Monday, January 23, 2017

From the IRS: Seven Reasons Taxpayers Should E-file Their Taxes in 2017

Taxpayers who still file paper returns may find now is the best time to switch to e-file. Last year over 85 percent of taxpayers filed their taxes electronically. E-file is the fastest and safest way to file.
Here are the top seven reasons a taxpayer should file electronically in 2017:
  1. Accurate and Easy. IRS e-file is the best way to file an accurate tax return. The tax software helps taxpayers avoid mistakes by doing the math for them. It guides users through each section of a tax return. E-file is easier than doing taxes by hand and mailing paper tax forms.
  2. Safe and Secure. IRS e-file meets strict security guidelines. It uses modern encryption technology to protect tax returns. The IRS continues to work with states and tax industry leaders to protect tax returns from refund fraud. This new effort has put more safeguards in place to make tax filing safer than ever before. The IRS has processed more than one billion e-filed returns safely and securely.
  3. Convenient and Often Free. Taxpayers can e-file for free through IRS Free File. Free File is only available on Taxpayers may qualify to have their taxes e-filed for free through IRS volunteer programs. Volunteer Income Tax Assistance offers free tax preparation for those earning $54,000 or less. Tax Counseling for the Elderly generally helps people who are age 60 or older. Taxpayers can buy commercial tax software or ask their tax preparer to e-file their tax return. Most paid preparers have to file their clients’ returns electronically.
  4. Faster Refunds. In most cases, e-file prevents mistakes and helps people get their refund faster. The quickest way to get a refund is to combine e-file with direct deposit into a bank account. The IRS issues more than nine out of 10 refunds in less than 21 days – however, some returns need further review and take longer.
  5. Prior-Year Tax Return. Taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.
  6. Health Care Coverage Reporting. IRS e-file can help with tax provisions of the health care law. The software will walk users through each line on the tax form that relate to the Affordable Care Act.
  7. Payment Options. If taxpayers owe taxes, they can e-file early and set up an automatic payment on any day until the April 18 deadline. They can pay electronically from their bank account with IRS Direct Pay. Other payment options include electronic funds withdrawal and payment by debit or credit card. Visit for details.

Thursday, November 3, 2016

What is a Tax Levy?

This is when the IRS sends you written (legal notice) to your employer and or your bank saying that you owe the IRS and that the employer and or the bank is under legal obligation to forward YOUR money to the IRS to satisfy your tax debt.

The good news is the IRS will send you a series of tax notices before this happens..

The bad news is; When and if you don't respond to their mail, the IRS will levy your bank account and attach your wages, legally, without having to go to court.

If you are receiving notices because of unfilled taxes, the way to avoid a tax levy is to:
  • First, file your OWN tax return.  Do not rely on the IRS's Substitute Return (a return the IRS prepared for you)
  • More than likely you'll owe less money. However the penalties and interest can increase the amount back up.  In fact we've had clients who ended up getting a refund.  
At this point you don't need an attorney.  It's just a matter of filing your unfilled tax returns, unless there are additional skeletons in your tax closet.

We can offer you professional, affordable and expert help, but you'll need to provide me with your tax information.  Visit this page and scroll to the bottom for easy instructions on how to get your tax information.

It is best to get your tax information directly from the IRS, that way your unfilled return will correspond with what the IRS has on file and your chances of being audited will decrease.  Anytime the IRS contacts you concerning unfilled tax returns, you become a person of interest.   The best way to get them off your back is to file a return which includes the same figures the IRS has in your tax file/records.  Yes, your bank and your employers has already sent information to the IRS - This is how they know you should have filed and didn't.

The IRS won't go away.  They don't know how.  They will get your attention one way or another. Visit me on the eBay platform, which is safe and easy, and get the IRS off your back. .  

Okay You Prepare Taxes Online, Past Due Returns and Unfiled Taxes, How Does That Work?


We depend on the safety and security of a "fax" 

You fax your info to our secure fax line, which we have the password and security information to access.

We send your pdf tax return black under a fake "subject" 

You print out your return, delete the email and act like nothing happened.

We delete our attachment files once you receive your tax return. .

Easy.  Fax info to secure line

Receive taxes in PDF format

Print Out.  Sign, Date and Mail or take to the IRS.

We delete the attachment.

Okay, how do I get my tax information to fax to you?  I lost my W2s and all tax information for the year(s) the IRS is bugging me about.

