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IRS targeting improper employee "tool plans"

2008-02-20T17:10:00.000-05:00

Employee Tool & Equipment Alert

Employee Tool and Equipment Plans, sometimes called Service Technician’s Tool Reimbursement Plans, that purport to receive tax-favored treatment as “accountable plans” are under investigation.

These plans are widely marketed to various industries that employ workers who are required to provide their own tools. Under the faulty plans, employers avoid employment and related taxes by incorrectly treating amounts paid for tools as non-taxable wages.

Employers that claim unwarranted tax benefits from plans that do not qualify for tax favored treatment are being identified for examination.

These plans are widely marketed to various industries, including the automotive, heavy equipment, construction, aircraft maintenance, agriculture, and other industries. Taxpayers that are considering implementing such a plan are advised to take a cautious approach.

You can read more about this alert here or contact Dennis Burbridge, CPA to discuss its direct impact on your specific situation.

FBI Director: Mortgage Fraud Substantial

2008-02-04T10:55:00.000-05:00

AP Online via NewsEdge Corporation :

HONOLULU_FBI Director Robert Mueller said Thursday that the agency is committed to investigating and prosecuting companies involved in mortgage fraud and other violations in connection with home loans made to risky borrowers.

Mueller said probes were being conducted across the country, including in Hawaii, where he stopped on his way back from a trip through Asia.

"There is not a state that does not have some investigation," he told reporters at the FBI office in Honolulu. "It is a substantial problem but we've been through problems like this in the past."

The FBI said Tuesday it was working with the Securities and Exchange Commission to investigate 14 companies, from mortgage lenders to investment banks, for possible accounting fraud, insider trading or other issues connected to subprime mortgage lending.

Mueller declined to identify the companies.

The FBI allocated substantial manpower and resources to address the savings and loan crisis in the early 1990s and corporate fraud earlier this decade, and Mueller said he was prepared to do the same to address fraudulent lenders.

"I anticipate that we will see the same extensive investigations that we saw then with successful prosecutions following those investigations," Mueller said.

As the nation's housing crisis worsens, there has been a dramatic spike in the number of mortgage fraud cases under investigation. An FBI spokesman said 1,210 such cases are open, up from roughly 800 a year ago.

The bureau is looking into the practices of so-called subprime lenders, as well as potential accounting fraud by financial firms that hold subprime loans on their books or securitize them and sell them to other investors.

During his trip to Asia, Mueller met Chinese officials in charge of security for this summer's Olympic Games in Beijing. He also was in Cambodia to inaugurate an FBI office at the U.S. Embassy in Phnom Penh.

AP Online -- 02/04/08

3 million will have to wait until Feb. for refunds, IRS says Agency cites late fix to alternative minimum tax

2007-12-31T19:56:00.000-05:00

Rocky Mountain News via NewsEdge Corporation :

More than 3 million people will have to wait until February to get their tax refunds because of Congress' late fix to the alternative minimum tax, the IRS said Thursday.

Congress put a one-year freeze on growth of the alternative minimum tax last week, shielding many middle- and upper-middle income taxpayers from first exposure to the tax.

But Congress' late action means the Internal Revenue Service won't be able to start processing five AMT-related forms until February, delaying potential refunds for those people until that month.

Between 3 million and 4 million people filed in January of last year using those forms, with many of those people expecting a refund, the IRS said.

The average refund in 2007 was $2,324, the agency said.

"We regret the inconvenience the delay will mean for million of early tax filers, especially those expecting a refund," acting IRS Commissioner Linda Stiff said.

As many as 13.5 million people will have to wait until Feb. 11 to start filing with the five AMT-related forms, but the IRS said filing patterns show only between 3 million to 4 million of those people file during the early tax season anyhow.

The IRS was able to reprogram its computers to begin accepting the seven other AMT-related forms when the tax season opens in early January.

The tax packages that will start arriving in the mail beginning after New Year's Day were printed in November.

However, that was before the fixes to the AMT were approved by Congress.

The alternative minimum tax was passed in 1969 and was aimed at about 155 very wealthy families who used deductions to avoid paying any federal income tax.

The AMT disallows certain deductions and credits.

It was not adjusted for inflation and has hit a growing number of middle-income taxpayers.

More than 4 million were subject to it in the 2006 tax year.

Without the congressional fix, more than 20 million families would have been faced with an extra $2,000 tax hit on average.

INFOBOX

IRS forms

* Five forms not available:

Form 8863, Education Credits

Form 5695, Residential Energy Credits

Form 1040A's Schedule 2, Child and Dependent Care Expenses for Form 1040A Filers

Form 8396, Mortgage Interest Credit

Form 8859, District of Columbia First-Time Homebuyer Credit

* Seven of 12 AMT-related forms are available now at www.irs.gov

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

2007-11-14T21:25:00.000-05:00

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 IRS.gov 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.

Taxpayers can access a telephone version of “Where’s My Refund?” by calling 1-800-829-1954.

Poker Tournament Winnings Must be Reported to the IRS

2007-10-22T21:05:00.000-04:00

Poker Tournament Winnings Must be Reported to the IRS

IR-2007-173, Oct. 19, 2007

WASHINGTON — Starting next year, casinos and other sponsors of poker tournaments will be required to report most winnings to winners and the Internal Revenue Service, according to the IRS.
The new requirement, which goes into effect on March 4, 2008, was contained in guidance released Sept. 4 by the Treasury Department and the IRS. The guidance is designed to clear up confusion about the tax reporting rules that apply to poker tournaments. In recent years, some casinos and players have been confused over whether poker tournament sponsors who hold the money for participants in a poker tournament are required to report the winnings to the IRS and withhold tax on the winnings.

For tournaments completed during 2007 and before March 4, 2008, casinos and other sponsors of poker tournaments will not be required to report the winnings to the IRS or withhold tax on the winnings. But beginning March 4, 2008, the IRS will require all tournament sponsors to report tournament winnings of more than $5,000, usually on an IRS Form W-2G.

Tournament sponsors who comply with this reporting requirement will not need to withhold federal income tax at the end of a tournament. If any tournament sponsor does not report the tournament winnings, the IRS will enforce the reporting requirement and also require the sponsor to pay any tax that should have been withheld from the winner if the withholding requirement had been asserted. The withholding amount is normally 25 percent of any amounts that should have been reported.

