Wednesday, May 30, 2012
WHAT’S THE BUZZ? TELL ME WHAT’S A HAPPENNIN’ – WEDNESDAY EDITION
* TAXGIRL Kelly Phillips Erb offers “A Simple Solution for Reducing Taxpayer Fraud” at FORBES.COM.
Her solution echoes what I have been saying for years -
“So here’s my great advice: eliminate refundable tax credits. So simple. So easy. And I am sure that it would reduce tax fraud.”
Kelly observes the obvious –
“It’s clear that refundable tax credits are synonymous with increased instances of taxpayer fraud.”
As for the number one source of tax fraud, Kelly points out –
“Top of the list is, of course, the EITC, which has been a constant source of tax fraud. How much fraud? The IRS believes that between 23 and 28% of EITC claims are paid in error. The result is estimated fraudulent payouts each year of more than $10 billion.”
I especially like Kelly’s bottom line -
“I happen to believe that, as a taxpayer, you need some skin in the game. If you’re filing a return simply to get money back from the government that you didn’t pay in, I don’t know if that’s the best use of our country’s limited resources (there are other, better ways for those folks to receive benefits and assistance).”
* Tom Herman answers a question on “Claiming Losses on Worthless Stock” at his Ask Dow Jones blog at the WALL STREET JOURNAL.
He provides an excellent first step -
“Start by asking your broker when the company went bust and whether the shares you own are totally worthless.”
Sometimes, as I have seen lately, if the total worthlessness is questionable the brokerage will purchase the stock for one penny so as to be able to include it on your year-end 1099-B.
* So much for $5.00 a gallon. Kay Bell reports “Memorial Day Gasoline Prices Down, But State Gas Taxes Were Up a Bit in April” in her annual Memorial Day week-end post on gas taxes at DON’T MESS WITH TAXES.
The good news is –
“The average price of gas is down 14 cents a gallon from this time last year, and a quarter since the end of March.”
Kay provides a list of the 10 most expensive states for gas tax. It is a pleasure not to see NJ on top of such a list for a change.
* Trish McIntire talks about “Moving Expenses” at OUR TAXING TIMES.
* My ears were ringing yesterday morning. It appears that MISSOURI TAXGUY Bruce and friends mentioned me when talking about grandfathering of longtime preparers for the RTRP competency test.
Thanks to Jason Dinesen for suggesting that I have forgotten more about 1040s than he knows.
The gang also discusses the differences between an Enrolled Agent, a CPA, a tax lawyer, and a plain old RTRP and when one might need each of these.
Click here to hear the entire discussion
Unfortunately I do not have either a microphone or camera to permit me to join in the fun.
This is a weekly event usually held on Tuesday between 11am and 12 noon - so put next week’s edition on your calendar.