Burden for preparers

Tax preparers may start being tougher in asking you to prove your entitlement to certain deductions. This is because a law was recently passed that requires these professionals to help weed out tax dodgers. This may result in increased paperwork and greater fees to some taxpayers since a longer amount of time will be required for preparing many returns.

Tax preparers now rely on different standards thanks to the IRS. This change is supposed to encourage preparers to be more careful about agreeing to sign returns with shady or extreme income tax deductions without warning the IRS of such behaviors through a specialized communication form.  Read more…

If you’ve ever stooped through a short door or tried to reach a book off the top shelf you know how uncomfortable it is to be the wrong size. The same thing is true with taxes - many tax benefits are only available to families and individuals whose AGI (adjusted gross incomes) or MAGI (modified adjusted gross income) falls within certain limits.

Calculating adjusted gross income (or AGI) is actually quite simple. Take all the income you report on your taxes, your “gross income,” minus any deductions (called “adjustments”) and what’s left is your adjusted gross income. The following items are all expenses you can legally deduct from your gross income: Read more…

Deductions are expenses the IRS allows you to subtract from your taxable income, lowering your overall tax bill. There are two ways to file deductions - using the standard deduction, and “itemizing.”

Standard Deductions

Every taxpayer is allowed to take a standard deduction. The standard deduction assumes you have an “average” amount of tax-deductible expenses, and lumps them into one easy sum based on your circumstances. For 2007, the standard deduction amounts are: Read more…

What’s the difference between a taxidermist and a tax collector? According to Mark Twain, “The taxidermist takes only your skin!” Many Americans would agree with him - tax bills often seem unreasonably high. Fortunately, there are many completely legal ways to reduce your taxes and keep more of your hard-earned money for yourself and your family. They’re called tax breaks.Tax breaks are provisions of the income tax code that reduce the amount you and your family have to pay. Some people think claiming tax breaks is cheating - something greedy corporations and rich people do - but it’s not. The famous Judge Learned Hand once stated, “There is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike, and all do right, for nobody owes any public duty to pay more than the law demands.” You are completely entitled to every tax break you qualify for, and not taking those breaks is only giving the IRS a gift they don’t deserve.

Here are five simple rules to remember when looking for tax breaks: Read more…

Innovative technology and the convenience that the Internet and teleconferencing brings have led more coaches, contractors, professional consultants, and freelance workers to go into business for themselves. Being self employed isn’t a means of simply generating additional income to supplement a job - it has become a full-time endeavor. A lot of full-time workers are setting their own hours while making great incomes. However, self-employed people do have distinct tax concerns. Read on for 10 helpful tax tips to reduce the bite Uncle Sam takes out of your income: Read more…

This tax season 10% of Americans will let someone borrow them their own money through a tax refund anticipation loan.  Rates might be as high as 744%.  A rapid refund is just your income tax refund given to you on the spot by your tax preparation service- usually within 1-2 days.  Rather than waiting for your tax return to come through the mail or via direct deposit directly from the government some people are choosing to get money in their pockets immediately at a great expense to themselves.  Despite the length of the loan lasting only about 10 days they are costing individuals hundreds of dollars in some cases.  Read more…

Homeowner Assistance for 2007

Increasing the amount for AMT exemptions was one of many changes in tax law during 2007. The federal legislature also made possible tax deductions for persons facing home foreclosures, as well as those purchasing mortgage insurance policies last year.

Mortgage insurance is mandatory in cases where buyers put down less than one-fifth of the purchase price of a home and are using government-subsidized or private banking loans. The premium for this policy is deductible for up to two homes, but only if the insurance contract was signed in 2007.

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Does the thought of preparing your small firm’s tax return make you queasy? Do you put it off until the deadline, hoping against hope that it will disappear? You don’t need to go through this anymore. There is now an excellent small business owner’s guide to tax preparation that can aid you to stop procrastinating any longer. Read more…

Wesley Snipes, star of such amazing action films such as Blade, Blade II, Blade III, Blade IV, and Blade V faces 17 years of imprisonment and resulting ass-rape for charges of failing to file a tax return.

Mr. Snipes’ defense is that he was “following unscrupulous tax advice”. 

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