Failure to File or Pay Penalties: Eight Facts

The number of electronic filing and payment options increases every year, which helps reduce your burden and also improves the timeliness and accuracy of tax returns. When it comes to filing your tax return, however, the law provides that the IRS can assess a penalty if you fail to file, fail to pay or both. Here are eight important points about the two different penalties you may face if you file or pay Read More

IRS Announces More Flexible Offer-in-Compromise Terms

The Internal Revenue Service announced another expansion of its “Fresh Start” initiative by offering more flexible terms to its Offer in Compromise (OIC) program that will enable some of the most financially distressed taxpayers to clear up their tax problems and in many cases more quickly than in the past. “This phase of Fresh Start will assist some taxpayers who have faced the most financial hardship in recent Read More

Renting Your Vacation Home

Income that you receive for the rental of your vacation home must generally be reported on your federal income tax return. However, if you rent the property for only a short time each year, you may not be required to report the rental income. Below are tips on reporting rental income from a vacation home such as a house, apartment, condominium, mobile home or boat: Rental Income and Expenses Rental income, Read More

FAQ: Refund Splits

Question: What is a split refund? Answer: A split refund lets you divide your refund, in any proportion you want, and direct deposit the funds in up to three different accounts with U.S. financial institutions. Question: What are the benefits of splitting my refund? Answer: By splitting your refund, you get the convenience of directing some of your refund to your checking account for immediate needs and Read More

Health Insurance Tax Breaks for the Self-Employed

If you’re self-employed and paying for medical, dental or long-term care insurance, the IRS wants to remind you about a special tax deduction for some insurance premiums paid for you, your spouse, and your dependents. Starting in tax year 2011, this deduction is no longer allowed on Schedule SE (Form 1040), but you can still take it on Form 1040, line 29. You must be one of the following to qualify: A Read More

More Time to Contribute to IRAs in 2012

You have two extra days this year to make contributions to your Individual Retirement Arrangements. That’s because April 15 falls on a weekend and Emancipation Day, a legal holiday in the District of Columbia, will be observed on Monday, April 16. That means the due date for filing your tax return and making contributions to your 2011 IRA is Tuesday, April 17. Here are the top 10 things the IRS wants you to know Read More

Payroll Tax Cut Extended to the End of 2012

The IRS released revised Form 941 enabling employers to properly report the newly-extended payroll tax cut benefiting nearly 160 million workers. Under the Middle Class Tax Relief and Job Creation Act of 2012, workers will continue to receive larger paychecks for the rest of this year based on a lower social security tax withholding rate of 4.2 percent, which is two percentage points less than the 6.2 percent rate Read More

Deadline Extended to April 17

The Internal Revenue Service opened the 2012 tax filing season by announcing that taxpayers have until April 17 to file their tax returns. Taxpayers will have until Tuesday, April 17, to file their 2011 tax returns and pay any tax due because April 15 falls on a Sunday, and Emancipation Day, a holiday observed in the District of Columbia, falls this year on Monday, April 16. According to federal law, District of Read More

Do I Need to File a Tax Return This Year?

You are required to file a federal income tax return if your income is above a certain level, which varies depending on your filing status, age and the type of income you receive. However, some people should file even if they aren’t required to because they may get a refund if they had taxes withheld or they may qualify for refundable credits. Even if you don’t have to file for 2011, here are six reasons why you Read More

2012 Standard Mileage Rates

Beginning on Jan. 1, 2012, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be: 55.5 cents per mile for business miles driven 23 cents per mile driven for medical or moving purposes 14 cents per mile driven in service of charitable organizations The rate for business miles driven is unchanged from the mid-year adjustment that became effective on July 1, 2011. The Read More