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The Tax Resolution Institute Helps Allentown Pennsylvania Company With Unpaid Payroll Taxes

January 30, 2012 By

The problem of unpaid payroll taxes and the trust fund recovery penalty happens everywhere, even in growing cities like Allentown in Pennsylvania. Like Irvine and other growing cities that the Tax Resolution Institute has helped in the past, Allentown has been experiencing a challenging mix of economic growth and the subsequent challenges. Helping the process, the Allentown Economic Development Corporation operates the Bridgeworks, a business incubator that has helped to fight the recession. Such civic support in Allentown helps attract and support young commercial and manufacturing businesses.

Unpaid Payroll Taxes In Allentown

When a young commercial business in Allentown found themselves with a serious problem of unpaid payroll taxes because deposits to the IRS were missed, TRI came in to make sure the doors stayed open. We will not go into any more detail about the business to protect a client’s anonymity as we always do. It is too dangerous in a small and vibrant business community like Allentown to go even discuss the nature of the business and what it produces or what services it offers to its clients.

Tax Resolution Services in Allentown

Tax Resolution Services in Allentown

What is more important is that the company found itself with a serious financial crisis on account of unpaid payroll taxes. Hit by the recession as it continued to expand in the growing Allentown economy, the business owners “temporarily borrowed” from their employee’s payroll taxes in the trust fund in order to cover costs. But they failed to make a few deposits on time and set themselves up for terrible consequences. Rather than find an alternative financing solution, they began to cook a recipe that leads only to disaster.

 The Best Tax Resolution Services In Pennsylvania

Luckily, the tax Resolution Institute offers the best in tax resolution services in Pennsylvania. When the IRS discovered the missing payments and the delinquent deposit dates, the company began to receive threatening notices. Luckily, they were smart enough not to hesitate. Learning about the Tax Resolution Institute on the web, they contacted us for a free consultation. Peter Stephan and the tax experts at TRI presented a plan that could put an end to the crisis. By paying off the debt and a portion of the fines, the penalties were waived and the crisis was over. The company escaped without being placed in a true financial crisis that could have closed their doors in Allentown. Rather than paying the full amount owed in fine and penalties, they paid less than 10% and breathed a sigh of tax relief when TRI provided them with an unpaid payroll tax resolution and an effective solution.

Filed Under: Delinquent Tax Debts, Payroll Tax Problems, Tax Relief, Tax Resolution Services Tagged With: , , , ,

How Businesses Get in Trouble with Unpaid Payroll Taxes – 2 Key Examples From Philadelphia & Pittsburgh in Pennsylvania

January 28, 2012 By
Unpaid Payroll Taxes

The Problem Of Unpaid Payroll Taxes

In today’s tough economy, whether a result of ignorance, accident, or design, unpaid payroll taxes get plenty of business owners in trouble with the IRS. It is very easy for a business with large operating expenses and reduced sales to “temporarily borrow” from the payroll taxes account to keep the lights on. Payroll deductions are called a Trust Fund because you become a trustee of the IRS. Unpaid payroll taxes result from failing to make the required payroll tax deposits on time and in the correct amounts. Failure to collect and submit this money means you have committed a trust fund violation against the federal government. IRS Revenue Agents take such violations very seriously and responds harshly to the liable business owner.

Never forget that in addition to withholding the money from your employees’ wages, and depositing that money on their behalf, you also have the requirement to pay a matching amount for some of those taxes. And never confuse reporting with depositing. These are two entirely different processes. Reporting tells the government how much you owe. Depositing is the process of actually sending them the money in a timely manner and in the correct amount. If you mix up the two, you will be held liable for the unpaid payroll taxes.

