I just couldn’t stay away – and I am sure you knew it. GDEs be damned!
* This week’s article at MAINSTREET.COM is “When Is Your Small Business Really A Hobby?” (by yours truly).
* Jim Wang talks about “6 Documents You Need But Hate Thinking About” at BARGAINEERING.
Trust me, if you have elderly parents you should make sure all of these things are in order while they are still “competent” – you do not want to wait until there is a “situation” before getting thinking about them.
* Kay Bell, the Yellow Rose of Taxes, has begun her series of Mid-Year Tax Moves with “Midyear Tax Tip #1: Welcome Summer with Energy-Related Tax Breaks”.
Kay asked me to submit a mid-year move, which I did. So be on the lookout for mine.
* I somehow overlooked Kay’s 3-D (or triple-D) post from last week “Deductions Demand Documentation”. One can never over-stress this truism.
Kay’s post discusses a Tax Court case involving charitable contributions. A few items of note from the post –
(1) “The Court noted that IRS findings in such cases ‘are presumed correct, and the taxpayer bears the burden of proving error in the Commissioner’s determinations’.
Further, said the Court, ‘Deductions are a matter of legislative grace, and the taxpayer bears the burden of proving he is entitled to the deductions claimed’.
Got that? When it comes to dealing with the IRS, you're presumed guilty. That is, the IRS' position is the one the courts will believe from the get go. It's up to you to convince the tax agency's examiner and/or auditor otherwise.”
(2) “Although the panhandlers might truly need the few bucks you dispense as you wait for the traffic light to turn green, they are not an official charitable group. That means your gift to them -- or any individual, such as the family down the street whose house burned down -- is not an IRS qualified tax deduction.”
(3) “And don't forget to get a proper receipt or have some sort of acceptable substantiation, such as a canceled check or credit card statement that shows all the tax-required details of the gift.”
* Speaking of mid-year tax moves, an INC.COM article by Issie Lapowsky tells us “How to Prepare for Next Tax Season Now”.
Bloggers love lists, and accountants love acronyms. This article brings us the acronym PLAN from Miami-based public accountant Adam Spiegel -
P = “prepare your records ahead of time.”
L = “list your issues and questions.”
A = “analyze your financial statements for accuracy."
N = “note the changes in laws during the year and discuss them with your tax advisor”
* The TAX POLICY BLOG’s “Monday Map: Property Taxes on Housing by State” indicates that New Jersey is #2 on the list. Garden Staters pay, on average, 1.74% of the value of their homes in real estate taxes. I would have thought it would be the most expensive state – but it was beaten by Texas with 1.76%. CT is #8, but NY and CA are not even in the top 10.
No juvenile jokes about NJ and “#2”.
* Over at TAX GIRL Kelly Phillips Erb sets straight a taxpayer who is “leaving my full-time job 2 start grad school” and “Moving 300 miles” in “Ask the taxgirl: Moving Expenses”
* Who said life, or taxes, is fair. Joe Kristan explains that “The Geithner Rule Only Applies to Geithner” over at the ROTH AND COMPANY TAX UPDATE BLOG.
The taxpayer had very similar circumstances to those of Treasury Secretary Geithner, who got a pass on his tax FU. However, this pass is only available to the politically connected. Joe quotes the Court as saying –
“Regardless of the facts and circumstances relating to the case to which petitioner refers involving U.S. Secretary of the Treasury Timothy Geithner, petitioner is required to establish on the basis of the facts and circumstances that are established by the record in his own case that there was reasonable cause for, and that he acted in good faith with respect to, the underpayment for each of his taxable years 2005 and 2006 that is attributable to his failure to report self-employment tax.”
While I agree with the Court that the facts and circumstances of the specific case must determine the decision – it does not make the fact that Geithner got away with his tax faux pas any less wrong.
* Two items caught my attention from the ACCOUNTANTSWORLD.COM daily headline news e-letter:
(1) Despite controversial ads Yahoo Finance points out that “Pa. Collects $261 Million in Tax Amnesty Program”. And
(2) It also reports that “New Jersey Democrats Fail to Extend Millionaires Tax”. Whenever New Jersey Democrats fail it is good news. Unfortunately, any “millionaire tax” would not have applied to me.
* The CCH daily headline e-letter reports “Tax Bill in Limbo”. So the popular “extenders” are still currently unextended.
* This week’s article at MAINSTREET.COM is “When Is Your Small Business Really A Hobby?” (by yours truly).
* Jim Wang talks about “6 Documents You Need But Hate Thinking About” at BARGAINEERING.
