TaxMamas TaxQuips: Tax Quips http://www.taxquips.com?cat=TaxQuips The number one tax podcast online - receive a daily TaxQuips that answers a reader's tax question using real life tax strategies and recommends resources to help you either solve your own tax problems, or at least helps you communicate with your tax pro. The number one tax podcast online - receive a daily TaxQuips that answers a reader's tax question using real life tax strategies and recommends resources to help you either solve your own tax problems, or at least helps you communicate with your tax pro. Tax podcast and small business podcast. Tax and small business news tidbits, tips and tax loopholes, covering investment, inheritance, real estate and more from www.taxquips.com - Subscribers are welcome to submit questions. en-us Copyright 2006 taxmama.com TaxMama taxquips@gmail.com taxquips@gmail.com (TaxMama) Eva Rosenberg http://www.taxquips.com/audio/rssimage.jpg TaxMamas TaxQuips http://www.taxquips.com Fri, 21 Nov 2008 21:22:36 -0800 Thu, 20 Nov 2008 06:50:00 -0800 Loudblog no Business News & Politics Investing Training Copyright 2006 taxmama.comtax,irs,tax,debt,tax,bankruptcy,oic,divorce,qdro,grat,estate,tax,gift,tax,selling,home,business,tax,sohoBusiness/Investingtax,irs,tax,debt,tax,bankruptcy,oic,divorce,qdro,grat,estate,tax,gift,tax,selling,home,business,tax,sohohttp://creativecommons.org/licenses/by-nc-nd/2.0/Subscribe with My Yahoo!Subscribe with NewsGatorSubscribe with My AOLSubscribe with RojoSubscribe with BloglinesSubscribe with NetvibesSubscribe with GoogleSubscribe with PageflakesDid you want to get your own tax questions answered? Drop by TaxMama.com or TaxQuips.com for more free information - and to submit your own question. Thu, 20 Nov 2008 06:50:00 -0800 Too Early for Forms http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/459596095/index.php http://www.taxquips.com/index.php?id=1043 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1043#comments Tax Quips Tax Quips Today TaxMama hears from Sarah in Pennsylvania with this question. “I have a client who wants to close the business and file final 2008 returns. None of the forms are yet available on IRS website. How do I proceed to close the business?” Today TaxMama hears from Sarah in Pennsylvania with this question. “I have a client who wants to close the business and file final 2008 returns. None of the forms are yet available on IRS website. How do I proceed to close the business?” Dear Sarah, That’s easy. Do everything you need to do to close the business except the final tax returns. You can certainly pro-forma them, if you like, so your client can pay any final tax liabilities. Remember, when you close a business now, the tax return won’t be due for at least 2 ½ or 3 ½ months after the business closes, depending on whether it’s a partnership or corporation. By then, you’ll have 2008 forms. If you MUST finalize everything now, prepare everything using 2007 forms. Enter the dates at the top of the first page where you normally show the fiscal year information. Print out the return and white out the 07 in 2007. Then using a black marker, write 2008. Attach a statement explaining that you didn’t have the 2008 forms. And remember, you can find answers to all kinds of questions about improvising forms and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] 00:00:00 Today TaxMama hears from Sarah in Pennsylvania with this question. &#8220;I have a client who wants to close the business and file final 2008 returns. None of the forms are yet available on IRS...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_xfSILyIoa4rAuhH03ARxwFVaTgs_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/xfSILyIoa4rAuhH03ARxwFVaTgs_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_xfSILyIoa4rAuhH03ARxwFVaTgs_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=xfSILyIoa4rAuhH03ARxwFVaTgs_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1043"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=J8EYvi"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=J8EYvi" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=tRUmN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=tRUmN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=ixu2N"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=ixu2N" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=le64n"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=le64n" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=TAi7n"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=TAi7n" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=afFfN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=afFfN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=DSMen"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=DSMen" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=DlTaN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=DlTaN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=xqGwN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=xqGwN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=2pL6n"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=2pL6n" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/459596095" height="1" width="1"/>http://www.taxquips.com/index.php?id=1043http://taxmama.audioacrobat.com/download/620fd868-29ed-8b7d-9d1c-c20375fd3ce7.mp3 Wed, 19 Nov 2008 06:19:00 -0800 Turning in Tax Criminals http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/458445716/index.php http://www.taxquips.com/index.php?id=1042 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1042#comments Tax Quips Tax Quips Today TaxMama hears from Victor in Florida who wants to know. “Is there some type of reward for turning in or catching tax criminals?” Dear Victor, Yup. There is. In fact, you can even find an old IRS press release on TaxMama.com Today TaxMama hears from Victor in Florida who wants to know. “Is there some type of reward for turning in or catching tax criminals?” Dear Victor, Yup. There is. In fact, you can even find an old IRS press release on TaxMama.com from May of 2000 that talks about the program. http://www.taxmama.com/IRSnews/reward.htm Use Form 211 Application for Award for Original Information. http://www.irs.gov/pub/irs-pdf/f211.pdf In order to collect the reward, you must meet certain qualifications: 1) You have to be the first person to tell IRS about this tax evader. 