Repost from CNN/Money.com: IRS starts mopping up Congress's tax-reporting mess

IRS starts mopping up Congress's tax-reporting mess
By Neil deMause, contributing writerJuly 9, 2010: 11:18 AM ET

NEW YORK (CNNMoney.com) -- With a new mandate looming that will require business owners to file millions more tax forms, the Internal Revenue Service has begun the daunting process of figuring out how to turn the law's sweeping demands into actual rules for taxpayers.

To read the rest of the article click here. IRS starts mopping up Congress's tax-reporting mess

IRS provides a web page with help for homebuyer tax credit extension

The IRS has created a web page with information about the extension of the homebuyer tax credit. http://www.irs.gov/irs/article/0,,id=225078,00.html The deadline for the credit was extended from June 30, 2010 to September 30, 2010.

Here are some important exceprts from the page.

The IRS reminds taxpayers that special filing and documentation requirements apply to anyone claiming the homebuyer credit. To avoid refund delays, those who entered into a purchase contract on or before April 30, but closed after that date, should attach to their return a copy of the pages from the signed contract showing all parties' names and signatures if required by local law, the property address, the purchase price, and the date of the contract.
Besides filling out Form 5405, First-Time Homebuyer Credit and Repayment of the Credit, all eligible homebuyers must also include with their return one of the following documents:

• A copy of the settlement statement showing all parties' names and signatures if required by local law, property address, sales price, and date of purchase. Normally, this is the properly executed Form HUD-1, Settlement Statement.
• For mobile home purchasers who are unable to get a settlement statement, a copy of the executed retail sales contract showing all parties' names and signatures, property address, purchase price and date of purchase.
• For a newly constructed home where a settlement statement is not available, a copy of the certificate of occupancy showing the owner’s name, property address and date of the certificate.

Besides providing a tax benefit to first-time homebuyers and purchasers who haven’t owned homes in recent years, the law allows a long-time resident of the same main home to claim the credit if they purchase a new principal residence. To qualify, eligible taxpayers must show that they lived in their old homes for a five-consecutive-year period during the eight-year period ending on the purchase date of the new home. Homebuyers claiming this credit can avoid refund delays by attaching documentation covering the five-consecutive-year period:

• Form 1098, Mortgage Interest Statement, or substitute mortgage interest statements,
• Property tax records or
• Homeowner’s insurance records.

There are three options for claiming the credit on a qualifying 2010 purchase:

• If a 2009 return has not yet been filed, claim it on Form 1040 for tax-year 2009. Though these returns cannot be filed electronically, taxpayerscan still use IRS Free File to prepare their return. The returns must be printed out and sent to the IRS, along with all required documentation. The IRS urges taxpayers claiming refunds to choose direct deposit.
• If a 2009 return has already been filed, claim it on an amended return using Form 1040X.
• Whether or not a 2009 return has been filed, wait until next year and claim it on a 2010 Form 1040.

For details, check out the complete page. http://www.irs.gov/irs/article/0,,id=225078,00.html

Re-post from AccountingWEB.com: Collecting unpaid taxes four pennies at a time

The article below is reposted from AccountingWEB. It describes a collection effort by the IRS.

Aaron Zeff is the owner of Harv’s Metro Car Wash in Sacramento, California. Imagine his surprise when, one day last March, federal agents showed up at his business demanding payment of an amount owed from tax year 2006.

Just how much did Zeff need to cough up? Four pennies.

Check out the article for the entire story.
Collecting unpaid taxes four pennies at a time AccountingWEB.com

Update on the Estate Tax from the Tax Policy Blog

This is the latest on the estate tax from the Tax Foundation's Tax Policy Blog. The Obama proposal, included in the FY 2011 budget essentially makes the 2009 law permanent. This sets a top tax rate of 45% with a $3.5 million exemption for individuals and twice that for couples. There are also other proposals to establish top rates as high as 65% for some estates. Click the link below to read the article.

Harkin, Whitehouse and Sanders Are Pushing an Estate Tax Proposal That Might Be Called the Die Abroad Act

Update on the IRS' PTIN database

The TSCPA participated in a teleconference with the IRS on June 15, 2010. One of the topics was the new PTIN database. Information from that teleconference was reported on the TSCPA Federal Tax Policy Blog.

Here's is part of what the post describes.

The new online Preparer Tax Identification Number (PTIN) database, scheduled to open September 1, 2010 gives the Office of Professional Responsibilities (OPR) a much-improved vehicle for tracking paid preparers’ compliance with the filing and payments of personal, corporate and payroll tax returns.

Click on this link to read the entire post on the Federal Tax Policy Blog. New PTIN Database Tracks Paid Preparers’ Tax Obligations

TSCPA Federal Tax Policy Blog: IRS to Require PTIN Holders to Reregister with the New System this Fall

IRS to Require PTIN Holders to Reregister with the New System this Fall

The Texas Society of CPA's Federal Tax Policy Blog posted an article about the new PTIN registration requirements.

Beginning in September, the IRS will demand all paid tax return preparers to register with its new online system and obtain Preparer Tax Identification Numbers (PTINs). Preparers with current PTINs will be able to keep their assigned number, but will have to reregister and pay a user fee (amount TBD). PTIN holders may be subject to periodic checks for compliance with personal and business tax filing and payment obligations.

To read the entire post, click here.

House Passes Tax Extenders Bill

From the Journal of Accountancy:

Friday, the House of Representatives passed the American Jobs and Closing Tax Loopholes Act (HR 4213) by a vote of 215–204. The bill now goes to the Senate, which will not take it up for consideration until after it returns from its Memorial Day recess on June 7.

The bill as passed by the House extends a large number of expired tax provisions through 2010. These include the IRC § 41 research credit, the standard deduction for state and local property taxes, and the deduction for state and local sales tax.

To read the rest of the article, click on the link below.

House Passes Tax Extenders Bill