Easy.  We explain in detail how to get your tax information from the IRS 

If you'd rather NOT talk to the IRS, we all explain a way to get your information without speaking to the IRS.

The IRS prepared a "Substitute Tax Return" for me, now they say I owe them money.  Should I just pay them?  What about a payment plan?

NO.  Before you make payments, you should file your OWN tax return, which we can do for you.  We will still need your tax information and once you receive this information from the IRS we can have your return ready within 48 hours.

The IRS is not aware of your legal  tax deductions or write-offs.  When we prepare a "real" return, more than likely you'll less, maybe even a lot less.

YES.  We can help you with an Installment Agreement.  We complete the Installment Agreement Request Form and usually the IRS will grant the Installment Agreement if you don't already have a payment plan in place and sometimes, even if you do.

Go here follow the instructions at the bottom of the page. We use eBay. As you know eBay will ensure  you receive the services you pay for.   We have an excellent rating.  You will receive information where to fax your information after you've completed the transaction on eBay

Who the hell are you, and why should I trust you? 

I am the lead tax accountant.  Retired part-time.  Registered with the IRS every year since 1999.  Basic tax instructor in the San Francisco Bay Area.  Since retirement, I travel often, write children's books and books on how to save on taxes.  By law I must and will provide to you, my ID# from the Department of Treasury.  

Click here to learn more  

Tax Loopholes for the Little Guy

Tax Loopholes do exist for the middle income taxpayer.  Everything from deducting a percentage of the cost of your cell  phone bill when your mobile phone is used for business and your employer does NOT reimburse you to deducting the cost of security provided by security dogs who remain on your business property overnight.

You can download the book on Amazon and read on any mobile device. 100 Tax Loopholes and Tax Write-Offs for Home Based Businesses

Wednesday, April 9, 2014

Senate Committee Mulls Regulation of Tax Preparers

The Senate Finance Committee held a hearing Tuesday on the subject of incompetent and unethical tax preparers and heard testimony on how the Internal Revenue Service should deal with them.

The committee heard testimony from IRS commissioner John Koskinen, National Taxpayer Advocate Nina Olson, an official with the Government Accountability Office, tax preparers and advocates from across the country, as well as the attorney who represented the tax preparers whose lawsuit ended the IRS’s tax preparer regulatory program.

“Taxpayers today face a double burden: crooked or incompetent tax preparers, along with an overgrown and complicated tax code. We should put an end to both,” said Senate Finance Committee chairman Ron Wyden, D-Ore. “I’m proud to say my state gets this issue right. While Oregon and a few other states are already leading in this area, we need to restore federal standards to protect all American taxpayers.”

Wyden said that unlike many other industries, paid tax preparers don’t have to meet any standards for competence in order to prepare someone else’s return.

“In some egregious cases, preparers calculate a taxpayer’s refund in person and skip the line that shows who did the work,” said Wyden. “Then after the taxpayer leaves, the preparer falsifies the math to boost the refund, files the return and pockets the difference. And worst of all, unless the taxpayer can prove what happened, they’re on the hook for the money when the IRS finds out.”

At the hearing, the GAO released the results of a new investigation involving undercover site visits in which 17 of 19 randomly selected, paid tax preparers failed to complete a tax return accurately, either due to significant mistakes or willful negligence. The new GAO investigation reported findings similar to those of a 2006 GAO investigation that identified preparer mistakes in 19 of 19 uncover visits.

Tax refund errors in the site visits varied from giving the taxpayer $52 less to $3,718 more than the correct refund amount. Only two out of 19 preparers calculated the correct refund amount. The full report can be found here.

GAO director of tax issues James R. McTigue Jr., told the Senate committee that tax returns prepared by a paid preparer showed a higher estimated error rate of 60 percent, compared to an error rate of 50 percent for tax returns that were self-prepared by the taxpayer.

Voluntary Certification

IRS commissioner John Koskinen told the senators that the tax preparer community is a key ally in the agency’s efforts to fulfill its dual mission of providing taxpayer service and ensuring tax compliance. “We view our relationship with tax professionals as a partnership, one that has enabled a system that interacts with hundreds of millions of taxpayers to nimbly adjust to new tax laws, speed the average time for refunds, and encourage the voluntary compliance of taxpayers,” he said. “Return preparers are a vital link between the IRS and taxpayers, especially given that the vast majority of people seek help in doing their taxes.”

