IRS Audit Email Tax Scam...

Did you get an email claiming to come from the IRS?

Did it ask you for your social security number?

Bank account numbers?

Be warned!

There's an email IRS audit scam going around.

Read this...

Cash Rewards for Revealing Tax Frauds

Do you know someone who is cheating the IRS out of money?

Do they conveniently "forget" to pay taxes?

Or deliberately misrepresent what they've earned?

Get bigger cash rewards for telling the IRS.

Read more here...

Tax Scams: The IRS says don't fall for these...

We've all heard of Wesley's Snipes tax woes as of late, right?

And we don't want to go thru what he did, capiche?

So read the IRS's recent top 12 tax scams listed here.

Free Tax Withholding Calculator

Fretting that you owe such a large amount in taxes?

Salivating about that big fat refund due you?

Try the IRS' free tax calculator online.

It'll help you figure out how much you should have withheld from your checks in 2007, so you won't over- or under-pay next tax filing season.

The free tax calculator should provide some solace.

Or heartache.

Should You File a Tax Return? Who Must File...

by A.L. Dobbins

"Down right rotten! Low down deal! I've been had! Why me?"

All kind of bad things can happen if you believe some people's hype and do not file your income taxes. Like a couple who came to me a few years ago. They were in the process of closing a real estate deal, selling their house in a Chicago suburb and buying a house in a more desirable suburb, with better schools, better shopping and other benefits.

One of the real estate agents came up with some bad news for the duo, however: the IRS had an outstanding lien on their old home in the amount of $30,000. The deal was off.

Two very disappointed people went back to their old home. What is so sad about this case is that they did not owe IRS any taxes and were due a refund for most of the five (5) years they had not filed. The IRS did not know of their tax liability and their policy is to place a lien on all of your property if you have not filed for several years. Also you are subject to lose your refund if your refund is more than 3 years past due.

Should You File a Tax Return?
IRS TAX TIP 2007-02
You must file a tax return if your income is above a certain level. The amount varies depending on filing status, age and the type of income you receive.

For example, a married couple under age 65 generally is not required to file until their joint income reaches $16,900. However self-employed individuals generally must file a tax return if their net income from self employment exceeds $400.

Check the “individuals” section of the IRS Web site at IRS.gov or consult the instructions for form 1040, 1040A or 1040EZ for specific details that may affect your need to file a tax return with IRS this year.

Even if you do not have to file, you should file to get money back if Federal Income Tax was withheld from your pay, or you qualify for any of the following:

• Earned Income Tax Credit.
The Earned Income Tax Credit is a federal income tax credit for eligible low-income workers. The credit reduces the amount of tax an individual owes, and may be returned in the form of a refund.

• Telephone Tax Refund.
The telephone tax refund is a one-time payment available on your 2006 federal income tax return, designed to refund previously collected long-distance federal excise taxes. It is available to anyone who paid long-distance taxes on landline, cell phone or Voice over Internet Protocol (VoIP) service.

• Additional Child Tax Credit.
This credit may be available to you if you have three or more qualifying children or if you have one or two qualifying children and earned income that exceeds $11,300. The Additional Child Tax Credit may give you a refund even if you do not owe any tax.

• Health Coverage Tax Credit.
Limited to certain individuals who are receiving certain Trade Adjustment Assistance, Alternative Trade Adjustment Assistance, or pension benefit payments from the Pension Benefit Guaranty Corporation.

For more information about filing requirements and your eligibility to receive tax credits, visit the IRS Web site at IRS.gov.

Links:Forms and Publications Earned Income Tax Credit Telephone Tax RefundSubscribe

Advice for Choosing a Tax Return Preparer

IRS TAX TIP 2007-06
Taxpayers who pay someone to do their taxes should choose a tax preparer wisely. If you choose to use a paid tax preparer, it is important that you find a qualified tax professional.

Taxpayers are ultimately responsible for everything on their return even when it’s prepared by someone else. The most reputable preparers will request to see your records and receipts and will ask you multiple questions to determine your total income and your qualifications for expenses, deductions, and other items.

By doing so, they have your best interest in mind and are trying to help you avoid penalties, interest, or additional taxes that could result from later IRS contacts.

While most tax return preparers are professional and honest, taxpayers can use the following tips to choose a preparer who will offer the best service for their tax preparation needs.

Ask about service fees. Avoid preparers who claim they can obtain larger refunds than other preparers, or those who guarantee results or base fees on a percentage of the amount of the refund.

Plan Ahead. Choose a preparer you will be able to contact after the return is filed and one that will be responsive to your needs.

Get References. Ask questions and get references from clients who have used the tax professional before. Were they satisfied with the service received?

Research. Check to see if the preparer has any questionable history with the Better Business Bureau, the state’s board of accountancy for CPAs or the state’s bar association for attorneys. Find out if the prepare belongs to a professional organization that requires its members to pursue continuing education and also holds them accountable to a code of ethics.

Determine if the repairer's credentials meet your needs. Are they an Enrolled Agent, Certified Public Accountant or Tax Attorney? Only attorneys, CPAs and enrolled agents can represent taxpayers before the IRS in all matters including audits, collection actions and appeals. Other return preparers may represent taxpayers only in audits regarding a return they signed as a preparer.

Report suspected tax fraud and abusive tax prepares to the IRS on Form 3949-A, Information Referral, or by sending a letter to Internal Revenue Service, Fresno, CA 93888. Download Form 3949-A from IRS.gov or order by mail at 1-800-829-3676.

Links: Form 3949-A Information

MY TWO CENTS WORTH!!
by A.L. Dobbins

Every time I think of preparing tax returns without a computer I get a headache and my blood pressure goes up.

Of course you should take care in choosing a tax preparer, but this advice should be a two-way street -- tax preparers should be careful in accepting a new client. Like those who want you to exceed their deductions beyond what they can prove. I avoid those who march into my office and announce: " I want all my money back" or "I need a refund of $3000.00" before I even see their W-2.

A bad client can ruin your business or cause the IRS to audit all of your clients.

Quick and Easy Access to IRS Forms and Publications

Free forms from the IRS website:

IRS TAX TIP 2007-13
The Internal Revenue Service has many forms and free publications on a wide variety of topics to help you understand and meet tax filing requirements. If you need IRS materials try one of these easy options:

Internet: You can access forms and publications on the IRS website 24 hours a day, 7 days a week, at IRS.gov.

Phone: Call 800-TAX-FORM (800-829-3676) to order current year forms, instructions and publications and prior year forms and instructions. You should receive your order within 10 days.

Walk-in: During the tax-filing season, many libraries and post offices offer free tax forms to taxpayers. Some libraries also have copies of commonly-requested publications. Braille materials are also available. Many large grocery stores, copy centers, and office supply stores have forms you can photocopy or print from a CD.

Mail: Send your order for tax forms and publications to National Distribution Center, P.O. Box 8903, Bloomington, IL 61702-8903. You should receive your products within 10 days after we receive your order.

Links:
Publication 910, Guide to Free Tax Services (PDF 636K)
Publication 2053A, Quick and Easy Access to IRS Tax Help and Forms (PDF 40K)

Order Publication 1796, Federal Tax Products on CD-ROM, from NTIS — the National Technical Information Service.