Planning Taxes by the Season

Unfortunately, planning for taxes needs to be an almost constant consideration. There are certain tax plans you can make as they apply to the season of the year. Planning your taxes in this manner can make the task less like a chore and not leave you in a rush to do everything at the last moment.

After the beginning of the New Year, you will want to start putting your tax records in order, whether you plan to file early or not. Be certain that you have documentation of all your expenditures as they apply to tax credits, exemptions, or deductions now, so you don’t have to be hunting down paperwork when you file your income tax return.

If you prepared early and adequately for your taxes, the arrival of spring should be a welcome time for you. Take a look at the tax code and see what credits, exemptions, or deductions might apply to remodeling around the house. Usually, any project pertinent to energy saving has some type of tax benefit associated with it.

This is the best time to put your big tax strategies into play before the end of the year.

Lower Stress By Managing Your Tax Savings

Tax time is one of the most stressful seasons of the year for many Americans. There is a rush and bustle to get everything done in order to prepare an income tax return. Many taxpayers feel stressed and suffer from undo anxiety.

You can alleviate the stress and worry of tax time with a little preparation.You might easily miss many opportunities to lower your tax liability and save on credits, deductions, and exemptions.
You may want to consider, instead, preparing your return with the aid of computer software like Turbo Tax. While not free, these programs cost much less than hiring a professional to prepare your income tax return for you. You simply enter the information the program requests and it will run you through prompts and instructions, even suggesting applicable tax credits, deductions, and exemptions for you to take advantage of, in order to lower your tax liability. The program will even help you to file your return electronically, guaranteeing you the fastest return on your income tax rebate.

Knowing that the computer or the professional are going to have all the tax information at hand to make your filing successful, it should greatly lower your stress at income tax time.

Barack Obama Plans to Keep Estate Tax

The Democratic posture on the estate tax contrasts with Mr. Obama's reluctance to press forward with his campaign pledge to raise income-tax rates on top earners, which he worries could have an adverse economic impact during a recession.

Under the Obama plan detailed during the movement, the estate tax would be locked in permanently at the rate and exemption levels that took effect this year. That would exempt estates of $3.5 million -- $7 million for couples -- from any taxation. The value of estates above that would be taxed at 45%. If the tax were returned to Clinton-era levels, it would exclude $1 million from taxation with the rest taxed at 55%.

At the level projected in the Obama policy, all but the largest estates -- fewer than 2% of annual deaths -- would escape taxation. Over 10 years, the Obama plan would cost the Treasury around $324 billion more than if the Clinton estate-tax levels were maintained, according to the Joint Committee on Taxation. Full repeal would cost more than $500 billion over a decade.

Most such taxes are still collected from estates of the ultra-rich. But business and farm groups say small businesses and family farms struggle with it as well, at the very least devoting time and energy to planning ways to escape or minimize taxation as enterprises pass from generation to generation.

"The very wealthy, in their mission to reduce their exposure, made proposals that threw the small-business community overboard," said one prominent small-business lobbyist, referring to a move to have estates taxed as capital gains upon their disposition, without regard to the amount shielded from taxation.

Qualify Yourself for These Tax Savings Methods!!

Every solitary small and home-based business owner can easily save thousands of dollars each year in tax savings alone. "You have got to be crazy not to have one".

Legislature passed legislation that allows HUGE tax savings to encourage your success. They'll even let you take tax deductions on losses from your home-based business, year after year, as long as you are actively and legitimately pursuing to make a profit.

For the most division people, just like you are overpaying their taxes by thousands of dollars, or more, every year, and they don't even realize it! Get this; the average tax payer actually believes that getting a refund from the IRS is a good thing!
The fact of the theme is, if you are getting a refund every year you are actually giving an interest-free loan. Yep! Keep your hard earned money (tax refund) throughout the year and can use it for whatever the legislators feels fit to do with it. This is money you could be putting back in YOUR own pocket to help YOU build and grow YOUR own home-based business! These are YOUR tax savings people, wake up! Stop complaining and do something about it!

In order to make certain that you don't miss some large tax deductions that could save you a great deal of money, it is wise to consult with an income tax professional so that you don't miss any of commonly missed tax deductions.
Go get what is rightfully yours....Tax Savings!

Uses of Tax Planning Books

Taxes are one of the major contributors to national treasury of any country. These in turn are utilized to carry out all the developmental activities for the benefit of the general masses. Individual taxes and corporate taxes are forms of direct taxes levied by the government. Every country has its financial head in the form of Finance Minister who frames laws concerning the nation's budget. Each year, these laws are revised to meet the needs of current financial trends.