Koskinen noted that each year, paid preparers are called upon by taxpayers to complete about 80 million returns, or about 56 percent of the total individual income tax returns filed, while another 34 percent of taxpayers use tax preparation software, for a total of 90 percent who seek some form of assistance.

“Competent preparers make our job easier by helping their clients properly report their taxes and pay what they owe,” said Koskinen. “Given the crucial role that return preparers play in our tax system, the IRS believes it is critical to ensure a basic competency level for tax return preparers and to focus our enforcement efforts on identifying and stopping unscrupulous preparers.”

Last year, he noted, the U.S. District Court for the District of Columbia issued an injunction last year in the case of Loving v. IRS that prevented the IRS from enforcing the regulatory requirements it had tried to impose for competency testing and continuing education, and the decision was upheld by a federal appeals court this year. “The IRS is continuing to assess the scope and impact of the court’s decision while consideration is given to options for appeal,” he added.

Koskinen noted that the Obama administration’s fiscal 2015 budget includes a proposal to explicitly authorize the IRS to regulate all paid tax preparers. He asked Congress to provide that authorization and said the IRS might offer a voluntary form of certification to tax preparers in the meantime.

“Following the court decision, the IRS remains concerned about protecting taxpayers and ensuring they receive quality assistance in preparing their tax returns,” said Koskinen. “While we urge Congress to quickly enact the proposal described in the President’s Budget, we are taking a close look at the possibility of an interim step involving a program of voluntary continuing education.

The idea of a voluntary program is under consideration because we believe it is important to maintain the momentum for regulation and oversight of unregulated preparers that has built up over the last five years, and to lessen the risks to taxpayers resulting from the lack of federal education requirements. Before moving forward on this idea, however, we will solicit feedback from a wide range of external stakeholders as to whether such an interim step would be useful and appropriate.”

Taxpayer Advocate

National Taxpayer Advocate Nina Olson reiterated her support for requiring competency exams for tax preparers, pointing out that she had been an unenrolled tax preparer at one time. “Shortly after I graduated from college in the mid-1970s, I hung out a shingle and held myself out as a return preparer,” she said. “I had been a Fine Arts major, so to say the least, I was not a tax expert. But in that period, tax software was not yet widely available, so an individual wanting to prepare tax returns had to learn the basics. I took this endeavor seriously, and ultimately, I believe I did a good job for my clients. Even then, however, taxpayers would have been better served if return preparers were required to demonstrate basic competency in tax return preparation.”

However, Olson noted that tax prep software makes it easy for anyone to claim they are tax preparers. “With the advent of tax preparation software and the Q&A format, a person can hold himself out as a return preparer with almost no knowledge or skill by simply sitting with a taxpayer and working through the software’s prompts,” she said. “As many undercover ‘shopping visits’ to return preparers have found, preparing returns with software and little knowledge typically does not produce accurate results.”

She pointed out that unscrupulous tax preparers are able to take advantage of clients and charge high fees for services such as pay-stub loans and refund anticipation checks, which have largely replaced refund anticipation loans in recent years.

“In tax year 2012, 56 percent of 142 million individual taxpayers paid preparers to complete their returns for them,” said Olson. “Very simply, the absence of minimum competency standards for return preparers leaves these taxpayers vulnerable to inadvertent errors that could cause them to overpay their tax or to underpay their tax and face IRS collection action. It also leaves some taxpayers open to unscrupulous preparers, many of whom would be weeded out if the return preparation industry were professionalized. At present, we require volunteers who help prepare returns for elderly, disabled, and low-income taxpayers through the VITA and TCE programs to pass a competency test. Yet we ask nothing of hundreds of thousands of persons who make their living off tax preparation. That makes little sense to me.”

H&R Block president and CEO William Cobb told the senators about his company’s support for tax preparer regulation. “H&R Block employs more than 70,000 highly trained tax professionals across the country and 80,000 professionals worldwide,” he said. “A typical client is served by an H&R Block tax professional with more than a decade of experience and hundreds of hours of training. Our tax professionals progress through a 14-level certification program, culminating in master tax adviser status. To be re-hired, H&R tax professionals must complete at least 15 hours of continuing education annually. H&R Block’s tax professionals are trained on systems, policies and procedures that require an additional 35 hours of education annually.”

