in delayed refunds, while a February 18, 2008, filing season start date will result in $87 billion of delayed refunds.

The letter also points out that a large number of delayed tax returns could be especially troublesome if some taxpayers who have been filing electronically revert to paper filing. An influx of paper returns will drive up the cost of processing and delay refunds.

The letter concludes by urging Congress to take quick action to mitigate the risks of AMT changes to taxpayers. "Although it is difficult to quantify the exact impact with certainty, the risks are high and the effect on taxpayers is potentially very burdensome," the Board states.

© Copyright 2007 SmartPros Ltd.

Sunday, November 25, 2007

IRS Tiene $110 Millones en Cheques de Reembolso que Buscan un Hogar

IR-2007-189SP, 14 de noviembre 2007

Washington - El Servicio de Impuestos Internos (IRS) está buscando a 115,478 contribuyentes quienes tienen cheques de reembolso sumando cerca de $110 millones que fueron regresados al IRS por el servicio postal.

Los cheques de reembolso de un promedio de $953, pueden ser reclamados tan pronto los contribuyentes actualicen su dirección con el IRS. Algunos contribuyentes tienen más de un cheque esperando.

“Los contribuyentes no deben perder la oportunidad de obtener su dinero”, dijo Richard Morgante, Comisionado de la División de Salarios e Inversiones. “El IRS hace el proceso lo más sencillo posible para que los contribuyentes actualicen sus direcciones y reclamen sus reembolsos”.

La herramienta en ¿Dónde está mi reembolso? permite a los contribuyentes revisar el estado de sus reembolsos. Un contribuyente debe proporcionar su número de seguro social, estado civil tributario y la cantidad del reembolso que aparece en su declaración de 2006. La herramienta dará el estado su reembolso y en algunos casos provee instrucciones para resolver problemas de entrega.

Los contribuyentes pueden usar una versión telefónica de ¿Dónde está mi reembolso? llamando al 1-800-829-1954. Continuar->

PMI may be tax deductible

Federal government allows tax break for private mortgage insurance.

If you obtain a new home loan with private mortgage insurance in 2007, you might be able to deduct the cost of the insurance on your 2007 federal income tax return. The rules are just as complicated as most other tax laws, so you should consult a qualified tax professional for guidance on your individual situation.

What is PMI?
Private mortgage insurance (PMI) protects the lender from the risk that you might default on your home loan. As the borrower, you pay the PMI premiums. PMI is purchased through a private company, unlike government-related mortgage insurance, which is obtained though an agency such as the Federal Housing Administration. Lenders generally require mortgage insurance if your down payment or existing equity is less than 20 percent of the appraised value of your home.

Who benefits from tax deduction?
If you and your spouse file a joint tax return and have adjusted gross income (AGI) of no more than $100,000 or if you file an individual tax return and have AGI of no more than $50,000, you may be able to deduct 100 percent of the PMI you paid in 2007. You'll need to itemize your tax deductions to take advantage of this benefit.

There is no cap on the amount of paid PMI that you can deduct; however, the deduction is reduced by 10 percent for each additional $1,000 of AGI. That means if you and your spouse file a joint tax return and have AGI of $100,000 to $110,000 or if you file an individual return and have AGI of $50,000 to $55,000, you may be able to take a partial deduction.

The deduction is allowed for both purchase-money and refinance mortgages, but there is a gray area as to whether PMI paid for the cash-out portion of a refinance would be deductible. If you obtain a refinance loan with cash out and PMI in 2007, you'll need to consult a tax professional for advice.

Your lender or loan servicer might report the annual amount of PMI you paid to you on the same year-end form that's used to report annual mortgage interest or another form. This report is required only if the total PMI is more than $600.

Rethink piggyback or PMI equation
The PMI deduction is allowed only for mortgages that close between Jan. 1 and Dec. 31, 2007, and is effective only for the 2007 tax year, unless the federal government renews the law for subsequent years.

This limited duration complicates the question of whether a single mortgage with PMI may be more preferable than two mortgages in a "piggyback" structure.

