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Hey, You with the Refund…..

IRS Statement on Refund Tool

The IRS is experiencing high traffic on “Where’s My Refund?” as more tax returns come in. Because of the heavy volume of refund inquiries, the IRS anticipates “Where’s My Refund?” will have limited availability during busier periods. Due to the large number of inquiries and to avoid service disruptions, the IRS strongly urges taxpayers to only check on their refunds once a day. IRS systems are updated once a day, usually overnight, and the same information is available whether on the internet, IRS2go smartphone app or on IRS toll-free lines. Nine out of 10 taxpayers typically receive refunds in less than 21 days when they use e-file with direct deposit

 

Thanks NATP for the heads up!

What Tax Professional didn’t see that coming?

Once they took the refund cycle calendar away from Tax Pro’s and directed everyone to the “Where’s My Refund?” on the www.irs.gov website or the refund app, this was bound to happen. Oh well, they tried….I guess.

 

Enjoy your night and your refund, not everyone gets one!🙂

Education and Depreciation Forms are in next week!

Passing along information from the IRS:

IRS To Accept Tax Returns with Education Credits, Depreciation Next Week

IR-2013-18, Feb. 8, 2013

WASHINGTON — The Internal Revenue Service announced today that taxpayers will be able to start filing two major tax forms next week covering education credits and depreciation.

Starting Sunday, Feb. 10, the IRS will start processing tax returns that contain Form 4562, Depreciation and Amortization. And on Thursday, Feb. 14, the IRS plans to start processing Form 8863, Education Credits.

This step clears the way for almost all taxpayers to start filing their tax returns for 2012. These forms affected the largest groups of taxpayers who weren’t able to file following the Jan. 30 opening of the 2013 tax season.

The IRS will be able to accept the education credits and depreciation forms following the completion of reprogramming and testing of its systems.  Work continues on preparing IRS systems to accept the remaining tax forms affected by the American Taxpayer Relief Act (ATRA) enacted by Congress on Jan. 2.

The IRS also announced today it will start accepting the remaining forms affected by the January legislation the first week of March.  A specific date will be announced later. Most of those in this group file more complex tax returns and typically file closer to the deadline or obtain an extension. A full list of the forms that will be accepted the first week of March is available on IRS.gov.

Next week’s opening covers two groups of taxpayers using:

  • Form 8863, Education Credits. Form 8863 is used to claim two higher education credits — the American Opportunity Tax Credit and the Lifetime Learning Credit.
  • Form 4562, Depreciation and Amortization. Most of the people using the depreciation form tend to file later in the tax season or obtain a six-month extension. Non-1040 business filers using Form 4562 can also file starting Sunday.

Have a great weekend!

How will the Health Care Reform affect me?

 

Getting questions at my tax desk about how the Health Care and Education Reconciliation Act of 2010 will affect them next year. January of 2014 starts to affect every individual United States citizen and legal residents. You and I will be required to have your state minimum health insurance, but not all forms of insurance are considered as minimum coverage. If you find yourself without insurance a penalty will need to be paid unless you are exempt.

 

What is minimum coverage?

  •        Government sponsored programs such as Medicare, Medicaid, Chip, U.S. Military Insurance, Veterans Health Care and those covered under Peace Corps health insurance.
  •       Employer Plans such as Government Plans, Church and grandfathered plans from your employer.
  •       Self-purchased health insurance whether it is from a small or large group market in your state.

 

What happens if I am not covered?

  •         You will be subject to either a monthly penalty for each month you do not have health insurance. Which is a flat fee or a percentage of your income and that percentage is based on your tax filing threshold for that year. (In 2014 that percentage is 1%)
  •        Or the penalty will be equal to the amount of the cost of your state minimum health care for the year of your household size.

 

For Example: David is single and makes $50,000 in 2014. Let us say for example purposes that the minimum health insurance premium for his state of Pennsylvania is $5000. David does not have health insurance for 2014 through his employer or self paid. David’s penalty on his tax return will be $403 ($50,000 minus 9750 (filing threshold for a single filer for 2012)) x 1% or $95(flat fee) whichever is greater.

 

The percentage of income for 2015 year is 2% and for 2016 and all years after that is 2.5%

The flat penalty for 2014 year is $95 or 1% whichever is greater.

For the 2015 year, it goes up to $325 or 2% whichever is higher.

And for 2016 and all following years it goes up to $695 or 2.5% whichever is greater.

There are special rules for individuals under 18 and age 65 years old and older. There are also rules on individuals who cannot afford coverage because it exceeds 8% of their household income in 2014. (The 8% could be adjusted for inflation yearly.)Some individuals could be considered exempt from penalty for failure to maintain minimum health insurance.

There is also a premium assistant credit some individuals may qualify for and the following year will need to reconcile any rebate on their tax return.

But all of these details will have to wait for further posts on the blog.

Think Spring because the little furry groundhog Phil is!

 

Check Back For Updates To Tax Filing

The Box for Mortgage Insurance Premiums have disappeared.

The 2012 Form 1098 does not contain a box for qualified mortgage insurance premiums. This is likely due to  the new tax bill was passed in January when mortgage companies were already in the process of issuing 1098s. The mortgage insurance premiums are deductible for 2012 and 2013, but could easily be overlooked if a tax professional does not specifically ask clients for the amount. (Thanks NATP for the update, and other Tax Professionals)

Ask your Tax Professional what you should bring when you might qualify for the Earned Income Credit.

