More Innocent Spouses Qualify for Relief Under New IRS Guidelines

The Internal Revenue Service today released new proposed guidelines designed to provide relief to more innocent spouses requesting equitable relief from income tax liability.

A Notice proposing a new revenue procedure, posted today on IRS.gov, revises the threshold requirements for requesting equitable relief and revises the factors used by the IRS in evaluating these requests. The factors have been revised to ensure that requests for innocent spouse relief are granted under section 6015(f) when the facts and circumstances warrant and that, when appropriate, requests are granted in the initial stage of the administrative process. The new guidelines are available immediately and will remain available until the finalized revenue procedure is published. The IRS will immediately begin using these new guidelines when evaluating equitable relief requests.

“The IRS is significantly changing the way we determine innocent spouse relief,” said IRS Commissioner Doug Shulman. “These improvements should dramatically enhance our process to make it fairer for victimized taxpayers facing difficult situations.”

This is the second major change made to the innocent spouse program. In July, the IRS extended help to more innocent spouses by eliminating the two-year time limit that previously applied to requests seeking equitable relief.

What can I do if the IRS has garnished my paycheck?

The IRS can collect money you owe them by issuing a garnishment on your paycheck. A garnishment is basically a levy that requires your employer to collect a large portion of your paycheck and pay it straight to the IRS until your tax debt is paid off. Garnishments usually collect between 30 and 70 percent of each paycheck.

Your best chance of avoiding garnishment is to respond immediately when the IRS contacts you. Before they can garnish any wages, the IRS can send a Final Notice 45 days before taking action. Also, it is important to know that the IRS can garnish your wages months or years after sending you the Final Notice. The best thing you can do when you get a Final Notice is act immediately.

If the IRS does issue a garnishment on your paycheck, you can find out if you qualify for tax relief through an Offer in Compromise, Installment Agreement or Currently Not Collectible status. Act as quickly as possible, because even you get a garnishment released, the IRS will not give back money that they have already collected.

OMNI Financial is the leader in IRS and state back tax help services. Our tax attorneys are dedicated to finding permanent tax debt relief for you. At Omni Financial, we are proud of our track record and even more proud of the tax debt solutions we have brought to our clients. OMNI is an established, long-standing member of the Better Business Bureau, the National Association of Tax Professionals, and the National Association of Enrolled Agents. Call us today for a free tax debt consultation 1 800-540-0433.

http://www.omni-financial.com

Payroll Tax Cut Temporarily Extended into 2012

Dec. 23, 2011

WASHINGTON — Nearly 160 million workers will benefit from the extension of the reduced payroll tax rate that has been in effect for 2011. The Temporary Payroll Tax Cut Continuation Act of 2011 temporarily extends the two percentage point payroll tax cut for employees, continuing the reduction of their Social Security tax withholding rate from 6.2 percent to 4.2 percent of wages paid through Feb. 29, 2012. This reduced Social Security withholding will have no effect on employees’ future Social Security benefits.

Employers should implement the new payroll tax rate as soon as possible in 2012 but not later than Jan. 31, 2012. For any Social Security tax over-withheld during January, employers should make an offsetting adjustment in workers’ pay as soon as possible but not later than March 31, 2012.

Employers and payroll companies will handle the withholding changes, so workers should not need to take any additional action.

Under the terms negotiated by Congress, the law also includes a new “recapture” provision, which applies only to those employees who receive more than $18,350 in wages during the two-month period (the Social Security wage base for 2012 is $110,100, and $18,350 represents two months of the full-year amount). This provision imposes an additional income tax on these higher-income employees in an amount equal to 2 percent of the amount of wages they receive during the two-month period in excess of $18,350 (and not greater than $110,100).

This additional recapture tax is an add-on to income tax liability that the employee would otherwise pay for 2012 and is not subject to reduction by credits or deductions. The recapture tax would be payable in 2013 when the employee files his or her income tax return for the 2012 tax year. With the possibility of a full-year extension of the payroll tax cut being discussed for 2012, the IRS will closely monitor the situation in case future legislation changes the recapture provision.