Trust me, if you have elderly parents you should make sure all of these things are in order while they are still “competent” – you do not want to wait until there is a “situation” before getting thinking about them.
* Kay Bell, the Yellow Rose of Taxes, has begun her series of Mid-Year Tax Moves with “Midyear Tax Tip #1: Welcome Summer with Energy-Related Tax Breaks”.
Kay asked me to submit a mid-year move, which I did. So be on the lookout for mine.
* I somehow overlooked Kay’s 3-D (or triple-D) post from last week “Deductions Demand Documentation”. One can never over-stress this truism.
Kay’s post discusses a Tax Court case involving charitable contributions. A few items of note from the post –
(1) “The Court noted that IRS findings in such cases ‘are presumed correct, and the taxpayer bears the burden of proving error in the Commissioner’s determinations’.
Further, said the Court, ‘Deductions are a matter of legislative grace, and the taxpayer bears the burden of proving he is entitled to the deductions claimed’.
Got that? When it comes to dealing with the IRS, you're presumed guilty. That is, the IRS' position is the one the courts will believe from the get go. It's up to you to convince the tax agency's examiner and/or auditor otherwise.”
(2) “Although the panhandlers might truly need the few bucks you dispense as you wait for the traffic light to turn green, they are not an official charitable group. That means your gift to them -- or any individual, such as the family down the street whose house burned down -- is not an IRS qualified tax deduction.”
(3) “And don't forget to get a proper receipt or have some sort of acceptable substantiation, such as a canceled check or credit card statement that shows all the tax-required details of the gift.”
* Speaking of mid-year tax moves, an INC.COM article by Issie Lapowsky tells us “How to Prepare for Next Tax Season Now”.
Bloggers love lists, and accountants love acronyms. This article brings us the acronym PLAN from Miami-based public accountant Adam Spiegel -
P = “prepare your records ahead of time.”
L = “list your issues and questions.”
A = “analyze your financial statements for accuracy."
N = “note the changes in laws during the year and discuss them with your tax advisor”
* The TAX POLICY BLOG’s “Monday Map: Property Taxes on Housing by State” indicates that New Jersey is #2 on the list. Garden Staters pay, on average, 1.74% of the value of their homes in real estate taxes. I would have thought it would be the most expensive state – but it was beaten by Texas with 1.76%. CT is #8, but NY and CA are not even in the top 10.
No juvenile jokes about NJ and “#2”.
* Over at TAX GIRL Kelly Phillips Erb sets straight a taxpayer who is “leaving my full-time job 2 start grad school” and “Moving 300 miles” in “Ask the taxgirl: Moving Expenses”
* Who said life, or taxes, is fair. Joe Kristan explains that “The Geithner Rule Only Applies to Geithner” over at the ROTH AND COMPANY TAX UPDATE BLOG.
The taxpayer had very similar circumstances to those of Treasury Secretary Geithner, who got a pass on his tax FU. However, this pass is only available to the politically connected. Joe quotes the Court as saying –
“Regardless of the facts and circumstances relating to the case to which petitioner refers involving U.S. Secretary of the Treasury Timothy Geithner, petitioner is required to establish on the basis of the facts and circumstances that are established by the record in his own case that there was reasonable cause for, and that he acted in good faith with respect to, the underpayment for each of his taxable years 2005 and 2006 that is attributable to his failure to report self-employment tax.”
While I agree with the Court that the facts and circumstances of the specific case must determine the decision – it does not make the fact that Geithner got away with his tax faux pas any less wrong.
* Two items caught my attention from the ACCOUNTANTSWORLD.COM daily headline news e-letter:
(1) Despite controversial ads Yahoo Finance points out that “Pa. Collects $261 Million in Tax Amnesty Program”. And
(2) It also reports that “New Jersey Democrats Fail to Extend Millionaires Tax”. Whenever New Jersey Democrats fail it is good news. Unfortunately, any “millionaire tax” would not have applied to me.
* The CCH daily headline e-letter reports “Tax Bill in Limbo”. So the popular “extenders” are still currently unextended.
* Oops - they did it again! Another refundable credit - which means another open call for tax fraud. Bill Perez reports in "Adoption Credit Expanded for 2010" at WILLIAM'S TAX PLANNING BLOG that "The adoption credit is worth a maximum of $13,170 for 2010 and will be a refundable credit".
To quote the anti-war anthem of my youth - when will they ever learn? When will they ever learn?
TTFN
1 comment:
Great article on business as a hobby, this can bite so many people who don't take the proper care is acting "business-like".
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