While most tax preparers have been busy getting ready for tax season and preparing returns, a few have taken the minimum competency test for their RTRP designation. Unfortunately, they’ll have to wait until early March to find out if they pass or not. According to Prometic: A sufficient volume of tests is required to determine a statistically valid passing score. The score setting process was delayed until a sufficient number of tests were administered. We apologize for the >>Read More

Who said? “The Earned Income Tax Credit is the best anti-poverty, the best pro-family, the best job creation measure to come out of Congress.” Today (1/27/12) is Earned Income Awareness Day. So in honor of the program, here is a little information. The Earned Income Tax Credit (EITC) is a refundable credit targeted at low income families. It was enacted in 1975 to offset the social security taxes taxpayers with children paid through withholding. At that time, the credit was 10% of wages >>Read More

Dear Family, Earlier today, IRS announced that electronic refunds are on target. People can expect to find them in your bank accounts within about 10 days. But, some refunds will be delayed. IRS is beefing up the fraud detection system. Returns with Earned Income Credits, American Opportunity Credits and other refundable credits will take a little longer. That’s good news, believe it or not. Last year, IRS releases millions of dollars of fraudulent refunds, despite safeguards. >>Read More

Your kids can be helpful at tax time. That doesn’t mean they’ll sort your tax receipts or refill your coffee, but those charming children may help you qualify for some valuable tax benefits. Here are 10 things the IRS wants parents to consider when filing their taxes this year. Dependents In most cases, a child can be claimed as a dependent in the year they were born. For more information see IRS Publication 501, Exemptions, Standard Deduction, and Filing Information. Child Tax >>Read More

While digging through Discover Financial Services’ (DFS) 10-K yesterday, we noticed an interesting disclosure about a class action lawsuit filed against the company last November in federal court  in California’s Northern District. It seems that one of Discover’s card holders had a beef against the company because it allegedly “…contacted him, and members of the class he seeks to represent, on their cellular telephones without their express consent in >>Read More

Before you call your tax preparer about your refund, make sure you know what the IRSis saying about their refund timing… The IRS has opened its filing season successfully this month, and refunds have started going out to many taxpayers. As with the start of any tax season, there are system validations that occur requiring some fine-tuning of our systems. As part of this, some taxpayers will receive refunds approximately one week later than initial projections they may have received, >>Read More

Well – at least that’s what ‘The Daily Mash‘ (a satirical online newspaper) is reporting. Their spoof article continues: MOIRA Stewart, the all-seeing God of Tax, has warned of great suffering for those self-employed workers whose forms displease her. Powerful divinity Stewart, whose earthly guises include a semi-likeable middle-aged woman, a grey fox and a fire-breathing lizard with nine heads and 43 tusks, has assured mortals that she will not be made a mockery of >>Read More

According to Phil Drake of Drake Software, the IRS has confirmed that there are a high number of refunds being delayed.  While the IRS has released no numbers or explanation as to why the delay, they are working on the issue. While many taxpayers are finding that their refund has been delayed, others are getting their money faster than expected due to Customer Account Data Engine (CADE). In fact, they will probably the only taxpayers getting their refund this week. Ya gotta love the IRS. >>Read More

While I don’t live close enough to an IRS office to take returns in, some readers might. I caught this on one of the web boards I check. The verification came from the NAEA Partners The Internal Revenue Service will no longer accept tax returns from tax return preparers in their Taxpayer Assistance Centers beginning with the 2012 filing season. Tax returns include, but are not limited to, Form 1040  Series including Form 1040X, Form 4868, Form 2290, Form 94X series, and Form 1041. Tax >>Read More

Unemployment is still high, at 8.5%, and underemployment is rife: Plenty of people are working part-time when they’d rather have full-time jobs. Then there are the part-time jobs pretty much anyone would love to have: corporate directorships. Earlier this month, Michelle footnoted how Google (GOOG) seems to have decided to double the value of the one-time stock grant for new directors, to $1 million, from $500,000. But in recent weeks, some other director pay arrangements have also >>Read More

