Meet The Tax Lady Sac Bee Article

My law firm and I were recently featured in a Sac Bee business article. The article appeared in the Sunday June 10th edition of the Sacramento Bee, and there was even a picture of me on the front page! Click here to read the full article: Meet the "tax lady" Roni Deutch.

IBM Saves 1.6 Billion In Now Closed Tax Loop Hole

According to CNN.com, IBM saved approximately $1.6 billion in the month of May 2007 by using a corporate tax loophole that has since been closed by the IRS. IBM participated in a $12.5 billion stock repurchase that took advantage of funds earned overseas that were not subject to U.S. taxes. IBM was able to save $1.6 billion in the transaction. Although the IRS would not comment on IBM’s recent activity, two days after IBM’s repurchase the IRS announced plans to issue regulations making companies pay U.S. taxes when they buy back their stock. The new regulations would treat funds used for buybacks as repatriated earnings.

Bonds Sits Out Second Game In A Row Due To Injury

According to SFgate.com, Barry Bonds was out of the lineup for the second game in a row but vowed not to go on the disabled list. "I'm not going on the DL. Don't count on me seeing the DL at all," Bonds said. "I won't let myself. I'll work hard. I'll do what I have to do to make sure I don't go there ... unless I get hit by a truck. I'll play through it." He later claimed that he expects to return to the lineup for the series finale tonight. "I was sore (last week) in New York. This kept escalating," Bonds said. "Normally, I'd get through it. I'd never had shin splints. It started hurting in my knees, bad. ... Today, I feel good. I feel I can go out there and play."

Top 6 Types of Life Insurance

Here is an article that explains in depth different types of Life Insurance. The article also has links to a directory of different companies offering life insurance and more information about each type listed above.



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What is your socioeconomic status?

From the New York Times. Check out this interactive chart where you can choose your occupation, education, income, and wealth and then displays your status level using these commonly used factors for gauging class. Where do you fall?



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Arkansas Attorney Mishandles IRS Payments and Amended Returns

Hired to amend a return and submit the balance due, the Bentonville, Arkansas attorney asked that IRS payment be made out to him and he would forward the money. Rather than paying the IRS, the attorney cashed and spent the proceeds, and failed to file the amended return.The suit alleges legal malpractice, breach of fiduciary duty, and conversion.



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Barry Bonds Mum About Playing in 2008

Barry Bonds isn't sure about his future or thinking about breaking Hank Aaron's home run record. Swarmed by a horde of reporters, an affable Bonds sat in the dugout and discussed various topics. Asked if he planned to play next season, Bonds said: "I don't know. Let me get through this one first."



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IRS Tips for Preserving Financial Documents in face of Hurricane Season

“With forecasts calling for an active Atlantic hurricane season, the IRS encourages taxpayers to protect tax and financial documents that can be hard to replace,” IRS Acting Commissioner Kevin M. Brown said. “A little planning can help safeguard valuable information in case a hurricane or other disaster strikes.”

Listed below are tips for individuals and businesses on maintaining financial and tax records:

• Paperless Recordkeeping - scan paper records into electronic form, save a copy on a USB drive, place in a safe
• Documenting Valuables - photograph or videotape the contents of his or her home, especially items of greater value. See the IRS's disaster loss workbook, Publication 584
• Check on Fiduciary Bonds - bond could protect the employer in the event of default by the payroll service provider
• Update Emergency Plans - annually

IRS Tax Fraud

According to the Internal Revenue Service (IRS), every person is responsible for filing his or her own tax return when required to do so through a duty known by the IRS as voluntary compliance. Fortunately the majority of Americans comply by determining and paying the correct amount of taxes to the government. However, there are many that willfully and intentionally violate their legal duty of voluntary compliance by failing to pay the correct amount of income, employment, or excise taxes. The IRS claims these individuals "pose a serious threat to tax administration and the American economy," and has teams dedicated to tracking down and prosecuting these violators.

Millions of Americans live in fear of the IRS because they owe back taxes to the IRS. However, there’s a big difference between owing a few hundred dollars because of mistakes on your previous tax return and committing tax fraud. In committing tax fraud you deliberately break the tax law by providing incorrect information on your tax returns for the purpose of some type of gain. Activities the IRS determines as breaking the tax laws include but are not limited to:

• deliberately underreporting income
• deliberately omitting income
• overstating the amount of deductions
• keeping two sets of books
• making false entries in books and records
• claiming personal expenses as business expenses
• claiming false deductions
• hiding assets or income
• transferring assets or income

In order to combat these abuses the IRS created the Criminal Investigation Division. It strives to correct the issues of improper tax filing and payment. The Criminal Investigation Division of the IRS investigates a wide array of individuals and industries including business owners and self-employed wage earners. It is the main component of the IRS’s efforts to directly influence taxpayer compliance.

The Tax Fraud Program is the Criminal Investigation Division's largest enforcement program that covers a variety of tax fraud and tax and money laundering crimes. According to IRS statistics there were 1,863 investigations initiated by the Tax Fraud Program in 2006, leading to nearly 700 people being sentenced and incarcerated for breaking the tax law.

The Tax Fraud Program classifies tax fraud crimes into two basic programs, legal source tax crimes and illegal source financial crimes. Legal source tax crimes involve people who earn wages legally but choose to evade taxes by violation of tax laws. These cases involve behaviors that threaten the tax system, such as questionable claimed refunds, unscrupulous tax return preparers, and persons who challenge the legality of income taxes. The prosecution of these cases is essential in supporting the IRS’s overall compliance goals, encouraging voluntary compliance with the tax laws, and promoting fairness and equity in the American tax system.

The second program, illegal source financial crimes, focuses on money gained through illegal sources of income, such as illegal gambling. According to the IRS, these underground operations threaten our "voluntary tax compliance system and undermine the overall public confidence in our tax system." The IRS demands that taxes be paid on money earned through any means, therefore many recipients of illegal income attempt to legitimize their income. This process of "cleaning" the illegally obtained money is known as "money laundering." The IRS deems money laundering as "tax evasion in progress."

Nowadays, money launderers use various schemes and transactions to conceal income and assets. This includes manipulation of currency reporting requirements and the layering of transactions. Since money laundering and currency violations are often intertwined with tax violations, the illegal source financial crimes program encompasses many tax and tax related violations.

The punishments and penalties for tax fraud issues vary from cases to case. However, according to the US tax code (sections 18 and 26) some violations of tax law carry penalties of up to five years in prison with fines up to $250,000.00 for individuals and $500,000.00 for corporations. According to IRS statistics, the average incarceration sentence for tax fraud crimes in 2006 was 26 months.

Recently some tax fraud issues have been making headlines. On May 25th a federal grand jury in Fresno indicted 21 California residents for bank fraud and filing false federal income tax returns. The accused were involved in a tax scheme where they filed false tax returns with the IRS then obtained bank loans from those false tax returns. According to the indictments, the accused acquired false W-2 forms that listed their real name and Social Security number. What was false was the employer, wages, and withholdings. The accused then took their forms to a tax preparer where they had their tax returns filed claiming refunds based on the Earned Income Credit. "Tax refund schemes of this magnitude will not be tolerated and will be vigorously prosecuted," claimed U.S. Attorney McGregor Scott. "These schemes undermine the tax collection process for all of those who pay their taxes."

