Tax Masters Accused of Fraud and Deception
State AG says 'Tax Lady', Roni Deutch should be jailed for contempt
per the court case. The “Tax Lady’ spent millions on advertising; hired people off the street with no training to work the telephones in a “sweat shop” type setting and had no intention on really helping the desperate taxpayers that contracted with her.
No sympathy here. It has been frustrating the past few years, seeing the growing number of scammers advertising their supposedly top secret and unique services for settling up past tax debts with IRS.
As anyone capable of using Google can easily see, these services take money from desperate people, do nothing to help them, and leave them even worse off with the tax agencies. Any competent professional tax advisor can help people work on arranging a payment plan or an Offer In Compromise with IRS for far less than the thousands these scam services charge. It's good to see these scammers being nailed by the authorities.
Tuesday, August 30, 2011
Monday, August 29, 2011
FEDERAL REGULATIONS MULTIPLY AT RECORD PACE
With working with small businesses, I know first-hand the impact of federal and state regulations. The regulations are there to serve a useful purpose, but sometimes enough is enough. It seems like a vicious circle. The more regulations we have, the more bureaucrats we need, and more bureaucrats sit in their office and create more regulations…which create more bureaucrats.
The U.S. Chamber of Commerce reports that the administration last week "released version 2.0 of its regulatory review, which looks back at existing regulations to determine which regulations it can streamline or eliminate." In his commentary at http://www.chamberpost.com/, the U.S. Chamber's regulatory expert, Bill Kovacs writes that while the administration is to be commended for taking the initiative, "results of this look-back will not have a material impact on the real regulatory burdens facing businesses today." In 2007, there were around 110,000 federal regulations. Today, those rules are proliferating at a rate of about 4,000 additional regulations annually. There are currently more than 22,580 pages of federal regulations on environmental protection; 15,700 pages of tax code; 10,800 pages to regulate agriculture; 6,555 pages for the transportation sector; 5,575 pages on banking regulation; and 4,955 pages of labor law. Still, the rules keep coming. According to reports, the federal agencies added $9.5 billion in new regulatory costs in July alone by proposing 229 new rules and finalizing another 379 rule changes.
The U.S. Chamber of Commerce reports that the administration last week "released version 2.0 of its regulatory review, which looks back at existing regulations to determine which regulations it can streamline or eliminate." In his commentary at http://www.chamberpost.com/, the U.S. Chamber's regulatory expert, Bill Kovacs writes that while the administration is to be commended for taking the initiative, "results of this look-back will not have a material impact on the real regulatory burdens facing businesses today." In 2007, there were around 110,000 federal regulations. Today, those rules are proliferating at a rate of about 4,000 additional regulations annually. There are currently more than 22,580 pages of federal regulations on environmental protection; 15,700 pages of tax code; 10,800 pages to regulate agriculture; 6,555 pages for the transportation sector; 5,575 pages on banking regulation; and 4,955 pages of labor law. Still, the rules keep coming. According to reports, the federal agencies added $9.5 billion in new regulatory costs in July alone by proposing 229 new rules and finalizing another 379 rule changes.
Saturday, August 27, 2011
EIGHT THINGS TO KNOW IF YOU RECEIVE AN IRS NOTICE
Each year, the Internal Revenue Service sends millions of letters and notices to taxpayers for a variety of reasons. Our observation is that most of the time the notices that you receive are in error. Most notices are computer generated and many times it is a matter that the computer has not recorded the information or matched the information properly. Alway, always check the noticed carefully before you respond.
Here are eight steps to know about IRS notices – just in case one shows up in your mailbox.
1. Don’t panic. Many of these letters can be dealt with simply and painlessly.
2. There are a number of reasons why the IRS might send you a notice. Notices may request payment of taxes, notify you of changes to your account, or request additional information. The notice you receive normally covers a very specific issue about your account or tax return.