If the PMI deduction isn't extended, you may still benefit from the two-loan option, or if you want to bank on the odds that the deduction will be extended, you may want to factor that expectation into your decision.

Either way, individual circumstances such as how long you plan to keep your mortgage and own your home, your ability to qualify for two loans, the purpose and type of your second loan, and your personal tolerance for risk, among other factors, may be more important than the tax benefit of the PMI deduction. Be sure to weigh all of the relevant factors before you make your decision. Continue->

Saturday, November 24, 2007

Impuesto Sobre el Ingreso del Trabajo por Cuenta Propia

Por lo general usted debe pagar impuestos sobre el ingreso del trabajo por cuenta propia si recibio ingresos netos mayores que la cantidad especificada por ley. Generalmente los ingresos netos del trabajo por cuenta propia representan 92.35% de su ganancia neta. La ganancia neta se calcula restando los gastos ordinarios y necesarios de una ocupación o negocio del total de su ingreso bruto del trabajo por cuenta propia. Para este fin usted trabaja por su cuenta si es propietario único de un negocio, es un contratista independiente, miembro de una sociedad colectiva, o trabaja por su cuenta de alguna otra manera. Puede estar obligado a pagar impuesto sobre el ingreso del trabajo por cuenta propia aún si está recibiendo beneficios del Seguro Social.

Year-end planning to lighten your load at tax time

As the year-end approaches, chances are you're thinking more about holiday celebrations than tax planning and preparation.

But there are measures you can take before your business' fiscal year ends that may lighten your load come tax time, experts say. Now is the time to plan, before it's too late. CONTINUE->

Friday, November 23, 2007

¿Dónde se Puede Reportar Actividad Fraudulenta de Impuestos?

Si sospecha o tiene conocimiento de que un individuo o corporación no está cumpliendo con la ley de impuestos, usted debe reportar esa actividad. El reportar una actividad sospechosa o fraudulenta se puede hacer por teléfono, a través del correo, o visitando la oficina local de IRS.

Para reportar actividades sospechosas de fraude contributivo, llene la Forma 3949-A o escriba una carta que contenga información similar, y envíela por correo al Internal Revenue Service, Fresno, CA 93888.

Por correo: Comunicación escrita puede enviarse a las direcciones que aparecen en:

A Letter from IRS You Do Not Want

A Letter from IRS You Do Not Want: New Auditing Initiative Promises to Be Grueling

Nov. 9, 2007 (The Philadelphia Inquirer) -- A very selective national lottery is under way, and you better hope your number does not come up. Continue->>

Co-Founder of "Institute of Global Prosperity" Guilty of Tax Fraud

Nov. 12, 2007 (SmartPros) -- David Alan Struckman, co-founder of the "Institute of Global Prosperity" -- an organization that sold audiotapes, CD's and tickets to offshore seminars on "wealth-building" strategies -- was found guilty in a federal court of tax evasion and conspiracy to defraud the United States. Continue->>

Thursday, November 22, 2007

El Congreso está fallando en cumplir sus responsabilidades

'El AMT fue diseñado para asegurar que los ricos paguen su parte justa en impuestos, pero cuando el Congreso aprobó el AMT hace décadas, no llevaba un índice para inflación. Como resultado, la carga tributaria más elevada del AMT está incidiendo en un número cada vez mayor de familias de clase media', explicó.

Why Your Tax Refund Will Be Late

Habitual congressional gridlock usually has no impact on the lives of ordinary Americans. But what happened on the Senate floor last Friday just before lawmakers left for their Thanksgiving break will delay tax refunds next year for some 50 million taxpayers who count on them.

House bill to fix tax mess is doomed

You may not have heard of the AMT - many haven't - but forget all those horrors that recently haunted Halloween movie and TV screens. AMT is the real thing - a monster that's about to eat you up. Well, a lot of you anyway.