A Business In Pittsburgh With Unpaid Payroll Taxes

The Tax Resolution Institute once helped a construction company in Pittsburgh with unpaid payroll taxes. The payroll tax crisis was caused by a misunderstanding by the owners. In a cash crunch, they had continued reporting while missing deposits. The construction company owners believed that by continuing to report the amount owed, they would not be penalized by the IRS and would be able to pay the rest later. This could not be farther from the truth. Luckily, the tax experts at the Tax Resolution Institute were able to negotiate a deal with the IRS that enabled the company to remain in business. They were given the opportunity to collect the funds needed to pay what was owed with interest and a small penalty. Without the help of TRI, their doors would have been closed and their assets sold.

Depending upon the size of your payroll, you are required to make payroll tax deposits either semi-weekly or monthly. The IRS makes this determination the first time you file your taxes. You do not choose. Business owners who get into trouble over payroll tax matters usually do so because they skip one or more deposits. And the IRS Revenue Agents do not care why you missed the deposit. Once you miss even one, you have a record of unpaid payroll taxes and you start receiving an automated series of letters. These letters quickly start threatening civil and legal penalties including interest, penalties, fines and, in extreme cases, criminal action.

IRS Officers Agents Will Not Stop Until The Trust Fund Is Recovered

IRS Revenue Officers Do Always Collect Unpaid Payroll Taxes

A Business in Philadelphia With Unpaid Payroll Taxes Helped

The Tax Resolution Institute once helped a financial services company in Philadelphia with an unpaid payroll tax problem. The previous company of the new accountant had monthly deposits. Although the construction company had to make semi-weekly deposits, the new accountant made the mistake of making monthly deposits. When the threatening letters started coming from the IRS, the owners of the construction company contacted the Tax Resolution Institute. In any tax situation with the IRS, it is always better to avoid going it alone. The Tax Resolution negotiated a positive resolution for the company with the IRS, resolving the problem of unpaid payroll taxes. Since monthly deposits had continued to be made, the trust fund recovery penalty was replaced with a small cautionary fine and a promise of future compliance.

If your unpaid payroll taxes are getting out of control, you need to engage an experienced tax professional to represent you before the IRS. The tax professionals at the Tax Resolution Institute can negotiate a payment arrangement or settlement between you and the IRS. In many cases, we are able to successfully remove or reduce the amount you have been assessed in fines, interest or penalties. Like we did with the two Pennsylvania businesses in Philadelphia and Pittsburgh, the Tax Resolution Institute can resolve an unpaid payroll tax problem and offer your company effective tax relief.

Filed Under: Payroll Tax Problems, Tax Relief, Tax Resolution Services Tagged With: , , , , , ,

If You Are A Millionaire, The Internal Revenue Service Is Much More Likely To Audit You

January 25, 2012 By
Millionaires Targeted By The IRS

1 In 8 Millionaires Targeted By The IRS For Tax Audits

If you earned over a million dollars last year, you were much more likely to be contacted by the IRS. An incredible one in eight people earning at least $1 million annually were audited by the Internal Revenue Service last year. In contrast, according to IRS data released and reported on in the Huffington Post, only 1 in 100 individuals earning less than $200,000 had their income tax returns examined by the IRS. The Tax Resolution Institute empathizes with wealthy taxpayers, and we understand how you suddenly feel as if you are under siege for no reason. If you need the best in effective and reliable tax resolution services, please contact us today.

The 12 percent of millionaire earners audited in 2011 was appreciably higher than the 8 percent who were audited in 2010. IRS officials said the high ratio was part of an effort to demonstrate that tax laws are applied fairly. As we all know from the State of the Union, President Barack Obama and congressional Democrats are seeking to boost taxes on the wealthy as a way to pay for jobs programs. President Obama announced an incredible tax hike against the wealthiest taxpayers of 30% of their annual income.

Between 2004 and 2009, the percentage of millionaire earners audited ranged between 5 percent and 7 percent. The auditing data is divided into only three categories of income: below $200,000, $200,000 and up, and $1 million and higher. About 1 in 25 people earning $200,000 and more was audited in 2011. With the United States economy still in crisis, the federal government clearly has decided to target the wealthy. In addition, the data shows that the IRS also audited a greater proportion of large corporations than smaller ones. Last year, only 1 percent of corporations with assets under $10 million were audited. Among corporations with assets of $250 million and up, 28 percent were audited.

