Tuesday, August 11, 2015
WHAT’S THE BUZZ, TELL ME WHAT’S A HAPPENNIN’ – TUESDAY EDITION
Sorry for the brief BUZZ installments lately – but there is not much happening in the federal tax arena.
The idiots in Congress have left for vacation without addressing the “tax extenders”. As I have said in a previous BUZZ it looks like it will be déjà vu all over again as the idiots once again wait until the last minute to extend these tax breaks for another year or two.
* Tax pros – Did you see the latest post at THE TAX PROFESSIONAL yet? Why not? There are two questions I want you to answer.
* In light of the comments by two of the candidates in the recent Republican debate Kelly Phillips Erb explains “Our Current Tax v. The Flat Tax v. The Fair Tax: What's the Difference?” at FORBES.COM.
I like the idea of a flat tax because –
“A true flat tax would mean, as Dr. Carson explained, that everyone would pay the same tax rate regardless of income.”
I don’t believe a person with higher income should be punished for ambition and entrepreneurship by being taxed at a higher rate.
The concept behind the “Fair Tax” – a national sales tax – should not be dismissed out of hand. It has many advantages. Because it is a consumption tax paid at the point of purchase those who currently avoid tax as part of the “underground economy” would be paying tax, including, as former Governor Huckabee pointed out at the debate, “illegals, prostitutes, pimps, drug dealers, all the people who are freeloading off the system”.
* Over at DON’T MESS WITH TAXES Kay Bell, the yellow rose of taxes, warns us that the “Latest Tax Scam Arrives as Fake Snail-Mailed IRS Letters”.
For years we have been telling you that the IRS will never initiate contact with a taxpayer by telephone or email. They will always do it by postal mail. Scammers have been listening, and are now sending out phony IRS balance due notices via postal mail.
Kay points out that “real letters from the IRS, even those about amounts the agency says you owe, do not demand that you send it or its agents payments via specific methods such as pre-debit cards. And initial written notices from the IRS also give you time to respond to or rebut the agency's request for additional tax payment.”
For years I have also been telling you that whenever you receive any correspondence from the IRS or a state tax agency give it to your tax preparer immediately. Do not send any money to anyone without first checking with your tax pro.
If you have “self-prepared” your tax returns, either by hand or via a “box”, and you receive correspondence from a tax agency you should contact a tax professional before doing anything (you should have used a tax pro instead of a “box” in the first place). Click here for a starting point in your search for a tax pro.
* Sarah Brenner from THE SLOTT REPORT explains “How You Can Utilize an HSA Now to Save For Retirement”.
* Julian Block (I assume no relation) deals with the question “Fees for Divorce Mediators: What’s Deductible?” at ACCOUNTING WEB.