The Alternative Minimum Tax is a great idea gone woefully wrong from neglect. It was enacted in 1969 to make sure the hyper rich, no matter how many dodgy tax lawyers and accountants they laid on, would pay at least something into the common coffers. Here, at last, was a tax that would still be there after every deduction and asset razzle-dazzle had been figured in.

Trouble is, creeping inflation has been slowly lowering the effective threshold. The AMT already snags 4 million upper-echelon taxpayers who were never intended for its grasp and 23 million upper-middle-class earners could fall prey next year if Congress doesn't intervene.
Continue ->

Wednesday, November 21, 2007

Only 39 Shopping Days for Year-End Tax Planning

(Nov. 21, 2007)
By Blake Christian, CPA, MBT

Unfortunately, since December 31 coincides with the tax-reporting period for 99 percent of U.S. individual taxpayers, the average taxpayer will only begin thinking about their 2007 taxes during the first quarter of 2008. Unfortunately, this delay is generally very costly, since almost every individual taxpayer reports taxable income on a cash basis, as opposed to an accrual basis.

In order to minimize tax liabilities, it is necessary to pay certain expenses before year-end in order to claim them as tax deductions. It is also important for taxpayers to determine if they are in an alternative minimum tax position, which can change the entire year-end tax-planning strategy. Continue ->

Justice Dept. Sues to Shut Down San Diego-Area Tax Prep Firm

Justice Dept. Sues to Shut Down San Diego-Area Tax Prep Firm
The United States has sued the operators of a San Diego-area tax prep firm, asking a federal court to permanently bar them from preparing tax returns for others, the Justice Department announced.

Small Biz Tax Planning May Be Complex
Many small business owners meeting with their accountants this month and next may find that year-end tax planning and projections for 2008 are a little more complicated than usual because of the uneasy economy.

Estado de su reembolso - California

Verifique el estado de su reembolso del año 2006 para California. Por favor espere 7 días después de que usted e-file. Si usted hizo sus impuestos en papel, por favor permita 8 semanas para procesar su declaración. Espere el tiempo indicado antes de comenzar.

  • Su número de seguro social.
  • Su domicilio completo. Si su dirección ha cambiado desde que entrego su declaración, por favor llamenos al (800) 852-5711.
  • La cantidad del reembolso que aparece en su declaración de impuesto.
  • Un navegador (browser) que soporta 128-bitio (bit) SSL codificación (encryption).

Tuesday, November 20, 2007

¿Necesito declarar impuestos?

Un individuo debe declarar impuestos si su ingreso bruto o su ingreso bruto ajustado (AGI) fue más de la cantidad definida por la ley. Residentes de California deben tomar en cuenta el total de los ingresos brutos globales para determinar el requisito de declarar.

Residentes por Parte del Año deben declarar impuestos si tienen cualquier ingreso tasado por California (el cual incluye ingresos de todas las fuentes mientras fue residente e ingresos con fuentes en California mientras fue un no-residente), y sus ingresos de todas las fuentes son más que las cantidades requeridas para declarar para los residentes.

No-residentes deben declarar impuestos si tienen cualquier ingreso con fuentes en California y sus ingresos de todas las fuentes son más que las cantidades requeridas para declarar para los residentes.

Social Security Contribution and Benefit Base

The Social Security Administration has announced that the contribution and benefit base for remuneration paid in 2008 and self-employment income earned in tax years beginning in 2008 is $102,000. The "old law" contribution and benefit base for 2008 is $75,900. The "old law" base is used by the Railroad Retirement program to determine certain tax liabilities and tier II benefits, by the Pension Benefit Guaranty Corporation to determine the maximum amount of pension guaranteed under ERISA, and by the Social Security Administration to determine a year of coverage in computing certain benefits. Further, the minimum amount a domestic worker must earn so that such earnings are covered under Social Security or Medicare is $1,600 for 2008.

Monday, November 19, 2007

Tax Refunds May Be Delayed Due to Congress

Tax Refunds May Be Delayed Due to Congress - More News

Nov. 16, 2007 (Associated Press) -- The tax-filing season may be off to a shaky start even before it officially begins.