The IRS Is Going After Your Money

The IRS Is Going After The Money Of Millionaires

The IRS said its enforcement efforts to collect all taxes owed — which include audits, court cases and other activities — netted $55 billion last year. That is nearly $3 billion less than the previous year, and the Obama White House is not happy about the fall-off. In total, the IRS audited nearly 1.6 million of the 141 million individual income tax returns that were filed. The agency collected a total of $55 billion from its enforcement efforts for the 2010 tax year. In 2011, according to the recent data, the Revenue Agents of the Internal Revenue Service garnisheed wages or seized money from bank accounts 3.7 million times, put tax liens on property 1 million times and seized 776 pieces of property.

The Tax Resolution Institute believes that all taxpayers should be treated equally without preferences or prejudices. If you are a wealthy taxpayer and you have been contacted by the IRS, do not delay in taking action. Contact us today for the best in tax resolution services.

Filed Under: Income Tax Problems, Tax Relief, Tax Resolution Services Tagged With: , , , , , ,

The Internal Revenue Service Files An Income Tax Lien Against Lindsay Lohan

January 13, 2012 By
Lindsay Lohan and the IRS Income Tax Lien

Lindsay Lohan and the IRS Income Tax Lien

Like so many celebrities in crisis before her, Lindsay Lohan is facing an IRS tax lien for nearly $94,000 that the federal government says she owes in delinquent income taxes. The Tax Resolution Institute has seen such celebrity cases again and again over the years as a result of poor financial management and zero tax planning. Records in Los Angeles County show the lien filed by the IRS at the beginning of 2012 seeking payment for the 2009 tax year.

According to Lohan’s publicist Steve Honig, the starlet’s finances are nobody’s business but her own. Then again, clearly the Internal Revenue Service has a very different perspective. If the actress knows what is good for her and learns from the dreadful experiences of Wesley Snipes and Nicholas Cage, she will hire a top tax professional and deal with the crisis at hand. Lohan is continuing to serve morgue duty to comply with her probation in a pair of misdemeanor cases so she has no more room for additional legal troubles.

Lohan claims that she thought her accountants were handling that sort of thing, and she says that she intends to pay the bill immediately. Her paycheck for recently posing nude in Playboy magazine ought to help. The Internal Revenue Service filed the tax lien against her home in Encino, according to E! Online. In full-tabloid mode for many years, clearly it is time for Lindsay Lohan to address her tax troubles and legal problems and put the bad news of the past behind her. Lohan found the time last week to go to the Chateau Marmont on Wednesday night and attend a party hosted by the Weinstein Co., to celebrate award season. If Lindsay Lohan wants to receive awards and not fines in the future, she should hire a proper financial management team and the tax experts at the Tax Resolution Institute to help her find the tax relief she clearly needs.

Filed Under: California Tax Relief, Tax Lien Problems, Tax Planning, Tax Relief Tagged With: , , , , ,

The New California Willful Misclassification Of Independent Contractor Law Is Essential Information For All Employers Part 2

January 12, 2012 By

Previously, the first part of this article was posted, going into detail about the new California Willful Misclassification Law of Independent Contractors and how it will effect companies. From a tax resolution perspective, it can have extreme consequences in regards to payroll taxes and the trust fund recovery penalty. Here is the second part of the article that continues the analysis.