Earlier in May, a New Mexico resident pleaded guilty to defrauding the United States government of thousands of dollars through a tax refund scheme. Between February and April of 2007, the individual prepared tax returns for taxpayers brought to him/her by a recruiter who supplied taxpayers' names, Social Security numbers, bank account information, and W-2 Forms. The individual then falsely filed the returns claiming the Earned Income Credit. The individual then took a percent of the refund amount. Over the two-month period, the individual prepared approximately 39 tax returns, with a resulting in a loss to the United States of over $100,000. "The days of not being held accountable, for unscrupulous tax returns preparers who peddle false hopes and dreams in the form of fraudulent tax refunds, are numbered," said IRS special agent Kenneth Hines.

The important thing to remember is to be completely honest when preparing your income tax returns. Alternatively, you should seek a competent professional to prepare your returns for you. If you follow your legal duty of voluntary compliance and pay your taxes without hiding income then there is never a reason to worry.

IRS Warns Taxpayers Of New Scam

The IRS issued a warning this morning regarding a new email scam claiming to be from the IRS’s Criminal Investigation division. The goal of the email to convince the receiver that they are being investigated by the IRS for filing a false tax return. It attempts to get users to click a link or open an attachment that can take over the person’s computer hard drive and allow some one remote access to the computer. The IRS is warning American taxpayers not to click the link or open the attachment in the email. "Everyone should beware of these scam artists," claims Kevin M Brown, Acting IRS Commissioner. "Always exercise caution when you receive unsolicited emails or emails from senders you don’t know." The IRS does not send out unsolicited emails or ever ask for personal information via email. If you receive one of these emails forward it immediately to phishing@irs.gov.

International Surfing Day Returns June 21st

According to Global Surf News June 21 has been dubbed International Surfing Day across the glob. This will celebrate the third occurrence of the holiday, which inspires surfers every where to take a day to share and acknowledge their love of surfing and beaches. "This is a great opportunity for us surfers to celebrate our sport by simply doing what we love to do most – going surfing," says Evan Slater, Editor of Surfing Magazine. "It’s also a great opportunity to remind everyone about the need and importance to protect our oceans, waves and beaches."

Placer County Now Provides Online Tax Bill Search Tool

Placer County, California is now allowing people to search for and view tax bills for properties using a property's APN number. This will allow for home buyers to verify the tax bill for a property before writing an offer.



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Two Senators Urge IRS to Update Charities Disclosure Form

Sen. Max Baucus, chairman of the Senate Finance Committee Chairman and Sen. Charles E. Grassley, Republican of Iowa have asked the IRS and - specifically - the U.S. Department of the Treasury to update the Form 990, the federal informational tax return charities file.

"It is clear that transparency and openness are pillars in encouraging our nation's charities to be responsive to the needs of the community," wrote the Senators. A more thorough form "will allow the IRS to better identify those entities that warrant additional review or further questions... and also mean that charities that are doing the right thing will be less subject to audit."

Among the topics the senators asked the Treasury Department to focus on as they revise the form:

• Executive pay and perquisites - including payments from other charities, joint ventures, contracts, and subsidiaries
• Endowments - charities that have endowments should show how much of the endowment is spent on their charitable mission
• Related organizations and joint ventures
• Fund raising - how much of the money they raise is spent on charitable programs rather than fund-raising costs
• Hospitals - more information about their charity care and billing and debt-collection practices
• Governance

"Fast and loose games in this area undermines the mission of nonprofits and fosters a public cynicism that's detrimental to all charities as they rely on public support for their nonprofit work," wrote the Senators.

Mets ride two Benitez balks to 12-inning win vs. Giants

Armando Benitez committed two balks -- the last of which allowed the tying run to score -- and gave up a game-winning solo homer to Carlos Delgado in the Giants' 5-4 loss to the Mets in 12 innings.

After the Giants went ahead 4-3 in the top of the 12th, Benitez walked Reyes to lead the bottom half. Reyes moved up on a balk and then went to third on a sacrifice. Reyes stayed at third when Carlos Beltran grounded out but then was waved home when Benitez was called for his second balk. Benitez then gave up Delgado's winning home run.

Tax Provision May Derail Immigration Reform

The Hill reports this morning that conservative Republicans in the House have plans to derail the Senate immigration compromise based on a procedural matter. The bill includes tax policy, which according to the Constitution, has to originate in the House, and some Republicans have lined up to issue a "blue slip" stop to the legislation on that basis.

House conservatives are ready to stop the Senate immigration bill in its tracks with a procedural weapon should the contentious measure win passage in the upper chamber. The procedural weapon House conservatives may hold is a constitutional rule that revenue-related bills must originate in the House. The current Senate immigration measure requires that illegal immigrants pay back taxes before becoming citizens. This requirement opens the door to a House protest, dubbed a “blue slip”. The "blue slip" comes from the color of its paper.

House Republicans used the same back-taxes mandate for a blue-slip threat that derailed last year’s immigration conference. The new Senate bill still must survive two more weeks of voter scrutiny and contentious amendments, but several conservatives already are lying in wait for the Senate to “make the same mistake twice,” as one House GOP aide put it.

“If we get an opportunity to do it, believe me, we’ll do it,” the aide said. “I think it’s going to be a matter of who will get there first. A number of people in the House are dying to be fingered as the person who killed [the Senate bill].”

During a blogger conference call with Senator John McCain, one of the bill's architects, the conservative blogger, Captain Ed of Captain's Quarters, mentioned a Boston Globe story that reported the removal of a requirement to pay back taxes before entering either the Z-visa or Y-visa program. The White House reportedly requested that section be removed, and the blogger asked the Senator why illegal immigrants would get a pass on paying back taxes when American citizens don't get that privilege.

Senator McCain hadn't heard about the removal of the requirement. “I’d not heard that proposal on the part of the president,” McCain said, according to a transcript of the call. “I would resist that.” In fact, Senator McCain went back and reinstated the provision after the blogger conference call.

Inadvertently, Senator McCain may have provided an "out" for House Republicans to at least delay the bill's consideration. While any Representative can blue-slip a revenue-producing bill from the Senate, it takes a majority to enforce it. Given the heat from both sides of this debate, that may not be difficult to arrange, and it would require the Senate negotiators to start from Square One.

“We would certainly have the right [to a blue slip] and could exercise it,” another House GOP aide said.

Via Captain's Quarters.

House Ways and Means Oversight Subcommitte holds hearing on IRS's use of Private Debt Collectors

House Ways and Means Oversight Subcommittee Chairman John Lewis (D-GA) issued the following opening statement during today’s hearing on the Internal Revenue Service’s use of private debt collectors:

Today, the Committee is repeating history. We again are reviewing whether the Treasury Department should be allowed to contract with private debt collectors for federal taxes.

This is not a new question for the Ways and Means Committee. I would like to read from an 1874 Report of the Committee repealing Treasury’s authority to use private tax collectors and pay them a commission. It states:

The Committee are of opinion that any system of farming the collection of any portion of the revenue of the Government is fundamentally wrong . . . No necessity for such laws exist . . . the Secretary of the Treasury and the head of the Internal Revenue Bureau are empowered by law to make all collections of taxes . . . The Internal Revenue Bureau is possessed of full knowledge of the laws relating to the collection of the revenue . . . [and] has all the machinery necessary for their full and complete enforcement . . . The Committee, in view of the facts . . . believe that the law . . . should be repealed and the contracts made thereunder should be revoked and annulled.
H.R. Rep. No. 559, 43d Cong., 1st Sess. 9 (1874).

These words are true today–130 years later.

The collection of federal income taxes is a core government function. It is the mission and purpose of the Internal Revenue Service.

Today’s private collector program can never work. Taxpayers and the American public deserve better.

The IRS has 45 employees watching 90 contract employees yet no one has the full story on what they are doing. Debt collectors receive up to a 25% bounty on federal income taxes.