Internal Revenue Service officials warn that millions of people may face delays in having their returns processed next year and getting billions of dollars in refunds. The problem: Congress still hasn't approved temporary relief for many people from the alternative minimum tax, or AMT, a parallel system that operates under many different rules than the regular system.

Some lawmakers predict Congress probably won't take action until next month. If so, that could spell major trouble, Treasury and IRS officials warn. That's because it takes time for the IRS to reprogram its computerized processing systems to reflect last-minute changes made in Congress, says Terry Lemons, an IRS spokesman. How long? "Up to 10 weeks after the bill is signed into law," he says. "The AMT is not simple, and these are not simple changes to our systems."

"As we look at the upcoming 2007 filing season, the potential exists for us to see a problem of greater magnitude than anything we have faced in the past," said Linda Stiff, the IRS's acting commissioner. In a recent speech, she warned that the processing of as many as 50 million returns "would be delayed."

Last week, the House passed a wide-ranging bill that includes temporary AMT relief. Although the bill is viewed as must-pass legislation, it includes other items that aren't expected to be accepted by the Senate, and President Bush has vowed to veto the bill in its current form. Thus, the final legislation is expected to be significantly different than the House version.

About four million people had higher tax bills for 2006 because of the AMT. That number would jump to about 25 million people for the 2007 tax year if Congress doesn't pass a relief bill. Among those most likely to be caught by the AMT are people with large families who live in high-tax areas, especially New York City.

Congressional delays could affect people who file on paper as well as the growing numbers of people who file electronically. A record 57 percent of all federal income-tax returns filed earlier this year for the 2006 tax year were zapped electronically to the IRS. That was up from 36 percent in 2002.

If the problem sounds familiar, that's because it is. Last year, Congress waited until December to extend several popular tax provisions that had expired at the end of 2005. Among these was the option to deduct state and local sales taxes, instead of state and local income taxes, as long as you itemized your deductions. Lawmakers resurrected this provision and others, and President Bush signed the bill into law on Dec. 20.

But congressional action didn't come until well after the deadline for the IRS to send its 2006 materials to the printer. As a result, claiming those deductions became unusually tricky, one of the reasons many people eligible for the sales-tax deduction didn't claim it, according to a government report.

"What we're facing with the AMT this year is of much greater magnitude" than last year's headaches, says Mr. Lemons of the IRS. "It's a far greater number of taxpayers" who may be affected, and "the delays in being able to file could potentially be much longer."

What's more, "millions of other taxpayers not involved in AMT returns may also have their refunds delayed because of the backlog in processing other returns," says Ms. Stiff, the acting IRS commissioner.

"We are worried," says Tom Ochsenschlager, vice president, taxation at the American Institute of Certified Public Accountants. Congress "is really putting the IRS in a box on this issue. That's going to make a lot of taxpayers upset."

While taxpayers who owe money typically wait until April to file and pay, millions of people fire off their returns early each year in order to get their refunds. An IRS spokesman says more than 54 million returns had been filed through March 2 of this year. About two-thirds of all taxpayers typically get refunds each year. The average refund this year was more than $2,200.

Makers of popular tax-preparation software, including Intuit Inc.'s top-selling TurboTax, say their 2007 versions will go on sale in retail stores soon. Naturally, the TurboTax versions will be based on current law, not on estimates of what Congress might do. But TurboTax officials say their computer systems are fast enough to make online changes soon after Congress decides what, if anything, to do. Still, that won't do tax filers much good if they're waiting for their refund early next year and the IRS system isn't yet ready to process their return.


THE HOUSE VOTES to extend a tax break for many older taxpayers.

Under current law, people who are 70 1/2 or older can transfer as much as $100,000 this year directly from an individual retirement account to qualified charities without getting hit by income taxes on that money. The transfer counts toward that person's minimum required distribution requirement.

Charities say many people have taken advantage of this provision, which is set to expire at the end of this year.

The House voted to extend the provision through the end of 2008.


SOCIAL SECURITY taxes will rise again next year for many workers.