The Spotlight Is On California Employers

The Spotlight Is On California Employers

Part 2 — There are so many California employers who have misclassified their workers as “independent contractors” to avoid the costs and expenses associated with payroll, overtime pay, workers’ compensation insurance, disability, and other traditional employee benefits and protections. In California, the state agency most involved with determining whether an employee is misclassified as an independent contractor is the Employment Development Department (EDD). Looking to fill the state coffers, the EDD is allowed to go back three years and seek reimbursement for unpaid payroll taxes, unemployment insurance, disability insurance, workers’ compensation insurance, and to assess both fines and penalties for violations of various California Labor Code violations

The failure to pay a terminated employee all wages due and owing in a timely fashion can subject an employer to a penalty of up to 30 times the employee’s daily wage without regard to the actual amounts of unpaid wages. Needless to say, when a worker is misclassified it is a given that the payroll taxes have not been paid. Employers who fail to pay for unemployment insurance benefits and/or state disability insurance benefits are not only required to pay the amounts not withheld, but may also be assessed a 10% penalty and interest on the unpaid contributions. 

California employers should know that it does not matter that a worker signed an independent contractor agreement, or was paid as an independent contractor. Both the California Labor Commissioner and the courts will look behind any such purported agreement and examine the underlying nature of the relationship to determine whether the worker was misclassified.

Payroll Tax Liability In California Is Intensifying

Payroll Tax Liability In California Is Intensifying

California employers are strongly urged to review their employment practices. Misclassifying employees as independent contractors can have devastating consequences for your business. In an investigation, the California Employment Development Department focuses on the right of the principal to control the manner, mode, method and means of performing the actual job. The investigation is extensive and includes these five questions:

  1. Doe the employee have a separate occupation or business?
  2. Does the employee providing the service supply their own tools and the place of work?
  3. Is the service performed an isolated event or continuous in nature?
  4. Is the employee paid by the hour or by the job?
  5. What is the extent of actual control exercised by the principal over the manner and means of performing the services?

California payroll tax audits often lead to a finding of payroll tax fraud by the EDD. This may happen if an employer pays workers in cash over a number of years, and fails to file Forms 1099 or makes other attempts to conceal the existence of those workers. If a corporate taxpayer cannot pay the California employment taxes it owes, the EDD may hold corporate officers and stockholders who willfully fail to pay California payroll taxes personally responsible. Unlike the IRS trust fund recovery penalty for federal payroll taxes, responsible officers and shareholders will be held responsible not only for the trust fund portion of the California payroll taxes, but the entire amount of the California State employment taxes including all interest and penalties.

 

 

Filed Under: California Tax Relief, Payroll Tax Problems, Tax Planning, Tax Resolution Services Tagged With: , , , ,

JK Harris Files For Bankruptcy, Cleaning House Of The Tax Resolution Services Industry

January 10, 2012 By
JK Harris No Longer Smiling

JK Harris No Longer Smiling

Joining American Tax Relief and Roni Deutch in the pit of financial and criminal scandal, JK Harris & Co. filed for bankruptcy and suspended all operations last week, preparing for the possible liquidation of the firm’s assets. First, the FTC shut down American Tax Relief, then the California Attorney General sued Roni Deutch for cheating innocent American taxpayers, and now JK Harris is going out of business. As a representative of the very best of the tax resolution services industry, the Tax Resolution Institute is happy to see the house being cleaned. We are tired of our necessary and important industry being maligned and dominated by criminals and scam artists. It is time for the cream to rise to the top, and Americans to know that when they hire a Tax Resolution professional, their tax problems will be handled honestly and effectively.

Although company founder and Chief Executive Officer John K. Harris had been attempting to restructure and possibly sell the business and two affiliates under Chapter 11 bankruptcy protection since October, the history of scandal and scams kept al potential buyers far away. Employees were told in an email last week that they could return to their offices to pack up their personal belongings. “This is truly the most devastating event I have been forced to deal with in my 58 years on this earth,” Harris said in the distraught email. “I am not sure it will reach that level for all of you, but I know that for some of you it will be as personally devastating.” The next step for JK Harris & Co. is expected to take place today on January 10 in a bankruptcy court hearing, where the company will ask a judge to appoint a trustee.