Today TaxMama® hears from Bill in the Tax Quips Forum who raises a good question. “I have a lot of independent distributors asking about deducting their autoship of product for personal use. They say that their tax person said you can claim the deduction because you have to “be a product of the product” or because that is one of the ways to be commission qualified. I say no, because it is for personal use. I know on cost of goods sold that you pull out ‘items for >>Read More

Today TaxMama® hears from Stephanie in the Tax Quips Forum with a very valid concern. “I’m concerned about this requirement that PayPal report my sales numbers via the 1099-K. The clients I work with will also have to send me a 1099-MISC. Won’t that be income that is double reported? Usually I just enter my total income and ignore any 1099’s I receive since I keep track on my own and claim every last penny I earn. I am Not sure how this is going to work with this >>Read More

KPMG will no longer loan tax professionals to GE during busy season, according to a source close to the situation. KPMG was billing an extra $8-10 million, over and above the audit each year, for the service. Loaning, assigning, or “seconding” tax or any “bookkeeping” staff to an audit client is prohibited by the Sarbanes-Oxley Act of [...] >>Read More

The Tax Foundation released their 2012 State Business Tax Climate Index today. And it was no surprise to see the bottom three composed of California, New York and New Jersey. These states have high taxes overall (California adds high regulatory costs, too; however, the business climate index ignores this). Meanwhile, Wyoming, South Dakota, and Nevada are the top three states. No surprise: These states don’t have high taxes (they don’t have personal or corporate income taxes at >>Read More

Tax Tips for the Self-employed There are many benefits that come from being your own boss. If you work for yourself, as an independent contractor, or you carry on a trade or business as a sole proprietor, you are generally considered to be self-employed.1. Self-employment can include work in addition to your regular full-time business activities, such as part-time work you do at home or in addition to your regular job.2. If you are self-employed you generally have to pay self-employment tax >>Read More

As taxpayers continue to wait for all their tax forms to arrive, let’s talk about what to do with one of those forms. Form 1098T is the tuition statement from colleges and universities telling what was paid for a student during the year and what scholarships and grants the college/university know the student received. Besides being one of the last forms to arrive, the 1098T is one that needs to most adjustment to come up with the correct deductions. When dealing with a 1098T, I really like >>Read More

Every year the IRS issues a refund chart for that tax year. It gives taxpayers an expected date their refund will be deposited or mailed. Of course, they reserve the right to take more time should the return need more processing. But for the most part, their schedule worked pretty well. Until this year. While the "official" direct deposit day for returns accepted by the IRS on or before Jan. 18th is tomorrow the 25th, it looks like some refunds have been delayed. Tax practitioner >>Read More

Last week we wrote about an American executive who got a sweet deal after his employer decided to move its headquarters from Chicago to London. But you needn’t worry that there will be some kind of executive vacuum here in the States:  Yesterday we found an equally impressive agreement that will soon transplant a London-based executive to New York. The executive in question is C. William Eccleshare, who has been working as the Chief Executive Officer—International of Clear >>Read More

Correction: The headline on an early version of this post incorrectly said O’Donnell would get “free” clothing instead of discounted clothing. My apologies for the error. American Eagle Outfitters (AEO) describes itself as offering “high-quality, on-trend clothing, accessories and personal care products at affordable prices.” But while it pours effort into making the case that its clothes are a good deal, it put far less into making clear just how good a deal >>Read More

If you are a Parent, you want to review these Ten Tax Benefits … maybe that rug rat can help you out this year, ha,ha… Your kids can be helpful at tax time. That doesn’t mean they’ll sort your tax receipts or refill your coffee, but those charming children may help you qualify for some valuable tax benefits. Here are 10 things the IRS wants parents to consider when filing their taxes this year.1. Dependents In most cases, a child can be claimed as a dependent in the >>Read More