So that tournament sponsors can comply with this requirement, tournament winners must provide their taxpayer identification number, usually a social security number, to the tournament sponsor. If a winner fails to provide this identification number, the tournament sponsor must withhold federal income tax at the rate of 28 percent.

The IRS reminds tournament winners that, by law, they must report all their winnings on their federal income tax returns. This rule applies regardless of the amount and regardless of whether the winner receives a Form W-2G or any other reporting form. This is true for 2007 and earlier years, and will continue to be the case after the new reporting requirement goes into effect.

It’s That Time of Year - Year End Tax Planning

2007-10-22T13:54:00.001-04:00

It’s That Time of Year - Year End Tax Planning

September is over and summer is just a memory. Now we enter autumn, a particularly beautiful, sometimes dreary, time of year that brings its own special feeling. With tree leaves moving from their summertime green to bright oranges, reds & yellows just before they fall and the weather turning cooler….well, the truth is that between Mother Nature’s autumn show, and Halloween ushering in the holiday season, there is much to distract us. While those distractions can be wonderful, don’t let them keep you from the business of minimizing what you pay to Uncle Sam.

The next three months mark the last quarter of the year - and your last chance to take steps to minimize your tax liability for 2007. Use the time wisely. This article is intended to remind you of some of the things you can do the rest of 2007 to reduce your tax bill.

Income

Of course, the way you reduce your income tax burden is to reduce your taxable income. It should come as no surprise then that decreasing your gross income will aid you in achieving that goal.

Delaying billing at year-end is a classic way for cash basis taxpayers to reduce taxable income. People who run businesses that extend credit can delay sending the last billing of 2007 until it’s virtually certain your customer(s) will not be able to get the payment to you by December 31.

If you use this technique, remember that your customers may need tax deductions of their own. Try and time your billings to allow them to write a last minute check and put it into the mail to you on December 31. That way, both you and your customer(s) are happy. One thing you should not do is instruct a customer to pay in 2008 when they otherwise would have paid in 2007. In certain circumstances, if you have the ability to receive payment but do not, the income may be includible in 2007.

Selling assets at a loss may be another possibility for you. Many taxpayers have racked up some healthy gains from stock market and mutual fund activities this year. Offsetting realized gains by selling stocks with a loss in them is a great way to reduce taxable income - and assets with a loss that is permanent are prime candidates. Remember, the asset you sell need not be a stock if you are trying to cover a gain on a stock sale. Any capital loss can offset your current year capital gains.

Beware of wash sale rules. If you sell a stock and then repurchase it within 30 days, the tax code will treat the sale as if it did not occur, negating the loss.

Be extremely careful when purchasing mutual funds in the latter part of the year. Mutual funds typically make distributions of capital gains earned throughout the year in December. Since the assets created by the capital gains are held in the mutual until year end, they increase the net assets of the fund. When you pay the net asset value at the time of purchase, you are essentially buying and paying tax on someone else’s capital gain income. Look very carefully at any mutual funds you are thinking of buying to avoid this costly error.

Do you have some cash that needs to remain relatively liquid, but needs to be invested in an interest-bearing account? If so, consider putting the cash in a short-term certificate of deposit that does not pay interest until 2008. You put off the taxable income while still keeping the money available on short notice.

If you are negotiating the sale of an asset, and the sale must occur in 2007, consider selling the property on an installment basis. By taking only a portion of the sales price in 2007, and the remainder in 2008, you can defer payment of the tax for a full year.

Before we leave the subject of income, remember: there are times that you might actually want to accelerate income. Say you took a huge business loss in 2007 but, as a result, expect 2008 to be a much better year. If your 2008 plans include taking significant gains on asset sales, or receiving money from a significant sale, you may want to ‘zero out’ the business loss by accelerating what would otherwise be 2008 income. It is possible that, by doing so, you will keep yourself in lower tax brackets in both years, which will reduce your tax bill.

Expenses

If you calculate income on a cash basis and operate as either a sole proprietor or as a pass-through entity (partnership, S Corporation, trust), consider paying all your bills before December 31, 2007. Cash basis taxpayers take a deduction only when the expense is paid. You can do so by check or, if necessary, credit card.

One very important point to bear in mind is that you don’t want to incur an expense just to get a deduction. At the very best, an expenditure of $100 will only save you $35 in federal tax. You will still be out-of-pocket by $65. Incur only those expenses that you would have paid under normal circumstances.

Don’t forget the option to expense certain fixed assets that you buy and place in service before the end of 2007. Again, the purchased equipment should be something you planned to acquire anyway and buying it in 2007 is simply accelerating a needed purchase. Cash basis taxpayers must either pay the full purchase price in 2007 or borrow money from an entity that is not the seller. If you let the seller finance your purchase, you will only be able to expense or depreciate the equipment as you make payments on the loan. The maximum amount you can expense in 2007 is $112,000.

Is now the time to set up a retirement plan for your employees? If you establish a retirement plan in 2007, any employer contributions will be due just before you file your tax return. Think about that! You get the deduction in 2007, but the cash goes out in 2008.

From a personal standpoint, don’t forget itemized deductions. Now is the time to estimate your total itemized deductions. If it does not appear that your deductions will exceed your standard deduction (amount the government assumes you will spend and which is allowed as a deduction from adjusted gross income), consider holding off on incurring any more itemized deductions to the extent you can. Paying in 2008 may allow you to “bunch” deductions. This is a technique where you combine two years’ deductions into one year, making them eligible for use as itemized deductions in one of those years. The savings can be substantial.

Conclusion

This has been a short, fast trip down ‘Tax Planning Lane’. It’s not an exhaustive list of your options because a proper evaluation of your options requires that all facts about your tax situation are known. Give us a call, or drop by, and let’s discuss your particular circumstances. We can help you minimize your tax bite for 2007.

Happy Halloween!

These articles are intended to provide resources for the tax and accounting needs of small businesses and individuals. The information contained in this Website is intended to provide general information on matters of interest in the areas of tax and accounting. Users are encouraged to contact us regarding specific situations

Special Web Section Unveiled for Homeowners Who Lose Homes; Foreclosure Tax Relief Available to Many

2007-09-18T15:19:00.000-04:00

IR-2007-159, Sept. 17, 2007

WASHINGTON — The Internal Revenue Service unveiled a special new section today on IRS.gov for people who have lost their homes due to foreclosure. The IRS also reassured homeowners that, although mortgage workouts and foreclosures can have tax consequences, special relief provisions can often reduce or eliminate the tax bite for financially strapped borrowers who lose their homes.
The new section of IRS.gov includes a variety of information, including a worksheet designed to help borrowers determine whether any of the foreclosure-related relief provisions apply to them. For those taxpayers who find they owe additional tax, it also includes a form they can use to request a payment agreement with the IRS. . In some cases, eligible taxpayers may qualify to settle their tax debt for less than the full amount due using an offer-in-compromise.