An additional page was added to the earned income credit, Tax Professionals can NOT file your return without extra documents showing proof that the dependent(s) qualify you for this credit.

Update for Pennsylvania Business, Rental and Farm Owners

Pennsylvania has decided to include utility payments to use tax for filers that use the office in home form. This is for small businesses and rental owners that use a percentage of their home for an office.

Forms Delayed

The Depreciation and Amortization forms have been pushed back to the end of February, to mid-March.

The Education Credit Form will  not being ready for filing until then either.😦

The Residential Energy credit also will affect individual filers, and remember this credit is only 10% of the cost with a maximum of $500 credit that can be claimed since the credit began. So if you received this credit in a prior year, bring that tax year return to your Tax Professional. They will be able to figure the maximum if any of the credit you are entitled to.

There is a total of 31 credits delayed.

Kislak Tax and Notary Update

  •       The Secure Portal I use for long distant clients to upload their tax documents has been added to Kislak Tax and Notary website www.kislaktaxandnotary.com
  •  Clients that do not have a bank account once again can ask for a bank card at my desk to receive their refund.
  •       Once again, if you are short on cash when you go to file, the bank I am affiliated with can deduct your tax prep fees from your refund.
  •       If you took advantage of one of those holiday loans that a tax chain offered, you can save yourself their high costs of tax prep fees by going to a reputable Tax Professional and paying the balance of your loan after you receive your refund.
  •       I still offer credit card payments to help make it easier on you to pay your tax prep fees.
  •       I changed to more expensive tax program this year and it is super fast and offers so much more within your tax documents that you take home.

There is plenty more updates when it comes to filing your federal, state, and local tax returns that pertain to you and we will touch on that when you call for your appointment, emails or at my desk.

Let’s Kick their Arses!

Muhammad Ali Training Camp

Muhammad Ali Training Camp (Photo credit: bulettchen333)

 

If you have read my blog long enough you would have noticed I despise a certain lime green box of a tax corporation (Their commercials are hilarious). Professionally they give CPAs, Attorneys, Enrolled Agents and Independent Tax Professionals the upper hand in the Tax world. Personally they keep trying to kick me down, but I get back up.

The clients that have called or come in, have told me that the lime green company has failed to tell their clients of the January 30th filing season open. But after working with this company, this is not surprising at all. For all the other Tax Professionals out there, you need to know that their phones will be ringing off the hook with angry clients…..right in the middle of the busy early season.

This company does not play nice at anything, and all the while getting their over-worked workers to do the dirty work. While their pockets are full at the end of tax season, their workers vow that it will be their last.

Yes, I am back….and I say we kick their arses in tax returns. ( I just watched the movie Ali, does the post still make a difference? I can be smarmy too!)

Yes I’m still short and still can be a little feisty!

Sales Tax, Regulating Tax Pro’s, Farmers and Fishermen

Sunset over the Hummelbaugh Farm, Gettysburg, ...

Sunset over the Hummelbaugh Farm, Gettysburg, Pennsylvania (Photo credit: thelearnedfoot_)

 

A group of U.S. Senators hope to pass a bill that would help states to collect taxes on transactions. The Marketplace Fairness Act, which would allow states to require online retailers and catalog retailers to collect sales tax on transactions. The various sales tax laws across the country which can be complex for many business owners, state legislators would first have to simplify their own state’s tax laws. The bill does not establish a national sales tax, but allows states to voluntarily opt in, as long as they follow conditions. It includes exceptions for small retailers (online or remote sellers), with gross annual “remote sales” in the U.S. of $500,000 or less.

 

A federal judge barred the IRS from regulating through a competency exam, hundreds of thousands of tax preparers this past week. A U.S. District Judge ruled against the IRS in favor of three tax preparers who filed suit last year. The IRS has imposed a series of new regulations on tax preparers because of poorly filed tax returns. Beginning in 2011, the new regulations consisted of: a requirement to pass a qualifying exam, paying an annual application fee, and taking 15 hours annually of continuing-education courses. The judge stopped the implementation of the regulations, which could be appealed by the IRS. So the beat goes on! (I think I clearly gave my opinion on this subject in the past, so no opinions in this post.)

 

The IRS is giving Farmers and Fishermen some extra time to file this year; they have until April 15th to file.  

Trish McIntire of Our Taxing Times writes “These taxpayers have the option to make estimated payment like any self-employed taxpayers. However, they also have the option to file their tax return and pay all of the balance due by March 1st and avoid the underpayment of estimate tax penalty. But since some forms will not be available before the middle of February at the earliest, the IRS will allow farmers and fisherman to file when the forms become available and not face the penalty.

Because of the delays, farmers and fishermen who had at least 2/3rds of their income from farming and fishing in 2011 or 2012 will have until April 15th to file their return and pay any balance due. “

 

This time next week, I just might be up to my ears in tax returns….So I hope to see you soon if you are a client and for everyone else….until next time!

Reblog: Taxbook for Taxpayers

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Tax Book for Taxpayers

Fellow blogger, Robert Flach of Wandering Tax Pro fame, has a book you might be interested in; My Best Tax Advice. Robert has been preparing taxes for over 40 years and has shared his experience with us. The book covers picking a tax pro, keeping records, tax procedures and lots more.

My Best Tax Advice is $4.95 and can found here.

Reblogged from Our Taxing Times

 

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