by steve | Aug 4, 2010 | Tax News
IRS Realigns and Renames Large Business Division, Enhances Focus on International Tax Administration
As part of a continuing effort to improve global tax administration efforts, Internal Revenue Service officials announced today the realignment of the Large and Mid-Size Business (LMSB) division to create a more centralized organization dedicated to improving international tax compliance.
As part of the organizational shift, the name of the IRS’s large corporate unit ? LMSB ? will change on Oct. 1 to the Large Business and International division (LB&I).
?Executing our international strategy is a top priority, and our work continues to intensify in this area,? said IRS Commissioner Doug Shulman. ?Every day, we are moving forward in our international compliance efforts. Bringing together our top international personnel in this new group will help us advance our global tax administration efforts and ensure focus and fairness in a critical area for our nation.?
The new LB&I organization will enhance the current International program, adding about 875 employees to the existing staff of nearly 600. Most of the additional examiners, economists and technical staff are current employees who specialize on international issues within other parts of LMSB.
The realignment will strengthen international tax compliance for individuals and corporations in several ways, including:
Identifying emerging international compliance issues more quickly.
Removing geographic barriers, allowing for the dedication of IRS experts to the most pressing international issues.
Increasing international specialization among IRS staff by creating economies of scale and improving IRS international coordination.
Ensuring the right compliance resources are allocated to the right cases.
Consolidating oversight of international information reporting and implementing new programs, such as the Foreign Account Tax Compliance Act (FATCA).
Coordinating the Competent Authority more closely with field staff that originate cases, especially those dealing with transfer pricing.
Otherwise centralizing and enhancing the IRS’s focus on transfer pricing.
Heather C. Maloy will continue serving as Commissioner of LB&I. Michael Danilack, Deputy Commissioner, International, will head the realigned global unit. Paul D. DeNard will continue serving as Deputy Commissioner (Operations).
The new international unit will include a transfer pricing director, who will continue piloting the new transfer pricing practice, and a chief economist, who will oversee the IRS’s economic positions pertaining to transfer pricing.
The realigned organization will let us focus on high-risk international compliance issues and handle these cases with greater consistency and efficiency as we continue to increase our work in this area,? Shulman said.
In addition, the realigned LB&I will continue to serve the same population of taxpayers ? corporations, subchapter S corporations and partnerships with assets greater than $10 million as well as certain high wealth individuals.
Today?s announcement marks the latest in a number of efforts the IRS has made to increase international tax compliance. The IRS has taken major steps to address offshore tax evasion, including the investigation of the misuse of undisclosed offshore accounts by U.S. taxpayers. Last fall, the IRS created a Global High Wealth Industry unit to better monitor tax compliance by high income individuals and their related enterprises.
LB&I is also charged with overseeing the implementation of the recently enacted Foreign Account Tax Compliance Act (FATCA). Signed into law in March, FATCA will substantially improve international information reporting, increasing international transparency and compliance.
The IRS and the Department of Treasury have also worked to revise tax treaties and tax information exchange agreements (TIEAs) to increase transparency and to make it more difficult for taxpayers to evade taxes just by crossing international borders.
by steve | Aug 2, 2010 | IRS Tax Advice, Tax News
IRS Internal Revenue Service
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Here are some facts about IRS:
* IRS audits approx. 1.4 millions tax returns a year
* IRS Seizes approx. 3.4 million bank accounts and pay checks
* IRS files approx. 950,000 federal tax liens
Know Your Rights
You have rights as a taxpayer when dealing with the IRS.
* Publication 1, Your Rights as a Taxpayer
* Protecting Taxpayer Rights, Fact Sheet
* The Taxpayer Bill of Rights 2, as passed by Congress
* Taxpayer Bill of Rights II, IRS Training Publication
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Under no circumstances will the Internal Revenue Service tolerate discrimination by its employees, grantees, contractors, and/or subcontractors. NO ONE shall be excluded from participating in, be denied the benefits of, or be subject to discrimination because of: race, color, sex, national origin, disability, reprisal, or age in programs or activities funded by the Department of Treasury – Internal Revenue Service.
Taxpayer Advocate Service
The Taxpayer Advocate Service (TAS) is an IRS program that provides an independent system to assure that tax problems, which have not been resolved through normal channels, are promptly and fairly handled.
