Tuesday, September 5, 2017
WHAT’S THE BUZZ, TELL ME WHAT’S A HAPPENNIN’
FYI- I am off to Cape Cod and Martha’s Vineyard tomorrow, so no more posts this week.
* Monday’s post at THE TAX PROFESSIONAL was “Continuing the Ethics Discussion”.
* Jim Wang’s post “Are You a PTA Parent? That Volunteering May Just Pay Off” at the TURBO TAX BLOG isn’t just for PTA members. It applies to all who volunteer for a church or charity, including volunteer work related to Hurricane Harvey.
* TaxGirl Kelly Phillips Erb is putting out a call for volunteers to “Write For Forbes During Tax Reform Week”. I have sent her my submission.
* Also at FORBES.COM Tony Nitti reports “Robert Mueller Employs Powerful Weapon In Trump-Russia Investigation: The IRS”.
Remember, it was the IRS that finally brought down Al Capone. And Capone was smarter than Trump (not too many people aren’t – except perhaps for Trump’s cult of ignorami).
* Speaking of the idiot in the White House, check out the September “issue” of THE LIBERTY TIMES.
* As with Henry and Richard, while I would never recommend that a taxpayer use Liberty Tax Service, or any “fast-food” commercial chain, to prepare their returns, I do believe its TAX LOUNGE BLOG can offer good advice, as it does in dealing with the question “Why You Need to Withhold Taxes From Unemployment” –
“Believe it or not, unemployment compensation is taxable income. Too few people seem to know this — or maybe it’s just that too few people want to know this. Nevertheless, this oversight could lead to taxpayers who didn’t withhold taxes from unemployment benefits owing on their federal and state income tax returns.”
“Instead of worrying about how much you have to pay at the end of the year, contact your state unemployment office, either by phone or online. Have them withhold the 10 percent required for federal taxes and whatever percentage is required for state income taxes in your state. If it turns out you don't owe taxes, you may get it back as a refund. Better to have taxes taken out initially than to worry about how to pay a significant debt at the end of the year.”
Another issue with taxable unemployment benefits – some states, like New Jersey, have stopped mailing out paper copies of Form 1099-G to report unemployment benefits and withholding therefrom, just like many states have stopped sending out paper copies of Form 1099-G for state tax refunds, I guess to save money. As a result I have seen several clients fail to report unemployment benefits on their 1040, and get hit with penalties and interest when the oversight is uncovered during the IRS matching process.
It is very important that anyone who receives unemployment benefits during the year go to the appropriate state website in January 2018, usually the same website that they used to request or maintain benefits, print-out the Form 1099-G, and give this form to their tax preparer.