The IRS depends on the collectors to “self-report” complaints of taxpayers.

GAO investigators have confirmed that contractors have been exercising discretion over who gets offered to take the customer satisfaction survey.

The program targets low- and middle-income taxpayers rather than those who have the means to protect themselves.

At the end of the day, most Americans don’t even know that the harassing calls they receive are from debt collectors hired by the IRS.

To date, the collectors have made nearly one million calls in attempts to reach 35,000 taxpayers. Those called have been subject to harassment, confusion, and violations of taxpayer protections.

Mr. Chairman, I ask that a partial list of taxpayer complaints be included in the record. Mr. Chairman, I also would like to play five calls between an IRS private collector and one taxpayer. I want my colleagues to hear what our constituents are facing as the private collectors attempt to find the correct person owing taxes. I ask that a transcript of these calls be included in the record and that we play them for the Members to hear.

The “cat and mouse” game you are about to hear has captured over 300,000 members of the public. All but 10,000 of these were innocent parties who did not owe any tax. Social security numbers along with tax information must be protected to prevent identity theft and ensure the integrity of our tax system.

I ask, “Who is in charge here?” What have we done? We must end this.

IRS Announces Low Income Taxpayer Clinics Grant Recipients

Earlier today Nina E. Olson, National Taxpayer Advocate, announced that the Internal Revenue Service will be awarding nearly $8 million in matching grants to Low Income Taxpayer Clinics (LITCs) this year. The IRS will be awarding LITC grants to 154 organizations from 49 states plus the District of Columbia, Puerto Rico and Guam. According to the IRS LITCs are "qualifying organizations that provide representation for free or a nominal fee to low-income taxpayers involved in tax disputes with the IRS or that provide education on taxpayer rights and responsibilities to taxpayers for whom English is a second language or who have limited English proficiency." Source: IRS.gov.

Hawaii Hotel Occupancy Plunges

According to Pacific Business News, hotel occupancy has fallen below the two-thirds mark throughout the Hawaiian Islands. During a seven day period spanning May 5th through May 12th, Statewide hotel occupancy slid down to only 58.8%. This represents a staggering 16.9% dip from the same week last year. The last time the occupancy rates fell below 59% was back in December of 2004. Hotel occupancy in Hawaii was actually lower than the national rate of 64.8%.

670 Quintillion to 1

Since Jan. 23, 2007, 46-year-old Jacqueline Gagne from Rancho Mirage, California has hit 10 holes in one.

San Francisco Giants Beat Oakland A’s

On Sunday the Giant’s beat the Oakland A’s in a 4-1 win, thanks to pitcher Matt Morris. The Giants' veteran pitched a two-hit complete game with nine strikeouts to give the Giants a much-needed win after consecutive losses. ''This was something we needed today and I'm glad I was able to do it,'' claimed Morris. ''I'm not here to be on the back page (of the tabloids), that's for sure. I'm here to get my innings and keep the team in the game.'' For a more detailed recap of the game, check out All Headline News.

GM Fuel Cell SUVs Go 300 Miles

According to the Cincinnati Enquirer, General Motors Corporation set a new world record last week when their Sequel SUV fuel-cell vehicles were each driven 300 miles on public road using only one tank of hydrogen. The point of the drive was to prove that the vehicle was ready for the public, and that it could travel long distances without problems. "This is a very significant event to us," notes Larry Burns, Vice President of Research, Development and Planning. "Our goal was to go 300 miles because that is what our customers tell us they need. This is a vehicle that can carry four or five passengers, but this is also a vehicle that emits just water. We are in the infancy of a whole new automobile." The test came just one day after President George W. Bush announced his plans to increase vehicle fuel-economy standards by the end of 2008.

Letter to Congress, U.S. Treasury, and the IRS

Last week, I sent an open letter to Congress, the U.S. Treasury, and the IRS identifying a problem that can be easily fixed and beneficial to taxpayers and the IRS. Here is a press release about the letter and including an actual photocopy.

Specifically, the problem was that the IRS requires a complete financial disclosure from all taxpayers who owe in excess of $25,000.00. The complete financial disclosure includes giving the IRS extremely personal information and private financial information. The disclosure is required even if you arrange to fully pay the amount owed within five (5) years, which is agreeing to a substantial payment. The disclosure also requires substantiation of all financial information claimed. This includes providing copies of all current financial records, such as bank statements, paycheck stubs, proof of payment for monthly expenses (i.e. medical expenses, child care, etc.). As you can imagine, such a system acts as a barrier for many taxpayers to get a fair resolution. In fact, it frightens many from even attempting to address their IRS tax debt.

Congress, the U.S. Treasury, and the IRS can work together to create a more efficient and effective program. Simply raising the bar to when the IRS requires a complete financial disclosure will go a long ways towards creating that program.

IRS Looking To Collect Personal User Data From Internet Firms

The Internal Revenue Service (IRS) is backing the U.S. Treasury Department’s efforts to include a proposal in the 2008 budget requiring many Internet businesses to collect personal data from their users. The proposal is part of an effort to close the ever-present gap between what Americans should pay in income taxes and what they actually do. This amounts to an estimated $300 billion per year. However, collecting the targeted data is going to be a difficult task for the site-operators and small business owners. Furthermore, the process will create security issues for millions of users in a time when online identity theft is rampant.

In 2001, the "tax gap" – difference between what the IRS should collect in taxes and what it actually does collect – was over $345 billion. Underreporting on individual income tax returns accounted for $197 billion of the gap. Underreporting on business tax returns accounted for $88 billion. This left the IRS collecting only about 85% of owed taxes. Since taking over the White House, the Bush Administration has seen this gap as an opportunity to increase the federal government’s revenue without raising taxes.

At the behest of the Bush Administration, the IRS has implemented a variety of new enforcement and collections measures to reduce the gap over the last five years. The efforts have paid-off: the IRS increased its enforcement revenues by nearly 44 percent from $33.8 billion in 2001 to $43.1 billion in 2004 to $48.7 billion in 2006. "Clearly, more work needs to be done by the IRS to improve service and enforcement," states IRS Commissioner Mark W. Everson. "But we are clearly making progress, and these numbers underscore that point."

Now, more enforcement and collection measures are on the table. As part of its ongoing campaign to close the tax gap, the Bush administration has allocated over $400 million of next year’s budget for these new measures. A main goal of the proposed measures is to increase the taxes paid by many sole-proprietors and small businesses. Currently, sole proprietors and small businesses report most of their income to the IRS through an "honor" system. The IRS claims some of these small businesses report only half of their total income, leaving millions of dollars in unpaid taxes. One specific target of the proposal is to collect taxes from income generated through online auction sites such as eBay and Ubid.com. Recent studies show over 700,000 Americans making their sole income from auction sites like eBay, and without any formal method to monitor these sales the government is assuming most of this income is being underreported.

Specifically, the new proposal would force auction sites acting as online brokers to file income statements for all customers using their sites to conduct 100 or more transactions or generating more than $5,000.00 per year in income. In order to comply, the sites would need to collect personal data from their users including name, address, and taxpayer identification or social security numbers (SSNs). Essentially, the IRS is forcing the collection of the data under the threat of liability and further legal consequence.

Typically, people generating income form auction sites are small businesses and self-employed individuals who do not have taxpayer identification numbers. Therefore, they will have to provide the sites with their SSNs, which will be stored and maintained by the individual sites in massive data banks of personal information. Although the IRS claims the sites will only need to collect data from high volume users, it is very likely that the sites will have to collect data from all of their users.

Having the proposed amount of personal data exchanged over the Internet could prove to be very problematic. Illegal phishing scams already target sites collecting personal data. Phishing is already problematic for eBay, where scammers create fake re-direct sites that retrieve users' personal data.