Cleaning House Of Greedy Tax Resolution Companies

Cleaning House Of Greedy Tax Resolution Companies

JK Harris & Co. once advertised that it could resolve people’s tax debts for “pennies on the dollar,” but the nationwide firm was dogged by cash-flow problems and the cost of large settlements related to multiple claims that it misled consumers. In case after case, attorneys general complained that the company told consumers it could resolve their tax problems, and took their payments, when no such relief was possible for those particular clients. More than 5,000 customers who had hired the company to try to resolve their federal and state delinquent tax debts are left in the lurch by the shutdown. If you have a serious tax problem and you feel abandoned by JK Harris, contact the Tax Resolution Institute today for a free consultation. Our goal is to provide you with effective and legitimate tax relief and viable tax debt solutions.

Filed Under: Delinquent Tax Debts, Income Tax Problems, Tax Relief, Tax Resolution Services Tagged With: , , , , ,

The New California Willful Misclassification Of Independent Contractors Law, Payroll Taxes And Your Business

January 9, 2012 By

As a resource to our past, present and potential future clients, the Tax Resolution Institute provides an in-depth analysis of the new California independent contractor law. When Governor Brown signed the new law at the end of 2011, the stakes rose to the next level. and your business could be in serious financial jeopardy, both with payroll tax violations and numerous other penalties. Here is the first part of our two part analysis.

California Enforcement Spotlight In Your Business

California Enforcement Spotlight On Your Business

Part 1 — If you are a business owner in California and you employ independent contractors, whether you are based in Orange County or San Diego, Los Angeles or Irvine, it is time to pay attention because the EDD could be coming after you. Let’s face the simple truth – California is struggling to collect more revenue and has begun implementing some of the most aggressive tax collection actions in the nation. In October 2011, Governor Brown signed Senate Bill 459 into law that makes the “Willful Misclassification” of employees as independent contractors illegal.

Working with the California Employment Development Department, the law gives California’s Labor Workforce Development Agency authority to assess very high civil penalties and take severe actions against a person or employer violating this new law, including extensive payroll tax violations.

The 3 key points of the law are outlined as follows:

Point 1 – This law allows California’s Labor Commissioner, or a court, to levy a civil penalty of $5,000 to $15,000 for each violation found to be “willful” (a single misclassified individual is one violation).

Point 2 -If the agency, or a court, determines there is a pattern and practice of these “willful misclassifications,” a civil penalty of $10,000 to $25,000 for each violation may be imposed.

Point 3 – These fines are in addition to any other assessments, penalties and fines that may be imposed under other laws.

A New Day For Independent Contractors In California

New Day For Independent Contractors And Employers In California

Do not think that your company will be exempt or you will pass under the radar of this new law. These fines will be levied against any business that continues to “willfully misclassify” workers. “Willful misclassification” is defined in the new law as “avoiding employee status for an individual by voluntarily and knowingly misclassifying that individual as an independent contractor.” What is truly challenging about the new law is that the courts have generally defined “knowing” in this context as including constructive knowledge, which can mean what an employer purportedly should have known.

What is frightening is that the law not only includes financial penalties and payroll tax violations, but has a public disclosure aspect as well. Any violator will be required to post a letter on its Internet website for one year that explains the violation in detail. The letter must contain the following according to the letter of the law:

(1) That the Labor and Workforce Development Agency or a court, as applicable, has found that the person or employer has committed a serious violation of the law by engaging in the willful misclassification of employees.

Yes, you have to admit in public that you violated the law.


(2) That the person or employer has changed its business practices in order to avoid committing further violations of this section.

Yes, like a child, you must admit on your business premises that not only did wrong, but will do better in the future.

(3) That any employee who believes that he or she is being misclassified as an independent contractor may contact the Labor and Workforce Development Agency. (The notice must include the mailing address, e-mail address, and telephone number of the Agency.)

Yes, the purpose of the posting is to help your employees prosecute you for the willful misclassification.

(4) That the notice is being posted pursuant to a state order.