The maximum amount of earnings subject to Social Security tax will rise to $102,000 from $97,500 for 2007.

An estimated 164 million workers will pay Social Security tax next year. Of those, nearly 12 million, or 7 percent, will pay higher taxes as a result of the higher taxable maximum.

© Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Lawsuit says Block 'cartel' for electronic tax filing fees

Valley Tax Office

Subprime Woes and Credit Market Turmoil Bring Down Financial Executives' Confidence in the Economy
Optimism about the economy among CPAs serving as senior-level executives plunged in the fourth quarter to its lowest level in three years, according to the latest Business and Industry Economic Outlook Survey of the AICPA.

Revised Charges Filed in KMPG Tax Shelter Case
A former partner at the accounting firm KPMG pleaded not guilty to a fresh indictment in a two-year-old case over questionable tax shelters.

Requisitos Revisados Para Solicitar un ITIN

  • ¿Cuáles son los requisitos revisados para solicitar un
  • ¿Porqué el IRS está cambiando el proceso de aplicar
    por el ITIN?
  • ¿Cuáles documentos son aceptables como prueba de
    identidad y estado de extranjero?

Lawsuit says Block and others act as 'cartel' for electronic tax filing fees

Kansas City Star (MO) (KRT) via NewsEdge Corporation :

Nov. 16--A lawsuit filed Tuesday alleges a partnership between the IRS and private companies, including H&R Block Inc., has charged taxpayers excessive fees for providing "free" electronic tax filing services.

The lawsuit was filed in federal court in Philadelphia and seeks class-action status. It says the partnership, known as the Free File Alliance, is a "cartel" that has failed to set electronic filing fees according to federal law.

The suit alleges that cartel members "illegally reaped hundreds of millions, if not billions, of dollars in revenues" at the expense of taxpayers who have filed their returns electronically.

The suit names the Free File Alliance, Block and Block unit Block Digital Tax Solutions LLC, as well as Block software rival Intuit Inc., as defendants.

On Thursday, Tim Hugo, executive director of the Free File Alliance, said the suit was "totally without merit."

"This suit is so riddled with inaccuracies, you would think it was written by a first-year law student," he said.

Linda McDougall, a spokeswoman for Block, said the company had not reviewed the lawsuit yet and declined to comment.

The Free File Alliance program, now in its fifth year, is a partnership between the Internal Revenue Service and some 20 tax software companies designed to provide free electronic filing of tax returns. The alliance says that 15.4 million returns have been filed under the program since 2003 and that 70 percent of all taxpayers -- 95 million Americans -- are eligible to use it.

According to the IRS' Web site, taxpayers who earned $54,000 or less in 2007 are eligible to use Free File beginning in mid-January 2008. Taxpayers can access the service through

Once there, filers are notified that they are leaving the IRS site and being taken to the Web site of the company they have picked. The IRS warns filers that by going directly to a company's Web site and not through, they may be charged a fee for the preparation and filing of their returns.

The Free File program has come under criticism before.

In November 2006, then-Senate Finance Committee Chairman Charles Grassley, an Iowa Republican, and ranking member Max Baucus, a Montana Democrat, told then-IRS Commissioner Mark Everson that the IRS had made the program "inaccessible, complicated and otherwise frustrating for taxpayers."

Earlier, Grassley had urged the IRS to rein in commercial offers made by alliance members. In a letter to Everson he said that an "underlying principle of the Free File Alliance is that no one should be forced to pay to electronically file a tax return. That principle has been and continues to be eroded."

And this year, a government audit found that common tax scenarios were not always handled accurately and that multiple calculation errors were made by the commercial software of Free File Alliance companies. The IRS disagreed with the audit's recommendation that it should test the software for tax code compliance, saying that would be all but impossible.

In response to the criticisms, Hugo said Thursday that the IRS' own surveys showed that more than 90 percent of taxpayers who availed themselves of e-filing would use it again.

He also said he had removed offers for Refund Anticipation Loans and other commercial products in the free-file network.