The IRS urges struggling homeowners to consider their options carefully before giving up their homes through foreclosure.

Under the tax law, if the debt wiped out through foreclosure exceeds the value of the property, the difference is normally taxable income. But a special rule allows insolvent borrowers to offset that income to the extent their liabilities exceed their assets.

The IRS cautions that under the law, relief may be limited or unavailable in some situations where, for example, part or all of a home was ever used for business or rented out.

Borrowers whose debt is reduced or eliminated receive a year-end statement (Form 1099-C) from their lender. By law, this form must show the amount of debt forgiven and the fair market value of property given up through foreclosure. Though the winning bid at a foreclosure auction is normally a property’s fair market value, it may not necessarily reflect its true value in some cases.

The IRS urges borrowers to check the Form 1099-C carefully. They should notify the lender immediately if any of the information shown on their form is incorrect. Borrowers should pay particular attention to the amount of debt forgiven (Box 2) and the value listed for their home (Box 7).

The IRS also reminds lenders of their obligation to provide accurate information on the Form 1099-C. By law, the lender must send a copy of this form to the IRS. IRS follow-up contacts with taxpayers involved in foreclosure are based largely on the information reported on this form, and whether it conflicts with information provided by the taxpayer on their federal income tax return.

The IRS normally initiates these follow-up contacts by sending the borrower a notice. The tax agency urges borrowers with questions to call the phone number shown on the notice. The IRS also urges borrowers who wind up owing additional tax and are unable to pay it in full to use the installment agreement form, normally included with the notice, to request a payment agreement with the agency.

Need professional assistance? Contact Dennis Burbridge CPA

Back-to-School Tax Breaks Help Teachers

2007-09-11T13:44:00.001-04:00

Back-to-School Tax Breaks Help Teachers Pay
Classroom Costs; Aid Parents, Students With College Tuition

WASHINGTON — With the new school year now under way, the Internal Revenue Service today reminded teachers, parents and students that saving receipts and keeping good records can help them take advantage of various education-related deductions and credits on their 2007 federal income tax return.

“The start of the school year is a good time to remind parents, students and teachers to save all receipts related to tax-advantaged education expenses,” said IRS Acting Commissioner Linda Stiff. “Good recordkeeping makes sense because it can help avoid missing a deduction or credit at tax time.”

Deductions reduce the income on which tax is figured. Credits reduce the overall tax. Though both can lower a person’s year-end tax bill or increase their refund, credits normally result in greater tax savings.

The educator expense deduction allows teachers and other educators to deduct the cost of books, supplies, equipment and software used in the classroom. Eligible educators include those who work at least 900 hours during a school year as a teacher, instructor, counselor, principal or aide in a public or private elementary or secondary school.

Worth up to $250, the educator expense deduction is available, whether or not the educator itemizes their deductions on Schedule A. In tax-year 2005, teachers and educators deducted just over $893 million of these out-of-pocket classroom expenses. Under current law, this deduction is scheduled to expire at the end of this year.

Three key tax breaks—the tuition and fees deduction, the Hope credit and the lifetime learning credit—help parents and students pay for the cost of post-secondary education. All three are available, regardless of whether an eligible taxpayer itemizes their deductions. Under current law, the tuition and fees deduction is scheduled to expire at the end of this year, but the two credits remain in effect. In tax-year 2005, taxpayers claimed tuition and fees deductions totaling nearly $11 billion and education credits of almost $6.2 billion.

Normally, a taxpayer can claim tuition and required enrollment fees paid for their own and their dependent’s college education. A taxpayer cannot take both an education credit and the tuition and fees deduction for the same student in the same year. Income limits and other special rules apply to each of these provisions. Education credits are claimed on Form 8863, and the tuition and fees deduction for 2007 will be claimed on new Form 8917.

IRS Publication 970, Tax Benefits for Education, can help eligible parents and students understand the special rules that apply and decide which tax break to claim. The publication also describes other education-related tax benefits, including qualified tuition programs (also known as 529 plans), the student loan interest deduction, Coverdell education savings accounts and the education savings bond program.

Increase in Federal Minimum Wage Will Not Reduce 45B Credit

2007-09-05T23:11:00.000-04:00

Issue Number: IR-2007-155

Washington — Employers should be aware of two changes to the credit for the portion of employer Social Security paid with respect to employee cash tips known as the 45B Credit. These changes are the result of recently enacted legislation.

The law now requires employers to determine their credit using the minimum wage in effect on January 1, 2007 even if the minimum wage increases. Therefore, in 2007, when the federal minimum wage did increase to $5.85 from $5.15 per hour, employers will still use the $5.15 rate to determine their credit to compute their allowable credit for tips reported for services performed after Dec. 31, 2006.

The 45B Credit allows employers in the food and beverage industry to claim a credit for the Social Security and Medicare taxes the employers pay on their employees' tip income. The credit equals the Social Security and Medicare taxes the employer paid on the tips received by the employees. However, no credit is given for tips used to meet the federal minimum wage rate.

Employers claiming the credit must reduce their Social Security and Medicare tax deduction accordingly. Eligible employers should use Form 8846, Credit for Employer Social Security and Medicare Taxes Paid on Certain Employee Tips, to claim the credit.

The new law also allows the employer to use the 45B credit to offset alternative minimum tax. Previously, the credit could only be used against the regular tax. This offset is available for 45B credits for taxable years beginning after Dec. 31, 2006.

Related Item: Credit for Portion of Employer Social Security Paid with Respect to Employee Cash Tips (IRC 45 B Credit)

IRS Warns Taxpayers of New E-mail Scams

2007-08-27T18:35:00.000-04:00

Updated Aug. 24, 2007 — The Internal Revenue Service today warned taxpayers of a new phishing scam, in which an e-mail purporting to come from the IRS advises taxpayers they can receive $80 by filling out an online customer satisfaction survey. The IRS urges taxpayers to ignore this solicitation and not provide any requested information. The IRS does not initiate contact with taxpayers through e-mail.

Phone Customers Can Still Request Excise Tax Refund, IRS Says

2007-08-21T20:09:00.000-04:00

WASHINGTON — Telephone customers can still request this year’s one-time excise tax refund, according to the Internal Revenue Service.

