How to report violations of tax law

The IRS has outlined in Notice 2008-04, ways informants can report violations of the tax law and possibly claim a reward based on the amount of additional tax, penalties and interest that is owed. The IRS’ Whistleblower Office will make the final determination about whether an award will be paid and the amount of the…

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IRS and States to Share Employment Tax Examination Results

Officials from the Internal Revenue Service and more than two dozen state workforce agencies announced they have entered into agreements to share the results of employment tax examinations. The agreements, part of the Questionable Employment Tax Practice (QETP) initiative, provide a centralized, uniform means for the IRS and state employment officials to exchange data, thereby…

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Beware – Fraudsters Claiming to Represent IRS

The IRS has fallen victim to identity theft where fraudsters are contacting taxpayers claiming to be the IRS. The written notices (emails + snail mail) appear very official looking. When you receive any post marked mail or notice what-so-ever that appears to be from the IRS take care to proceed with caution. The first thing…

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Offer in Compromise – Check Carefully

The Internal Revenue Service issued a consumer alert advising taxpayers to beware of promoters’ claims that tax debts can be settled for “pennies on the dollar” through the Offer in Compromise Program. Some promoters are inappropriately advising indebted taxpayers to file an Offer in Compromise (OIC) application with the IRS. This bad advice costs taxpayers…

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Selling your home: Ownership Test vs. Use Test

Generally, you have made a profit if the selling price of your home is greater than the price you paid to purchase the home. That profit, considered a capital gain, is subject to income tax. However, under certain circumstances the law allows you to exclude all or part of that gain from your income –…

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Tax Deductible Moving Expenses

Did you recently move to another city for a new job or because your old job is now at a new location? A tax break may be coming your way. How far you moved and the amount of time you spend on the job will have a major impact on whether you qualify for the…

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Employment Tax Record Keeping

Records to be kept for at least 4 years should include: Your employer identification number. Amounts and dates of all wage, annuity, and pension payments. Amounts of tips reported. The fair market value of in-kind wages paid. Names, addresses, social security numbers, and occupations of employees and recipients. Any employee copies of Form W-2 that…

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‘SAVER’S CREDIT’ for Retirement Savings Contribution

One way for low and moderate income Americans to save on taxes is by saving for retirement. If you make voluntary contributions to an employer-sponsored retirement plan or to an individual retirement arrangement, you may be able to take a tax credit. Formally the “The Retirement Savings Contributions Credit”, the Saver’s Credit applies to: Individuals…

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Offset Education Costs with Tax Credits and Deductions

It is Back-to-School time. Whether you are paying for a college education or a teacher buying items for your classroom, education credits and deductions can help lower your tax bill. The Hope Credit, Lifetime Learning Credit or the Tuition and Fees Deduction may help offset the cost of higher education for you, your spouse and…

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How Long Should Records be Kept

The length of time you should keep a document depends on the action, expense, or event the document records. Generally, you must keep your records that support an item of income or deductions on a tax return until the period of limitations for that return runs out. The period of limitations is the period of…

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