3. Each letter and notice offers specific instructions on what you are asked to do to satisfy the inquiry.
4. If you receive a correction notice, you should review the correspondence and compare it with the information on your return.
5. If you agree with the correction to your account, then usually no reply is necessary unless a payment is due or the notice directs otherwise.
6. If you do not agree with the correction the IRS made, it is important that you respond as requested. You should send a written explanation of why you disagree and include any documents and information you want the IRS to consider, along with the bottom tear-off portion of the notice. Mail the information to the IRS address shown in the upper left-hand corner of the notice. Allow at least 30 days for a response.
7. Most correspondence can be handled without calling or visiting an IRS office. However, if you have questions, call the telephone number in the upper right-hand corner of the notice. Have a copy of your tax return and the correspondence available when you call to help us respond to your inquiry.
8. It’s important that you keep copies of any correspondence with your records.
Here are eight steps to know about IRS notices – just in case one shows up in your mailbox.
1. Don’t panic. Many of these letters can be dealt with simply and painlessly.
2. There are a number of reasons why the IRS might send you a notice. Notices may request payment of taxes, notify you of changes to your account, or request additional information. The notice you receive normally covers a very specific issue about your account or tax return.
3. Each letter and notice offers specific instructions on what you are asked to do to satisfy the inquiry.
4. If you receive a correction notice, you should review the correspondence and compare it with the information on your return.
5. If you agree with the correction to your account, then usually no reply is necessary unless a payment is due or the notice directs otherwise.
6. If you do not agree with the correction the IRS made, it is important that you respond as requested. You should send a written explanation of why you disagree and include any documents and information you want the IRS to consider, along with the bottom tear-off portion of the notice. Mail the information to the IRS address shown in the upper left-hand corner of the notice. Allow at least 30 days for a response.
7. Most correspondence can be handled without calling or visiting an IRS office. However, if you have questions, call the telephone number in the upper right-hand corner of the notice. Have a copy of your tax return and the correspondence available when you call to help us respond to your inquiry.
8. It’s important that you keep copies of any correspondence with your records.
Friday, August 26, 2011
ACCOUNTANTS IN THE MOVIES
In Hollywood, accounting can seem like a pretty glamorous profession, or not.
May 17, 2011 - The Producers
Gene Wilder co-starred as accountant Leo Bloom in "The Producers," the 1968 Mel Brooks madcap comedy. Teamed with Zero Mostel (left) as Max Bialystock, the womanizing theatrical impresario, they try to create the biggest flop ever to hit Broadway, a musical tribute to Adolf Hitler. Their roles were later reprised by Matthew Broderick and Nathan Lane in a hit Broadway musical and a 2005 remake.
Gene Wilder co-starred as accountant Leo Bloom in "The Producers," the 1968 Mel Brooks madcap comedy. Teamed with Zero Mostel (left) as Max Bialystock, the womanizing theatrical impresario, they try to create the biggest flop ever to hit Broadway, a musical tribute to Adolf Hitler. Their roles were later reprised by Matthew Broderick and Nathan Lane in a hit Broadway musical and a 2005 remake.
Thursday, August 25, 2011
DEBT DEAL TALK
It seems like a lot of the talk these days is about the Congressional Committee that is to come up with a deficit plan to present to Congress and the President. On top of that, the President has been saying on his bus tour that he has a plan that he is going to unveil in September. How is this going to impact income taxes? Here are my thoughts:
First of all, I don’t think that anybody thinks that the committee will offer a plan that will be passed so we will default (bad choice of words), to the 1% cutback called for in the deficit bill.
Right now, House Republicans appear to have blocked any new taxes. And all seven Republican candidates participating in the recent presidential debate pledged to oppose new taxes even if they were accompanied by ten times that amount in spending cuts. So, new taxes appear off the table for now.
