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Showing posts from February, 2004
Help for Child Tax Credit Available on IRS.gov

The Internal Revenue Service reminds practitioners that taxpayers claiming
the Child Tax Credit cannot claim the full $1,000 per child if they
received an advance payment check last year. When figuring the credit,
they must subtract the amount they got in advance. Failure to do so will
reduce and could delay the tax refund claimed.
Taxpayers can get the amount of their advance Child Tax Credit payment by
visiting IRS.gov. Information is available by clicking on 1040 Central or
Your 2003 Advance Child Tax Credit. Click here
Senators Push to Tax VoIP after 2 years
Sens. Thomas Carper and Lamar Alexander revived the debate over taxing Internet access with the introduction of a bill that would reinstate for two-years the now-expired ban on state and local taxation of Internet access services. The senators oppose a competing bill that would make the Internet tax moratorium permanent and extend the exemption from taxation to all forms of technology used to provide
Internet access, maintaining that the other bill would be too costly to already cash-strapped states.

Essentially, after 2 years, the Senators want states to be able to tax internet services, especially the expanding broadband services and the use of the internet for telephone services, VoIP.
Taxation of Lottery Winnings

A lump sum payment for the right to receive future
installments on a winning lottery ticket is taxable as
ordinary income, not capital gain, the Ninth Circuit holds.
Not Filing Tax Returns Costs Billions in Lost Refunds
Nearly 2 million students, retirees and other taxpayers stand to lose $2.5 billion in refunds if they don't act quickly to claim the money.

The Internal Revenue Service said Monday that anyone who should have gotten a refund for taxes paid in 2000 but didn't file a return must file and claim the money by April 15.

Half of those taxpayers could claim refunds of $529 or more, the IRS estimated. That calculation does not include the earned income tax, which could make the refund even larger for some low-wage workers.

Don't wait until it's too late!
IRS to Audit More Small Businesses

A restructuring announced by the Internal Revenue Service recently could mean that more small businesses see audits of their income tax returns.
The IRS said it would be adding 2,200 new positions to its enforcement, or audit, operations in 2005, having consolidated or cut back in other divisions. The agency noted that between 1996 and 2002, its enforcement personnel declined by more than a quarter.

Expect more audits of small companies and their owners in 2005 for the 2002 and 2003 tax years. Although the staff won't be full increased until next year, agents can still look back at prior-year returns.