State Licensing

Wyden touted Oregon’s tax preparer licensing standards and pointed out that a 2008 study by the GAO found that tax returns from Oregon were 72 percent more likely to be accurate than returns from the rest of the country.

Wednesday, February 12, 2014

Tax Preparers Defeat IRS in Appeals Court Ruling on Licensing, Not Everyone is Happy

The D.C. Circuit Court of Appeals ruled Tuesday that the IRS had no legal authority to impose a nationwide licensing scheme on tax return preparers that would have required testing and continuing education as Registered Tax Return Preparers. continue below:

 Learn how thousands of wealthy U.S. taxpayers have duped the IRS out of paying taxes on over $120 billion dollars.  Learn what the IRS and Justice Department is doing about it, and why hundreds of wealthy Americans could be facing prison.  A true and documented story, that reads like a criminal mystery.  Gab a copy in the Kindle Store today, Offshore Transparency, IRS & Offshore Banking


The decision affirms a January 2013 ruling by U.S. District Court Judge James E. Boasberg, which struck down the IRS’s new regulations as unlawful (see Court Rules IRS Doesn’t Have the Authority to Regulate Tax Preparers). In the case, known as Loving v. IRS, both courts rejected the IRS’s claim that tax-preparer licensure was authorized by an obscure 1884 statute governing the representatives of Civil War soldiers seeking compensation for dead horses.

“This is a major victory for tax preparers—and taxpayers—nationwide,” said Dan Alban of the Institute for Justice, the lead attorney for the three independent tax preparers who filed the suit. “The court found that Congress never gave the IRS the power to license tax preparers, and the IRS cannot give itself that authority.”

The appeals court held, “If we were to accept the IRS’s interpretation of [the statute], the IRS would be empowered for the first time to regulate hundreds of thousands of individuals in the multi-billion dollar tax-preparation industry. Yet nothing in the statute’s text or the legislative record contemplates that vast expansion of the IRS’s authority.”

More than 350,000 tax-return preparers would have been subject to the regulations. The attorneys for the preparers argued that the regulations would have put tens of thousands of mom-and-pop preparers out of business and increased the cost of tax-return preparation for millions of taxpayers.

“My customers—not the IRS—should be the ones who get to choose who prepares their taxes,” said Sabina Loving, an independent tax preparer from Chicago and the lead plaintiff in the case. “I have a right to earn an honest living without getting permission from the IRS.”

The court ruled that “[t]he IRS may not unilaterally expand its authority through such an expansive, atextual,
Learn how to meditate for financial success.
and a historical reading of [the statute].”

“We think it’s a major victory for both independent tax preparers and taxpayers,” Institute for Justice senior attorney Scott Bullock said in an interview. “The three-judge panel unanimously affirmed all the fundamental points of the District Court’s opinion and held that the IRS does not have the authority to regulate tax preparers under the statute and under the legislative history of the law. The IRS simply cannot assume that authority to license tax preparers. They need to go to Congress to get that authority. That's what the D.C. Circuit held. They gave six separate reasons for affirming the District Court opinion and just really affirmed it across the board.”

Bullock hopes the IRS decides not to pursue further appeals in the case. “It has now been rejected by four judges, both the District Court and by three D.C. Circuit judges,” he said. "They do have the right to petition the entire D.C. Circuit. I believe they have 45 days to do so. The federal government has a little bit longer than most folks. Then the court will decide that relatively quickly. Then, after that, the next step for them would be to go before the Supreme Court and they would have 90 days. If they decide not to petition the entire D.C. Circuit, it would be 90 days from today. If they do decide to petition the entire D.C. Circuit and they reject that, it would be 90 days from whenever that order rejecting the en banc petition came though.”
When Judge Boasberg clarified his original decision last year, he ruled that the IRS can continue to require tax preparers to register for Preparer Tax Identification Numbers, or PTINs, and the latest ruling should not affect that. However, it should also bring some relief to tax professionals.

“It was a big relief to many of the independent tax preparers when the decision was first handed down,” said Bullock. “Hopefully this will end the matter once and for all and they would not be subjected these new licensing requirements, but it’s up to the IRS if they decide to continue to appeal.”

The IRS was noncommittal on whether it plans future appeals. “The IRS is currently reviewing the decision,” the IRS said in a statement. “The IRS continues to believe that it’s critical for taxpayers to be able to rely on quality work from tax preparers.”