2) You must provide enough information about the tax evader, so IRS can find him/her. Social Security numbers would be ideal – and address and name may suffice. 3) You must provide enough information about the tax crime, so IRS can determine that the potential unpaid taxes are worth chasing after. Under the Whistleblower provisions, that means the taxes, penalties, and interest must exceed $2,000,000. 4) It would be a big help if you could also point IRS to any assets that would be used to pay those taxes. You need to understand that turning someone in won’t get you a reward. If IRS can’t collect any money to cover those unpaid taxes, you’ll get nothing. In addition, according to the instructions on Form 211, there is a statement that “payment of awards under 7623(a) is made at the discretion of the IRS. ” Isn’t that a kick! One piece of comforting news is that your identity will remain confidential. I have spoken to IRS legal counsel about this issue. They assure me that even if the accused’s attorney subpoena’s a copy of the Form 211 you sent in, IRS will ‘cleanse’ it. That means they will black out all the information identifying the accuser. While it is good to have the people you don’t like pay their fair share of taxes, too; remember that there is a balance in the universe. All actions have consequences. So think about this carefully before you do this. And once you do it, forget about it. It often takes IRS a couple of years to act on these submissions. So don’t sit there waiting for immediate results. And remember, you can find answers to all kinds of questions about turning in tax cheats and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] 00:00:00 Today TaxMama hears from Victor in Florida who wants to know. &#8220;Is there some type of reward for turning in or catching tax criminals?&#8221; Dear Victor, Yup. There is. In fact,...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_SJgo5CYqiQFrZrdfAs-YL5CKrBs_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/SJgo5CYqiQFrZrdfAs-YL5CKrBs_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_SJgo5CYqiQFrZrdfAs-YL5CKrBs_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=SJgo5CYqiQFrZrdfAs-YL5CKrBs_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1042"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=VW61I4"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=VW61I4" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=LUkVN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=LUkVN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=Qn4fN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=Qn4fN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=9SaBn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=9SaBn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=Sd50n"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=Sd50n" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=nk1vN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=nk1vN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=cipmn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=cipmn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=qNvSN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=qNvSN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=3TPKN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=3TPKN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=ORHRn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=ORHRn" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/458445716" height="1" width="1"/>http://www.taxquips.com/index.php?id=1042http://taxmama.audioacrobat.com/download/6ab79df3-a4dd-7a52-1bb3-96e1d623c545.mp3 Tue, 18 Nov 2008 06:07:00 -0800 Closing Business Early http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/457208278/index.php http://www.taxquips.com/index.php?id=1041 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1041#comments Tax Quips Tax Quips Today TaxMama hears from Roger in Pennsylvania who says. “I have a client who wants to close the business and file final 2008 returns. None of the forms are yet available on IRS website. How do I proceed with closing the business?” Dear Today TaxMama hears from Roger in Pennsylvania who says. “I have a client who wants to close the business and file final 2008 returns. None of the forms are yet available on IRS website. How do I proceed with closing the business?” Dear Roger, That’s easy. Do everything you need to do to close the business except the final tax returns. You can certainly pro-forma them, if you like, so your client can pay any final tax liabilities. But, remember, when you close a business now, in November, the tax return won’t be due for at least 2 1/2 months (corp) after the business closes; or 3 1/2 months, if it’s a partnership. By then, you’ll have 2008 forms. If you MUST finalize everything now, prepare everything using 2007 forms. Enter the dates at the top of the first page. Print out the return and white out the 07 in 2007 and using a black marker, write 2008. Attach a statement saying that you didn’t have the 2008 forms. However, I’d wait until next year to see if any rates change. If it’s a corporation, be sure to use the correct corporate rate tables – just in case the rates change after Obama takes office. And remember, you can find answers to all kinds of questions about final returns and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] 00:00:00 Today TaxMama hears from Roger in Pennsylvania who says. &#8220;I have a client who wants to close the business and file final 2008 returns. None of the forms are yet available on IRS website. How do...