With so many issues of identity theft online, many people are going to be reluctant to provide their SSNs to sites like eBay. According to the Center for Democracy and Technology, "forcing businesses to collect SSNs could have a chilling effect on legitimate e-commerce if consumers balk at providing their SSNs for simple transactions -- something most people are not accustomed to doing."

In addition, the government is putting the entire financial burden on the Internet businesses. Collecting and safely maintaining this confidential data could cost millions of dollars. These large costs might not be a problem for huge companies like eBay, but it might be too much to bear for small businesses. More than likely, they will have to take on an additional and sizeable expense to store and secure the data.

Scott Weber, owner of GunrunnerAuctions.com, a site that auctions about 400 guns per month, said the additional paperwork would be a huge burden and additional cost. "I'm pretty much a one-horse operation here," Weber said. "I do everything myself. I would have to hire a whole bunch of people. I would have to hire someone full-time to do this. You'd need to track people all over the country, and you'd have to get their SSNs."

Some sites are already beginning to make changes with anticipation of this new proposal. Just a few days after the IRS’s announcement, Yahoo! Auctions announced they would close their auction sites in the United States and Canada effective June 16, 2007. Though Yahoo! Auctions only account for under 1% of total online auctions and they recently established an alliance with eBay, many are still wondering if Yahoo’s decision had anything to do with the IRS’s recent announcement.

Currently no lawmaker has come out for or against the new proposal. However, it is likely to go unnoticed as part of the President’s 2008 budget plans. As part of a representative democracy, it is the job of the citizen to notify their member of Congress when they disagree with an important issue. If you want your voice heard, you can write your representative through House.gov.

For more information on this topic, please see the following suggested readings:

News.com -Selling stuff online? Here comes the IRS
Center for Democracy and Technology
Yahoo! US Auction Sites Are Retiring
Written Statement of Nina E. Olson

Fastest Growing Tax Is on Tobacco

According to Tax Foundation, the taxes on tobacco have shown the fastest increase in taxes on any product since 2000. Recent Census data shows that between 2000 and 2005 the taxes on tobacco products have risen a staggering fifty five percent, as opposed to much smaller increases on other products such as alcoholic beverages, gasoline, etc. This is consistent with the recent trend of raising revenue through means that are "politically feasible." Raising taxes on tobacco is politically easy because the tax revenue benefits all taxpayers but only a minority of people must pay the tax.

2007 Tax Season Sets IRS Records

The 2007 tax season set new records for the number of e-files, direct deposits, and hits to the IRS’s official website. According to recent IRS data, there were over 76 million income tax returns that were e-filed, with an additional surge of last minute filers choosing to e-file. "E-file and our other electronic services helped us deliver a strong filing season for the nation’s taxpayers," said IRS Acting Commissioner Kevin M. Brown. "Again this year, millions of additional taxpayers gave up paper tax returns to file electronically. E-file and IRS.gov were among several factors that helped us overcome one of the most challenging filing seasons ever for the IRS." The IRS claims their official site received over 140 million visitors, up nearly 13 million from last year. Source: IRS.gov.

IRS Kicks Home Owners While They're Down

According to the Washington Post, the IRS has bad news for homeowners who are seriously delinquent on their mortgages and hoping for debt relief. If your lender decides to modify your loan or forgive your debt, you could end up owing federal income taxes on that amount. The IRS essentially treats the amount that is forgiven as ordinary income. Lenders are even required by law to notify the IRS when they forgive the debt. This news is especially bad in the current market, where many people are finding themselves upside-down in the current market because of interest only loans or property value decreases.

Nissan and GM Hybrids Still Qualifies for Tax Credit

The IRS recently announced that purchasers of qualified Nissan and GM vehicles may continue to claim the Alternative Motor Vehicle Credit. The announcement comes after the IRS concluded its quarterly review of the number of hybrid vehicles sold. Nissan only sold 2,094 qualifying vehicles to retail dealers, while GM sold 2,927 qualifying vehicles to retail dealers in the quarter ending March 31, 2007.

The allowable credit amount for the vehicles is as follows:
Altima Hybrid — Nissan’s only certified hybrid vehicle — $2,350.
Chevrolet Silverado Hybrid 2WD — $250
Chevrolet Silverado Hybrid 4WD — $650
GMC Sierra Hybrid 2WD — $250
GMC Sierra Hybrid 4WD — $650
Saturn Vue Green Line — $650
Saturn Aura Hybrid — $1,300

US Government Has Record Breaking Collections In April

According to the Treasury Department the government collected a total of $1.505 trillion so far in 2007. This represents an increase of 11.2% over the same period last year. Included is $383.6 billion that was collected in April, the largest single month tax collection ever. In the beginning of the year government spending was at an all time high, but the total spending of $1.585 billion was only up 3.2% from last year. The Congressional Budget Office said it expects the total deficit for 2007 to total between $150 and $200 billion. This would be a significant decrease from last year's deficit of $248.2 billion.
Source: CBS News

More Franchises Seeking Charitable Causes

According to the Wall Street Journal, more franchise businesses are adding a new element to franchise owners, a designated charitable cause. The tactic known as cause marketing is a process where businesses link themselves to a special charity or social causes and raise funds through promotions and sales. The tactic isn’t new to big corporations like Nike, Home Depot, etc, but it’s beginning to gain popularity in franchise businesses. Having a designated charitable cause allows companies to unite franchisees in various markets, convey a consistent image, and boost their profiles and bottom lines. "It's increasingly popular among franchise organizations who are trying to penetrate local markets, who are trying to bond with their franchisees and who are trying to help franchisees to attract and retain employees," says David Hessekiel, president of Cause Marketing Forum Inc.

Poor Hit Hard By Refund Anticipation Loans

According to an Associated Press report, people who were hit hardest by refund anticipation loans were low income households. A North Carolina investigation found that people in the state spend about $44 million per year on refund anticipation loans with interest rates topping 800%. The study claims that nearly 86% of the refund loans issued in 2004 went to low-income borrowers. About 500,000 taxpayers in North Carolina get tax refund loans every year, with average costs ranging from $78.30 to $174.95. For more details on the study visit Forbes.com.

Chrysler Seeks Diesel Tax Breaks

According to CarAndDriver.com, Mark Chernoby, Vice President of DaimlerChrysler, delivered a testimony calling on Congress to broaden tax credits to include all diesel vehicles. He spoke during a hearing in the U.S. Senate Finance's subcommittee on Energy, Natural Resources and Infrastructure where congress is looking into use tax incentives to speed introduction of more fuel-efficient vehicles. "The credit has been pivotal in establishing consumer acceptance of hybrid passenger cars and we believe it will be helpful in the future in encouraging more hybrid light trucks," Chernoby claimed. "Introduction of diesel passenger vehicles and light trucks would establish an altogether new market for biodiesel and renewable diesel."

IRS Investigates Man Running Secret Bank

The Internal Revenue Service has brought charges up against a Washington man who was operating a "warehouse bank" from his own home. According to court documents he had taken in over twenty eight million dollars from people across the country looking for a "discreet" bank account. According to an IRS investigator, Robert Arant had hundreds of customers who used his banking services to conceal assets for the purpose of evading taxes. A civil complaint was brought up against Arant for promoting abusive tax shelters and unlawfully interfering with Internal Revenue Service laws. For more information visit WTOPnews.com.

