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Showing posts from July, 2009

New Offer In Compromise Forms

New IRS Offer In Compromise Forms

The Internal Revenue Service has released a new version of Form 656-B, “Offer in Compromise Booklet,” and a revised Form 656, “Offer in Compromise.”

The new Form 656-B contains all of the forms and instructions necessary to file an offer in compromise. The revised Form 656 has been slimmed down to four pages and now only includes the four-page offer-in-compromise application. All of the worksheets, checklists and instructions previously found in Form 656 can now be found in Form 656-B. The availability of the two forms allows taxpayers and practitioners to access the offer-in-compromise application without printing or sorting through the offer booklet.

An offer in compromise is an agreement between a taxpayer and the IRS that resolves the taxpayer’s tax liability. Under certain circumstances, the IRS has the authority to settle federal tax liabilities by accepting less than full payment.

Simply filling out the form is not enough! Your tax attorney must p…

Small tax-exempt organizations must file Form 990-N

Small tax-exempt organizations must file Form 990-N

The IRS and the Treasury Department have issued final regulations clarifying how and when certain small tax-exempt organizations must file an annual electronic notice.

The final regulations finalize the temporary regulations without substantive change and affect small tax-exempt organizations whose annual gross receipts are not normally in excess of $25,000. They may be required to electronically submit Form 990-N, also known as the e-Postcard, unless they choose to file a complete Form 990 or Form 990-EZ.

The Pension Protection Act of 2006 added this filing requirement to ensure that the IRS and potential donors have current information about tax-exempt organizations.

The first e-Postcards were due in 2008 for tax years ending on or after Dec. 31, 2007. The e-Postcard is due every year by the 15th day of the 5th month after the close of the organization's tax year. For example, if the organization’s tax year ended on Dec. 31, 2007, …

House set to Raise Taxes to 45%

House Democrats agreed yesterday to raise taxes on the wealthy to pay for more government control of the nation's health-care system, proposing a surtax that would send the top federal tax rate toward 45 percent.

The top federal tax rate currently stands at 35 percent, but Democrats have vowed to raise it to 39.6 percent next year, when cuts enacted during the Bush administration expire. Combined with other federal tax adjustments, the surtax could leave most taxpayers with annual incomes more than $350,000 facing top federal rates of at least 45 percent. There are additional increases in Medicare tax to apply to capital gains.

Democrats Increasing Taxes

The Democrats controlling the House and Senate are lining up to support hefty tax increases in the midst of an economic downturn. Most increases under consideration would go into effect next year. Capital gains will have a "Medicare" tax. The top rate will exceed 40%. Higher income earners will face more penalizing tax increases. All of this will be done in the name of "health care reform."

Big Brother is Watching Small Business!

The Senate conducted Hearings for "Transparancy" for corporations and LLCs. This means the Government wants to know everything about small business so it can tax and control every aspect. The Representative from the DOJ said that federal legislation must include four components:
(1) law enforcement must have access to the names and contact information for those who have control over a company and the company's assets;
(2) define "beneficial owner" the same across all 50 states and collect name, address and photo ID from ALL recognized as beneficial owner,
(3) obtain beneficial ownership information in an accurate and timely fashion which means it must be maintained on site in the state of formation, and it must be updated any time info changes and it must be certified annually, and
(4) there must be a federal enforcement component.
The purpose of this is to regulate and control every aspect of business by the government. This means setting-up a business will beco…