Most phone customers, including most cell-phone users, qualify for the refund. The refund covers the three-percent tax paid on long-distance and bundled service. It can add $30 to $60 — or even more — onto a taxpayer’s refund. So far this year, 92.1 million taxpayers, 71.6 percent of all individual tax return filers, have requested telephone tax refunds totaling $4 billion.

Eligible phone customers can request the refund on their 2006 income-tax return. This includes those who haven’t filed yet or those who obtained a tax-filing extension earlier this year.

People who don’t need to file a regular income-tax return can use a special short form — Form 1040EZ-T— to request the refund. Individuals with low income, including many senior citizens, may qualify to use this special form.

The government stopped collecting the long-distance excise tax last August after several federal court decisions held that the tax does not apply to long-distance service as it is billed today. The tax continues to apply to local-only phone service.

Federal officials also authorized a one-time refund of the three-percent tax collected on long-distance or bundled service billed after Feb. 28, 2003, and before Aug. 1, 2006. Bundled service is local and long-distance service provided under a plan that does not separately list the charge for local service.

Bundled service includes, for example, phone plans that provide both local and long-distance service for either a flat monthly fee or a charge that varies with the time for which the service is used. It is the type of service provided by many cell-phone companies.

If you paid the tax and haven’t filed yet, here are some tips to help you figure the refund correctly and get it quickly:

Consider using the standard-refund amount. About 99 percent of returns requesting the telephone-tax refund are choosing the standard amount. Though the standard amount is optional, it is easy to figure and approximates the eligible amount for most telephone customers. You only have to fill out one line on your return, and you don’t need to present proof to the IRS. The standard amount, ranging from $30 to $60, is based on the number of exemptions you can claim on your return. If you can be claimed as a dependent on someone else’s return, you cannot use the standard amount.
If you paid more than the standard amount, you may figure your refund using the actual amount of tax shown on your phone bills and other records. Base your refund request on the three-percent federal tax paid, not the total phone bill. Do not count tax paid on local-only service. You must have the phone bills or other records adequate to support the amount you are requesting. These documents should not be sent along with the refund request but should be retained in case the IRS questions the amount requested.
If you’re not sure whether you paid the tax, check the portion of your telephone bill that relates to long-distance or bundled service. Service providers use a number of different terms to identify the tax. Phrases to look for include: English-language phone bills -- Federal, Federal Excise 3%, Federal Excise @ 3%, Federal Excise Tax, Federal Tax, Fed Excise Tax and FET; Spanish-language phone bills -- Impuesto Indirecto Federal and Impuesto federal. Typically, this federal tax amount is not combined with any other tax or surcharge on a customer's bill. In other words, it is normally shown as a separate line item.
Do not file duplicate requests. If you file a regular income-tax return, do not file Form 1040EZ-T. Designed exclusively for requesting the telephone-tax refund, this simple form is for people who don’t need to file a regular income-tax return. If you want to take advantage of the retirement savers credit or earned income tax credit for low and moderate income workers, the child tax credit or other tax breaks, file a regular return and include your telephone-tax refund request on that return.
If you already filed your return but failed to request the telephone-tax refund, you can file an amended return using Form 1040X. This form, available on IRS.gov, cannot be e-filed; it must be filed on paper. To avoid delaying a refund request, mail your completed Form 1040X at least three weeks after you filed your original return (if it was e-filed) or at least eight weeks later (if filed on paper).
File electronically. Electronic-filing software flags often overlooked tax breaks, such as the telephone-tax refund, and helps you figure them accurately and report them properly. If you use a professional tax preparer, ask that person to e-file your return.
E-file for free. If your income is $52,000 or less, use the Free File link on IRS.gov to connect to a private-sector company offering free e-file services.
Choose direct deposit. Whether you file electronically or on paper, you can get your refund at least a week sooner by having it deposited directly into your checking or savings account.
Stay away from tax preparers who falsely claim that many, if not most, phone customers can get hundreds of dollars or more back under this program.

2007-04-18T17:33:00.000-04:00

IRS Gives Northeast Storms Victims Until April 26 to File Tax Returns

IR-2007-92, April 18, 2007

WASHINGTON — Taxpayers affected by the major storm that hit the Northeastern United States April 16 now have until Thursday, April 26 to file their tax returns, the Internal Revenue Service said today.

Earlier this week, the IRS gave taxpayers directly impacted by the storm an additional two days beyond the April 17 deadline to meet their tax filing obligations without incurring late filing and payment penalties. After further assessment of conditions across the region affected by the April 16 storm, the IRS has decided to allow affected taxpayers an additional seven days to fulfill their tax filing obligations.

Power outages and public transportation problems made it impossible in some cases for some taxpayers and tax professionals to meet the April 17 filing deadline.

Affected taxpayers can mark their paper tax returns with the words “April 16 Storm.” Taxpayers who e-file their returns can use their software’s “disaster” feature, if available.

This news release supercedes IR-2007-89.

IRS Gives April 16 Storm Victims Additional 48 Hours to File Income Tax Returns

2007-04-16T23:33:00.000-04:00

IRS Gives April 16 Storm Victims Additional 48 Hours to File Income Tax Returns

IR-2007-89, April 16, 2007

WASHINGTON — Victims of the major storm affecting several Northeastern states on Monday, April 16 will have two additional days to file their tax returns beyond the April 17 tax deadline, the Internal Revenue Service announced today.

Taxpayers directly impacted by the storm have until midnight April 19 to meet their tax filing obligations without incurring late filing and payment penalties.

Across the Northeast, there have been power outages and public transportation problems making it difficult in some cases, if not impossible, for some taxpayers and tax professionals to meet the April 17 filing deadline.

“Because this unusually forceful storm hit within 24 hours of the filing deadline, we are giving affected taxpayers 48 additional hours,” IRS Commissioner Mark W. Everson said.

Affected taxpayers can mark their paper tax returns with the words “April 16 Storm.” Taxpayers who e-file their returns can use their software’s “disaster” feature, if available.

need last minute assistance? dburbcpa is there for you

Taxpayers Have Until April 17 to File and Pay

2007-01-25T23:41:00.000-05:00

IR-2007-15, Jan. 24, 2007

WASHINGTON — Taxpayers across the nation will have until Tuesday, April 17, 2007, to file their 2006 returns and pay any taxes due, the Internal Revenue Service announced today.
Taxpayers will have extra time to file and pay because April 15 falls on a Sunday in 2007, and the following day, Monday, April 16, is Emancipation Day, a legal holiday in the District of Columbia.