Notices
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* Understanding your notice
* Topic – IRS notices
Your Rights to Representation
Learn more about granting power of attorney.
You are entitled to similar protection of confidentiality with respect to tax advice given by a federally authorized tax practitioner as with an attorney.
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* Frequently Asked Questions
Examination
We accept most taxpayer’s returns as filed. If we inquire about your return or select it for examination, it does not suggest that you are dishonest. The inquiry or examination may or may not result in more tax. To learn about your rights during the examination process, and for information about how audits are conducted;
* Examination of Returns, Appeal Rights, and Claims for Refunds – Publication 556
* Market Segment and Specialization Program (MSSP)
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It is your right to appeal any action taken by the IRS to change your account.
* Topic – Your Appeal Rights
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Collection Process
Learn about the process IRS may follow to collect overdue taxes, including a summary of your rights and other important information about the collection process.
* Pub 594, The IRS Collection Process
* Topic: Tax Collection
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by steve | Jul 19, 2010 | Florida Sales Tax, Tax News
If you are having State of Florida Tax issues, hire one of the best companies in Florida. Call Fresh Start Tax at 1-866-700-1040.
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Representation Issues with the State of Florida Department of Revenue
The State of Florida sales tax representation includes the following matters with the Florida Department of Revenue (DOR):
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The keys to resolving your Florida Sales Tax Problem, DOR, Department of Revenue
There are several keys to make sure your case is resolved timely. These keys are necessary on every case. The Department of Revenue is interested in resolving the cases in their system. The DOR goal is to close cases and get them out of their inventory.
Here are the keys necessary to stop enforcement action on your back taxes.
* Have all your tax returns filed before you call Florida Sales Tax and the Department of Revenue on your back tax issues.
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* Be prepared to give the Department of Revenue all supporting documentation to prove your financial statement.
* Make sure you are current on deposit requirements.
How to stop Florida Sales Tax collection enforcement on your back sales tax
* Contact the Department of Revenue on your back tax problem as soon as you become aware of the situation or receive a letter.
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* Utilize the settlement program to reduce your tax debt, if you qualify.
* Contact Fresh Start Tax, we are the true professionals in the State of Florida
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by steve | Jul 14, 2010 | Tax News
IRS Collection Practices.
The report from the Taxpayer Advocates Offices expresses continuing concern that IRS collection practices emphasize collection of past-due liabilities even where doing so inflicts unnecessary or disproportionate harm on taxpayers and jeopardizes future tax collection. The conventional wisdom seems to be that more hard-core enforcement actions like liens and levies mean more revenue,? Ms. Olson said. ?But the data don’t bear that out. Since FY 1999, the IRS has increased lien filings by about 475 percent and levies by about 600 percent, yet inflation-adjusted revenue raised by the IRS Collection function has actually declined by about seven percent over that period.?
Lien filings can badly damage a taxpayers financial viability because lien filings appear on credit reports, causing the taxpayers credit score to drop an average of about 100 points immediately and causing lasting harm because they typically remain on the taxpayers credit record for at least seven years. Many employers, mortgage companies, landlords, car dealerships, and credit card issuers check credit reports, so the filing of a tax lien can adversely affect the taxpayers ability to obtain and retain a job, purchase a home, rent an apartment, or obtain credit generally. Accordingly, a lien filing may reduce the taxpayers income or increase his expenses, thereby impairing his ability to pay tax in the future. Last year, the IRS filed nearly one million liens against taxpayers.
The report also notes that the IRS has issued at least four public statements over the past year-and-a-half pledging to assist financially struggling taxpayers who are having difficulty paying their tax bills. Yet the number of liens and levies has continued to rise, the number of offers-in-compromise the IRS is accepting is near an all-time low, and there is little evidence the IRS is changing its collection practices.
After publication of her 2009 Annual Report to Congress, Ms. Olson issued several Taxpayer Advocate Directives to the IRS on lien issues, including directives (i) to discontinue its policy of automatically filing tax liens in cases where the IRS has determined that the taxpayers account should be placed into ?currently not collectible? status based on financial hardship and (ii) to require managerial approval for the filing of liens in cases where the taxpayer owns no assets. She has also urged the IRS to expand the availability of the offer-in-compromise program for financially struggling taxpayers who cannot reasonably pay their tax debts in full.