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_8KwkzTVxEQ-BLTsdeJO2lL4dILk_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/8KwkzTVxEQ-BLTsdeJO2lL4dILk_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_8KwkzTVxEQ-BLTsdeJO2lL4dILk_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=8KwkzTVxEQ-BLTsdeJO2lL4dILk_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1041"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=MefE5S"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=MefE5S" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=O90WN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=O90WN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=KxEhN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=KxEhN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=oo8Kn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=oo8Kn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=t1wVn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=t1wVn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=W1T8N"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=W1T8N" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=UA3Wn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=UA3Wn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=iGvoN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=iGvoN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=awG1N"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=awG1N" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=njFHn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=njFHn" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/457208278" height="1" width="1"/>http://www.taxquips.com/index.php?id=1041http://taxmama.audioacrobat.com/download/73563ca9-4b9e-4b6a-3e3d-81068fa7d164.mp3 Thu, 13 Nov 2008 05:49:00 -0800 Veteran and EITC http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/451818497/index.php http://www.taxquips.com/index.php?id=1036 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1036#comments Tax Quips Tax Quips Today TaxMama hears from Kathy in New Mexico who says. “My husband has his full VA disability and Social Security disability. I do not work. Are we entitled to the earned income tax credit (EITC)? We do not file taxes. Are we entitled to file for Today TaxMama hears from Kathy in New Mexico who says. “My husband has his full VA disability and Social Security disability. I do not work. Are we entitled to the earned income tax credit (EITC)? We do not file taxes. Are we entitled to file for the last stimulus check, or is to late?” Dear Kathy, Well, to answer your last question first, you’re not too late for the Stimulus check. You’re too late to get it this year. But if you file a tax return early next year, you will still get the money. You’ll be able to file online for free, using the Free File Alliance, if you like. http://www.irs.gov/efile/article/0,,id=118986,00.html Or you can go to a VITA site, where IRS volunteers can work with you in person and answer your questions. Again, no charge for the service. http://www.irs.gov/individuals/article/0,,id=107626,00.html AARP’s TaxAide is also a VITA service – and they specialize in seniors. http://www.aarp.org/money/taxaide/ Now, back to your first question. Do you qualify for the earned income credit? By definition, it’s a credit to help people who work (earned income) but are substantially underpaid. Pension and Social Security income doesn’t qualify you for the EITC. Only wages and self-employment income. You can read more about the earned income tax credit here: http://www.irs.gov/individuals/article/0,,id=96406,00.html See all the great information available online. You just need to know where to find it! You’re making a good start. And remember, you can find answers to all kinds of questions about senior tax issues and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] 00:00:00 Today TaxMama hears from Kathy in New Mexico who says. &#8220;My husband has his full VA disability and Social Security disability. I do not work. Are we entitled to the earned income tax credit...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_riSiTrGmIv56pPMZJ-xwmnGEDEo_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/riSiTrGmIv56pPMZJ-xwmnGEDEo_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_riSiTrGmIv56pPMZJ-xwmnGEDEo_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=riSiTrGmIv56pPMZJ-xwmnGEDEo_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1036"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=qXiDWh"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=qXiDWh" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=hJffN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=hJffN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=GWayN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=GWayN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=HsF3n"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=HsF3n" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=oa8an"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=oa8an" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=RJxzN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=RJxzN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=a1rUn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=a1rUn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=fdukN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=fdukN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=d0jnN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=d0jnN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=qqZKn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=qqZKn" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/451818497" height="1" width="1"/>http://www.taxquips.com/index.php?id=1036http://taxmama.audioacrobat.com/download/9919a440-0d5d-0c9b-01d9-519e0d6af87c.mp3 Wed, 12 Nov 2008 06:03:00 -0800 New Jersey Exit Tax http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/450732409/index.php http://www.taxquips.com/index.php?id=1035 