Bullock believes the IRS should provide refunds to tax preparers who paid to take the tests and continuing education courses before the RTRP regime was invalidated by the courts.

“I believe they would probably be required to do that, and they [the tax preparers] would have the right if they so choose not to be subjected to these licensing requirements.”

“Administrative agency overreach threatens the economic liberty rights of entrepreneurs,” said Institute president and general counsel William Mellor in a statement. “This precedent ensures that agencies must follow the law and cannot exceed the power given to them by Congress.” As the Court noted, “‘fox-in-the-henhouse syndrome is to be avoided . . . by taking seriously, and applying rigorously, in all cases, statutory limits on agencies’ authority.’”

IRS Commissioner John Koskinen has indicated he would be open to offering the certification on a voluntary basis to tax preparers if the IRS loses the appeal. “If you can’t require it, offer it, and if you complete the information, you get a certificate that says, ‘I have completed the IRS preparer course.’ I think that could be over time very valuable to preparers, and consumers could ask preparers, ‘Have you gone through the IRS training?’” said Koskinen during a press conference last month after he was sworn in as commissioner (see IRS’s New Commissioner Favors Voluntary Tax Preparer Certification). “Whatever happens with the court case, we ought to be able to move forward on that and provide taxpayers with as much assurance as we can that the preparers they are dealing with have met some kind of minimum standards.”

Bullock indicated the Institute for Justice would have no problem with a voluntary certification scheme. “We made that very clear in our statements because they [the IRS] had asked the D.C. Circuit to stay the ruling, and they had stated they had no power to even do this on a voluntary basis,” said Bullock.  “And we had said, ‘That’s not true. You can offer this, but you can’t require licensure. But if you want to do this on a voluntary basis, you’re free to do so.’ And the district court judge made it clear that the IRS was free to do this on a voluntary basis, but they could not legally require it, it. If they did that, that of course would end the legal dispute.”

H&R Block Slams Decision
H&R Block, which was one of the main proponents of the RTRP tax preparer regulation regime, reacted with dismay to the Appeals Court decision.

Block said that in a country where all 50 states regulate hair dressers, the tax prep chain found it “stunning” that tax preparers, with extensive access to the personal financial history and identities of their clients, are not required to meet minimum competency standards.

“It is outrageous that all consumers don’t enjoy basic protections with such a significant financial transaction as tax preparation,” said H&R Block president and CEO Bill Cobb in a statement. “Something is out of whack when you are better protected when getting your haircut than when sitting across the desk from a tax preparer. All consumers should have access to the protection that our clients receive when working with our highly trained tax professionals.”

H&R Block noted that it has long supported efforts to better serve and protect consumers through minimum standards for, and oversight of all tax return preparers. Block pointed out that it already trains and has continuing education requirements for all of its tax preparers and added that it looks forward to working with Congress and the Treasury Department on “any legislation that may be necessary to implement minimum tax preparer standards as a formidable tool in the fight against fraud.”

One tax attorney pointed out that the IRS will still be able to check up on errant tax preparers, even after the latest ruling. “The IRS’s ability to require previously unregistered tax preparers to meet certain education and testing requirements, while perhaps now temporarily set back a step, will inevitably come to pass because of the important role preparers play in tax system administration,” said G. Michelle Ferreira, tax attorney and managing shareholder of the San Francisco office of international law firm Greenberg Traurig. “I believe law makers will recognize the need to make explicit that the IRS should be able to set basic standards for individuals who prepare tax returns so that we can be sure such returns are correct and in compliance.”
Because the Loving decision does not disturb the rules requiring all paid preparers to obtain a PTIN, those individuals must still register with the IRS, Ferreira said, “which still gives the IRS the ability to check up on preparers where evidence points to problems.”

CPA Reactions
While attorneys and CPAs would have been exempt from the proposed rules, several CPAs from the New York State Society of CPAs reacted strongly to the news of the court’s decision Tuesday.

“The potential impact is that the storefront tax preparer will thrive on the ignorant and the fraud will continue,” said Vincent Cosenza, CPA and tax manager at Shanolt, Glassman, Klein and Kramer PC in New York City.

“Much of what the IRS was looking for is already being done by most CPA firms,” said David Young, CPA, owner of Young & Company CPAs LLC in Rochester, N.Y.  “Having a strong system of quality control for tax return preparation and continuing professional education is in part what differentiates a CPA firm from H&R Block and other non-CPA firms. The taxpayer is ultimately responsible for what is on his or her income tax return.

