Skip to main content

THURSDAY TAX TIDBITS

Five Facts the IRS doesn't want you to know!



1. Calling the IRS for help won't work.

Calling the IRS usually requires you to stay on hold. Last year, 35.6% of phone calls went unanswered by representatives; that's a lot! Additionally, this year the IRS projects that they will only serve 43 percent of callers after they wait for 30 minutes. Crazy, I know!

2. The IRS can't handle all the paperwork either.

About 50 percent of letters the IRS receives have not been handled in a timely manner. The IRS deals with over a million pieces of correspondence; it takes an average of 45 days to respond.

3. The IRS is worried about ObamaCare collection.

If you received a subsidy based on your projected income, and you made more than that estimate, you may have to pay back part of the subsidy. If you did not have a health care plan, you may be able to file for an exemption or you could owe a small penalty. The Trump administration ended this policy, however, it is not effective until 2019.

4. Your refund may be delayed this year.

Blame the budget cuts says IRS Commissioner John Koskinen. In January, he wrote a memo warning employees of a possible hiring freeze and possible two-day furlough later this year. The memo also mentioned that individuals who file paper returns can wait for a week longer for their refund due to staffing.

5. The IRS is an open target to scammers. 

In 2015, the IRS spent $5.5 billion in fraudulent identity theft refunds. Independently, many Americans also experience scams by con artists contacting them and pretending to be the IRS. To learn how to avoid becoming a scam victim, read my past articles that teach you red flags.

To avoid getting caught in the messy web of the IRS, do your taxes right the first time. At Cunningham's tax office, our tax accountants do your taxes right the first time and help you get the best refund you can receive. We are open Monday through Friday from 9 AM to 5 PM; contact us by email or phone at: thetaxlady4u@gmail.com or 253.581.1461

Follow me!
Twitter: @thetaxlady4u
And ask me about PolkaDotPowerhouse!

Comments

Popular posts from this blog

THURSDAY TAX TIDBITS

Tax Tip: Start Planning Ahead!

It is never too early to start thinking about the upcoming tax season. Don't procrastinate and be prepared for the tax reform changes that have been implemented this year. Under the Trump Administration, there have been several tax changes that may impact you or your business. Here are some changes that may impact you:


Tax Reform: Business Impact
There are many business considerations, including the corporate tax rate, limitations on net interest expense, full expensing of business assets, changes to net operating loss deductions, limitation of like-kind exchanges, limitation on deductibility of FDIC premiums, corporate alternative minimum tax, rules for recognition of income, changes to business tax credit, the modified limit on excessive compensation, and the modified deduction for meals and elimination of entertainment expenses. Not being able to claim the same expenses as before may lead to higher taxes! Tax Reform: Individual Impact
Individuals will …

THURSDAY TAX TIDBITS

Why You Should Turn Your Business Into An S Corp!

Are you thinking about starting your business or do you think your business couldn't be running any better? Whatever your business ownership position is, start thinking about turning your business into a corporation. An S Corp is a: "is a closely held corporation that makes a valid election to be taxed under Subchapter S of Chapter 1 of the Internal Revenue Code." Being an S Corp protects your personal liabilities from any business losses. There are more benefits to becoming an S Corp, such as tax and deductibility benefits. Here are some reasons why you should consider becoming an S Corp:


❖Save money on self-employment tax
❖W2 at year end
❖Deductibility of wages & payroll tax, employer portion
❖Rent expense paid to the shareholder 
❖Liability protection
❖Perpetual existence
❖Costs

To understand how this applies, the table below demonstrates the accounting differences between a Sole Proprietorship and an S Corp:


Start growing …

THURSDAY TAX TIDBITS

How to: Notice red flags and avoid scams!
Summertime tends to be a period when thieves increase their scam attempts. They try to obtain peoples’ Social Security numbers, account information and passwords. To avoid these scams, remember these signs!
The IRS and authorized private collection agencies will never: Call to demand immediate payment using a specific method such as a prepaid debit card, gift card or wire transfer. Normally, the IRS mails a bill and the payments are made payable to the U.S Treasury. Never make checks to other partiesThreaten to immediately bring in the local police or other law-enforcement groups to have the taxpayer arrested for not payingDemand that taxes be paid without giving the taxpayer the opportunity to question or appeal the amount owedAsk for credit/debit card numbers over the phoneUse email, text messages, or social media to discuss personal tax issues, such as those involving bills or refunds

If you believe you may owe taxes, then you can: View tax …