“This year, taxpayers have additional time to file and pay beyond the traditional April 15 deadline,” said IRS Commissioner Mark W. Everson. “As we always do, we encourage taxpayers to get an early start on their taxes to make sure they have plenty of time to accurately prepare their return.”

This means the entire country has an April 17 deadline. Previously, the April 17 deadline applied just to individuals in the District of Columbia and six eastern states who are served by an IRS processing facility in Massachusetts, where Patriots Day will be observed on April 16.
The April 17, 2007 deadline will apply to any of the following:

2006 federal individual income tax returns, whether filed electronically or on paper.
Requests for an automatic six-month tax-filing extension, whether submitted electronically or on Form 4868.
Tax year 2006 balance due payments, whether made electronically (direct debit or credit card) or by check.
Tax-year 2006 contributions to a Roth or traditional IRA.
Individual estimated tax payments for the first quarter of 2007, whether made electronically or by check.
Individual refund claims for tax year 2003, where the regular three-year statute of limitations is expiring.

Most taxpayers will not have to change their plans in response to this announcement. Three out of four individual filers get refunds. Typically, returns claiming refunds are filed early in the tax season.

By law, filing and payment deadlines that fall on a Saturday, Sunday or legal holiday are timely satisfied if met on the next business day. Under a federal statute enacted decades ago, holidays observed in the District of Columbia have impact nationwide on tax issues, not just in D.C. Under recently-enacted city legislation, April 16 is a holiday in the District of Columbia. Officials recently became aware of the intersection of the national filing day and the local observance of the new Emancipation Day holiday after most forms and publications for the current tax filing season went to print.

Even with the extra time, taxpayers can skip the last-minute rush and avoid needless mistakes by filing early, taking advantage of the speed and convenience of electronic filing, choosing direct deposit for any refunds and paying any taxes due by direct debit or credit card. IRS.gov has further details on electronic filing and payment options and links to companies providing these services.

How does this impact your personal financial scenario? Contact dburbcpa and find out.

IRS: Do Not Claim Old Phone Tax Refund

2007-01-25T23:38:00.000-05:00

IRS: Do Not Claim Old Phone Tax Refund
(AP) WASHINGTON

The Internal Revenue Service warned Thursday that it will take prompt action against taxpayers and preparers who claim improperly large refunds from a discontinued telephone tax.

The IRS said early filings indicated some taxpayers are requesting "large and apparently improper amounts" for the one-time refund from the long-distance excise tax that the government stopped collecting last August.
"People requesting an inflated amount will likely see their refunds frozen, may have their entire tax returns audited and even face criminal prosecution where warranted," IRS Commissioner Mark Everson said.

The agency said some taxpayers appeared to be asking for refunds of their entire phone bills rather than for the 3 percent tax on long-distance and bundled service they are entitled to. Others were making requests for thousands of dollars, indicating they had phone bills of more than $100,000.

The government has authorized a refund of tax collected on service billed during the period from March 2003 to July 2006. The IRS has urged taxpayers to request a standard refund amount ranging from $30 to $60, based on the number of exemptions they claim. It said no documentation is needed for the standard amount, which approximates the eligible amount for most taxpayers.

Everson said the tax agency will aggressively pursue tax preparers and promoters who make improper requests. He said audits will be sent out and investigators will visit tax preparers filing for questionable telephone tax refunds. The agency urged taxpayers to stay away from unscrupulous preparers who make false claims about the phone tax refund.

IRS PROBLEMS? GET HELP contact dburbcpa

Tax Benefits for Armed Forces Members

2007-01-10T03:06:00.000-05:00

The Military Family Tax Relief Act of 2003 has various benefits related to military service. Several earlier tax law provisions gave breaks to those serving in combat areas. Tax Information for Members of the U.S. Armed Forces has links to these details and more.To determine how these benefits impact your specific circumstances visit dburbcpa.com

Vehicle costs help push mileage deduction higher

2006-11-02T22:54:00.000-05:00

Vehicle costs help push mileage deduction higher

MarketWatch via NewsEdge Corporation :

SAN FRANCISCO (MarketWatch) -- The standard mileage-rate deduction for business-related driving in 2007 will return to the record high of 2005, the IRS announced Wednesday.
The 2007 rate will be 48.5 cents per mile, up from 44.5 cents in 2006.
That matches the record-high rate in effect for the final four months of 2005.
Usually the IRS adjusts the mileage rate once per year, but in 2005 it raised the rate a whopping 8 cents at mid-year, the steepest one-time hike eve, because of the steep rise in gasoline prices created in part by Hurricane Katrina.
Fuel prices are again a factor in the IRS' decision to raise the rate, the tax agency said.
"The primary reasons for the higher rates were higher prices for vehicles and fuel during the year ending in October," the agency said in a press release.
The standard mileage deduction is limited to companies using four or fewer vehicles. For larger companies ineligible to take the deduction, the IRS standard mileage figure is widely used as a benchmark in setting reimbursement rates for employees' driving expenses.
To determine the mileage rate, the IRS hires an independent researcher, Runzheimer International, to analyze driving costs, including fuel prices, car maintenance and registration.
For miles driven for medical or moving purposes, the standard mileage rate will rise to 20 cents per mile in 2007, from 18 cents a mile in 2006.
The altruistic will find no added relief: The rate for driving related to charitable purposes, a rate set by Congress, remains at 14 cents a mile.

See the full IRS press release on 2007 rates.

For more information on current standard mileage rates, contact Dennis Burbridge CPA and visit his site at www.dburbcpa.com
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IRS Announces Standard Amounts for Telephone Tax Refunds

2006-09-18T16:06:00.000-04:00

IRS Announces Standard Amounts for Telephone Tax Refunds

IR-2006-137, Aug. 31, 2006

WASHINGTON — The Internal Revenue Service today announced the standard amounts that most long-distance customers can use to figure their telephone tax refund. These amounts, which range from $30 to $60, will enable millions of individual taxpayers to request the telephone tax refund without having to dig through old phone bills.

In general, anyone who paid the long-distance telephone tax will get the refund on their 2006 federal income tax return. This includes individuals, businesses and nonprofit organizations. The 2006 return is usually filed during 2007.