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1035#comments Tax Quips Tax Quips Today TaxMama hears from Harvey in New Jersey who tells us. “I am a Senior Citizen & semi-retired. Thinking of leaving the state of NJ. I heard there is a state exit tax. Is this correct?” Dear Harvey, Whew, federal & Today TaxMama hears from Harvey in New Jersey who tells us. “I am a Senior Citizen & semi-retired. Thinking of leaving the state of NJ. I heard there is a state exit tax. Is this correct?” Dear Harvey, Whew, federal & California taxes are big enough areas for me to keep up with, without learning the tax laws of all 50 states and the various territories. However, doing a quick search on Google, I found this discussion at Snopes.com – http://message.snopes.com/showthread.php?t=16010 It’s not an exit tax you’re looking at. What you have is the Realty Transfer Tax, a tax on the sale of any real estate in New Jersey. It applies to all property owners, whether you’re staying or leaving. You can see the rates here: http://www.state.nj.us/treasury/taxation/realty_over.shtml There are reduced rates for seniors…so you should get a break on the rates. But you may as well count on giving up several thousand dollars. And remember, you can find answers to all kinds of questions about odd taxes and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] 00:00:00 Today TaxMama hears from Harvey in New Jersey who tells us. &#8220;I am a Senior Citizen &#38; semi-retired. Thinking of leaving the state of NJ. I heard there is a state exit tax. Is this...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_TJw7i8LPK8QAb83DP9-mJJn8MyI_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/TJw7i8LPK8QAb83DP9-mJJn8MyI_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_TJw7i8LPK8QAb83DP9-mJJn8MyI_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=TJw7i8LPK8QAb83DP9-mJJn8MyI_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1035"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=69b6h4"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=69b6h4" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=RKvUN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=RKvUN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=ox4JN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=ox4JN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=7jjnn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=7jjnn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=4seZn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=4seZn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=l7uQN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=l7uQN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=srSrn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=srSrn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=zrrHN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=zrrHN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=3EzlN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=3EzlN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=Wcvbn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=Wcvbn" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/450732409" height="1" width="1"/>http://www.taxquips.com/index.php?id=1035http://taxmama.audioacrobat.com/download/56af823b-010a-e8bf-bb6b-86704ed8c52c.mp3 Mon, 10 Nov 2008 07:21:00 -0800 Passive Loss Limitation http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/448508101/index.php http://www.taxquips.com/index.php?id=1034 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1034#comments Tax Quips Tax Quips Today TaxMama hears from Clyde in Florida, with this oopsie! “My wife and I have rental properties and we reported losses for 2006 and 2007. We recently found out about Form 8582 and the Passive Activity Loss Limitations rule. Our income without Today TaxMama hears from Clyde in Florida, with this oopsie! “My wife and I have rental properties and we reported losses for 2006 and 2007. We recently found out about Form 8582 and the Passive Activity Loss Limitations rule. Our income without the rental losses exceeded $150,000. What should we do?” Dear Clyde, That’s interesting. I do understand the compulsion to prepare your own tax returns. It does feel great to be in control. But are you doing them by hand? Even for seasoned tax professionals, doing a complete tax return by hand is out of the question these days. There are too many limitations to take into account, not to mention the alternative minimum tax, computation to consider. If you used tax software, either in a box or online – it would have generated the Form 8582. Uh, that is, unless you checked the box saying you’re a real estate professional. Regardless. If you are certain that you took the rental deductions to which you weren’t entitled, you need to filed amended returns for 2006 and 2007 to correct that error. Use Form 1040X. TaxCut still sells prior year versions of the software http://store.taxcut.com/dr/v2/ec_dynamic.main?SP=1&PN=47&sid=1478&cache_id=0 Or this site offers prior year versions of TurboTax software. http://www.taxsoftwarestore.com/tax-year-2006.html If you’re going to amend anyway, please turn it over to a tax professional. There are bound to be other errors in your return, sorry to say. And remember, you can find answers to all kinds of questions about correcting errors and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] Today TaxMama hears from Clyde in Florida, with this oopsie! &#8220;My wife and I have rental properties and we reported losses for 2006 and 2007. We recently found out about Form 8582 and the...