The IRS will issue additional guidance as needed to implement the provisions of this new two-month extension, including revised employment tax forms and instructions and information for employees who may be subject to the new “recapture” provision. For most employers, the quarterly employment tax return for the quarter ending March 31, 2012, is due April 30, 2012

Surprising Tax Bill: Fan who caught Jeter’s 3000th hit may be facing tax liability

When doing the right thing can cost you thousands in taxes

Christian Lopez, the Yankee’s fan who caught Derek Jeter’s 3,000th hit, could be facing a five-figure tax bill thanks to the reward the New York Yankees gave him for returning the ball to Jeter.

The 23-year-old Lopez received tickets to the game as a birthday gift from his girlfriend. The Yankees fan said he suspected something big was going to happen at the game but didn’t realize he’d become part of history. After catching the record-breaking ball, Lopez announced that he intended to return the ball to Jeter, sending the crowd wild with cheers.

To show their gratitude, the Yankees presented Lopez with luxury suite tickets for every remaining home game and any postseason games the Yankees may play, along with three bats, three balls and two jerseys, all signed by Jeter.
When the IRS caught wind of the compensation the Yankee fan received, they estimated that Lopez would be responsible for $5,000 to $13,000 in prize taxes.

Lopez says he does not intend to return the season tickets and was quoted saying, “The IRS has a job to do, so I’m not going to hold it against them, but it would be cool if they helped me out a little on this.”

It’s up for debate whether the Yankees gave Lopez the items as an act of generosity or as an exchange for goods. What do you think about the situation? Is the IRS being unreasonable?

OMNI Financial is the leader in IRS and state back tax help services. Our tax attorneys are dedicated to finding permanent tax debt relief for you. At Omni Financial, we are proud of our track record and even more proud of the tax debt solutions we have brought to our clients. OMNI is an established, long-standing member of the Better Business Bureau, the National Association of Tax Professionals, and the National Association of Enrolled Agents. Call us today for a free tax debt consultation 1 800-540-0433.

http://www.omni-financial.com

Volunteer Income Tax Assistance Program

The Volunteer Income Tax Assistance Program from the IRS

Every year, more than 12,000 volunteer staffed tax assistance locations are sponsored by the IRS and opened by community and non-profit groups. These volunteer staffers are able to provide basic tax preparation services for the members and beneficiaries of their non-profit organizations. 

Volunteer Income Tax Assistance Program for the Elderly

Elderly taxpayers are assisted by the AARP and its Tax-Aide volunteer program. It is geared toward lower and middle income taxpayers, especially those who are 60 years of age and older. Tax-Aide provides each beneficiary with a volunteer tax preparer, whose work is then checked by a second volunteer before the final return is e-filed for maximum efficiency. It is available at 6,000 locations nationwide and is a part of the Tax Counseling for the Elderly program.

Volunteer Income Tax Assistance Program for Military Personnel

Active military personnel benefit from IRS assistance through the Armed Forces Tax Council, which includes volunteers who assist members of the armed forces with their special tax needs. Each branch of the armed forces is represented and assisted by the council, and its volunteers are specially trained to deal with military related tax relief.

Volunteer Income Tax Assistance Program Resources

More information about the volunteer programs is available at the irs.gov website. The IRS recommends that eligible taxpayers locate and take advantage of this authorized volunteer service, so that they can be assured of obtaining all pertinent IRS tax relief.

OMNI Financial is the leader in IRS and state back tax help services. Our tax attorneys are dedicated to finding permanent tax debt relief for you. At Omni Financial, we are proud of our track record and even more proud of the tax debt solutions we have brought to our clients. OMNI is an established, long-standing member of the Better Business Bureau, the National Association of Tax Professionals, and the National Association of Enrolled Agents. Call us today for a free tax debt consultation 1 800-540-0433.

www.omni-financial.com

Free Military Tax Relief For Military Personnel and their Families!

Military members and their spouses may be eligible to receive free military tax relief assistance.

In conjunction with the IRS and the Volunteer Income Tax Assistance Program, the U.S. Armed Forces provides free military tax relief in the form of free income tax return preparation assistance for active duty military personnel and their families.

