Author Archives: Tax Expert

About Tax Expert

An e-tax professional at http://www.taxexcise.com, a product of Think Trade Inc., A BBB accredited, IRS authorized E-file service provider for all kinds of Excise taxes like Form 2290, Form 720, Form 8849 etc, my articles will reflect friendly ideologies of my company just like how friendly our e-file tax application is to them. For any queries, reach us @ 866-245-3918 or email us on info@thinktradeinc.com

Tax professionals should review data safeguards

With the tax filing season around the corner, the IRS and its Security Summit partners remind tax pros to review their security measures. The Taxes-Security-Together Checklist can help tax professionals identify the basic steps they should take to safeguard their clients and their business.

Here’s an overview of some of those safety measures.

Use multi-factor authentication to protect tax accounts
Practitioners can download to their mobile phones readily available authentication apps offered through Google Play or the Apple Store. These apps will generate a security code. Codes may also go to a preparer’s email or text, but the IRS notes those are not as secure as the authentication apps. Tax professionals can search for “authentication apps” in a search engine to learn more. Continue reading →

IRS resources help taxpayers determine if an offer in compromise is the right way to resolve tax debt

Individual taxpayers and business owners can use the IRS’s Offer in Compromise Booklet or the new how-to video series to learn how an offer in compromise works and decide if it could help them resolve their tax debt. Taxpayer’s can use pre-qualifier tool see if they are eligible for an offer in compromise.

An offer in compromise is an agreement between a taxpayer and the IRS that settles a tax debt for less than the full amount owed. An offer in compromise is an option when a taxpayer can’t pay their full tax liability. It is also an option when paying the entire tax bill would cause the taxpayer a financial hardship. The goal is a compromise that suits the best interest of both the taxpayer and the agency.
Continue reading →

Resources to make tax time easier for U.S. service members and veterans

The IRS has a variety of resources to help members of the military, veterans and their families navigate the unique and complex circumstances that come with filing taxes while in the military. Reviewing these resources is a good way to get ready for the upcoming tax filing season.

Here’s a list of some of these resources.

IRS announces new online tool to help U.S. withholding agents validate their 1042-S data prior to filing

IRS Issue Number:    IR-2021-223 | November 15, 2021.

WASHINGTON – The Internal Revenue Service today launched a new online tool designed to help U.S. withholding agents comply with their reporting and withholding responsibilities with respect to IRS Form 1042-S (Foreign Person’s U.S. Source Income Subject to Withholding).

The tool performs a quality review of data before submission to the IRS. Use of the tool does not change a withholding agent’s obligations to file Forms 1042-S with the IRS and furnish a copy of the Form 1042-S to the payee. Continue reading →

Why it’s important that taxpayers know and understand their correct filing status

As taxpayers get ready for the upcoming filing season, It’s important for them to know their correct filing status. A taxpayer’s filing status defines the type of tax return form they should use when filing their taxes. Filing status can affect the amount of tax they owe, and it may even determine if they have to file a tax return at all.

There are five IRS filing statuses. They generally depend on the taxpayer’s marital status as of Dec.31. However, more than one filing status may apply in certain situations. If this is the case, taxpayers can usually choose the filing status that allows them to pay the least amount of tax. Continue reading →

Year-end giving reminder: Special tax deduction helps most people give up to $600 to charity, even if they don’t itemize

The Internal Revenue Service today reminded taxpayers that a special tax provision will allow more Americans to easily deduct up to $600 in donations to qualifying charities on their 2021 federal income tax return.

Ordinarily, people who choose to take the standard deduction cannot claim a deduction for their charitable contributions. But a temporary law change now permits them to claim a limited deduction on their 2021 federal income tax returns for cash contributions made to qualifying charitable organizations. Nearly nine in 10 taxpayers now take the standard deduction and could potentially qualify. Continue reading →

Common tax scams and tips to help taxpayers avoid them

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In recent years, tax schemes and scams have been on the rise. Con artists work year-round which means taxpayers must remain vigilant to avoid being victimized. Here are some tips to help people recognize and avoid some of the most common tax-related scams.

Email phishing scams

The IRS does not initiate contact with taxpayers by email to request personal or financial information. Generally, the IRS first mails a paper bill to the person who owes taxes. In some special situations, the IRS will call or come to a home or business. Continue reading →

More Ida relief from IRS: Sept. 15, Oct. 15 deadlines, other dates extended to Jan. 3 for parts of Connecticut

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Victims of Hurricane Ida in parts of Connecticut now have until Jan. 3, 2022, to file various individual and business tax returns and make tax payments, the Internal Revenue Service announced on November 3, 2021.

Following the Oct. 30 disaster declaration by the Federal Emergency Management Agency (FEMA), the IRS is offering this relief to those parts of the state designated for either individual or public assistance. Currently, this includes Fairfield and New London counties, including the Mashantucket Pequot Tribal Nation and the Mohegan Tribal Nation. Any jurisdiction added to the FEMA declaration will automatically receive the IRS relief. The current list of eligible localities is always available on the disaster relief page on IRS.gov. Continue reading →

Tax pros should renew PTINs now for the upcoming filing season

The IRS reminds all active federal tax return preparers they must renew their Preparer Tax Identification Numbers now for 2022. All current PTINs will expire December 31, 2021.

Anyone who prepares or helps prepare a federal tax return for compensation must have a valid PTIN from the IRS. They need to include the PTIN on any return filed with the IRS. Tax preparers must pay a fee of $35.95 to renew or get a PTIN for 2022. This fee is non-refundable, and preparers must pay the exact amount to complete the PTIN process. Continue reading →

Here’s what taxpayers should know about backup withholding

Backup withholding ensures that the government is paid the correct amount of taxes on specific types of payments reported on certain Forms 1099 and W-2G.

Here are some facts about backup withholding.             

Backup withholding is required on certain non-payroll amounts when certain conditions apply.
The payer making such payments to the payees does not generally withhold taxes, and the payees report and pay taxes on this income when they file their federal tax returns. There are, however, situations when the payer is required to withhold a certain percentage of tax to make sure the IRS receives the tax due on this income. Continue reading →