Our Taxing Times

Ask Questions.

This is the time, while you are thinking about taxes, to ask your tax preparer questions. Take some time when you sit down with them or add a note with your question when you send them your return. The questions can just be informative or can help you tax plan for the coming year. But if you have questions, ask them. Yes, your preparer is busy but a few minutes now can save them much more time fixing a problem later. And right now you’re looking for general info. You can always come back for specifics later. But if you put off asking your questions while you are thinking taxes, you might forget about asking until it’s too late.

What kind of tax questions should you ask?

• Retirement - if this is in the plans during the next year, your preparer can help you understand proposed changes. And don’t forget to ask about Social Security if you will start drawing it during the next year.
• Divorce or Marriage – either can play with an expected refund.
• Children - what effect could a new baby have on your taxes? Or, what happens when a child goes to college or starts working.
• Starting a business – get an overview of what records you will need to keep. You can always get more info later.
• Making a withdrawal from your 401K or IRA – if you are thinking about doing this, ask about the tax consequences. The same goes for taking a loan against your 401K.
• Credits and deductions – ask about those credits you’ve heard about on the news. Do you qualify and why/why not?
• Review your return – ask about items that didn’t come out the way you thought they should.
• Are you paying a penalty - a big balance due may trigger a penalty. Should you make estimates or change your withholding?

Ask questions so that you can stay on top of your taxes. A good preparer will try telling you about issues they see but even the best ones don’t read minds. So ask questions so we can do our job better.

McIntire Tax Center - on Facebook - on Google+ - or Twitter @ mactax.

A Short Rant

Dear Telemarketer – please understand that I am tired and swamped and the one reason I am addressing this issue now is that I want to post something to the blog today. But I also have a point to make:

I do not owe you my time.

You called me. I didn’t request your call or the product you are selling. I will give you a limited amount of time but I expect you to use it well or I will end the call. Don’t get huffy because I tell you to lose the script and tell me what you want. Don’t lie to me and pretend that we’ve talked before or that I’ve bought from you. It won’t work and I will immediately hang up. Stop the chitchat. I don’t have time or energy for it. If you can briefly tell me what you want, I’ll give you a couple of minutes. I doubt that I will buy but I’ll listen.

As for those of you in a tax related field like the CPE vendor I heard from today, you should know better. While each practice is different, calling and expecting me to sit through a sales pitch this time of the year is really stupid. Send me an e-mail that I can read at my convenience.

Finally, don’t you dare harass my receptionist! If I can’t take your call, leave a message and if I chose, I’ll call you back.

Off soapbox!

McIntire Tax Center - on Facebook - on Google+ - or Twitter @ mactax.

Payroll Tax Cut and Refunds

A quick catch up on the biggest tax news.

Both the Senate and House have passed the extension of the 2% payroll tax cuts and the bill is headed to the President’s desk to be signed. The bill also continued unemployment benefits for taxpayers out of work over 6 months and kept Medicare reimbursement for doctors from taking a dive.

And it looks like the IRS is catching up on issuing refunds for returns filed early this month. While funding is still way behind, the refunds are starting to show up correctly on “Where’s My Refund” with a target date. The date is still 2 weeks off but the last time I saw that, the clients actually got their refund much faster. The light at the end of the tunnel is at least lit.

McIntire Tax Center - on Facebook - on Google+ - or Twitter @ mactax.

Dirty Dozen

No not the WWII movie with an all star cast. This Dirty Dozen is a list of scams the IRS releases each year. Heading the list this year are Identity Theft, Phishing and Tax Preparer Fraud.

Information on all the "honorees" can be found in IR-2012-23. The IRS also has YouTube videos on the Dirty Dozen in English, Spanish and ASL. Those links are in the IR-2012-23 page. There are also links to more info on identity theft, phishing and preparer fraud.

 McIntire Tax Center - on Facebook - on Google+ - or Twitter @ mactax.

Just What I Needed!

Today has been a rough day; clients bringing in new info for completed returns, refund delays and their daily calls, price shoppers, and tax returns multiplying like Tribbles. So, the e-mail I received from Charles Sipe at  Masters in Accounting website made my day. Our Taxing Times has been names to their list of top 50 Accounting Blogs.