“When choosing a tax preparer, the taxpayer should consider the possible negative ramifications of choosing an unregulated and unlicensed tax return preparer,” Young advised.  “It would be wise for the taxpayer to ask about the tax preparer’s qualifications, continuing professional education, and the firm’s quality control as it relates to tax returns.”

“I am a little upset that unlicensed tax preparers don’t have to deal with taking CPE  and keeping themselves up to date with new legislation, as CPA are required to do annually,” said Johnpaul Crocenzi, CPA, a tax manager at Raich Ende Malter & Co. LLP in New York. “Having the IRS regulate tax preparers will actually protect the consumer from having a tax return done by someone that doesn’t know or understand the Tax Code.”

Although the IRS proposed regulation of tax return preparers did not directly affect CPAs, there is always a concern about regulations that can creep into other areas, according to Kevin McCoy, CPA, director of Marvin and Company near Albany, N.Y. But “until the IRS is granted the authority by Congress, it appears the unlicensed tax return preparers are free to continue to operate as before,” he said.

Tuesday, February 11, 2014

What You Should Know About the Alternative Minimum Tax

This tax more than any other tax can sneak up on you.  And once the tax is applied it's difficult if not impossible to lower it or get rid of it.  The best way to handle the AMT tax is to do tax planning.  At least that way, you can prepare for the tax or avoid it all together.

What You Should Know about AMT

Have you ever wondered if the Alternative Minimum Tax applies to you? You may have to pay this tax if your income is above a certain amount. The AMT attempts to ensure that some individuals who claim certain tax benefits pay a minimum amount of tax.

Here are some things from the IRS that you should know about AMT:

1. You may have to pay the tax if your taxable income, plus certain adjustments, is more than the AMT exemption amount for your filing status. If your income is below this amount, you usually will not owe AMT.

2. The 2013 AMT exemption amounts for each filing status are:
• Single and Head of Household = $51,900
• Married Filing Joint and Qualifying Widow(er) = $80,800
• Married Filing Separate = $40,400

3. The rules for AMT are more complex than the rules for regular income tax. The best way to make it easy on yourself is to use IRS e-file to prepare and file your tax return. E-file tax software will figure AMT for you if you owe it.

4. If you file a paper return, use the AMT Assistant tool on to find out if you may need to pay the tax.

5. If you owe AMT, you usually must file Form 6251, Alternative Minimum Tax – Individuals. Some taxpayers who owe AMT can file Form 1040A and use the AMT Worksheet in the instructions.

Monday, February 10, 2014

Good News. IRS Provides Safe Harbor for Taxpayers with Discharged Debts for Real Property

Washington, D.C. (February 7, 2014)

By Michael Cohn

The Internal Revenue Service has issued a revenue procedure to help taxpayers with so-called “mezzanine” financing in workouts and similar circumstances when they have debts that have been discharged in connection with real property.

Revenue Procedure 2014-20 provides a safe harbor under which the IRS will, under certain defined circumstances, treat indebtedness that is secured by 100 percent of the ownership interest in a disregarded entity that holds real property as indebtedness that is secured by real property for purposes of Section 108(c)(3)(A) of the Tax Code. The revenue procedure will assist taxpayers with mezzanine financing in workouts and similar circumstances.

The IRS noted that borrowers will often incur debt in connection with real property used in a trade or business. If the debt is later discharged, the income from the discharge of indebtedness may be excluded from gross income if certain requirements are met. In some cases, the real property is held by the borrower in an entity that is wholly owned by the borrower, and is, for federal tax purposes, disregarded as an entity separate from its owner. In these cases, the debt may be secured by the borrower’s ownership interest in the disregarded entity holding the real property.
Revenue Procedure 2014-20, will be included in Internal Revenue Bulletin 2014-09 on Feb. 24, 2014.

Wednesday, February 5, 2014

IRS Criminal Prosecutions Climbed 23% under Obama

More people are being prosecuted for tax evasion.


The number of criminal prosecutions referred by the Internal Revenue Service to the Justice Department has increased 23.4 percent during the Obama administration.

Prosecutions in fiscal year 2013 alone jumped 30.6 percent from the previous year, according to a new report by Syracuse University’s Transactional Records Access Clearinghouse.

