Saturday, January 15, 2011

WHAT’S THE BUZZ? TELL ME WHAT’S A HAPPENNIN’

* Did you see my second column of “year-beginning” tax tips at MAINSTREET.COM – “Keep Good Records”?

* Paul Caron, the TAX PROF, takes us to a story from Time Magazine that tells about a Swiss village where tax collectors tell a delinquent “Pay Your Taxes or We'll Kill Your Dog

* FYI, In his first State of the State address on January 11, 2011, New Jersey Gov. Chris Christie called for "comprehensive tax reform" for corporation business and gross (personal) income taxes, and said his fiscal year 2012 budget would not include any tax increases. Christie feels the state needs to reform the taxes placed on business and individuals and begin to roll them back. Gov. He will propose the initial installment of a reform package in his budget, which will be presented next month.

* Kay Bell reminds us not to “double dip” in her post “Haiti Earthquake Anniversary and Charitable Deduction Reminder” at DON’T MESS WITH TAXES. The highlight below is mine -

If “you made a cash contribution to Haitian earthquake relief efforts between Jan. 12 and Feb. 28, 2010, and you deducted that amount on your 2009 return last year, be sure you don't deduct it again on your 2010 return”.

* And Kay also tells us the details of “New Federal Tax Refund Debit Cards for Taxpayers Without Bank Accounts”.

*However, Trish McIntire (who you read about in yesterday’s TAX BLOGOSPHERE BUDDY installment) tells us the debit card offering is “Too Late, Try Again Next Year” at OUR TAXING TIMES.

The problem is that they are too late for this program to be effective this year.”

* The Tax Foundation’s TAX POLICY BLOG reports on a great idea in “Pawlenty Proposes Making Congressmen Do Their Own Taxes”.

* Stacie Clifford Kitts rants about another reason I do not use tax preparation software in her post “Here’s A Lesson In Questionable Customer Service – Don’t Mess With Someone Who Has A Blog That People Actually Read” at STACIE’S MORE TAX TIPS.

* The “Cohan Rule” is alive and well! The Small Business Taxes and Management site tells how this rule was applied to moving expenses and a casualty loss deduction in its January 14th news item headed “Documentation is essential in securing any deduction, but you may be able to convince the Court to give you at least a partial benefit”.

* Joe Kristan reports on the wife of a Congressperson who got only slightly more punishment than Chuck Rangel for tax fraud in “Mrs Congresscritter Gets 30 Days for Tax Cheating” at the ROTH AND COMPANY TAX UPDATE blog. Both she, and certainly Chuck, deserve a more appropriate sentence.

BTW - I agree, as does Joe, with how the prosecutors characterized her husband. As Joe says, “When you see the work they do, it's hard to argue with that".

* The top item on the MONEY section of Friday’s USA TODAY was “Use Smartphone App to File Taxes”. It seems that TURBO TAX has an “app” that allows you to file a Form 1040EZ using their cell phone – for $14.99. I have rarely even looked at a 1040EZ over the years, but from what I recall it is so easy that even a Congressperson could prepare it. Why pay $14.99? And what about the state return. Hey, I don’t have a cell phone anyway.

Inside the same section was an item touting the IRS Free File program. As the article states, when you use the IRS Free File program you still involve a third-party tax preparation or tax software company in the process. So you are subject to the third-party’s advertising and sales pitches. It is not a way to file your return directly with the Internal Revenue Service. And I do believe that, while the federal filing is free, you may have to pay for filing your state return.

* We (tax bloggers) have all been telling you about the “raise in pay” resulting from the 2% reduction in Social Security withholding for 2011. However some taxpayers are actually taking home less money. TAXGIRL Kelly Phillips Erb explains why in “Ask the taxgirl: Screwy Withholding”.
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* The RED TAPE CHRONICLES from MSNBC is reporting “Tax Refund Loans Disappear, Now, More Fees”.

Henry and Richard are not offering RALs this tax season – but that hasn’t stopped them from looking for other ways to screw clients with high fee (and high profit) products. The item tells us -
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H&R Block Chief Executive Alan Bennett has vowed to create ‘other financial products’ to fill the void -- speculation has centered on other high-cost, short-term loan products.”
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And -
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Trainees who attend H&R Block employment sessions are being instructed to upsell short-term loans called 'Emerald Loans' offered by H&R Block Bank, according to people familiar with the training.”
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TTFN

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