Alan M. Feldman, a Philadelphia attorney who represents the named plaintiff in the lawsuit, Philadelphia physician Stacie Byers, said that 95 million Americans may be eligible to file their returns free of charge, but fewer than 4 million last year actually used the program.

"Seventy-five million more did e-file," he said, "but they were all charged by H&R Block, Intuit and all the other members of the so-called Free File Alliance. In other words, the best evidence I have is that about 96 percent of all e-filers have been charged to file."

Feldman said that tax preparation software companies organized the Free File Alliance out of concern "that the IRS was going to do what every other civilized Western democracy has done, and that is to permit citizens to file their tax returns for free, electronically."

He alleged that the companies cut a deal with the IRS under which they agreed to allow free electronic filing for income-eligible filers in exchange for the exclusive right to charge everyone else and for the IRS not to compete with them.

The suit alleges that Free File Alliance members have ignored a federal law that requires them to set fees based on the cost of electronic filing to the government, "its value to taxpayers, the public policy or interest served, and other relevant facts."

"Despite that legal requirement, the cartel and its members instead set their fees based solely on their private business consideration and market power as the gatekeepers to the IRS," the complaint states.

To reach Dan Margolies, call 816-234-4481 or send e-mail to


Starting, Operating, or Closing a Business

Starting a Business
Starting a business could be exciting. If you're considering starting a business, start here. This section provides information on everything from a checklist for a new business, to selecting a business structure, and more.

Operating a Business
This section contains information you need to operate your business. Learn about operating a business with employees, business expenses and tax credits, filing and paying taxes, recordkeeping, and choosing an accounting method.

Closing a Business
There is more involved in closing your business than just locking the doors. This section provides procedures for getting out of business, including what forms to file and how to handle additional revenue received or expenses you may incur.

Sunday, November 18, 2007

IRS Has $110 Million in Refund Checks Looking for a Home

IR-2007-189, Nov. 14, 2007

WASHINGTON — The Internal Revenue Service is looking for 115,478 taxpayers who are due refund checks worth about $110 million after the checks were returned as undeliverable.

The refund checks, averaging about $953, can be claimed as soon as taxpayers update their addresses with the IRS. Some taxpayers have more than one check waiting.

“Taxpayers should not miss out on getting their money back,” said Richard Morgante, commissioner of the IRS Wage and Investment Division. ”The IRS makes it as easy as possible for taxpayers to update their addresses and claim their refunds.”

The “ Where’s My Refund?” tool on enables taxpayers to check the status of their refunds. A taxpayer must submit his or her social security number, filing status and amount of refund shown on their 2006 return. The tool will provide the status of their refund and in some cases provide instructions on how to resolve delivery problems.

Ayuda para Víctimas de los Incendios en California

El Servicio de Impuestos Internos (IRS) proporciona información de ayuda para victimas de los incendios en el Sur de California.

Donating securities -- especially if they're shares you got from your grandmother when you were 20 and they've leaped in value in the 30 years since -- also allows the donor to avoid paying taxes on large capital gains. In the case of securities donations, the fund sells the shares and places the money into the investment pool chosen by the giver.

"What you may have is, you're approaching year-end, and from an income standpoint, it's been a good year, and you're in a very high tax bracket," said David L. Giunta, president of Fidelity Charitable Gift Fund. "You're philanthropically inclined. You know you want to give away money. It's a great time to give, but you may not be sure of all the organizations you want to give to. You can have it invested in one of the pools and then make the decisions."

7 year-end tax-saving moves

Congress may be taking its time to protect you from the AMT, but that doesn't mean you can't make some last-minute moves to reduce your tax bill.

1. Re-energize your house

If you were thinking of going green in your home, you've got about a month left to do so and still get credit for it. That's because two key energy tax credits are scheduled to expire at the end of this year. A credit is a dollar-for-dollar reduction of your tax bill.

You can reduce your tax bill by up to $500 if you install insulation, windows, doors or central air conditioning that meet certain energy conservation standards.

You also can take a credit up to $2,000 if you install a solar-powered hot water system or solar photovoltaic panels, which convert sunlight into electricity.