With program coordinators for the Marine Corps, Army, Navy, and Air Force, the Armed Forces Tax Council oversees the free military tax relief program for military personnel. Volunteer Income Tax Assistance (VITA) sites are staffed with income tax preparers who have been trained in the special circumstances that military families face. Issues such as combat pay, EITC (earned income tax credit), and power of attorney signatures are their areas of expertise and they provide the free military tax relief that our military families deserve.

When you go to your appointment with your military tax relief specialist, be sure to take the following:

·Valid photo identification, such as a military id or driver’s license

·Social Security cards for your spouse, yourself and all dependents

·Leave and earnings statements

·Forms W-2 and 1099, including dividend, interest and mortgage 1099’s

·Documentation for daycare expenses

·Current checkbook for direct deposit information

·Self-employment documentation if applicable

·Prior year’s tax returns, both state and federal

Some additional military tax relief information you will need:

·Birthdates for all persons listed on the tax return

·Written statement that your spouse is in a combat and unable to sign, if applicable

·Power of attorney, if applicable

·Information on itemized expenses, such as medical and dental expenses, unreimbursed moving expenses, property tax paid on your residence, mortgage interest paid, etc.

·Information on first-time-homebuyer credit if you qualified for that

If you are married and filing a joint return, both spouses should be present to sign. However, if one spouse is unable to be present, a valid power of attorney will be sufficient for the absentee spouse’s signature. If your spouse is unable to sign because of being in a designated combat zone, a special rule applies that will allow a signature with only a written statement that the spouse is in a designated combat zone and therefore unable to sign.

Additional information on income taxes for the military can be found at www.irs.gov, Publication 3, Armed Forces Tax Guide.

The deadline has been extended to April 18, 2011 for filing income taxes for the calendar year 2010. However, income tax preparers are extremely busy at the end of the income tax season, so don’t wait until the last minute.

OMNI Financial is the leader in IRS and state back tax help services. Our tax attorneys are dedicated to finding permanent tax debt relief for you. At Omni Financial, we are proud of our track record and even more proud of the tax debt solutions we have brought to our clients. OMNI is an established, long-standing member of the Better Business Bureau, the National Association of Tax Professionals, and the National Association of Enrolled Agents. Call us today for a free tax debt consultation 1 800-540-0433.

www.omni-financial.com

Omni Financial named as Finalist for Denver BBB ethics honors

• Denver Rescue Mission.

Does the IRS Owe You Money?

The Internal Revenue Service may have money for you. Was your income below the limit that requires you to file a tax return? If so, you may still be due a refund.

If you have not filed a prior year tax return and are due a refund, you should consider filing the return to claim that refund. If you are missing a refund for a previously filed tax return, you should contact the IRS to check the status of your refund and confirm your current address.

Unclaimed Refunds

Some people may have had taxes withheld from their wages but were not required to file a tax return because they had too little income. Others may not have had any tax withheld but would be eligible for the refundable Earned Income Tax Credit.

• To collect this money a return must be filed with the IRS no later than three years from the due date of the return.
• If no return is filed to claim the refund within three years, the money becomes the property of the U.S. Treasury.
• There is no penalty assessed by the IRS for filing a late return qualifying for a refund.
• Current and prior year tax forms and instructions are available on the Forms and Publications page of IRS.gov or by calling 800-TAX-FORM (800-829-3676).
• Information about the Earned Income Tax Credit and how to claim it is also available on IRS.gov.

Undeliverable Refunds

Were you expecting a refund check but didn’t get it?

• Refund checks are mailed to your last known address. Checks are returned to the IRS if you move without notifying the IRS or the U.S. Postal Service.
• You may be able to update your address with the IRS on the “Where’s My Refund?” feature available on IRS.gov. You will be prompted to provide an updated address if there is an undeliverable check outstanding within the last 12 months.
• You can also ensure the IRS has your correct address by filing Form 8822, Change of Address, which is available on IRS.gov or can be ordered by calling 800-TAX-FORM (800-829-3676).
• If you do not have access to the Internet and think you may be missing a refund, you should first check your records or contact your tax preparer. If your refund information appears correct, call the IRS toll-free assistance line at 800-829-1040 to check the status of your refund and confirm your address.