New Name and Layout

As you have probably already noticed we recently unveiled a new layout for my blog. We also purchased a new name for the blog, which you can now access by typing in RonisBlog.com. In addition to the physical changes we will also be making some changes to the content we feature on my blog. As well as the regular tax news I will also be posting franchise news and special featured articles which will go more in debt into tax law issues. So remember to update your bookmarks with http://ronisblog.com and be sure and check back daily for updates.

Returning Veterans Becoming Franchise Owners

According to US Franchise News, there is an increasing number of veterans returning from the Middle East who are looking to purchase small business franchises. Currently there are over 350 veterans who own a small business franchise in the United States as a result of the Veterans Franchise Initiative (VetFran), which offers discounted franchise fees to veterans who want to purchase a franchise business. The program was given the Support Sector Champion Award from the U.S. Department of Veteran Affairs at the nation’s capital. "The VetFran program is our way of saying thank you to veterans for their service," said Matthew Shay, president of the IFA. "They deserve our help in pursuing the American dream of business ownership because without them to protect our nation, such opportunities would not exist."

The Roni Deutch Tax Center is also a proud member of the VetFran program. To learn more about the special benefits we offer to veterans, please check out the Roni Deutch Tax Center Franchise website.

Tax Evader Sentenced to 63 Months in Prison

Earlier today a federal judge sentenced convicted tax evader Elaine Brown to 63 months in prison. She and her husband Ed Brown were both convicted of tax evasion. He is expected to receive a similar sentence later this afternoon. The two were found guilty by a jury of hiding Elaine’s income from 1996 to 2003, which was $1.9 million, as well as using $215,890 in postal money orders to purchase a compound for Elaine’s dental office. The couple has defended themselves by saying that federal tax laws do not exist, but the prosecuting attorneys claim their theories are "contrary to common sense," and that Elaine "had no excuse for not paying her taxes." Source: BostonHerald.

IRS Grants Virginia Tech Six Month Extension

Following yesterday’s horrific events, the Internal Revenue Service has granted a six-month filing and payment extension to all taxpayers affected by the shootings at Virginia Tech in Blacksburg, VA. The extension applies to all victims and their families, university students and employees, as well as emergency responders. The relief gives the affected parties until October 15, 2007, to file and make payments associated with their 2006 individual tax returns that were originally due on April 17. There will be no filing and payment penalties for those who qualify as long as the returns are filed and payments are made on or before October 15, 2007. "Taxes are the last thing the Virginia Tech family should be worried about at this time," notes IRS Commissioner Mark W. Everson. "Our hearts go out to the people affected by this tragic event." To claim this relief taxpayers need to call the IRS at 866-562-5227 and identify themselves before they file and or make payment.

More Last Minute Filers E-file

According to IRS data, as the tax deadline approaches more and more last minute filers are choosing to e-file. Historically more people e-file at the beginning of tax season, and typically those people are expecting a refund and want to get it fast. Late filers traditionally owe the government money and have more often used paper tax returns. But new statistics are showing that many taxpayers are choosing to pay electronically through credit card or direct debit. According to the IRS nearly 57 million returns have already been e-filed this year. Nearly one-third of those returns were e-filed during March alone, up more than 10 percent over last March. For more information check out the IRS’s website.

Tax Friendly States

CNN has put out a list of the most tax friendly states for 2007. The list was put together by comparing each states total state and local tax burden in 2006. That burden was determined by what residents pay in state and local income taxes, property taxes, sales taxes, luxury taxes and fuel taxes, among others. States that top the list include: Alaska, New Hampshire, Tennessee, Delaware, and Alabama. For the full list go to CNNMoney.com.

Tax Relief For Special Needs Children

According to recent Census data, one in twelve children and teenagers have a physical or mental disability. With special education enrollment costs on the rise, parents are left with the financial burden of paying for special education. Although the Internal Revenue Service does not have any clear cut relief measures for these parents, there are many deductions that the IRS recommends that parents of special needs children take advantage of when preparing their tax return. Intuit has a helpful article on tax relief for special needs children that you can read by clicking here.

US Government Sues Jackson Hewitt

According to the IRS’s website, the United States government has filed civil injunction suits against five corporations that operate Jackson Hewitt tax preparation franchises as well as 24 individuals managing or working at the franchises. The suit claims that the franchises "created and fostered a business environment" at the Jackson Hewitt franchises "in which fraudulent tax return preparation is encouraged and flourishes." Some examples of the fraudulent preparation include phony W-2 forms, fabricated businesses and business, massive fraud involving the Earning Income Tax Credit, etc. The suits also allege that Jackson Hewitt franchise managers and employees got kickbacks from customers to file fraudulent tax returns.
The suit is seeking more than $70 million in losses to the U.S. Treasury Department, as well as seeking court orders barring the franchisees and other defendants from preparing tax returns for others. "When practitioners prepare a false tax return, it has a corrosive impact on the tax system," claims IRS Commissioner Mark W. Everson. "I am deeply disturbed by the allegation that a major franchisee of the nation’s second-largest tax preparation firm is intentionally preparing improper tax returns with inflated refunds. I’m particularly concerned that many taxpayers of modest means could actually end up owing the government thousands of dollars if they claimed an improper refund."

IRS Warns About Phony Emails

The IRS has issued a press release warning about phony emails claiming to be from the Internal Revenue Service. The emails direct the receiver to click on a link that goes to a page asking for personal financial data such as credit card numbers or social security numbers. This practice of confusing victims into giving away private personal and financial information is known as phishing for information. The IRS is warning that they do not ever send out unsolicited emails, and that they never ask people for their PIN numbers, passwords or similar secret access information for their credit card, bank or other financial accounts. The IRS has created a special email address, phishing@irs.gov, that you can forward fraudulent emails to for further investigation. The email address has been up for about a year and has already received over 17,000 emails.

Expensive Tax Mistakes To Avoid

CNN.com has added a helpful article with advice on some expensive tax mistakes to avoid when preparing your tax returns this year. Some of their advice includes: avoid paying taxes with a credit card, avoiding refund anticipation loans, setting up an installment agreement, and paying on time. You can read the full article by clicking here.

Tax Watch Spring 2007 Edition Available

Tax Foundation.org has posted the Spring 2007 edition of their quarterly tax policy newsletter, Tax Watch. The newsletter includes non-technical research and discussion of current tax issues including Gross Receipts Taxes, the Alternative Minimum Tax, and much more. Click here to see the full newsletter.

E-Filing Up 5 Percent Says IRS

According to the IRS’s official website the number of tax returns being filed electronically is up five percent from the same time period last year. According to IRS Commissioner Mark W. Everson, "taxpayers are filing electronically at a record pace this year, E-file reduces taxpayer errors and gets refunds back quickly." So far 73 percent of all returns have been e-filed this tax filing season, up from 70 percent for the same period last year. Also up is the number of people having their returns deposited directly into their bank accounts. 76 percent of all refunds issued this tax-filing season were directly deposited, up from 71 percent for the same period last year.

IRS Identifies 40 Frivolous Positions To Avoid

Recently the Internal Revenue Service issued an article detailing 40 frivolous positions that taxpayers should avoid when completing their tax returns. These positions have no basis in tax law or have been determined frivolous by tax or federal courts. If any frivolous positions are contained in a tax return, taxpayers could face a fine for filing a frivolous tax return. In 2006 congress increased the penalty from $500 to $5,000 for persons submitting tax returns that are deemed frivolous by the IRS. One of the frivolous positions includes false arguments that wages are not taxable income, among various others. For more details visit the IRS’s official website.

Strangest Tax Deductions

Kiplinger has a new article on Yahoo finance with the top ten oddball tax deductions. All of which seem too be fake, but are actual examples that were held up in court. Some of the deductions include cat food for a junkyard owner, the cost of moving a pet, and a trip to the Bahamas among many others. Keep in mind that these deductions are not typical, and not recommended to include on individual taxpayers' returns.