But look out! The Bush tax cuts expire right after the 2012 election, and rates on ordinary income, capital gains, and qualified dividends will automatically go up unless Congress gets their act together to extend them. Democrats and Republicans are united in wanting to preserve them for "middle class" taxpayers. But the White House has pledged not to extend those cuts for single taxpayers making above $200,000 or joint filers above $250,000. If Obama wins in November, he may have the leverage to pass "enhanced revenues."
A final comment.
I love how the spin doctors in Washington use terms like "enhanced revenues" to mask new taxes. My favorite is the 3.8% "Unearned Income Medicare Contribution" imposed on investment income by last year's legislation that Washington laughingly refers to as “Healthcare Reform.” I swear, those guys have more euphemisms for "tax hikes" than Eskimos have words for snow.
First of all, I don’t think that anybody thinks that the committee will offer a plan that will be passed so we will default (bad choice of words), to the 1% cutback called for in the deficit bill.
Right now, House Republicans appear to have blocked any new taxes. And all seven Republican candidates participating in the recent presidential debate pledged to oppose new taxes even if they were accompanied by ten times that amount in spending cuts. So, new taxes appear off the table for now.
But look out! The Bush tax cuts expire right after the 2012 election, and rates on ordinary income, capital gains, and qualified dividends will automatically go up unless Congress gets their act together to extend them. Democrats and Republicans are united in wanting to preserve them for "middle class" taxpayers. But the White House has pledged not to extend those cuts for single taxpayers making above $200,000 or joint filers above $250,000. If Obama wins in November, he may have the leverage to pass "enhanced revenues."
A final comment.
I love how the spin doctors in Washington use terms like "enhanced revenues" to mask new taxes. My favorite is the 3.8% "Unearned Income Medicare Contribution" imposed on investment income by last year's legislation that Washington laughingly refers to as “Healthcare Reform.” I swear, those guys have more euphemisms for "tax hikes" than Eskimos have words for snow.
Wednesday, August 24, 2011
13 ESSENTIAL TALKING POINTS FOR THE EARTHQUAKE ENTHUSIAST
Since Virginia had a 5.9 magnitude earthquake and Colorado was also hit with earthquakes yesterday, I thought you might want some earthquake talking points.
1. The first recorded earthquake was in China in 1177 B.C.E.
2. China is also the birthplace of the first seismograph. Built in 132 C.E. by a man named Cheng Heng, it consisted of eight metal dragons holding eight carved balls over eight frog figurines. If an earthquake made the ground vibrate, the dragon facing the quake’s source would (naturally) drop a ball into the mouth of its corresponding frog.
3. Of course, it didn’t really work.
4. But it did look cool.
5. While dragons aren’t that good at predicting earthquakes, other animals might be. According to ancient reports, critters in the Greek city of Helice headed for the hills just before a massive quake leveled the city in 373 B.C.E.
6. There’s some modern evidence, as well. In 1975, Chinese officials evacuated Haicheng days before a massive earthquake, based both on warnings from seismologists and the strange behavior of local pets.
7. Before leaving Alabama, Shawnee leader Tecumseh told a Creek chief, “I … shall go straight to Detroit. When I arrive there, I will stamp on the ground with my foot, and shake down every house in Tuckhabatchee.” Coincidentally (or was it?), he arrived in Detroit on December 16, 1811, the day of the New Madrid earthquake—the largest ever recorded in the contiguous United States.
8. The most violent earthquake ever measured in the world hit Chile in 1960, coming in at a terrifying 9.5 on the Richter scale.
9. The atomic bomb dropped on Nagasaki, Japan, was “only” considered a 5 on the Richter scale.
10. In theory, a quake can actually measure 11, or even higher. The formula for the Richter scale has no upper limit.
11. Speaking of Charles Richter, the American scientist was supposedly an avid nudist. Rumors persist that his wife was so distressed by his penchant for hanging out in the buff that she divorced him.