There are constraints on how much you can take for any one type of installation (e.g., no more than $200 for windows), so check here for the specifics.

2. Cut your capital gains tax

With all the punishing volatility in stocks this year there's a good chance you've got some capital losses in your taxable investment accounts that you could take to offset any capital gains you've realized this year.

Your losses can offset 100 percent of your capital gains plus up to another $3,000 in ordinary income. If you have losses beyond that you can carry them forward to use on future tax returns.

One caveat, though: your loss will be disallowed if you reinvest in the same stock or fund that you sold within 30 days before or after the sale.

3. Maximize savings tax breaks

While it's never too late to start saving, it can be too late if you want your contribution to count as deductible for a given tax year.

You have until Dec. 31 to make a 2007 tax-deferred contribution to your 401(k) -- that will reduce your adjustable gross income and therefore your tax bill. The maximum contribution you may make this year is $15,500 (or $20,500 if you're 50 or older).

When it comes to deductible IRAs, to which you may contribute up to $4,000 this year, you will have until April 15, 2008 to both set up the IRA (if you haven't already done so) and make your 2007 contribution. (Check here to see if you qualify to make deductible contributions to an IRA.)

If you're self-employed and want to set up a profit-sharing Keogh plan, you must do so by Dec. 31. But you will have until your tax return due date (which may be as late as Oct. 15, 2008) to make a contribution and have it count for 2007. The maximum you may contribute is 100 percent of compensation or $45,000, whichever is less.

If you have a Simplified Employee Pension (SEP) IRA, you have until the due date of your tax return to both set up the account and make your 2007 contributions, which can't exceed $45,000.

If you need added incentive to save, you may qualify for an income tax credit up to $2,000 for your IRA or workplace retirement plan contributions. The saver's credit, as it's called, is available to taxpayers whose adjusted gross incomes are $25,000 or less for single filers, or $50,000 or less for married couples filing jointly.

4. Time your bonuses and investment gains

There are times when it makes sense for tax purposes to either defer or accelerate taking income or selling an investment.

Generally speaking, if you're in a high tax bracket it may reduce your tax bite if you postpone some income to next year. That's because the income ranges that apply to each tax bracket go up with inflation annually, so more of your income will be taxed in 2008 at lower rates.

The kinds of payments you might consider postponing: a bonus or payment of bills from your clients if you run a small business. In order for it to be considered 2008 income, the checks must be issued in 2008. If you get a check in 2007 and just don't deposit it, it will still count as 2007 income.

For retirees planning to take large distributions from their IRAs, it may make sense to take part in December and part in January. By doing so, "you may avoid moving to a higher tax bracket in either year, and keep more of your Social Security benefits from being taxed as well," said Mark Luscombe, CCH's principal federal tax analyst, in a statement.

On the other hand, there are cases when it may pay to take more of your income this year. For instance, if you're planning to sell some appreciated stocks or funds and you have a good chance of being in the 10 percent or 15 percent tax bracket next year if you take more income this year, you'll enjoy a 0 percent capital gains and dividend rate in 2008.

5. Time your deductions

If your last 2007 property tax bill is due in January, opting to pay it in December will boost your deductions for this year, unless you're subject to the Alternative Minimum Tax, which disallows deductions for property taxes. You also might consider making an extra mortgage payment this year since you can deduct the extra interest.

The same principle applies to any other itemized deductions such as charitable contributions, job-related deductions or medical procedures (if you think your medical costs for the year will exceed 7.5 percent of your adjustable gross income).

6. Mind the aging kiddie

The kiddie tax governs how a child's capital gains, dividends and interest are taxed. A portion (currently the first $850) is tax free, another portion (currently the next $850) is taxed at the child's tax rate (typically 5% to 10%), and anything beyond that threshold is taxed at the parents' (typically higher) rate.

The kiddie tax still applies only to those under 18. But starting next year, it will snare an older group -- specifically, those under 19 or to full-time students under 24 who don't earn enough to pay for at least half their support.

