The Federal Tax Credits Blog

Posts Tagged ‘irs’

Question: penalty for debt write off…never receive notice to report to IRS and not sure if debt is mine.?

I have a Creditor that has written off a past due debt. The Creditor has reported to IRS the amt of write off and claims that it is an account of mine. This is 2007 the write off is for 2005 in which the Creditor claims to have sent me something to claim on my Taxes for 2005. I haven’t seen anything inregard to claiming any interest on my taxes. I did not recognize said Creditor on IRS letter and I have written a letter to the Creditor with no response and it has been over 30 days now. I’ve review my Credit Report and did not recognize any such creditor or amt said write off listed on the IRS letter. IRS is stating I owe them 800 dollars due to not reported interest.
I have no proof that this account is mines. What can I do?

Answer: This is probably the Cancellation of a debt, and not a writeoff. There is a difference between cancelling a debt (you don’t owe it anymore) and writing it off (they don’t think they can collect it from you). A cancellation of debt is taxable because in essence the creditor paid the debt for you. A bad debt writeoff is not taxble to you as they can still come after you later if they think they can collect it.

Contact the IRS and tell them you don’t think the debt was yours. They should be able to tell you how to appeal the assessment. Meanwhile contact the creditor directly and find out what the debt was for. It may be that the debt has changed hands or the creditor has changed names.

Cybercrooks stalk small businesses that bank online

A rising swarm of cyber-robberies targeting small firms, local governments, school districts, churches and non-profits has prompted an extraordinary warning. The American Bankers Association and the FBI are advising small and midsize businesses that conduct financial transactions over the Internet to dedicate a separate PC used exclusively for online banking.

Personal Financial Planning Tips : How to Obtain a Copy of Your Credit Report

Question: tax question, should i notify the IRS and claim innocent spouse rule, please read and help?

my wife owns a hair salon that is incorporated for 6 years, she has written her car off every year even though the corp does not own the car its only in her name, she claims no tips and only writes herself a check for 1000 dollars a month, for personal income, even though she pays half the mortgage, 850, she has 2 car payments one car she bought for her dad and is 300 a month and her car is 500 a month, she makes her credit card payments about 800 a month, it just does not add up is this all legal

Answer: Was there an audit? Is there a tax liability from an audit?

If you are uncomfortable with the return, do not file jointly. She can not force you to. If you filed jointly in the past and an audit of a return resulted in a balance due, you can be held liable for the results.

Innocent Spouse is a little difficult to prove. You must prove that you did not know about the extra income and in no way benefited financially from it. It does not sound like Innocent Spouse would apply in your case.

Columbia Co. expects rush to claim deduction

Today is the final day for Columbia County landowners to pay their property tax bill in time to claim it on their 2009 federal tax returns, and county tax officials are expecting a large crowd eager to make the deadline.

Cambodia Film Cambodia Daily Rice Appeal

In the current financial situation of America the companies are looking forward to the bailout packages sanctioned by the American government. People have currently lost jobs and living off their savings. The next set of people who have jobs have faced job cuts and are unable to make their ends meet.

Due to a major cash crunch people resorted to credit card spending to run their day to day expenses. This lead to a major piling of debts as people kept on spending with minimum payments towards their cards. The American government finally intervened to put an end to the debt stressed life of people. The intervention was in the form of

1. Stimulus money
2. Tax cuts
3. Personal Grants for financially affected people.

The stimulus money brought back the liquidity in the market. Institutions wrote off debts and settled loans at very low rate of interest. Tax cut again increased the money flow which gave extra capital in the hands of businessmen to invest into the market and create more employment opportunities. Personal grants were given to people who were highly affected financially. They could use the money for any use they had even to pay back their loans.
If we summarize the affect of the fiscal package of the economy it was to increase the liquidity and employment opportunities for people. In both cases the chances of people paying back the debt to the creditors became high.

Due to the receipt of the bailout money the institutions became aggressive towards settlement towards lower rates. This is the right time for any debtors to completely come out of the debt situation by settling the debts.

If you want to get out of debt and hire a debt settlement company for debt negotiation then I have an important piece of advice. Do not go directly to a particular debt settlement company but rather first go to a debt relief network who is affiliated with several legitimate debt companies. In order to be in the debt relief network, the debt settlement companies must prove a track record of successfully negotiating and eliminating debt. They must also pass an ethical standards test. Going through a debt relief network will ensure that the debt company you are provided with is a legitimate and respected company. This is the most efficient way in finding the best debt settlement companies and increasing your chances of eliminating your debt.

FreeDebtSettlementAdvice.com is one of the largest and most respected debt relief networks on the marketplace today. To find a debt settlement company through FreeDebtSettlementAdvice.com

Emerging-Market Stocks Gain Most in Week, Set for Record Year

Dec. 31 (Bloomberg) — Emerging-market stocks rose the most in a week, poised for their biggest yearly gain ever, and bonds headed for a record annual rally after China pledged to maintain stimulus programs that have bolstered the global economy.

First Time Home Buyer Grant and Federal Stimulus $8000 Tax Credit Info

Retirement planning is a concept, alien to many an individual. Retirement is not just about lazing in the armchair sipping the morning tea; it is something much more than that. For a comfortable life after retirement, a detailed retirement planning is a prerequisite. The process of retirement planning includes setting the right goals, making investments, sketching out a vision and working towards achieving them. To sum it up, retirement planning is all about making a financial provision for a secure future, before hitting the retirement age.

The most important step in any retirement planning is the purposeful saving of money or setting aside some assets, which can derive an income at the old age. The main objective of this planning is to be financially independent. It is very important to start your retirement planning at an early age and there are several reasons to explain you as to why you should. A 2007 survey revealed that life expectancy for males and females is 67 and 71 years respectively and the figure is likely to go up with the advancement in technology. So, that only means more years to live post retirement.

Then of course there are these medical emergencies which can crop up on any fine morning and as you age, health problems keep piling up. To keep a check on your health problems you have to expend on doctor’s consultation and treatments which will shell out a lot of money in those idle days when you are no more working. In many cases mediclaims would not even suffice and that is when your saved assets will step in as your savior. Also, gone are the days of joint family and the concept of nuclear family is in. So, in your old age you will need to develop a corpus which would sustain through your years of retirement, when you have no one else to depend on.

Aspen Institute To Hold Briefing on Efforts to ‘Tap Tax Time’ to Build Americans’ Financial Security

Capitol Hill Briefing To Take Place Thursday Morning

Question: Can I qualify for the lifetime learning tax credit if I owe no taxes?

I was reading the IRS guide for this credit and they have a series of questions to answer if you qualify. I am good until it gets to decision 8. Decision (8). Do you have a tax liability (Form 1040, line 46 minus lines 47, 48, and 49) (Form 1040A, line 28 minus lines 29 and 30)?

I didn’t owe any taxes. So I didn’t have a tax liability? If you don’t have a tax liability it says you can’t get the credit. Why is this the case. Thanks.

Answer: The LLC is not a refundable credit. It can only reduce your tax liability to zero. If your tax liability is already zero the LLC is of no use to you.

Barron County Sheriff’s Department warning people about an e-mail scam

The Barron County Sheriff’s Department is warning you about an e-mail scam going around the area.

Answers to two questions about the First Time Home Buyer Tax Credit.