The standard amounts are based on the total number of exemptions claimed on the 2006 federal income tax return. The standard amounts are $30 for a person filing a return with one exemption, $40 for two exemptions, $50 for three exemptions and $60 for four or more exemptions. For example, a married couple filing a joint return with two dependent children (for a total of four exemptions) will be eligible for the maximum standard amount of $60.

“The easiest way for eligible taxpayers to get their money back is to use the standard amounts,” said IRS Commissioner Mark W. Everson. “These amounts save taxpayers from locating 41 months of old phone bills and analyzing these bills to determine the taxes paid. We believe the standard amounts are both reasonable and fair.”

To get the standard amount, eligible taxpayers only need to fill out one additional line on their regular 2006 return. The IRS is creating a special short form (Form 1040EZ-T) for those who don’t need to file a regular return.

The standard amounts are based on actual telephone usage data, and the standard amount applicable to a family or other household reflects the long-distance phone tax paid by similarly sized families or households. Those who paid the long-distance tax on service billed after Feb. 28, 2003 and before Aug. 1, 2006 are eligible for a refund.

Only individuals can use the standard amounts. Alternatively, individual taxpayers can choose to figure their refund using the actual amount of tax paid.

Details on requesting the telephone tax refund will be included in all 2006 tax return materials and on irs.gov.

Though businesses and nonprofits must base their telephone tax refund on the actual amount of tax paid, the IRS is looking for ways to make the refund process easier for these taxpayers. The IRS is considering an estimation method businesses and nonprofits may use for figuring the tax paid.

"Businesses and nonprofits generally have more varied usage patterns than individuals do," Everson said. "We've met with a number of business and nonprofit groups to understand their concerns, and we plan to continue to work with them to come up with a reasonable method for estimating telephone excise tax refund amounts."

For further information and to determine how this will effect your personal situation, contact Dennis Burbridge, CPA

IRS Renews E-mail Alert Following New Scams

2006-07-07T19:10:00.000-04:00

IRS Renews E-mail Alert Following New Scams

IR-2006-104, July 7, 2006

WASHINGTON — Following a recent increase in scam e-mails, the Internal Revenue Service reminded taxpayers to be on the lookout for bogus e-mails claiming to be from the tax agency.

The IRS saw an increase in complaints in recent weeks about these e-mails, which are designed to trick the recipients into disclosing personal and financial information that could be used to steal the recipients’ identity and financial assets.

“The IRS does not send out unsolicited e-mails asking for personal information,” said IRS Commissioner Mark W. Everson. “Don’t be taken in by these criminals.”

The IRS has seen a recent increase in these scams. Since November, 99 different scams have been identified, with 20 of those coming in June – the most since 40 were identified in March during the height of the filing season.

Many of these schemes originate outside the United States. To date, investigations by the Treasury Inspector General for Tax Administration have identified sites hosting more than two dozen IRS-related phishing scams. These scam Web sites have been located in many different countries, including Argentina, Aruba, Australia, Austria, Canada, Chile, China, England, Germany, Indonesia, Italy, Japan, Korea, Malaysia, Mexico, Poland, Singapore and Slovakia, as well as the United States.

The current scams claim to come from the IRS, tell recipients that they are due a federal tax refund, and direct them to a Web site that appears to be a genuine IRS site. The bogus sites contain forms or interactive Web pages similar to IRS forms or Web pages but which have been modified to request detailed personal and financial information from the e-mail recipients. In addition, e-mail addresses ending with “.edu” — involving users in the education community — currently seem to be heavily targeted.

The IRS does not send out unsolicited e-mails or ask for detailed personal information via e-mail. Additionally, the IRS never asks people for the PIN numbers, passwords or similar secret access information for their credit card, bank or other financial accounts.

Tricking consumers into disclosing their personal and financial information, such as secret access data or credit card or bank account numbers, is fraudulent activity which can result in identity theft. Such schemes perpetrated through the Internet are called “phishing” for information.

The information fraudulently obtained is then used to steal the taxpayer’s identity and financial assets. Typically, identity thieves use someone’s personal data to empty the victim’s financial accounts, run up charges on the victim’s existing credit cards, apply for new loans, credit cards, services or benefits in the victim’s name and even file fraudulent tax returns.

When the IRS learns of new schemes involving use of the IRS name or logo, it issues consumer alerts warning taxpayers about the schemes.

The IRS also has established an electronic mailbox for taxpayers to send information about suspicious e-mails they receive which claim to come from the IRS. Taxpayers should send the information to: phishing@irs.gov.

More than 7,000 bogus emails have been forwarded to the IRS, with nearly 1,300 forwarded in June alone.

The IRS’s mail box allows taxpayers to send copies of possibly fraudulent e-mails involving misuse of the IRS name and logo to the IRS for investigation. Instructions on how to properly submit one of these communications to the IRS may be found on this Web site. Enter the term "phishing" in the search box in the upper right hand corner. Then open the article titled “How to Protect Yourself from Suspicious E-Mails” and scroll through it until you find the instructions. Following these instructions helps ensure that the bogus e-mails relayed by taxpayers retain critical elements found in the original e-mail. The IRS can use the information, URLs and links in the bogus e-mails to trace the hosting Web sites and alert authorities to help shut down these fraudulent sites.

However, due to the volume the mailbox receives, the IRS cannot acknowledge receipt or reply to taxpayers who submit their bogus e-mails. The phishing@irs.gov mailbox is only for suspicious e-mails and not for general taxpayer contact or inquiries.

For information on preventing or handling the aftermath of identity theft, visit the Federal Trade Commission’s consumer (http://www.consumer.gov/idtheft/index.html) and OnGuardOnLine (http://onguardonline.gov/index.html) Web sites. Click on "Topics" to find the identity theft and phishing areas on OnGuardOnLine.

For information on identity theft prevention and victim assistance in relation to tax administration, visit the IRS Identity Theft Web page on the IRS.gov Web site. Enter the term "identity theft" in the search box in the upper right hand corner.

For schemes other than phishing, please report the fraudulent misuse of the IRS name, logo, forms or other IRS property by calling the Treasury Inspector General for Tax Administration’s toll-free hotline at 1-800-366-4484.

Longer Mortgages May Cost More in Long Run

2006-06-02T01:52:00.000-04:00

Longer Mortgages May Cost More in Long Run
AP Online via NewsEdge Corporation :

NEW YORK_When it comes to home mortgages, some people are thinking really long term by taking 40-year or 45-year _ or even 50-year _ loans.

