Just recently, an entertainment company in New York that is in the business of distributing TV shows throughout the state and the country was involved in a tax case before the state’s highest court. This stemmed from the said company’s charging of sales tax from its customers who lease their satellite dish, which is needed to receive signals for TV shows, for a monthly fee. After four years of operating the business, state auditors found out that the company have committed violations of the state’s tax laws. State auditors argued that the company’s parent company should have paid sales tax for acquiring the satellite dishes, but it did not and instead passed the sales tax payment to its customers. The case is still pending with the state’s Court of Appeals.
Getting Help from A Tax Lawyer in New York
Ascertaining taxes that are due to be paid is not a simple job. This is especially true if the taxpayer concerned has multiple sources of income at hand. The fact is that having multiple sources of income is the current trend in our economy, and this in turn can be attributed to the revolutionizing effect of technology to the society in general and the economy in particular.
Tips to Start Planning Next Year’s Returns
Tips
to Start Planning Next Year’s Tax Return
It’s certainly not too early to begin planning for next year’s tax return. Though, for most taxpayers, the deadline for this year has just recently passed, the countdown for next year has already begun. Planning for next year should start now. The
earlier you begin preparing for the next tax filing season, the better prepared you will be, maximizing your deductions and tax credits. Being organized and planning ahead also will save time and money in 2014. Here are six things you can do now to make next April 15 easier.
Considerations in choosing a NYC Tax Attorney
When people come to see me as a NYC Tax Attorney, they may sometimes ignore certain qualities they ought to look out for. It should be known that there are some qualities that people need to establish in the lawyer they go to for these services. The first thing that you need to ask is whether the professional is a member of the state bar. This will be a pointer of whether the professional you have your eyes on is qualified or not.
Top Ten Biggest Tax Breaks
A lot of speeches have been given of late about tax cuts, tax breaks, deductions, etc. So, who gets the biggest tax breaks? According to New York Tax Attorney at Thorgood Law Firm, the Top Ten tax breaks are:
- $181 billion – Employer contributions towards workers’ medical insurance premiums and medical care
- $165 billion – Various retirement plan contributions and earning not taxed
- $101 billion – Mortgage Interest deduction
- $84 billion – Lower tax rates on long-term capital gains and qualified dividends
- $69 billion – Deduction for state and local taxes
- $46 billion – Deduction for charitable contributions
Return of the Tax Penalty?
Unless Congress avoids the Fiscal Cliff, we will have a return of the so-called Marriage Penalty, resulting in higher taxes for many couples 2013.
Prior to the Bush tax cuts, there was a indeed a “penalty” against married couples under the tax code, as their standard deduction and income tax brackets were less than twice those of singles. In essence, married couples were paying higher taxes than their non-married counterparts.
When Congress passed the Bush tax cuts, however, they corrected the imbalance by, among others, giving married couples a standard deduction that’s exactly twice that of individuals. They also established income ranges for the 10% and 15% tax brackets to be exactly double that given to individual taxpayers.
Debt Forgiveness and the Fiscal Cliff
According to New York Tax Attorney Shamsey Oloko, if the country goes over the fiscal cliff, the average taxpayer, and the real estate industry, may feel the pain in yet another way – debt forgiveness.
Normally, if a lender forgives a portion of a loan, the beneficiary is required to pay taxes on the forgiven portion of the loan, as it would on an income.
However, in 2007, Congress passed a law, the Mortgage Forgiveness Debt Relief Act of 2007, which allowed taxpayers to avoid paying such taxes. Thus, if a lender agrees to a short sale or agrees to take less than you owe on your mortgage, you would not have to pay taxes on the unpaid balance of the loan.
TIPS FOR YEAR-END GIVING
With the year about to come to an end, taxpayers may want to make charitable contributions, including clothing and household items, to good causes, and take deductions on their tax returns in the process. It is helpful to keep in mind IRS requirement in making these contributions, to avoid audit problems along the way.
To deduct clothing and household items, they generally must be in good used condition or better. If you think the item is worth more than $500, you should get an appraisal and keep records.
BUSINESS OR HOBBY? Will the IRS allow you to deduct losses?
At one time or the other, most of us get involved in one kind of venture or another, sort of trying your hand at something different. Sometimes we make money in these ventures and the IRS can be counted on to expect its share of the profits. But what if you lose money in the venture, will you be entitled to a deduction on your return for the loss?
TOP TEN WAYS TO GET YOUR RETURN AUDITED
1. Unreported 1099 Income – This is perhaps the easiest way IRS can track down non-complying taxpayers. Every single Form 1099 issued to a taxpayer is only but a copy of the one in IRS records – IRS is aware of the income as it is also reported to them by the third party payer of compensation, interests, dividends, etc. Failure to report this income is one of the easiest flags for further review of tax returns.