As you can see, the consequences are extreme and the state of California, represented by the California Employment Development Department and the California’s Labor Workforce Development Agency new and extensive powers of both investigation and  retribution. In order to protect your business, you need a tax professional on your side like the Tax Resolution Institute, a respected company with both experienced Tax Resolution Specialists and Tax Attorneys on staff. This ends Part 1 of the account of the new law and regulations in regards to California independent contractors and the new Worker Misclassification Law. If you have a serious payroll tax problem with California Employment Development Department, the time to take action is now. Contact the Tax Resolution Institute for real help!

Filed Under: California Tax Relief, Payroll Tax Problems, Tax Relief, Tax Resolution Services Tagged With: , , , , ,

Whether You Live In Los Angeles, San Diego Or Irvine, IRS Income Tax Debt Relief Has Become A Real Necessity

January 2, 2012 By

In California’s challenging economy, owing money and finding yourself in a financial bind is not uncommon. Although owing money to people can be downright unpleasant, nothing compares with owing money to the Internal Revenue Service. Whether you live in Los Angeles, San Diego or Irvine,  the Internal Revenue Service is coming after your delinquent income tax debts with a renewed intensity. The Tax Resolution Institute understands that you need, and we can provide you with an effective strategy for income tax debt relief

A Tough California Economy Results In Income Tax Debts

A Tough California Economy Has Resulted In Serious Income Tax Debts

It is true that tax agencies like the IRS and the California Franchise Tax Board are relentless in their pursuit of unpaid income taxes. Like any company, the IRS understands that the cost of chasing a debt, is always measured against the value of the debt itself. The IRS takes a cost/benefit analysis when it comes to collecting income tax debts. In simple terms, if the IRS feels that your debt will and can never be repaid for practical reasons, it will not continue to pursue that debt. As a result, this is why both bankruptcy and currently not collectible status are employed as strategies by the Tax Resolution Institute in serious cases. In addition, the focus of the IRS on high debt collection is why we focus on larger cases in regards to amount owed and payment status.

One of our goals in a difficult economy when our clients have limited resources is to get the  IRS to look at you and your debt through that unrecoverable lens. The process to achieve such a perspective is difficult as it involves the understanding of complex tax policies and concepts. Naturally, you need to fill out many forms and make sure that all of your due diligence is executed and you do not appear as a criminal tax evader to the IRS. Luckily, we have the experience and the expertise to make sure that your tax case is handled with focus and care.

If you are in tax trouble and need effective tax relief from a delinquent income tax debt,  then need to hire a tax professional like the tax experts at TRI to help you. That is the simple truth of the matter, and it’s the only safe and sensible approach to your financial crisis. By having Peter Stephan and the Tax Resolution Institute in your corner, you ensure the future safety and financial security of your family. Do not take chances with your life.

The Tax Resolution Institute Knows California Tax Resolution Services

The Tax Resolution Institute Provide The Best In Southern California Resolution Services

Once the Tax Resolution Institute takes your case and receives power of attorney from you, it allows us to deal directly with the IRS on your behalf. By following a strategy that has worked countless times in the past, we will find a true resolution and your tax problems will soon be behind you. The approach I’ve just given you is used by thousands of people each day, who more or less have the same problems as you. The Tax Resolution Institute understands that whether you live in San Diego or Los Angeles, Irvine or Orange County, the Southern California economy has been nothing less than brutal over the past few years. It is no surprise that you are facing a serious income tax crisis, but we are here to help you find the freedom you deserve.

Filed Under: California Tax Relief, Delinquent Tax Debts, Income Tax Problems, Tax Relief Tagged With: , , , , , , ,

5 Essential End Of The Year Tax Planning Tips From The Tax Resolution Institute

December 27, 2011 By
End Of The Year Tax Planning Tips

End Of The Year Tax Planning Tips

Recognizing the importance of tax planning as 2011 ends and 2012 begins, the Tax Resolution Institue offers you this handy guide of 5 essential end of the year tax planning tips. Some may apply to you and some may not, but we are certain that there is at least two or three tips in this document that will help you with your tax planning. After all, although the Tax Resolution Institute focuses on helping individual and companies resolve delinquent tax debts, we also believe in providing techniques and strategies as a form of prevention to help you avoid such serious tax problems.