As they reviewed my blog:

"Common sense advice and an occasional rant are served up by Kansas-based Trish McIntire on “Our Taxing Times”, where this longtime tax preparer offers reasons to hang onto tax return copies, insight into the intent behind the creation of the Earned Income Credit, tax strategies for those with education expenses and a personal plea to tax procrastinators."

Thank You! Not just for the honor but for making this a better day. It’s nice to know that someone appreciates the blog.

McIntire Tax Center - on Facebook - on Google+ - or Twitter @ mactax.

Halfway Update

Tax season is halfway finished! Now before you go questioning my math, let me explain. Because of my particular client base, I have found that by February 15^th I have taken in about half of my returns. (Notice I didn’t say finished.) The actual percentage changes each year depending on the weather and when W-2s are released. While I’ll see fewer returns come in each day from now on, they’ll be more complex.

The season, so far, has been crazy because of the refund problems. The first problem was fraud filters that were too tight and were catching everyone. Once that was fixed, the deluge of returns didn’t bother MeF (Modernized e-File) but clogged up processing refunds. The hardest hit were taxpayers whose returns were accepted Feb 2, 3, 4, or 5. Many of them are still waiting for their refund in the IRS processing clog. It has to be frustrating for them since some taxpayers who filed last week now have their refunds.

There were extreme problems with at least one small tax chain and a couple of interesting bad preparer stories (one involving armed robbery) I’ll catch up on tax issues and blogging soon. But for now, I have a pile of returns to finish.

McIntire Tax Center - on Facebook - on Google+ - or Twitter @ mactax.

IRS E-Mails

In one word -ignore.

The IRS does not, repeat does not, initiate contact with taxpayers by e-mail. So any e-mails you receive saying you have a refund due or wanting info, are bogus and you do not want to respond. It doesn't matter how authentic they look, they are still scams and they just want your banking info or to plant a bug in your system.

If you want to do something, you can report the e-mail at phishing@irs.gov. The IRS has a whole page of info on e-mail scams and phishing on their web site.

More Money for IRS

Just a month after the Taxpayer Advocate Office suggested it in their annual report to Congress, President Obama has proposed an increase in the budget for the IRS in his fiscal 2013 budget.The Administration is proposing allotting the IRS $12.8 million which is $950 million more than they will receive this fiscal year. I don't know if there is a cause and effect correlation but I think it's a good idea. I don't know if this year's refund disaster could have been prevented with more resouces but more people and better equiptment could only help bring in more income.

More info.

Modernized e-File Works but…

...the systems downstream are having problems.

This is the first year that most tax returns have been filed using the IRS’s new Modernized e-File (MeF). And so far this tax season more returns have been filed MeF than all last year. The MeF system is working just fine. (I’ve been getting acknowledgements less than an hour. They could be coming faster but I don’t check every few minutes.) The problem this year is coming from systems that link to MeF. So until further notice, the IRS is asking those who actually transfer returns to the IRS to use the legacy system so that they can work out the issues. MeF processing and CADE2 systems are working well but services like “Where’s My Refund” are having issues. Once they have resolved the issues, the IRS will open MeF back up.

If you or your preparer has an acknowledgement that your return has been accepted by the IRS, they really do have it and are processing the return. The IRS expects refunds to be issued within the traditional 10 to 21 days.

Oh, and has “Where’s My Refund” been a big mess the last week. Taxpayers are getting messages that the returns filed a week before aren’t in the system. Or, they get a screen asking if they made a mistake in entering their info. Or, they get a refund date 2 weeks after their refund has been released. The system usually works well. In fact, I wrote a post on the 7^th that includes using “Where’s My Refund” to check on your refund. But until the IRS resolved the problem, this is not an accurate widget.

McIntire Tax Center - on Facebook - on Google+ - or Twitter @ mactax.

Sharing

I'm swamped so it's share time.

From TaxGirl, the IRS has adjusted the rules on credit card reporting.

From Kay Bell, with just over 2 weeks before the payroll extenders are set to expire, Congress is still playing games.