Free File For Telephone Tax Refund

Because of the confusion over the telephone tax refund the IRS is reminding telephone users who do not normally file tax returns that they can take advantage of the Free File system to request a telephone tax refund. According to the IRS the Free File system is the easiest and quickest way to request the refund, which could arrive in taxpayers bank accounts in about two weeks. IRS Commissioner Mark W. Everson claims, "Fee File is a great choice for people who don’t normally need to file a tax return but who are entitled to this special telephone excise tax refund." For more information on requesting a telephone tax refund through Free File, visit the IRS’s official site.

Help With W2 Forms

Associated Content has added an article with a detailed breakdown of the information on W2 forms. Included is a box by box breakdown of what appears in every box on W2 forms and how it pertains to individual taxpayers. You can read the full article here.

Revisions to Offer in Compromise Application Form

On Monday the IRS announced they had revised the application for an Offer in Compromise, Form 656 package. IRS Commissioner Mark W. Everson notes, "we hope that these changes help more people who qualify satisfy their tax obligations." The changes were made as a result of the Tax Increase Prevention and Reconciliation Act of 2005 and some of the changes include new payment terms and submission rules. For more details on the changes visit the IRS’s website.

$2.2 Billion in 2003 Tax Refunds

According to IRS estimates there is over $2.2 billion in unclaimed tax refunds from over 1.8 million American taxpayers who did not file a federal return in 2003. The IRS estimates that half of the people who could claim refunds would receive over $600 per return. There is no penalty for filing a late return qualifying for a refund, and the IRS is encouraging people to file before the April 17, 2007 deadline, at which point all unclaimed funds become property of the government. You can get all current and prior years tax forms at www.IRS.gov or by calling 1-800-TAX-FORM. For more information check out Times Record News.

E-Filing And Direct Deposit Numbers Up This Year

According to IRS data from March 2, 2006, the number of people using the e-file system, as well as people direct depositing their refunds has risen yet again. Overall the number of e-files has increased by 4% when compared with last year’s data. Including an increase in 7% of e-filing from personal computers and a 2% increase in e-filing from tax preparers. Also more people are requesting their refunds be directly deposited into their bank accounts. So far 82% of all tax refunds have been direct deposited, up from 80% last year. Source: IRS.gov.

Small Business Deductions

Do you own a small business? Nolo.com has compiled a list of the fourteen most important small business tax deductions, as well as another list of other easily overlooked deductions. You can check out the list by visiting Nolo.com.

Tax Incentives For Whistle Blowers

According to the IRS the difference between what taxpayers are supposed to pay in federal taxes and what they actually pay is around $345 billion per year. In order to help combat this ever-growing shortfall of revenue congress and the President have enacted a measure to give people more motivation to report others who are abusing the tax system. There are even plans to offer rewards for those who report abuse. The rewards will only go to informants who provide specific and useful information. For more on the whistle blowing incentives visit this article at The Star Ledger.

IRS Urges Taxpayers To Check Returns

Last week the IRS released statistics on the tax returns that they have received this tax season, and many people are not claiming the phone tax refund. Out of the thirty million tax returns that were filed before February 16th nearly 10 million did not claim the refund. Even more shocking, nearly half of the returns were prepared by a tax preparation office. The IRS is now encouraging taxpayers to check their returns to make sure they are aware of the one time phone tax refund, even if a tax preparation company prepared it. For more details on claiming your phone tax refund visit the IRS’s official site.

US House Passes Minimum Wage Tax Breaks

The US House of Representatives overwhelmingly approved small business tax breaks to be attached to the new minimum wage bill in a 360-45 vote on Friday. The House tax breaks include over 1.8 billion dollars in tax cuts compared to 8.3 billion the Senate approved on a similar minimum wage bill. Although House Democrats had originally hoped to pass the minimum wage bill without any associated tax breaks, it saw problems in the Senate where it was feared the bill would not receive any necessary Republican votes without including small business tax breaks. According to Senate Finance Committee chairman Max Baucus it should take two or three weeks for House and Senate negotiators to reconcile the two variations into one bill. Source: Yahoo News.

Common Tax Questions Answered

The Plain Dealer at Cleaveland.com has compiled a list of the most common tax and IRS questions with answers from Mary Vanac. Some topics include common tax return errors, important tax deductions, help on getting a refund, amended returns, new tax laws, and more. Click here to read the full article.

IRS Cracking Down On Abusive Tax Returns

Over the past week the IRS has been sending out IRS criminal investigators to tax preparation offices in seven major cities. The raids are part of the IRS’s crack down on tax preparation companies claiming thousands of dollars in phone tax refunds for clients who should only be getting $30 - $60 phone tax refunds. Investigators served search warrants for offices in Atlanta, GA; Dallas, Tyler, and Athens, TX; Riverside, California; Miami, Fla.; and New Orleans, LA. IRS agents have been temporarily closing businesses, and seizing computers and documents for evidence. The IRS is advising every one to stay away from tax preparers who make exaggerated claims about phone tax refunds. For more information check out the IRS’s website, or Yahoo News.

IRS Reached 2.3 Billion Dollar Agreement

On Valentines day the IRS announced they had reached a 2.3 billion dollar deal to resolve several tax disputes with Merck & Co., Inc. and its subsidiaries. Among the issues resolved were a few issues that resulted from the company’s use of minority equity interest financing transactions. The 2.3 billion dollar payment to the United States federal government is said to resolve the tax issues for the tax years 1993-2001. Although the settlement is one of the largest in IRS history, it is 40% below the $3.8 billion the IRS originally said it was seeking in November. Source: MarketWatch.com.

Deciding Whether or Not To Itemize

Each year during tax season there is one decision every taxpayer has to make, whether or not to itemize deductions on your tax return. Deciding to itemize depends mostly on how much you spent on certain deductible expenses last year including medical expenses, mortgage interest, state and local taxes, charitable contributions, etc. You should itemize if the amount you spent on those expenses is higher than the standard deduction amount according to the IRS. For more help deciding if you should itemize or not check out this article.

Energy Savings = Tax Savings

If you have made recent upgrades to your house then you may qualify for additional tax credits. There are many different home improvements that qualify for the energy credits including insulation, water heaters, air conditioners, fans, furnaces, skylights, windows, doors, solar panels, and certain roofs. The credit is usually around ten percent of the cost, but can vary depending on the type of upgrades. Keep in mind that only home improvements that reduce a home’s "heat loss or gain" are eligible for the credit. Thus, the credit may not apply to common household appliances such as dishwashers or refrigerators even if they bear the Energy Star label. For more details on getting an energy credit, visit DailyNews.com.

IRS To Prevent Telephone Tax Refund Abuse

In reaction to some tax preparers improperly claiming thousands of dollars in phone tax refunds the IRS has started a campaign to curb this abuse. According to the IRS’s website, they are finding instances of tax preparers claiming thousands of dollars in phone tax refunds, when their clients are only entitled to a fraction of that amount. In many cases the refunds appear to be for the entire amount of the taxpayer’s phone bill, rather than just the three-percent tax. To combat this the IRS is sending agents on special site visits to some tax preparation offices and will not process tax returns for taxpayers that claime more in phone tax refunds than they are entitled to claim. To get help with properly claiming this on your tax return, visit the IRS’s Telephone Excise Tax Refund page.

Top 5 Tax Audit Red Flags

CNN has compiled a list of the top five red flags in tax returns that might cause you to get audited. Included in the list is making too much money, giving too much to charity, taking too many credits, making careless errors, and failing to submit an alternative minimum tax schedule (if your earnings qualify). For more details on each of the five red flags, check out CNN.com.