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_bmBz1d6.AhmZh8zxys-XqBWZHoU_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/bmBz1d6.AhmZh8zxys-XqBWZHoU_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_bmBz1d6.AhmZh8zxys-XqBWZHoU_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=bmBz1d6.AhmZh8zxys-XqBWZHoU_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1034"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=PLkyri"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=PLkyri" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=lMM8N"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=lMM8N" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=cn5eN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=cn5eN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=ymann"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=ymann" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=d5Dvn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=d5Dvn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=ClpWN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=ClpWN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=p6x0n"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=p6x0n" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=I69SN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=I69SN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=mTT4N"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=mTT4N" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=2UnCn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=2UnCn" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/448508101" height="1" width="1"/>http://www.taxquips.com/index.php?id=1034 Thu, 06 Nov 2008 06:09:00 -0800 Default on Sale http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/444406870/index.php http://www.taxquips.com/index.php?id=1028 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1028#comments Tax Quips Tax Quips Today TaxMama hears from Tony in Texas, with this tale of woe. “I sold a business and was never paid all of the money that was owed to me. The company closed and went out of business and never paid me. Can I go back to 2006, the year of the sale Today TaxMama hears from Tony in Texas, with this tale of woe. “I sold a business and was never paid all of the money that was owed to me. The company closed and went out of business and never paid me. Can I go back to 2006, the year of the sale and recomputed the profit?” Dear Tony, I expect we’ll be seeing a lot more of this kind of thing in the next few years. Work with a tax professional to review the way that sale was reported in 2006. Amending a return to correct the sale of business is tricky stuff. If it was reported as an installment sale, you will have to amend both 2006 and 2007. If you reported all income from the sale at one time in 2006, that will be the only year to amend. However, when you sold the company, didn’t you file some sort of security document to make you a secured creditor? Or didn’t you secure the loan against the buyer’s home? You may still have some recourse against the buyer’s assets. If you do, you should try to collect. If you’re going to try to collect, you can still amend those tax returns now. When you collect, you can either amend them again or pick up the income all at once in the year you collect it. For forms: Use the current Form 1040X http://www.irs.gov/pub/irs-pdf/f1040x.pdf Use the 2006 Form 1040 and related Forms and Schedules http://www.irs.gov/formspubs/article/0,,id=169996,00.html Use the 2007 Form 1040 and related Forms and Schedules for the second year http://www.irs.gov/formspubs/article/0,,id=182756,00.html And remember, you can find answers to all kinds of questions about failed installment sales and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] 00:00:00 Today TaxMama hears from Tony in Texas, with this tale of woe. &#8220;I sold a business and was never paid all of the money that was owed to me. The company closed and went out of business and never...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_KNyj4lJeFJ.p7G.t5byVKUXsKAI_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/KNyj4lJeFJ.p7G.t5byVKUXsKAI_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_KNyj4lJeFJ.p7G.t5byVKUXsKAI_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=KNyj4lJeFJ.p7G.t5byVKUXsKAI_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1028"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=M4lts4"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=M4lts4" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=6CjaN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=6CjaN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=GYTSN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=GYTSN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=b2R0n"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=b2R0n" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=NTKKn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=NTKKn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=VE06N"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=VE06N" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=Dv9fn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=Dv9fn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=xQZVN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=xQZVN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=hGbbN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=hGbbN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=A6Rtn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=A6Rtn" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/444406870" height="1" width="1"/>http://www.taxquips.com/index.php?id=1028http://taxmama.audioacrobat.com/download/256b34c7-c8f6-51fa-bd42-71e17c571245.mp3 Wed, 05 Nov 2008 05:50:00 -0800 Stimulus vs Child Tax Credit http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/443258889/index.php http://www.taxquips.com/index.php?id=1027 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1027#comments Tax Quips Tax Quips Today TaxMama hears from Cho in New York, who says. “My 2008 tax rebate check included $300 per child. Do I still expect $1,000 Child Tax Credit for each eligible child when I file my 2008 federal tax return? Or, just $700 per child?” Today TaxMama hears from Cho in New York, who says. “My 2008 tax rebate check included $300 per child. Do I