The attraction is lower monthly payments, which make these mortgages more manageable for some families. The disadvantage is that consumers can end up paying much more interest over the life of the loan than they would with a traditional 30-year mortgage.

Only a handful of lenders currently are writing 40- to 50-year mortgages, but experts believe others will follow if they prove popular with home buyers.

Among the consumers looking at a 50-year mortgage is Larisa Meyer, 35, who is buying a 100-year-old home in Minneapolis.

Meyer, a self-employed graphic artist, said it's important to her to keep her monthly mortgage payment low because her income can be irregular. At the same time, she doesn't want an exotic mortgage, such as an interest-only loan, because she wants to build equity in her new home.

"A big part of selecting a 50-year mortgage is the payment size," Meyer said. "I also know that in a few years, I will have some equity. It won't be a ton, but there will be some."

Still, consumers should be forewarned that most of the longer-term mortgages do not have a fixed interest rate like many 30-year mortgages do.

The loan Meyer is considering carries an interest rate of 6.5 percent for the first five years, and then the rate can be adjusted annually, said Eric Pirius, a loan officer at River City Mortgage & Financial in Eagan, Minn., who is working with Meyer. It also requires a "balloon payment" of the outstanding balance after 30 years, although the presumption is that most mortgage holders will have refinanced long before that.

"I haven't talked to a client yet who intends to hold a mortgage for 50 years," Pirius said. "But that low payment helps people qualify. It gets them into that home and getting the tax benefits of ownership."

He calculated that a consumer who took out a $250,000 mortgage at 6.5 percent for a 30-year term would pay about $1,580 per month. That mortgage on a 50-year payment schedule would require monthly payments of about $1,410 _ a savings of about $170 a month.

Some housing experts are skeptical that the 40- to 50-year mortgages will be widely used.

Keith T. Gumbinger, vice president of HSH Associates, a mortgage information service based in Pompton Plains, N.J., said 40-year mortgages have come in and out of favor, last gaining some popularity in the mid-1980s when interest rates were so high many consumers didn't qualify for loans.

The major drawback of the longer-term mortgages, he believes, is that "equity builds extremely slowly" so that there's little advantage compared with interest-only loans.

And, he said, a consumer could end up spending a lot more in interest payments.

For comparison purposes, Gumbinger calculated the cost of mortgages of various lengths with a fixed rate of interest: On a $275,000 mortgage for 30 years at a fixed rate of 6.75 percent, a consumer would make monthly payments of $1,783.64 and pay $367,112 in interest over the life of the loan. That same mortgage at the likely higher rate of 7 percent for a 40-year term would require monthly payments of $1,708.93 and result in $545,290 in interest. At 7.25 percent for 50 years, monthly payments would be $1,707.45 and total interest would be $749,476.

"You really can't think of these as long-term financing vehicles because the interest cost is overwhelming," Gumbinger said.

Anthony Hsieh, chief executive officer of LendingTree, an online mortgage marketplace based in Charlotte, N.C., said he believed some lenders were promoting 40- and 50-year mortgages "to stir up some excitement" as interest rates have risen and cooled the housing market.

Hsieh said he didn't know of any lenders offering 50-year mortgages with the rate fixed for the entire term.

"They call it a 50-year, but the rate generally is fixed for only five or 10 years and they use a 50-year amortization table," he said. This configuration, he said, makes the longer term mortgages look more like 5-1 hybrid loans, which have fixed rates of interest for the first five years then start adjusting, or to some of the interest-only mortgages.

All of these mortgages, he noted, appeal to many of today's buyers "because they look at monthly payment and cash flow as their only objective" when selecting a mortgage.

___

On the Net:

http://www.dburbcpa.com/mtge1.htm

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Contact Dennis Burbridge, CPA - Loan Officer Affiliate for a no cost, no obligation consultation and prequalification.

TOYOTA AND LEXUS VEHICLES CERTIFIED FOR NEW ENERGY TAX CREDIT

2006-04-25T21:15:00.000-04:00

TOYOTA AND LEXUS VEHICLES CERTIFIED FOR NEW ENERGY TAX CREDIT

WASHINGTON — The Internal Revenue Service has acknowledged the certification by Toyota Motor Sales U.S.A., Inc. that the Toyota Camry Hybrid and Lexus GS 450h Model Year 2007 vehicles qualify for the hybrid tax credit enacted by the Energy Policy Act of 2005. The tax credit for hybrid vehicles applies to vehicles purchased on or after January 1, 2006, and may be as much as $3,400 for those who purchase the most fuel-efficient vehicles.

The hybrid vehicle certifications recently acknowledged by the IRS and their credit amounts are:

2007 Toyota Camry Hybrid $ 2,600
2007 Lexus GS 450h $ 1,550

Starting in 2006, this tax credit replaces the tax deduction of $2,000, which was previously allowed for taxpayers who purchased a new hybrid vehicle before December 31, 2005 for the clean-burning fuel deduction. The tax credit requires a different certification. Many currently available hybrid vehicles may qualify for this new tax credit.

Consumers seeking the credit may want to buy early since the full credit is only available for a limited time. Taxpayers may claim the full amount of the allowable credit up to the end of the first calendar quarter after the quarter in which the manufacturer records its sale of the 60,000th vehicle. For the second and third calendar quarters after the quarter in which the 60,000th vehicle is sold, taxpayers may claim 50 percent of the credit. For the fourth and fifth calendar quarters, taxpayers may claim 25 percent of the credit. No credit is allowed after the fifth quarter.

More information on hybrid vehicles and other alternative motor vehicles can be found on the IRS’s web site at: www.irs.gov.

NSA Finds Average Cost of Professional Tax Return

2006-03-09T23:00:00.000-05:00

How much should it cost for a professional accountant to do your taxes? The National Society of Accountants (NSA) found the answer. It surveyed 1,371 accountants nationwide to find out the mean cost of preparing a variety of tax returns.

FOR PROFESSIONAL SERVICES AT VALUE FEES CONTACT dennis@dburbcpa.com

For example, NSA found the mean cost of preparing a non-itemized Form 1040 to be $110 For an itemized Form 1040 with Schedule A, the cost is $201.

Where you live can make a difference in the fee you pay. For example, accountants in the Midwest charge a mean of $96 (non-itemized Form 1040) and $163 (itemized Form 1040), while those in the Northeast, South, and West charge between $111- $116 for a non-itemized return and between $205- $226 for an itemized return.