1) Sell Losing Stocks By The End Of The Year To Offset Capital Gains

One strategy you can use to reduce your taxes is to examine your investment portfolio and make sure to offset any capital gains by selling the stocks with capital losses. Capital losses offset capital gains in the year that the investments are sold off. However, if your losses exceed your profits, then the net loss is tax deductible but only up to $3,000 in net losses for that year. Still, the remainder of those losses carry over to the subsequent year as what is described as a “Capital Loss Carryforward” by the Internal Revenue Service

In addition, you must be careful when timing the sale of any losing positions. Any purchase of “substantially identical stock or securities” (from Publication 550) within 30 days of selling a security at a loss will be deferred. The key is to sell one investment at a loss, and purchase a similar (but not “substantially identical”) investment that helps build your portfolio. Always get the advice of a tax planning professional when making such a decision.

2) Be Fully Aware Of Tax Credits You Can Use To Lower Your Tax Bill

Yes, when it comes to tax credits, it often seems that the qualifying rules for each program  are both complex and overly specific.  Nevertheless, you should explore any or all of the options to see if they can be used to lower your overall income tax debt for that calendar year. Here are some of the tax credits used most often:

A. Child Tax Credit + Child and Dependent Care Credit:

The child tax credit provides you with a tax credit of $1,000 per qualifying child under the age of seventeen.  This credit is phased-out for taxpayers with modified adjusted gross incomes (AGI) in excess of $110,000 for married-joint filers, $55,000 for married filing separately, and $75,000 for all other taxpayers. In addition, if you’re paying someone else to care for a child under age 13 so you can work, then you may be able to claim the child and dependent care credit.

B. Hope and Lifetime Learning Credit:

If you are paying secondary education expenses, then the American Opportunity Credit, Hope Credit and Lifetime Learning Credit provide tax credits up to $2,500 for each qualifying student enrolled in a qualifying institution of higher education.

C. Helping The Environment - Hybrid Car Credit + Energy Saving Devices:

If you buy or lease a new hybrid car or truck, then you may be eligible for a tax credit of $250 to $3,400 per car depending on the fuel economy of the vehicle.  New car manufacturers will provide you with the details of these tax savings programs and you can also can find them online. In addition, if you have installed some of the newer energy saving devices in your home such as air conditioners, water heaters, furnaces, boilers or solar panels, then you may be eligible for a tax credit of up to $2,000.  Check with your utility company to find out which energy saving devices provide tax credits or rebates.

3)  Place Funds In Your 401k Retirement Account

401k Contributions Key For Tax Planning

401k Contributions Key For Tax Planning

If you are looking to lower your tax bill, one of the most effective ways to keep more of your gross income is to have it directed into a 401k retirement account. The 401k rules are quite generous when it comes to lowering income.  On a pre-tax basis you can invest up to $17,000 in 2012 (16,500 in 2011), and your contributions are often matched by your employer. Such an investment for your future security is nothing less than a win-win.

 

4) Please Do Not Forget Or Ignore Your Gambling Earnings And Losses

In this modern age of high-stakes poker online, in the casinos, and on television, more and more people are gambling each year with tremendous losses and some excellent earnings. Whether you play poker or back your favorite college team with a bookie, shoot craps or bet on the horses, all gambling winnings must be reported as taxable income. In addition, gambling losses may be claimed as deductions, up to the amount of your winnings. What is essential to remember is that gambling winnings and losses must be reported separately. If you file a tax return with with the IRS and do not report such figures, it is considered to be tax evasion.

5)  Organize And Maintain Your Paperwork And Records

Yes, we know this seems like a hassle, but it is a necessity as well? The IRS recommends that you keep all tax-related records for 3 years in case of an audit. But some old tax documents, such as last year’s W-2′s, can come in handy when you are filling out your tax return this year.