With so many aspects to be taken into account for the calculation of tax, chances of errors are quite high. This is why most business units hire or employ the services of tax return specialists to ensure that errors are avoided. Individuals and small business units, household ventures who do not wish to spend large amount of money in hiring professional tax consultants can refer to tax planning books the fill up their tax returns on the basis of information provided in them.

Tax planning are specifically published business books to comply with tax regulatory authorities governing that country. Tax planning books give entrepreneurs an opportunity to compute their firm’s annual tax returns using easy step wise guidelines. These business books prove to be beneficial for all kinds of business entities irrespective of the size and scale of operation. These books are not only informative but also serve as wise mentors guiding business owners on crucial tax related issues.

How to obtain Help with Past Due Taxes

There are times when you will find it rigid to pay your income tax. There are several factors why this problem happens. One of the primary causes is economic hardship. Your current finances may not be enough to pay your taxes. In case you skipped paying your taxes in the previous years, it is very important for you to seek tax help. There are several ways how you can get help with past due taxes.

It is in your best interest to pay taxes on time because the amount of penalties imposed by the IRS can be very staggering. So before you experience much trouble, you have to seek tax help as early as possible. Sometimes, the reason why you can not pay your taxes is that you are overpaying the IRS. There are several items in your tax returns that could be eligible for deductions. But because you are not aware of it, you will pay higher taxes which should not be.

In receiving help with past due taxes, it is really important to consult a tax professional. You can hire a tax attorney which will represent you. This is a costly option but can be very advantageous for you because you might get favorable settlement deals. The agents of Free Tax Support are experts in handling tax problems.

Put More currency in your Pocket by Adjusting Tax Withholding

American poet James Oppenheim once said, "The foolish man seeks happiness in the distance, the wise grows it under his feet." Taking Oppenheim's advice, you may not want to wait until next spring to receive your overpaid taxes for 2009. Why not adjust your tax withholdings and enjoy that money now?

Every year, millions of U.S. taxpayers receive a check from the government because they overpaid their income taxes in the prior year. If you're one of those millions, you probably enjoy the windfall as an excuse to splurge a little. The thing is, overpaying your taxes during the tax year amounts to making an interest-free loan to the U.S. Treasury.

If you had the extra money in your pocket right now, you could be using it to pay down debt or increase your savings. Either of those activities provides added financial benefits: several months of forgone interest costs or several months of investment earnings.

Tax withholding resources

If you normally receive a sizeable refund every year, you can probably add an allowance to your W-4 without issue. But, to avoid making costly mistakes, it's advisable to check a few free tax planning resources.

The choice is ultimately yours: look forward to next spring to receive your refund, or get it now. The poet in you might prefer the latter.

What is Tobin Tax and it’s Issues?

The primary aim of Tobin tax, unlike most taxes, is not to raise revenue, but to discourage short-term speculation, particularly in the foreign exchange markets. In the currency markets, enormous amounts of money are traded daily, as traders attempt to make profits from small discrepancies between the relative values of currencies.

The primary aim of Tobin tax, unlike most taxes, is not to raise revenue, but to discourage short-term speculation, particularly in the foreign exchange markets.

In the currency markets, enormous amounts of money are traded daily, as traders attempt to make profits from small discrepancies between the relative values of currencies.

What Problem Is the Tobin Tax Trying To Solve?

With no fixed exchange rate mechanism between currencies it is up to a large number of economic entities to determine the relative values of currencies in the marketplace. In itself this is no bad thing, but short-term currency speculation where large amounts of money are shifted between currencies with different interest rates make it difficult for countries to implement monetary policy.

The Credit Crunch and the Tobin Tax

Although foreign exchange speculation was not the cause of the credit crunch, it hampers countries ability to implement economic policy.

The Tobin Tax and the G20 Summit

Sarkozy's proposal for the G20 summit extended the remit to any financial transaction - it is unlikely that he will be able to carry this proposal in that form, but the credit crunch has made some unthinkable solutions thinkable. Perhaps the Tobin Tax will be one of them, an idea whose time has come.

Small Business will Gears up to Fight Taxes

It was throbbing enough this year for states, hit hard by the effects of the economic downturn, to balance their budgets. And 2010 will only be worse.

Most of the states approved a balanced budget for the 2009 fiscal year. But many states were in the red within two months of the fiscal year’s start on July 1, by a total of about $24 billion. States face a combined budget shortfall of $350 billion in the next two fiscal years, according to the center and the Council of State Governments, which uses similar projections.

Many legislatures made cuts to programs such as healthcare and social services, and reduced support for public colleges and universities. Most of those funds will be gone next year. At the same time, the economy isn’t expected to perform the type of rapid turnaround that would, for example, drive real estate values back up. In addition, continued high unemployment rates will mean reduced income-tax receipts, more outlays for unemployment claims and additional demand for safety-net services.