IRS Summertime Tax Tip

Four Tips on Preparing for a Disaster

Planning what to do in case of a disaster is an important part of being prepared. The Internal Revenue Service encourages taxpayers to safeguard their records. Some simple steps can help taxpayers protect financial and tax records in case of disasters.

Listed below are tips for individuals on preparing for a disaster.

1. Recordkeeping Take advantage of paperless recordkeeping for financial and tax records. Many people receive bank statements and documents by e-mail. This method is an outstanding way to secure financial records. Important tax records such as W-2s, tax returns and other paper documents can be scanned onto an electronic format. You can copy them onto a ‘key’ or ‘jump drive’ periodically and then keep the electronic records in a safe place.
2. Document Valuables The IRS has disaster loss workbooks for individuals that can help you compile a room-by-room list of your belongings. One option is to photograph or videotape the contents of your home, especially items of greater value. You should store the photos in a safe place away from the geographic area at risk. This will help you recall and prove the market value of items for insurance and casualty loss claims.
3. Update Emergency Plans Emergency plans should be reviewed annually. Individual taxpayers should make sure they are saving documents everybody should keep including such things as W-2s, home closing statements and insurance records. Make sure you have a means of receiving severe weather information; if you have a NOAA Weather Radio, put fresh batteries in it. Make sure you know what you should do if threatening weather approaches.
4. Count on the IRS In the event of a disaster, the IRS stands ready to help. The IRS has valuable information you can request if your records are destroyed. If you have been impacted by a federally declared disaster, you may receive copies or transcripts of previously filed tax returns free of charge by submitting Form 4506, Request for Copy of Tax Return, or Form 4506-T, Request for Transcript of Tax Return, clearly identified as a disaster related request.

For more information type “Preparing for a Disaster” in the search box on the IRS.gov homepage.

Report finds IRS Lien Determinations Were Untimely or Inappropriate for Some $1.4 Billion in Taxes Due

WASHINGTON – The Internal Revenue Service made untimely or inappropriate lien determinations for more than $1.4 billion in delinquent taxes, according to a new report publicly released today by the Treasury Inspector General for Tax Administration (TIGTA).

The IRS protects its claims against taxpayers who owe delinquent taxes by filing Federal tax liens. These liens establish the IRS’s priority among secured creditors for the taxpayers’ equity. Liens are generally filed on balance-due cases in which the taxpayer has received a notice demanding payment and has neglected or refused to pay.

The IRS can decide not to file liens when a taxpayer is in bankruptcy, has died without assets, when a corporation is defunct and miscellaneous other categories. Revenue officers are required to document a decision on whether a lien should be filed and include an explanation when they are not filed.

Revenue officers are supposed to attempt initial contact with a taxpayer or taxpayer’s representative within 45 days after they are assigned the taxpayer’s modules. A module refers to one specific tax return filed by the taxpayer for one specific tax period (year or quarter) and type of tax (i.e., individual, corporate, employment, excise, etc).

According to the report, the IRS did not make lien determinations for 210 open modules at two collection field offices representing a balance due of $6.4 million. In addition, IRS revenue officers did not document valid reasons for not filing liens when closing as “currently not collectible” an estimated 2,297 modules, with $72 million in delinquent taxes.

The report also found that liens were not filed on shelved modules within a certain dollar threshold, even though an IRS study has shown a benefit in doing so. TIGTA’s analysis found that between 2002 and 2008, the IRS shelved, without filing liens, modules representing approximately $1.4 billion in delinquent taxes. Shelved modules are placed in a currently not collectible status and no collection work is conducted.

“The IRS must ensure the appropriate handling of lien determinations,” said J. Russell George, the Treasury Inspector General for Tax Administration. “Failure to protect the Government’s interest on taxes that are owed creates an unfair burden on taxpayers who properly pay their taxes in full and on time,” he said, adding: “I am pleased that the IRS has agreed with our recommendations to address the identified shortcomings.”

TIGTA made eight recommendations that the IRS ensure that revenue officers document their reasons for not filing liens against delinquent taxpayers and ensure that timely lien determinations are made. The IRS agreed with TIGTA’s recommendations.

Source : www.treas.gov