Category: Taxes
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How to appeal a Pennsylvania tax penalty
Taxpayers who feel that Pennsylvania tax penalties were improperly applied may appeal those taxes. In many cases the amount of the penalty will exceed the original amount of the tax adjusted. You should explain in detail why your tax relief request should be granted and attach additional documentation, if necessary, of any supporting documents. Petitions for refund…
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The return of flat fee tax planning
This month I am bringing back the flat fee income tax planning service that I promoted a few years ago. I stopped marketing this service last year under criticism from other accountants that I was underselling the value of this type of expertise. I saw it as a great way to attract new clients that justified deliberately…
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Tax collection: Uncivil or just dumb?
Yesterday the Pennsylvania Department of Revenue sent a collection agent to the business office of a local client over a $294 shortage of payroll tax withholding in 2011 through 2014 where the state then added over $750 of interest and penalties. The total bill with interest and penalties is a little over $1100. The business…
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Tax concepts in marriage and divorce
When a married couple owes federal taxes there are different outcomes that may be applicable and available. This blog post lists some of the concepts that IRS recognizes that might be considered in any stressed marital tax settlement: Joint and several liability Injured spouse allocation and relief provisions Innocent Spouse Relief Separation of liability Equitable relief…
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Real estate flippers beware
IRS warns real estate investors to beware of tax schemes targeting real estate investors. The schemes tend to be offered by financial firms that are not professional tax advisers but promise favorable tax savings through the improper use of like-kind exchanges. Sales pitches may encourage taxpayers to exchange non-qualifying vacation or second homes. Many promoters of like-kind…
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Gas tax in New Jersey
I feel like I am perhaps the only person in New Jersey OK with paying higher gasoline taxes in exchange for the environmental benefits, progress on national energy independence promised infrastructure improvements and other trade-offs. I fundamentally believe that artificially low carbon energy pricing of the past few years is not in our best interest from…
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New tax scam with CP2000 notice
Apparently a new scam aimed at taxpayers involves and email with a fake IRS notice called a CP2000. This is the notice that the IRS sends in the mail when your tax return filed does not match the amounts received from other sources. The way to avoid this scam is simple: do not open email…
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Selling a rental property?
If you are planning to sell a rental property then it is likely important to estimate the taxes that will be due on the transaction. The calculation can be complicated but fortunately we have software available to help with the number-crunching. Just give a call and we can schedule time to run through the possible scenarios.…
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Why people prepare their own tax returns
Most Americans have the capacity to prepare their own tax returns. But should they? In cases where self preparation is not logical and is not cost-effective, what is the underlying reason driving the decision to self-prepare tax returns? This blog post explores some observations, Self-prepared tax returns About half of all individual tax payers can and should submit their own…
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Church and taxes
Congress gives at least four special tax considerations to churches*: First, churches are generally not required to pay income tax based on the result of their normal operations. This is the same as other tax-exempt organizations. Second, unlike other tax exempt organizations, churches are generally not required to file an annual informational filing with IRS.…