In response to these concerns, the IRS has convened a senior-level task force to conduct a comprehensive review of collection practices. Ms. Olson writes that she appreciates the IRS’s willingness to examine the issue. However, she remains concerned that it will take years to conduct the comprehensive review, and that in the interim, the IRS will continue both to damage taxpayers? credit ratings and to undermine long-term tax compliance without any significant revenue gains to show for their actions. Accordingly, IRS collection practices will remain a key area of focus for TAS in FY 2011. Right on Nina right on!!!
by steve | Jul 13, 2010 | IRS Tax Advice, Tax News
Students with a Summer Job
School?s out and many students now have a summer job. Some students may not realize they have to pay taxes on their summer income. Here are the six things the IRS wants everyone to know about income earned while working a summer job.
All employees fill out a W-4, Employee?s Withholding Allowance Certificate, when starting a new job. This form is used by employers to determine the amount of tax that will be withheld from your paycheck. If you have multiple summer jobs you will want to make sure all your employers are withholding an adequate amount of taxes to cover your total income tax liability. To make sure your withholding is correct, use the Withholding Calculator on IRS.gov.
Whether you are working as a waiter or a camp counselor, you may receive tips as part of your summer income. All tip income you receive is taxable income and is therefore subject to federal income tax.
Many students do odd jobs over the summer to make extra cash. Earnings you received from self-employment are subject to income tax. These earnings include income from odd jobs like baby-sitting and lawn mowing.
If you have net earnings of $400 or more from self-employment, you will also have to pay self-employment tax. This tax pays for your benefits under the Social Security system. Social Security and Medicare benefits are available to individuals who are self-employed the same as they are to wage earners who have Social Security tax and Medicare tax withheld from their wages. The self-employment tax is figured on Form 1040, Schedule SE.
Food and lodging allowances paid to ROTC students participating in advanced training are not taxable. However, active duty pay ? such as pay received during summer advanced camp ? is taxable.
Special rules apply to services you perform as a newspaper carrier or distributor. You are a direct seller and treated as self-employed for federal tax purposes if you meet the following conditions:
You are in the business of delivering newspapers.
All your pay for these services directly relates to sales rather than to the number of hours worked.
You perform the delivery services under a written contract which states that you will not be treated as an employee for federal tax purposes.
Generally, newspaper carriers or distributors under age 18 are not subject to self-employment tax.
Great tips from the IRS newswire.
by steve | Jul 7, 2010 | Tax News
First-Time Home-buyer Credit Closing Deadline Extended to September 30, 2010
The deadline for the completion of qualifying First-Time Home buyer Credit purchases has been extended. Taxpayers who entered into a binding contract before the end of April now have until September 30, 2010 to close on the home.
The Homebuyer Assistance and Improvement Act of 2010, enacted on July 2, 2010, extended the closing deadline from June 30 to Sept. 30 for eligible homebuyers who entered into a binding purchase contract on or before April 30 to close on the purchase of the home on or before June 30, 2010.
Here are five facts from the IRS about the First-Time Homebuyer Credit and how to claim it.
- If you entered into a binding contract on or before April 30, 2010 to buy a principal residence located in the United States you must close on the home on or before September 30, 2010.
- To be considered a first-time homebuyer, you and your spouse ? if you are married ? must not have jointly or separately owned another principal residence during the three years prior to the date of purchase.
- To be considered a long-time resident homebuyer, your settlement date must be after November 6, 2009 and you and your spouse ? if you are married ? must have lived in the same principal residence for any consecutive five-year period during the eight-year period that ended on the date the new home is purchased.
- The maximum credit for a first-time homebuyer is $8,000. The maximum credit for a long-time resident homebuyer is $6,500.
- To claim the credit you must file a paper return and attach Form 5405, First Time Homebuyer Credit, along with all required documentation, including a copy of the binding contract. New homebuyers must attach a copy of the properly executed settlement statement used to complete the purchase. Long-time residents are encouraged to attach documentation covering the five-consecutive-year period such as Form 1098, Mortgage Interest Statements, property tax records or homeowner?s insurance records.
For more information call Fresh Start Tax 1-866-700-1040
