According to the IRS, “virtual currency” is “a digital representation of value that functions as a medium of exchange, a unit of account, and/or a store of value.” Virtual currency is becoming more common as a source of investment and for privacy. However, virtual currency in video games is givin...
The likelihood of individual tax audits by the IRS continues to fall. In 2019, the IRS examined 0.45% of individual tax forms. This number is lower than the year before and less than half of the rate of tax examinations performed in 2010. One aspect of lower audits is a lot of uncollected tax r...
After a divorce, individuals will likely see significant changes in their tax filings. This includes single filing and deciding who claims children for tax purposes. When a spouse is awarded alimony or spousal support, the supporting spouse may wonder whether those payments are deductible and the...
Divorce can be a financially difficult time for a separating couple. In addition to the costs of divorce lawyers and litigation, each spouse will likely deal with changes in assets and debt, property changes, and relocation. To make the divorce even more painful, a spouse may get a tax notice in ...
The Internal Revenue Service (IRS) has released tax gap estimates for tax years 2011-2013. According to those estimates, the nation's tax compliance rate has changed little from prior years. The majority of taxes owed are paid and paid on time. When they are late, unpaid, or there is an underpaym...
The 2018 filing deadline for most taxpayers was April 15, 2019. However, many taxpayers needed a little more time and filed for an extension. The extension allowed these individuals a little more time to get their taxes in order. However, that extended deadline is fast approaching and taxpayers w...
Scammers are using the threat of tax penalties or arrest to trick taxpayers by pretending to be from the IRS. There have been reports of telephone scams, email scams, and even fake letters. The problem for many taxpayers is that they may be unsure whether a notice from the Internal Revenue Servic...
Many people have been making money on Bitcoin and other cryptocurrencies. This includes buying, selling, and trading digital currency, as well as mining Bitcoins. However, any income made from dealing in Bitcoins is not immune from taxation in the U.S. The IRS has sent letters to more than 10,000...
So the IRS decided to still allow 50% deduction for meals and entertainment, but there are new guidelines under the 2018 tax reform. The new law generally eliminated the deduction for any expenses related to activities generally considered entertainment, amusement or recreation. However, under t...
When dealing with the IRS, taxpayers have the right to confidentiality. As with all ten rights outlined in the Taxpayer Bill of Rights, the IRS is supposed to take these rights very seriously. Taxpayers should expect that any information they provide to the IRS will not be disclosed to outside p...
On August 29, 2018, the Maryland General Assembly's Joint Committee on Administrative, Executive, and Legislative Review approved emergency regulations to support Maryland's implementation of South Dakota v. Wayfair decision. This Supreme court decision can require retailers to collect sales taxe...
The right to privacy is one of ten rights the Taxpayer Bill of Rights gives all taxpayers. Some details about what taxpayers can expect in regards to the right to privacy: The IRS cannot seize certain personal items, such as books, clothing and undelivered mail. The IRS cannot seize a perso...
The IRS is reminding U.S. citizens and resident aliens, including those with dual citizenship, to check if they have a U.S. tax liability and a filing requirement. At the same time, the agency advised anyone with a foreign bank or financial account to remember the upcoming deadline that applies t...
The Internal Revenue Service is reminding an estimated 1 million taxpayers that time is running out to file a 2014 tax return and claim refunds totaling more than $1 billion. To claim any refund due, taxpayers must file their 2014 federal tax return by April 17, 2018. There is no penalty for fil...
Taxpayers who give money or goods to a charity may be able to claim a deduction on their 2017 federal tax return, which basically reduces the amount of their taxable income. Here are some important facts about charitable donations: Qualified charities. To receive a deduction, taxpayers must d...
One of the basic rights from the Taxpayer Bill of Rights, that all taxpayers are entitled to when dealing with the IRS, is the right to finality. Taxpayers that have been audited by the IRS or have other disputes are entitled to the Taxpayer Bill of Rights. For taxpayers who are in the proces...
Many taxpayers may need to take out money early from their Individual Retirement Account or retirement plan. Doing so, however, can trigger an additional tax on early withdrawals. They would owe this tax on top of other income tax they may have to pay. Here are a few key points to know: Early...
The Internal Revenue Service today announced it will begin to ramp down the 2014 Offshore Voluntary Disclosure Program (OVDP) and close the program on Sept. 28, 2018. By alerting taxpayers now, the IRS intends that any U.S. taxpayers with undisclosed foreign financial assets have time to use the ...
Taxpayers have the right to appeal an IRS decision in an independent forum. This is one of ten basic rights — known collectively as the Taxpayer Bill of Rights— that all taxpayers have when dealing with the IRS. The IRS Office of Appeals that handles a taxpayers case must be separate from the I...
Unclaimed federal income tax refunds totaling about $1.1 billion may be waiting for an estimated 1 million taxpayers who did not file a 2014 federal income tax return, according to the Internal Revenue Service. To collect the money, these taxpayers must file their 2014 tax return with the IRS no...
What is Trust Fund Recovery Penalty? An employer is required by law to withhold payroll tax from employees and then send the withholding money to the IRS. The requirement to send the money to the IRS can be daily, every other day, weekly, bi-weekly, monthly, or even quarterly. At the end of eac...
Many taxpayers these days are self-employed individuals. You are a self-employed person if you carry on a trade or business as a sole proprietor or an independent contractor. This trade or business does not need to be a regular full time business, but could be in addition to your regular job. T...
Taxpayers have the right to challenge the IRSs position and be heard. This is one of the Taxpayer Bill of Rights, which clearly outline the fundamental rights of every taxpayer. The IRS wants to make sure taxpayers know about their rights when dealing with the agency. Taxpayers have the right t...
Did You Know? Internal Revenue Code, Section 6107(a) requires all paid tax preparers to furnish the taxpayer with a completed copy of their tax return before (or at the same time) the return is presented to the taxpayer for signature. Failure to comply with this law may subject you to an Internal...
For tax years beginning after 2016, the due date for a U.S. person to file Form 3520, Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts, has changed to the fifteenth day of the fourth month following the end of the U.S. persons tax year. For most indiv...
Time is of the essence when it comes to tax-related issues. If you are uncertain as to what your next step should be, contact the reliable tax attorneys at Gabaie & Associates, LLC today.