IRS Issues Advice For Non Efilers

The IRS has begun processing the tax returns that claim the tax provisions enacted in December and is urging people who cite these deductions to not file using standard paper forms. These provisions include: State and Local General Sales Tax Deduction, Higher Education Tuition and Fees Deduction, and Educator Expense Adjustment to Income. The changes were made too late to appear on hard copy forms, so if you are going to claim these deductions then you will need to follow the IRS’s detailed instructions by clicking here.

Getting A Tax Refund For Driving

There are numerous different ways to get a tax refund from driving in your car. Although you cannot deduct expenses for your regular commute to work there are some other deductions that may be of value to many people. The tax laws regarding driving deductions are somewhat complicated, but USNews.com has an article detailing how to easily claim driving related deductions on your tax returns. Some of the deductions include driving to get medical care, driving to volunteer for a charity, and driving to relocate for a new job. For a full explanation of the driving related deductions, check out USNews.com

Looking for that 1099? Some 1099 Forms Will Arrive Late

At least five major brokerage houses, Morgan Stanley, Merrill Lynch, Wachovia Securities, Edward Jones and Raymond James, are delaying the mailing out at least some 1099 forms. They have received a month long extension from the IRS, and hope the extra time will avoid errors created by recent tax law changes. Two other brokerage houses, Fidelity and A.G. Edwards, plan to mail the forms out on time, but warn that some will need corrections. For more information visit USAtoday.com.

Many Early Filers Are Missing Out On the Phone Tax Refund

According to the IRS more than a third of taxpayers filing their returns early are not claiming the onetime phone tax refund that they are entitled to claim. A basic phone tax refund does not need any documentation and entitles taxpayers to a refund of at least $30, depending on the number of number of exemptions one claims. If you need more help to claim your phone tax refund, the IRS has set up a page with tips and advice that you can visit by clicking here.

Roni Deutch Tax Center Grand Opening Press Release

"It was fun for the whole family at the grand opening of the first Roni Deutch Tax Center on January 27 in Fair Oaks, CA. The company celebrated with free food and drinks, thousands of dollars in free gift cards and prize giveaways. Founder and president, Roni Deutch, spoke on the exciting plans of the company. "

Yahoo: Family Fun at the Grand Opening of First Roni Deutch Tax Center

PRweb: Family Fun at the Grand Opening of First Roni Deutch Tax Center

IRS Introduces Sales Tax Calculator

Earlier today the Internal Revenue Service announced a new online tool to help individual taxpayers. The tool is an online calculator designed to help people who itemize to determine if they will benefit more from deducting their local sales tax or their state income tax. For those not wanting to use the calculator, the IRS also has an online worksheet you can use to calculate the amount. You check out the calculator by clicking here.

IRS Extends Deadline for Filing

Recently the IRS announced that the deadline for filing 2006 tax returns, or paying any taxes that are due, would be pushed to April 17th. The extension was made because the 15th falls on a Sunday, and the 16th is a holiday in the District of Columbia. Originally the extended deadline only applied to the District of Columbia and six other states that are served by the Massachusetts processing facility. However, this year the April 17th deadline will apply to everyone. For more information check out AccountingWeb.

Grand Opening Press Release

"Roni Deutch is celebrating the grand opening of the first Roni Deutch Tax Center with a community celebration aimed towards raising money for the Hannah Rose Foundation. The company is promising a celebration to be remembered with thousands of dollars in prizes, free food and beverages. "
View the press release from the following links:

Yahoo: Tax Attorney Roni Deutch Celebrates the Grand Opening of the First Roni Deutch Tax Center

PRweb: Tax Attorney Roni Deutch Celebrates the Grand Opening of the First Roni Deutch Tax Center

Photos From Annual Awards Luncheon

Five new pictures from the annual Roni Lynn Deutch, A Professional Tax Corporation awards luncheon have been added to the Roni Deutch Flickr Page.

Annual Awards Luncheon Press Release

"Roni Lynn Deutch, A Professional Tax Corporation celebrated the end of 2006 with an awards luncheon on Sacramento's Delta King. The event featured a keynote address from Roni Deutch where she spoke on the power of positive thinking and how it helped her build her tax law firm. Later she awarded one employee with the company's first ten years of service award, and also selected twelve exceptional employees as the firm's All-Star team."
View the press release from the following links:

PRweb:Roni Deutch Celebrates Sixteen Years in Tax Law as She Thanked Employees, and Spoke on the Goals and Vision of the Company

Yahoo: Roni Deutch Celebrates Sixteen Years in Tax Law as She Thanked Employees, and Spoke on the Goals and Vision of the Company

Nine Craziest Tax Write-Offs

Bankrate.com has added a new article to their website with the nine craziest tax write-offs that you’ve ever heard of. Included in the top crazy deductions is a landlord who claimed he was renting a limousine to drive his tenants around, a woman who tried to take a day care tax credit for her dog sitter, and a man who tried to deduct expensive meals and theater tickets. To read details on all nine crazy tax write-offs click here.

Health Care Changes Could Raise Taxes

The White House recently announced their plan for improving the country’s health insurance coverage which included a proposal to make health insurance costs tax deductible. The plan will allow a $15,000.00 tax deduction for families, and $7,500.00 tax deduction for individuals. However, for those individuals who receive employer provided health insurance that costs more than $15,000.00 would face a tax hike, as their health insurance premiums would be counted as taxable income. Early estimates suggest that the plan will increase taxes for as many as 30 million taxpayers. For more information check out Reuters.com.

Senate Tax Writing Committee Approves Tax Breaks

The bill that proposed an increase to the minimum wage and that was approved by the U.S. House of representatives was met with some changes in the U.S. Senate Tax Writing Committee. Democratic leaders in the Senate opted to add over eight billion dollars in tax relief aimed at helping small businesses that typically hire minimum wage workers. It is expected that the bill will now be approved in the Senate, avoiding a fight with business lobbyists and possible filibusters. Visit Mail Tribune for more details on the new minimum wage bill.

New IRS Information Reporting Committee

Earlier today the IRS appointed eight new members to its Information Reporting Program Advisory Committee. The group was established in 1991 and serves the purpose of reporting information from the IRS to the public. For more information on the committee or to learn who the new members are visit the IRS’s website.

US House Passes Minimum Wage Increase

The United States House of Representatives ignored the advice of President Bush and passed a minimum wage increase without any associated tax breaks. The House passed the bill with a three quarters majority vote, as it now moves to the Senate for approval. The Fair Minimum Wage Act of 2007 (if passed to law) will raise the federal minimum wage to $7.25 per hour. To learn more on the new minimum wage changes visit Tax-News.com.

2007 Nissan Altima Qualifies for Hybrid Credit

Last week the IRS announced that the new 2007 Nissan Altima Hybrid meets the requirements of the Alternative Motor Vehicle Credit as a qualified hybrid motor vehicle. The full credit amount for the vehicle will be $2,350 but will only be available to a limited number of taxpayers. For more information visit the IRS’s website.

Getting Your Phone Tax Refund

On August 1, 2006, congress eliminated an excise tax on long-distrance telephone calls. Additionally, the IRS erronesoulsy collected the tax from thousands of phone users. The IRS has promised to refund the money erroneously collected. Depending on your situation, there are a number of different ways to get the refund. You can claim it as a credit on your 2006 tax return, use the IRS' 1040EZ-T form or use the IRS' estimated amounts. Businesses, however, do not get to claim a simple dollar amount and must calculate their return amount. For more information on getting your phone tax refund visit Kiplinger.com.