Convictions for tax crimes under the Obama administration are also drawing slightly longer average prison terms, 27 months under Obama, compared to 25 months during the George W. Bush administration, according to information obtained by TRAC under the Freedom of Information Act from the Executive Office for United States Attorneys.
Among U.S. federal judicial districts, Alaska registered the highest per capita rate of IRS prosecutions, 53 per million people, compared with 6.4 prosecutions per million nationally. Next in line was the Middle District of Alabama (Montgomery), with 30 per million, followed by the District of Columbia with 27 per million.
For more details, see the report at

Thursday, January 30, 2014

Tax Season Opens Jan. 31, Changes to IRS Service Options

The 2014 tax filing season opens on Friday Jan. 31. That is the first day that the IRS will accept 2013 federal income tax returns.

If you are working on your taxes and need tax help, the IRS website has the tax help and information you need.

Taxpayers are strongly encouraged to explore the various self-service, technology-based options that exist for tax help and tax return preparation on Taxpayers should be aware that due to limited resources, individualized tax help on IRS toll-free lines and Taxpayer Assistance Centers has changed beginning this year. More information on service changes for the 2014 tax season is available on

The quickest way to get information and help is through The web site is available 24/7, so you can get tax help any time you need. You may wish to bookmark 1040 Central as your go-to page for tax help. This web page has information and links to many helpful tools, products and services that will help you prepare and file your tax return. They include:
  • Tax Forms and Publications.  Download tax forms and publications. Many publications are also available in Spanish.
  • IRS Tools.  You’ll find several tools and self-service options on to help you with your taxes. 
  • Here are just a few:
When you are ready to file your tax return beginning Jan. 31, there are several, free options that you should consider. Taxpayers who have visited IRS Taxpayer Assistance Centers in prior years for free tax preparation should be aware that, beginning this year, these offices are no longer offering this service. Other options for free tax preparation include:
  • Use Free File to e-file for free.  Most people e-file their tax return these days. Everyone can use IRS Free File to prepare and e-file their federal taxes for free. The only way to use this program is through the IRS website. If you made $58,000 or less, you can use free tax software. If your income is more than $58,000 and you feel comfortable doing your own taxes, use Free File Fillable Forms. This option has the electronic versions of IRS paper forms.

  • Get taxes done with VITA or TCE.  You may be able to get free tax preparation at a Volunteer Income Tax Assistance or Tax Counseling for the Elderly site. IRS-trained volunteers can help you get the tax credits and deductions you’re entitled to claim. The VITA program generally offers free tax return preparation and e-filing to people who earn $52,000 or less. The TCE program offers help mainly to people 60 or older. Thousands of free tax preparation sites around the nation will open in late Jan. and early Feb. Visit to find the one nearest you.

Which Tax Form To Use When Filing Your Taxes

There is a right and wrong tax form to use when preparing your taxes.  The IRS has provided some tips to help you file using the correct tax form


Which form should you use to file your federal income taxes? These days, most people use a computer to prepare and e-file their tax forms. It’s easy, because tax software selects the right form for you. If you file on paper, you’ll need to pick the right form to use.

Before you decide, check out IRS Free File on It has free tax software or a Fillable Forms option that allows you to fill in your tax forms using a computer. You can e-file the completed forms for free!

If you still prefer paper and pen, here are some tips on how to choose the best form for your situation.
You can generally use the 1040EZ if:
  • Your taxable income is below $100,000;
  • Your filing status is single or married filing jointly;
  • You are not claiming any dependents; and
  • Your interest income is $1,500 or less.
The 1040A may be best for you if:
  • Your taxable income is below $100,000;
  • You have capital gain distributions;
  • You claim certain tax credits; and
  • You claim adjustments to income for IRA contributions and student loan interest.
However, reasons you must use the 1040 include:
  • Your taxable income is $100,000 or more;
  • You claim itemized deductions;
  • You are reporting self-employment income; or
  • You are reporting income from sale of a property.
Read more about which form to use in IRS Publication 17, Your Federal Income Tax. The quickest way to get tax forms and instructions is to visit and click on the ‘Forms & Pubs’ tab. New tax forms often appear online well before the printed forms are available.

You can also have forms mailed to you by calling the IRS at 800-TAX-FORM (800-829-3676), or you can pick them up at a local IRS office. Some libraries and post offices also have tax forms.
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