12. One guy not to trust for earthquake predictions? British soldier William Bell. In 1761, right after two earthquakes uncannily hit England 28 days apart, Bell smelled opportunity. He claimed a follow-up quake would be hitting the country four weeks later. Accounts depict Bell running through the streets of London ranting about the impending destruction. Amazingly, it worked. Folks were so panicked that hundreds actually slept in boats on the Thames thinking it would be safer than their homes. Luckily, the quake never hit. But Bell quickly lost his street cred and eventually ended up in an insane asylum.
13. In early 2001, FEMA prophetically listed the three most likely disasters to hit America: a terrorist attack on New York City (check), a hurricane in New Orleans (check), and a massive earthquake in San Francisco. Nervous yet?
1. The first recorded earthquake was in China in 1177 B.C.E.
2. China is also the birthplace of the first seismograph. Built in 132 C.E. by a man named Cheng Heng, it consisted of eight metal dragons holding eight carved balls over eight frog figurines. If an earthquake made the ground vibrate, the dragon facing the quake’s source would (naturally) drop a ball into the mouth of its corresponding frog.
3. Of course, it didn’t really work.
4. But it did look cool.
5. While dragons aren’t that good at predicting earthquakes, other animals might be. According to ancient reports, critters in the Greek city of Helice headed for the hills just before a massive quake leveled the city in 373 B.C.E.
6. There’s some modern evidence, as well. In 1975, Chinese officials evacuated Haicheng days before a massive earthquake, based both on warnings from seismologists and the strange behavior of local pets.
7. Before leaving Alabama, Shawnee leader Tecumseh told a Creek chief, “I … shall go straight to Detroit. When I arrive there, I will stamp on the ground with my foot, and shake down every house in Tuckhabatchee.” Coincidentally (or was it?), he arrived in Detroit on December 16, 1811, the day of the New Madrid earthquake—the largest ever recorded in the contiguous United States.
8. The most violent earthquake ever measured in the world hit Chile in 1960, coming in at a terrifying 9.5 on the Richter scale.
9. The atomic bomb dropped on Nagasaki, Japan, was “only” considered a 5 on the Richter scale.
10. In theory, a quake can actually measure 11, or even higher. The formula for the Richter scale has no upper limit.
11. Speaking of Charles Richter, the American scientist was supposedly an avid nudist. Rumors persist that his wife was so distressed by his penchant for hanging out in the buff that she divorced him.
12. One guy not to trust for earthquake predictions? British soldier William Bell. In 1761, right after two earthquakes uncannily hit England 28 days apart, Bell smelled opportunity. He claimed a follow-up quake would be hitting the country four weeks later. Accounts depict Bell running through the streets of London ranting about the impending destruction. Amazingly, it worked. Folks were so panicked that hundreds actually slept in boats on the Thames thinking it would be safer than their homes. Luckily, the quake never hit. But Bell quickly lost his street cred and eventually ended up in an insane asylum.
13. In early 2001, FEMA prophetically listed the three most likely disasters to hit America: a terrorist attack on New York City (check), a hurricane in New Orleans (check), and a massive earthquake in San Francisco. Nervous yet?
This article was written by Jeff Fleischer, and originally appeared in the May-June 2007 issue of Mental Floss magazine.
Tuesday, August 23, 2011
TELEVISION NEWS ANCHOR CANNOT DEDUCT CLOTHING
People ask me all the time about deduction of clothing worn at work. The rule is, if the clothes are suitable for wear in the normal course, they are not deductible. This is proven by a recent court case.
The Tax Court ruled that a television news anchor cannot deduct the cost of her business clothing that she wore only on TVeven though she felt the clothes were too conservative to be suitable for everyday wear. It also disallowed write-offs she took for the cost of makeup, manicures, contact lenses, news magazines, teeth whitening, cable TV and a gym membership. It doesn’t matter that her employer required her to maintain a professional appearance and to keep abreast of breaking news events. They’re still all nondeductible personal expenses.
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