"Independent accountants who belong to NSA provide an important service to millions of taxpayers each year, and this survey helps consumers understand the typical rates for tax preparation services," said NSA President Wanda Samek, a principal in the Denton, Texas accounting firm of Custom Business Service, Inc. "Tax laws grow more complex every year, and NSA offers a range of educational programs to keep our members current on the latest changes so they can provide the best possible service to clients."

The mean cost for preparing other types of tax returns includes:

$165 for a Form 1040 Schedule E (Rental)
$207 for a Form 1040 Schedule F (Farm)
$477 for a Form 1065 (Partnership)
$640 for a Form 1120 (Corporation)
$624 for a Form 1120S (S Corporation)
$386 for Form 1041 (Fiduciary)
$1,732 for Form 706 (Estates)
$449 for Form 990 (Tax Exempt)

The survey also found that taxpayers are increasingly choosing to file returns electronically, a service that most accountants offer. More than 70 percent of all returns that can be filed electronically are submitted that way -- up more than 20 percent over the last three years. The average fee for this service is $23.

Hourly fees for accountants to provide tax services average $109, while hourly fees for estate and financial planning average $123.

Like most other services, tax preparation fees are increasing. NSA reports that accountants raised their tax preparation fees 6.5 percent in 2005, and expect fees to rise 6.8 percent in 2006.

NSA and its affiliates represent 30,000 members.

FOR PROFESSIONAL SERVICES AT VALUE FEES CONTACT dennis@dburbcpa.com

TAXES: H&R Block blunder begs questions

2006-02-27T17:44:00.000-05:00

TAXES: H&R Block blunder begs questions

Miami Herald via NewsEdge Corporation :

Call it a gift to late-night television comedians.

But marketing experts say a $32 million tax mistake by H&R Block could drive away potential customers, and that would be no laughing matter for the nation's largest tax preparer.

"For a firm like H&R Block, credibility is of paramount importance," said James McAlexander, an Oregon State University marketing professor who has looked at how professional services providers appeal to consumers. "If the H&R Block story becomes fodder for late night television, where they become the butt of the joke, that could affect their credibility with prospective clients."

Shares of Kansas City-based H&R Block fell $2.18, or almost 9 percent, to close at $23.01 Friday on the New York Stock Exchange. The company on Thursday reported a 68 percent drop in third-quarter profits, and executives told analysts that they were lowering their earnings expectations for the year.

The company also said it was restating earnings for 2005 and 2004 and the first two quarters of this year after discovering it had made a mistake in determining its state income tax rates.

Analysts didn't seem too concerned that the gaffe could persuade potential H&R Block tax customers to take their business to independent accountants or competitors, like Parsippany, N.J.-based Jackson Hewitt Tax Service.

"Given what goes on with stocks, it's understandable for companies to have to go back sometimes and restate earnings," said Mike Millman, analyst with Soleil Securities/Millman Research. "What's important is operations."

On that front, Millman said he's far more concerned about H&R Block's report that through the first month-and-a-half of the U.S. tax season, the company has seen 4.1 percent fewer clients than a year ago. The company has attributed some of the loss to a series of technical glitches at the beginning of the year that drove an estimated 250,000 potential customers elsewhere.

"There are some questions about the future of the paid preparer part of their business," said Millman, who doesn't own H&R Block shares. "Whether [the decline in clients] was a bump in the road or a trend is unclear."

DIFFERENT RETURNS

In truth, it's much more complicated to work up the tax burden of a company that took in $4.4 billion in revenue last year operating more than 11,000 tax offices across the country, in addition to providing mortgage lending, investment advice and business accounting services, than it is to complete the return of an average individual taxpayer.

"We have advised our field offices that there's no relation between what goes on in preparing the individual tax returns and the corporate returns," said H&R Block spokesman Nick Iammartino.

In addition, customers who don't follow financial news may never even know about the restatement. But that could change if the ironic nature of a tax preparer getting its taxes wrong goes before a wider audience.

DISTURBING NEWS

Jeff Swystun, global director of Interbrand Corp., a New York-based branding and design consultant, said he was disturbed by the news that California Attorney General Bill Lockyer sued the company last week over its use of refund anticipation loans.

But he thinks the company, with a trusted brand, will be able to weather the storm.

"Consumers will eventually make a separation between their corporate situation and their history of providing quality and decent service," Swystun said. "It's a story of short interest but I don't think it's going to cut into their market share."

You can always relay on a CPA

IRS and States Approve dburbcpa for e-Filing

2006-02-14T01:32:00.000-05:00

IRS Approves dburbcpa for e-Filing

Ossining, New York -

The IRS today officially approved Dennis Burbridge CPA as a e-File provider.

How does this benefit you, the client?

1. IRS e-file gives you peace of mind.

* You’ll get confirmation within 48 hours that the IRS received your return.
* You’re less likely to hear from the IRS down the road because e-filed returns are automatically checked for accuracy. If errors are detected, you or your tax preparer will receive an electronic message indicating the error and will allow the mistake to be corrected and resubmitted without penalty.
* IRS e-file transmissions are very secure. IRS e‑file meets or exceeds all government security standards.
* There is no greater chance of being audited for taxpayers who use IRS e-file.
* Research shows that more than 80 percent of taxpayers who have tried e-file are “very satisfied” with the e-file’s benefits.
* Research shows that 83 percent of individual taxpayers who use IRS e-file remained loyal and e-filed the following year.

2. E-file is part of the electronic process that gets taxes done more accurately, quickly and efficiently.

* You or your tax professional can prepare, file and pay your taxes electronically.
* With IRS e-file, you can receive refunds in about half the time as paper filers, even faster with Direct Deposit.
* If you owe money, you can file early in the season and delay electronic funds withdrawal payments to as late as April 15, 2004.
* Individual taxpayers who electronically file their tax returns see a greater accuracy rate (99 percent) than those who only prepare forms electronically, but then print them and mail them to the IRS.
* Those who pay electronically are less likely to receive an IRS penalty or have their payments misapplied.
* Tax preparation software and online applications allow you to retain basic data – i.e. birth dates and Social Security Numbers – from year-to-year, virtually eliminating transcription errors.
* You can apply to use electronic signatures.
* In 37 states and the District of Columbia, taxpayers can use the Federal/State e-file program, through which taxpayers can electronically file federal and state income tax returns together.

CALL AND e-FILE TODAY 914-373-8481
dennis@dburbcpa.com

2006-02-11T22:58:00.000-05:00