Wednesday, May 23, 2012
WHAT’S THE BUZZ? TELL ME WHAT’S A HAPPENNIN’ – WEDNESDAY EDITION
* Russ Fox has a good warning for small business owners in “CPA Allegedly Practices Theft of Funds” at TAXABLE TALK.
The post discusses two CPAs who had clients make payments for federal and state tax liabilities directly to themselves, with the assumption that they would submit the payments to the appropriate tax agency. Instead they just kept the money.
Russ tells us –
“I haven’t met an accountant who would want you to make checks for your taxes payable to the accountant. If that’s what your accountant wants, be afraid.”
He also points out –
“Finally, I’d like to point out that Mr. Voltz, like Mr. Murray before him, is a CPA. He presumably has taken his ethics requirements. That hasn’t stopped him from being accused of what anyone would call a serious violation.”
While Russ is saying that registration/licensing of tax preparers will not stop tax fraud, with which I agree, my take is that forcing all preparers to sit through 2 hours of ethics classes each and every year will not turn a crooked preparer honest.
* Russ also warns us “Beware: Lots of Incorrect IRS Notices”.
He tells it like it is (highlights are mine) -
“Many IRS notices are wrong. Indeed, of the CP2000 notices I’ve seen this year at least 80% are wrong. Yet I have clients who just want to pay the IRS to get them off their backs. I cannot overemphasize that most IRS notices are not reviewed by a human before they’re sent to you. You will be the first person to read the notice. Do not assume a notice is correct just because the IRS says so.”
This is nothing new – I have been saying for years that more than half (I was being conservative) of IRS notices are wrong. And when it comes to state tax notices, especially NJ, the percentage is higher.
* The title of this IRS release says it all – “IRS Announces More Flexible Offer-in-Compromise Terms to Help a Greater Number of Struggling Taxpayers Make a Fresh Start”.
This is the program under which certain “tax resolution” companies advertise you can settle your IRS debt for “pennies on the dollar”. It ain’t necessarily so. However a reputable tax pro can use an Offer In Compromise to reduce your tax debt.
* Another self-explanatory IRS release title – “IRS Releases the Dirty Dozen Tax Scams for 2012”.
“The Dirty Dozen listing, compiled by the IRS each year, lists a variety of common scams taxpayers can encounter at any point during the year. But many of these schemes peak during filing season as people prepare their tax returns.”
* Over at the CHICAGO TRIBUNE Steve Rosen provides us with “Kids and Money: A Primer on Tax Deductions”, which discusses “some of the importantissues that summer workers and parents need to know”.