IRS Reaches Agreement on Gift Bags

Guests who attended the Golden Globe Awards last year received lavish gift bags that included jewelry, electronics and even trips. To ensure that that recipients pay taxes on such gifts and promotional items the IRS reached an agreement with the Hollywood Foreign Press. The agreement now requires that gift bag recipients be issued appropriate tax forms from the Hollywood Foreign Press so that the recipients can include such gifts in their income taxes. For more information visit the IRS’s website.

IRS Sets Processing Date

Beginning on February 3rd, the IRS will begin processing tax returns that claim deductions for state and local sales taxes, higher education tuition fees, and educator expenses referred to as the "extender" provisions. The IRS had previously announced that there would be a delay in processing returns with such deductions. Most taxpayers do not claim any of these extender provisions and should not be affected. People are welcome to submit their returns at any time, however they will not be processed until February 3rd. Any tax return that does not claim these deductions will be processed as normal. For more details, visit IRS.gov.

Changes To Frivolous Tax Policy

Thinking of filing a frivolous tax return? Think again! The recently passed Tax Relief and Health Care Act of 2006 made several changes to the "frivolous tax submissions penalty" (Section 6702). Previously, the penalty for filing a frivolous tax return was only $500 and was not much of a deterrent. The new penalty has been increased from $500 to $5,000. This is a dramatic increase and should serve as a greater deterrent from filing a frivolous tax return. Also, the revised legislation gives the IRS the authority to determine what qualifies as a frivolous return. For more information on the new regulations click here.

Installment Agreement Fee Increase

The IRS is raising it fees to establish an Installment Agreement because of increased labor and processing costs. Beginning January 1st 2007 the fee for entering into a non-direct debt installment agreement will be raised from $43 to $105, and the fee for direct debt installment agreements will be raised from $43 to $52. For more information on the new fees visit the IRS’s official website.

Happy New Year - 2007 Tax Breaks

With a new year comes new tax breaks. On January 1st several new tax breaks went into effect. Some of the most noteworthy include higher limits on 401(k) plans and a decline in estate tax rates. For a detailed list on all of the changes in 2007 visit Post-Gazette.com. From every one at the office of Roni Lynn Deutch, A Professional Tax Corporation and the Roni Deutch Tax Center we wish you a happy and healthy New Year!

Commercials on YouTube & Google

We recently added a few of our commercials for Roni Deutch, A Professional Tax Corporation and the Roni Deutch Tax Center to Google Video and YouTube. You can view these commercials by visiting the following links.

Roni Deutch, A Professional Tax Corporation
Commercial 1 (YouTube Google), Commercial 2 (YouTube Google)

Roni Deutch Tax Center
Commercial 1 (YouTube Google), Commercial 2 (YouTube Google)

2007 IRS Mileage Rates

Good news for those who track their mileage expenses. The IRS recently announced that they are raising the tax mileage rate from 44.5 cents per mile to 48.5 cents starting January 1, 2007. This is up 4 cents from the 2006 mileage rate. For more information on calculating your mileage rate deduction visit 2007s.org.

Certain Deductions May Delay the Processing of Your Return

The IRS announced that due to recent changes in the law they announced that a certain percentage of returns would be delayed in their processing. In particular, returns with a state and local sales tax deduction, higher education tuition and fees deduction, and educator expenses deduction. If you will be claiming any of these deductions and would like to have your return processed faster you should e-file your return. Returns that are e-filed tend to have fewer errors and are processed faster which means that if you are entitled to a refund you will get that faster too! You can read all of the IRS’s advice at www.IRS.gov.

Happy Holidays

Watching classic holiday movies will bring you joy and help you get into the spirit of the season. If you are interesting in watching a holiday classic then check out The Christmas Spot on FanPop, where you can stream over 100 holiday classics. Happy Holidays from every one here at Roni Deutch, A Professional Tax Corporation.

Pictures of Roni Deutch Tax Center

In October the first Roni Deutch Tax Center opened, and everything is going great. We have prepared thousands of tax returns already, and look forward to preparing thousands more. If you need help getting your taxes prepared check out RDTC.com. To see pictures of Roni Deutch Tax Center go to the Official Flickr Page of Roni Deutch.

Confusion with Tax Forms

With all of the new tax laws recently passed, IRS will not be able to update 2006 tax forms. Which means millions of people may miss out on valuable tax breaks. The IRS has updated their forms online and will be working to publicize the tax breaks to prevent confusion. For all of the updated tax forms that you will need, be sure to check out the IRS’s form page.

Tax Law Changes Cost Charities Millions

Charities are seeing great drops in the number of cars being donated because of tax law changes made last year. For more details check out this article on Examiner.com.

Charitable Donation Changes to Remember

The IRS has posted an article on their website with detailed guidelines on making charitable donations this year. There were several tax law changes made last year with the passing of the Pension Protection Act. The new law gives the government and taxpayers greater certainty in determining what can be deducted as a charitable contribution, and also provides retired taxpayers a new way to donate to charity. For more information on the Pension Protection Act check out this article on the IRS’s website.

Tax Relief for Phantom Gains

"US President George W. Bush is expected to sign into law by next week a bill that will give relief to employees who were taxed on 'phantom' share options gains they never received." Fore more information click here.

College Tuition Tax Deduction Extended

"The federally run College Tuition Tax Deduction program, which a month ago teetered precariously close to termination, was renewed last weekend, extending its life for another two years." For more information click here.

AMT Advice

The alternative minimum tax was created in 1969 to catch wealthy Americans who were avoiding paying their fair share of income taxes. Today, the AMT is now a taxing mechanism that adversely affects middle class Americans. For more information on the AMT check out Yahoo News.

Payroll Deduction Contributions

With the Pension Protection Act of 2006 changing the record keeping requirements for charitable contributions, many taxpayers are wondering how to deduct contributions taken directly out of their paycheck without losing their tax credits. The Internal Revenue Service addressed this issue by announcing that "the taxpayer should retain a pay stub, Form W-2, or other document furnished by the employer that shows the total amount withheld for payment to charity, along with the pledge card that shows the name of the charity." For more details visit the article on their IRS’s website by clicking here.

Small Business Tax Tips

Small business owners are constantly looking for ways to help reduce their taxes Some times making charitable donations or setting up a retirement plan is enough to help lower small business taxes, but often small business owners are looking for other methods. Forbes.com has posted an interesting article with tips for small business owners, you can read the article by clicking here.

$92.2 Million in Unclaimed Refunds

The IRS recently announced that they are waiting on 95,746 taxpayers whose refund checks have been returned undeliverable to the IRS. The total amount is over $92.2 million dollars, with an average refund of $963. The IRS Commissioner made this announcement to encourage taxpayers to notify the IRS with their updated address by using new features on the IRS’s website. You can now go to the "Where Is My Refund" page on the IRS website and find out if you are owed any money by the IRS. Or if you prefer you can request the form by calling 1-800-TAX-FORM (1-800-829-3676). For more information visit the IRS’s website at www.IRS.gov.

Advice on Charitable Donations

‘Tis the season to give! For advice on making a charitable contribution check out this article on MarketWatch.com.

Phone-Tax Refunds

In August the Treasury Department stopped collecting a three-percent tax on long distance calls, which has been in effect since the time of the Spanish American War back in 1898. It was also announced that the IRS would refund all money collected since March 2003 under the long distance tax. The government is expected to return up to $13 billion to individuals, businesses, and organizations. WashingtonPost.com has a helpful article with more details on this new return, including how to calculate the refund amount. To read the article click here.