So if your children are between 19 and 23 this year and are in the 15 percent tax bracket or less, they might do better to sell some of their appreciated assets now because their capital gains and dividend rate is only 5 percent. If they wait until next year, they'll once again be subject to the kiddie tax, and a portion of their gains and dividends may be subject to your tax rates.

7. Make charitable contributions

Generosity is a tax-deductible event.

If you make a cash donation, you have to substantiate it with a letter or receipt from the organization, a cancelled check or a bank statement showing the donation. Any documentation must include the name of the charitable organization as well as the date and amount of the contribution.

If you donate clothes or household items, you can only take the deduction if they are in good condition.

If you give appreciated property, you often may deduct the full market value. To top of page

Tax writers to IRS: We promise AMT fix

Tax-break tug-of-war on tap

Friday, November 16, 2007


Valley Tax Office

La Casa Blanca
Hoy en la Casa Blanca.


"El portal oficial en español del Gobierno de los EE.UU

La Agencia Federal Para el Desarrollo de la Pequeña Empresa (SBA)
Información para asistir a los propietarios de pequeños negocios.

Administración del Seguro Social
Información del Seguro Social en español.

Departamento de Hacienda de Puerto Rico

Información sobre aspectos contributivos en Puerto Rico.

Inmigración y Ciudadanía
Información Sobre Inmigración y Ciudadanía

Agencia Federal para el Manejo de Emergencias (FEMA)

Información sobre beneficios y asistencia a víctimas de desastres.

Los enlaces de a FirstGov en español harán posible que la comunidad de habla hispana tenga acceso a información oficial y servicios del Gobierno en su idioma sobre temas importantes tales como empleo, educación, inmigración, protección al consumidor y salud, entre muchos otros

State's Top Income Tax Debtors Posted Online

From: Valley Tax Office

Suit Alleges that Tax Companies Overcharge for E-Filing

A Philadelphia woman is seeking class action status for a lawsuit accusing H&R Block, Intuit and other tax software makers of overcharging consumers who pay to file their taxes online.

Tax Refunds May Be Delayed Due to Congress
The tax-filing season may be off to a shaky start even before it officially begins.

Tax Changes that affect you.

Recursos Para Pequeñas Empresas
El IRS les ofrece a los contribuyentes con negocio una variedad de recursos para ayudarle a tener éxito en su empresa.

Private Equity Tax Could Remedy AMT Pain

Nearly everyone agrees that Congress needs to quickly pass legislation to stop an unintended quirk in an old law from raising middle-class tax bills -- especially now that American households are struggling to contend with a slowing economy and a nasty downturn in the housing market.

Issued by the Board of Equalization - Betty T. Yee Announces Tax Assistance Available to Wildfire Victims

State's Top Income Tax Debtors Posted Online

Public Disclosure Aimed at Reducing Tax Gap

The Franchise Tax Board (FTB) today posted the names of the largest state income tax debtors to its website at All 224 taxpayers whose names appear on the list were notified of the posting last month.

"Each year, California loses more than $6.5 billion in unpaid taxes,” said State Controller and FTB Chair John Chiang. “This list represents more than $249 million owed that should be used in providing all Californians with services at the state and local levels. Hopefully, this action will encourage these taxpayers to come forward, pay what they owe, and quickly help the Franchise Tax Board remove their names from the list.”

Last year’s Assembly Bill 1418 (J. Horton) requires the FTB to list the 250 largest state income tax debtors who owe more than $100,000 in tax. The law excludes taxpayers whose debts are being paid through installments, appealed, litigated, or involved in bankruptcy proceedings.

Taxpayers can have their information removed from the website by paying the amounts in full, or obtaining an approved installment agreement. FTB will update its list annually.

Individual taxpayers who receive the Notice of Public Disclosure letter indicating their information may be posted should contact FTB at (866) 418-3702. Business taxpayers should call (866) 914-5594.

The Board of Equalization has a similar list of the state’s top sales and use tax delinquencies.

Editors Note: View the Largest State Income Tax Delinquencies List