still expect $1,000 Child Tax Credit for each eligible child when I file my 2008 federal tax return? Or, just $700 per child?” Dear Cho, Truly, the whole Stimulus Rebate thing has been very confusing. The $300 per child is part of the Stimulus Rebate. The $1,000 per child Child Tax Credit or Additional Child Tax Credit is a separate thing. So you’ll still be getting that. Remember, when you file your 2008 tax return, there will be line 70 among the credits, to give you the Stimulus Rebate – again. Do not take that credit if you’ve already received the money. Here’s a draft copy of the 2008 Form 1040. http://www.irs.ustreas.gov/pub/irs-dft/f1040—dft.pdf If no other tax laws are changed by the ‘lame-duck’ Congress, this is the version that will be in use next year. I hope this clears things up a bit. And remember, you can find answers to all kinds of questions about tax credits and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] 00:00:00 Today TaxMama hears from Cho in New York, who says. &#8220;My 2008 tax rebate check included $300 per child. Do I still expect $1,000 Child Tax Credit for each eligible child when I file my 2008...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_tDEa6Omrr4D57B4BoXHe9YV-pyg_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/tDEa6Omrr4D57B4BoXHe9YV-pyg_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_tDEa6Omrr4D57B4BoXHe9YV-pyg_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=tDEa6Omrr4D57B4BoXHe9YV-pyg_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1027"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=Cw3PvY"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=Cw3PvY" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=brJCN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=brJCN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=bQAON"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=bQAON" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=AtRpn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=AtRpn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=tAbOn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=tAbOn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=HvvzN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=HvvzN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=w6Amn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=w6Amn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=ILW9N"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=ILW9N" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=6VTSN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=6VTSN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=imRQn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=imRQn" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/443258889" height="1" width="1"/>http://www.taxquips.com/index.php?id=1027http://taxmama.audioacrobat.com/download/bb5d654d-3423-c665-ddd7-ee84a680cc97.mp3 Tue, 04 Nov 2008 06:06:00 -0800 Education Paid by Insurance http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/442135038/index.php http://www.taxquips.com/index.php?id=1026 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1026#comments Tax Quips Tax Quips Today TaxMama hears from Angela in Los Angeles, who tells us. “My friend got a form 1098-T . There is an entry of $11,200 in box 10 of her 1098-T. She has about $3,000 income from W-2. She is afraid to do her tax return because she thinks that Today TaxMama hears from Angela in Los Angeles, who tells us. “My friend got a form 1098-T . There is an entry of $11,200 in box 10 of her 1098-T. She has about $3,000 income from W-2. She is afraid to do her tax return because she thinks that amount from Box 10 of 1098-T is income. Is this true ?” Dear Angela, Hmmm…looking at the 2008 Form 1098-T, box 10, that’s the box for insurance reimbursements paid towards tuition and related expenses. http://www.irs.gov/pub/irs-pdf/f1098t.pdf Box 10. Shows the total amount of reimbursements or refunds of qualified tuition and related expenses made by an insurer. The amount of reimbursements or refunds for the calendar year may reduce the amount of any education credit you can claim for the year. I would want to find out the source of the insurance reimbursements. Then, thinking of the rules related to gifts – payments made directly to an educational institution are exempt from gift tax. So I suspect that there’s no income here. You may not need to put that amount anywhere. The $11,200 will reduce the rest of her tuition expenses to wipe out any education credit she could get. Though, with only $3,000 of wages, she won’t have any taxes at all – if this is her only income. However, I would want to look at that insurance source. If an insurance company is paying for her education, what other money is it paying her? And for what? Get a look at the source of the settlement. If she had a major physical injury and is receiving annual payments, there probably isn’t a taxable component. But, the insurance may be paying her for lost wages or other taxable compensation. I suspect that’s her real concern – not the amount in box 10. I hope that helps. And remember, you can find answers to all kinds of questions about education and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] 00:00:00 Today TaxMama hears from Angela in Los Angeles, who tells us. &#8220;My friend got a form 1098-T . There is an entry of $11,200 in box 10 of her 1098-T. She has about $3,000 income from W-2. She is...