Where Are All Of My Financial Papers?

Where Are All Of My Financial Papers?

Here are examples of tax-related documents you should organize:

  • W-2 forms
  • Pay stubs for the year
  • Mortgage payment stubs and/or home purchase closing statement
  • Receipts from anything you might claim as an itemized deduction
  • Receipts from donations given to any charity, including text message donations
  • Any receipts for business travel expenses + your car mileage log for business use
  • Credit card statements and bank statements, including canceled checks
  • Medical bills (particularly if exceeding 7.5% of your income)
  • 1090G form (for deducting state or local income taxes)
  • 1090 forms (from any dividends or other income paid to you)

To make your mountain of documents easier to store, try scanning them and keeping them as PDF files. This way you can print them out if you need them. If you do this, always remember to back up your computer. The IRS will not take kindly to the excuse that you scanned your financial documents and your hard drive failed. Always be careful!

That covers many of the bases for now. The Tax Resolution Institute are not only experts when it comes to tax resolution services, but we also have extensive experience in tax planning and tax prevention strategies. Contact us today for a free consultation so we can help you ensure the profitability of your financial future.

Filed Under: Tax Planning, Tax Relief, Tax Resolution Services Tagged With: , , , , , , , ,

A Christmas Present Of Essential Tax Information For California Taxpayers From The Tax Resolution Institute

December 25, 2011 By

Christmas should be a universal holiday for everyone, a time of seasonal relief and family love and financial support. The Tax Resolution Institute knows how many California taxpayers are in trouble this year as 2011 comes to a close. We want to provide with a Christmas present of essential tax information to help make 2012 a wonderful year for you and your family. Although the statute of limitations for Federal Tax Collection tends to be ten years, the statute of limitations for California Franchise Tax Board is twenty years. In this economic crisis, they are going after ancient tax debts with a particular vengeance these days.

Christmas Awareness - Extended Statute of Limitations

Christmas Awareness - Extended Statute of Limitations

The California Franchise Tax Board is not just going after delinquent income tax bills of current California residents. If you once lived in California and failed to pay your state income taxes, they are coming after you in Michigan and New York, Connecticut and Ohio, Illinois and Florida, Nevada and Pennsylvania. It does not matter what state you now live in, if the California Franchise Tax Board comes after you, they will levy your bank accounts and take tax collecting actions against you. California is in economic crisis with a huge deficit so the revenue agents from the Franchise Tax Board have been given a mission to dig up and collect all past due income tax debts to the state.

The statue of limitations for Federal tax collection in the vast majority of cases is ten years. The statute of limitations limits the time during which an action can be brought by the IRS for a tax audit and the time for IRS tax collection measures and attempts. In general, there is a 3-year SOL (statute of limitations) for IRS audits of your tax returns and a 10-year SOL for IRS collection attempts. There are some exceptions, particularly in cases involving criminal activity and illegal tax evasion. If you knowingly filed a false tax return in order to avoid paying taxes on taxable income, the statute of limitations is waived by the IRS because it becomes a criminal matter.

Christmas Present of Tax Awareness

A Christmas Present of Tax Awareness

Our Christmas present to you is one of awareness if you live in California and you believed you have avoided any back income tax problems because the IRS 10-year SOL has passed. This is not the case. When it comes to collecting income taxes, unlike the vast majority of states in the union, the California Franchise Tax Board can come after you for twice as long as the Internal Revenue Service. Just because the Federal statute of limitations has passed, it does not mean that you are out of trouble and in the clear. California will not stop until they collect your tax debt. If you need professional tax help and the best in tax resolution services, please contact the Tax Resolution Institute in the coming year. We are here as a valuable resource to help you find the financial freedom you deserve!

 

 

Filed Under: California Tax Relief, Income Tax Problems, New York Tax Resolution, Tax Relief, Tax Resolution Services Tagged With: , , , , , , ,
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