Monday, January 22, 2018
WHAT’S THE BUZZ, TELL ME WHAT’S A HAPPENNIN’?
* Over at GO BANKING RATES Michael Keenan gives us the “Average Tax Return and Tax Refund Schedule for 2017”.
One important date to note –
“Feb. 27, 2018: If you’re claiming the earned-income tax credit or need to apply for the child tax credit, you’ll have to wait longer. The IRS expects refunds for tax returns claiming those tax credits to be available starting Feb. 27, at the earliest. If you’re claiming either credit, that means the IRS holds back your entire refund — not just the portion connected to the specific tax credit.”
* Staying with that topic – JDSUPRA lists “Six Reasons to Get Your Tax Return Prepared Early”, all good ones.
* Ken Berry (not the actor – showing my age again) states the obvious in “2018 Tax Reform: Pass-Through Income Deduction More Complex Than Thought” at the CPA PRACTICE ADVISOR.
* Last week’s “Ask The TaxGirl” at FORBES.COM dealt with “Claiming A Tax Refund When You Owe Tax”.
Some good stuff in KPE’s answer (highlights are mine) –
“I am going to assume further that you filed your 2016 tax return early based on an estimate or last pay stub because you wanted your refund quickly.
Not only is that a bad idea, it's against the rules: The Internal Revenue Service (IRS) specifically bars tax preparers from e-filing your tax returns without receipt of forms W-2, W-2G and 1099-R. And while there are some tax preparers who will do anything for a dollar, I would advise you to find a tax professional who is willing to explain what can happen to you when you file without the right documentation.”
* And in another “Ask The Taxgirl” post KPE tackles “The $10,000 SALT Cap & Vacation Homes”.
Kelly says that property taxes paid on a personal use vacation home can be included in the $10,000 maximum deduction.
So, it appears you can deduct up to $10,000 in a combination of property taxes and state and local income or sales taxes on Schedule A for 2018 – 2025. If the property taxes on your primary personal residence are $6,000, and you have a vacation property with property taxes of $3,000, you can deduct up to $1,000 of state and local income or sales taxes to come up with the maximum $10,000.
* Let us make it a TaxGirl “trifecta” with the good news that “Mike 'The Situation' Sorrentino Expected To Plead Guilty To Tax Charges”. Thankfully the government is spared the cost of a trial.
No surprise about the tax evasion – and getting caught. All these reality tv "celebrities" (including the one in the White House) are merely self-absorbed and self-important idiots with limited intelligence.
* Did you know that if you owe too much money to your Uncle Sam the IRS can revoke your passport, or deny your passport application or renewal? Also at FORBES.COM, Robert W Wood explains “How Overdue Taxes Can Jeopardize Passports”.
* The TAX FOUNDATION reports on the "Summary of the Latest Federal Income Tax Data, 2017 Update" - “data on individual income taxes for tax year 2015, showing the number of taxpayers, adjusted gross income, and income tax shares by income percentiles.”
Curious about whether the wealthy are paying their “fair share” of taxes? The summary points out that (highlights are mine) -
“The top 1 percent paid a greater share of individual income taxes (39.0 percent) than the bottom 90 percent combined (29.4 percent).”
“In 2015, the top 50 percent of all taxpayers paid 97.2 percent of all individual income taxes while the bottom 50 percent paid the remaining 2.8 percent.”
THE FINAL WORDS
Part I -
The ridiculous Turbo Tax tv ads seem to be saying that taxpayers should not be afraid to use TT software to prepare their tax returns.
This is obviously not true. Individuals who use a “box” to self-prepare their 1040 need to be afraid that the return was not prepared correctly and that the IRS will charge them penalties and interest when the errors are eventually discovered.
It is difficult to decide whose tv ads are more stupid – Turbo Tax or Henry and Richard.
Part II –
“Trumpocracy: The Corruption of the American Republic” is a great new book by a respected Republican that “offers a persuasive and detailed account of how Trump is undermining American institutions, including the presidency itself.”
It is "a must-read for Americans who are in denial about the threat to democracy posed by a president absorbed in narcissism and recklessly indifferent to the institutions and norms of ethics and propriety that have sustained the great American experiment for 2½ centuries.
His attributions are meticulous, his footnotes are extensive, his willingness to call out deviations from his conservative brethren is commendable.
Therein lies the power and credibility of Frum’s conclusions. They are supported by verifiable facts, grounded in historical context, devoid of ideological hue.”