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_LTEs2xX70oeJrJnkOmOw9syrdps_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/LTEs2xX70oeJrJnkOmOw9syrdps_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_LTEs2xX70oeJrJnkOmOw9syrdps_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=LTEs2xX70oeJrJnkOmOw9syrdps_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1026"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=sESwHo"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=sESwHo" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=h9RqN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=h9RqN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=1aSxN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=1aSxN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=v2Bin"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=v2Bin" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=zcD5n"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=zcD5n" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=zNKxN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=zNKxN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=4yZgn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=4yZgn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=ei0SN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=ei0SN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=19xQN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=19xQN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=5RiSn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=5RiSn" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/442135038" height="1" width="1"/>http://www.taxquips.com/index.php?id=1026http://taxmama.audioacrobat.com/download/de5d93c7-2fa0-f025-95a2-8f159347790a.mp3 Mon, 03 Nov 2008 06:08:00 -0800 Overstated Income http://feeds.feedburner.com/~r/TaxMamasTaxquips/~3/441002970/index.php http://www.taxquips.com/index.php?id=1025 Eva Rosenberg Eva Rosenberg no http://www.taxquips.com/index.php?id=1025#comments Tax Quips Tax Quips Today TaxMama hears from Tom in California, with a problem. “I overstated my income. How do I correct this?” Dear Tom, This is an interesting problem. Naturally, the way to correct any error on a personal income tax return is to Today TaxMama hears from Tom in California, with a problem. “I overstated my income. How do I correct this?” Dear Tom, This is an interesting problem. Naturally, the way to correct any error on a personal income tax return is to file an amended return – Form 1040X. http://www.irs.gov/pub/irs-pdf/f1040x.pdf When you file the amended return, it does get reviewed by a live person, not a computer – unlike the original filing of that tax return. So, why is this interesting? It’s hard to prove you earned less than you originally reported. What made you realize that you overstated your income? Was it a 1099 you received that showed less income than you expected? That’s meaningless. You don’t do bookkeeping by way of 1099s other people send you. You’re meant to keep real books. Did you use the total deposits shown on your bank statement? Now, when you looked something over, you realized that not all the deposits were income? OK, fine. But you’ll have to prove that some of those deposits were something else – like loans or transfers from other accounts…or whatever. So, sure, go ahead and file an amended return for the year. But be very sure you can PROVE your case – otherwise, expect your claim to be rejected. And perhaps it might even generate an audit. That has been know to happen. Be sure to read the instructions to the Form 1040X and good luck! http://www.irs.gov/pub/irs-pdf/i1040x.pdf And remember, you can find answers to all kinds of questions about fixing errors on your tax return and other tax issues, free. Where? Where else? At TaxMama.com [Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.] 00:00:00 Today TaxMama hears from Tom in California, with a problem. &#8220;I overstated my income. How do I correct this?&#8221; Dear Tom, This is an interesting problem. Naturally, the way...<br/> <br/> If you were subscribed to TaxQuips, you'd be able to get your own questions answered, too. <p><map name="google_ad_map_lG1DQjiURQIgA-Nu.vbgJqcXQc8_"><area shape="rect" href="http://imageads.googleadservices.com/pagead/imgclick/lG1DQjiURQIgA-Nu.vbgJqcXQc8_?pos=0" coords="1,2,367,28"/><area shape="rect" href="http://services.google.com/feedback/abg" coords="384,10,453,23"/></map><img usemap="#google_ad_map_lG1DQjiURQIgA-Nu.vbgJqcXQc8_" border="0" src="http://imageads.googleadservices.com/pagead/ads?format=468x30_aff_img&client=ca-pub-0163205338784028&channel=7358070661&output=png&cuid=lG1DQjiURQIgA-Nu.vbgJqcXQc8_&url=http%3A%2F%2Fwww.taxquips.com%2Findex.php%3Fid%3D1025"/></p> <p><a href="http://feeds.feedburner.com/~a/TaxMamasTaxquips?a=RlOoiO"><img src="http://feeds.feedburner.com/~a/TaxMamasTaxquips?i=RlOoiO" border="0"></img></a></p><div class="feedflare"> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=ywgEN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=ywgEN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=pENVN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=pENVN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=cQcDn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=cQcDn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=XFOzn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=XFOzn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=YJouN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=YJouN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=DhGYn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=DhGYn" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=MD4uN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=MD4uN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=fDSRN"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=fDSRN" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/TaxMamasTaxquips?a=N1mpn"><img src="http://feeds.feedburner.com/~f/TaxMamasTaxquips?i=N1mpn" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/TaxMamasTaxquips/~4/441002970" height="1" width="1"/>http://www.taxquips.com/index.php?id=1025http://taxmama.audioacrobat.com/download/8cfef08d-dafe-04bd-17d4-23e59e236a8a.mp3 Eva RosenbergnonadultThe number one tax podcast online - receive a daily TaxQuips that answers a reader's tax question using real life tax strategies and recommends resources to help you either solve your own tax problems, or at least helps you communicate with your tax pro.