* TAX GIRL Kelly Phillips Erb reports that Money Management International thinks you can tell a lot about a taxpayer from their astrological sign in her post “What’s Your Tax Sign, Baby?”.
I am a Scorpio, and Kelly’s post tells us that “Scorpios are characterized as being passionate. Of those who plan to splurge with their tax refund, one out of four is a Scorpio”. What tax refund?
Kelly’s “Fix the Tax Code Friday” question was “Would you favor a tax ‘rebate’ or advanced credit for 2008?”. Check out my comment.
* Joe Kristan adds some additional things to look out for to the IRS “helpful hints when choosing a return preparer” in his post “Choosing A Reputable Preparer” over at the ROTH AND COMPANY TAX UPDATE BLOG.
I will be posting my annual “Don’t Assume” advice regarding choosing a tax preparer next week. One preparer you cannot choose is me – I am not looking for any new 1040 clients.
* If you want to know more about the “Fair Tax” proposal for a national sales tax currently being touted by Republican presidential candidate Mike Huckabee (it is not his idea – it has been around for quite a while now – he just hung his hat on it) the TAX FOUNDATION BLOG provides an extensive reading list in its post “Fair Tax Article Roundup”.
* MARKET WATCH reports that mutual funds issued record-breaking capital gain distributions this past December, which will mean increased capital gain taxes to be paid during the fast approaching tax season, in the article “How to Share Less With Uncle Sam”. While these distributions will be taxed at the lower capital gains rates they will be taxed just the same. And even though the distributions are taxed at lower rates, they increase AGI and therefore could end up costing much more than 5% or 15%.
* CCH reported that “TIGTA Finds No Problems with IRS Fees Paid to Private Collection Agencies”. A recent audit of fees paid by the IRS to private collection agencies conducted by the Treasury Inspector General for Tax Administration apparently revealed no significant problems.
According to the article, “TIGTA also reported that its staff is performing an overall evaluation of the initiative to measure its performance and evaluate its effectiveness. The overall evaluation will also examine IRS oversight of the program, contractors' compliance with laws and procedures and taxpayers satisfaction with the program”.
I will be interested in the findings of the full overall evaluation. I hope it will address the issue that IRS employees can do the same work for a lot less cost. Besides, as I have said here over and over again, the only motivation of an outside collection agent is to collect money - the more he/she collects the more he/she will earn - whether or not the money is legitimately due. Private collectors have no concern about verifying that the outstanding debt is correct or about responsible tax administration.
* Kay Bell from DON’T MESS WITH TAXES reports that the word from the Government Accountability Office (GAO) is “Taxpayer Information Vulnerable to Tampering”!
According to Kay, “In a report released yesterday, GAO investigators found that IRS records, including taxpayer data, are vulnerable to tampering or disclosure because the agency has not yet corrected dozens of information security weaknesses.”
Oi vey! Or as Kay says, Yikes!
* Kathleen Webb provides “Four Nanny Tax Myths Debunked” in the Wednesday, January 9th posting at her NANNY TAX AND PAYROLL UPDATES blog.
* CCH reports that, as the tax filing season is about to start, so, too, are the email scams.
According to the article, “The latest version of the refund scam is similar to past scams. The email tells the recipient that he or she is eligible for an IRS refund. 'After the last calculations of your fiscal activity, we have determined that you are eligible to receive a tax refund of $129.53,' the email reads.
The email asks the recipient to link to an electronic refund request form so the IRS can process the refund. Scam artists then use the personal information on the form to steal the recipient's identity or for other criminal purposes. Some email scams contain harmful viruses or spyware that can infest the recipient's computer.”
Remember, as I have said here time and again, the IRS will never initiate contact with a taxpayer via email! If you receive such an email delete it immediately.