"Businesses are frequently the easiest bogeyman when it comes time for legislators to look at.”Small business owners will need to be even more vigilant and organized to protect themselves when the tax man looks their way in 2010. It’s hard to believe that they would continue to come after America’s job creators during a continuing recession, but that’s what we have to expect."

Housing Crisis Leads to Loan Alteration and Tax-Exemption Surge

Although a large amount of national awareness has lately been focused on the issue of foreclosures and defaults, another huge problem that is much less well publicized is the issue of property taxes.

When the nation's housing crisis has risked the homes of millions of Americans, it also created a huge heap of unpaid bills- further risking homes to tax seizures, causing multi-million dollar shortfalls for many local governments who were already struggling to make ends meet because they rely on property taxes to pay for lots of public programs.

Treasurers and Tariff collectors in hundreds of communities across the nation are reporting that they have observed a sharp increase in the amount of delinquent businesses and homeowners coinciding with the country's increasing unemployment rate. They are bracing themselves for a higher level of delinquencies and defaults than in years past.

Authorities will do their best to set up settlement plans in the year or two after you have fallen behind or stopped paying. Usually within the first month or two, lenders will step in to protect their investment by agreeing to a loan modification or ordering a temporary freeze on payments. But in the end, if they don't get paid, the lenders or tax collectors will seize homes.

Many homeowners, however, will be adequate for legitimate property-tax reductions, and almost ten times the usual number of people is applying for them. The process doesn't necessarily require professional handling, many homeowners can do it themselves, if they feel well-prepared enough to appear before an appeals board. Those who do not feel comfortable enough should hire a property-tax consultant or an attorney, and a loan modification expert or real estate appraiser. Many of these services are available online.

Taxpayer’s Important Responsibilities

Taxpayers have always been responsible for the precision of their tax returns, which should not be new to anyone who has filed a return. But for first-time filers, or for those who have not filed in some time, there are ways to avoid possible run-ins with the IRS.

Disclosure Responsibility

Tax returns are centered on the standard of disclosure – more specifically, “full disclosure” – of income, number of dependents, credits elected (especially the Earned Income Tax Credit), filing status, and any other oral or written disclosures made that are necessary for a tax return preparer to complete the return.

Disclosure Problems

While the burden of disclosure is narrowed by working with a tax professional, willfully disregarding disclosure responsibilities can put taxpayers alone in unfamiliar territory, facing fines and imprisonment, not to mention the tax liability they faced from the start.
Income from employment or other sources generally should be informed in the period recognized. With items such as wage income reported on a Form W-2, the IRS can easily verify income and withholding levels.

The Value of Professional Help

The taxpayer is in charge for the content and accuracy of the return. With this in mind, taxpayers should consider the value of a tax professional’s skill and knowledge in income taxes. Consulting a tax professional can make taxpayers aware of potential issues that could stem from their tax situation. A little money spent consulting with a tax professional could result in a bigger refund and, just as important, a lot less stress if examined by the IRS.

Does Tax Affect SMEs Creation and Growth?

The taxation of small and medium-size enterprises (SMEs) is an important topic for policy makers, as SMEs make up the vast majority of businesses and typically account for the bulk of employment in OECD countries. The OECD has just released Tax Policy Study No. 18: “Taxation of SMEs: Key Issues and Policy Considerations”, which examines a broad range of SME tax issues, including: the possible influence of taxation on SME creation, business structure and growth; arguments for and against tax incentives for SMEs; and measures to address a relatively high tax compliance burden on SMEs.

The study considers differing income tax and social security contribution burdens of unincorporated and incorporated SMEs in detail, and analyses average statutory tax rates to investigate possible tax distortions to business creation and business structure decisions of a single owner/worker of an SME.

The study presents various arguments for and against the targeting of tax incentives at SMEs. Along with traditional market failure arguments, certain basic tax provisions, with uniform application to firms of all sizes, may result in a relatively high tax burden on SMEs, possibly creating impediments to SME creation and growth. SMEs may also face a disproportionately high tax compliance cost burden compared to larger businesses, calling for adjustments to administrative approaches and/or policy to address impediments to SMEs posed by tax compliance cost considerations. The study also provides country examples of SME tax incentives and compliance cost reduction measures.

Taxation system in the United States

Taxation in the United States is a complex system which may involve payment to at least four different levels of government and many methods of taxation. United States taxation includes local government, possibly including one or more of municipal, township, district and county governments. It also includes regional entities such as school and utility, and transit districts as well as including state and federal government.

Tax distribution

As of 2007, there are about 138 million taxpayers in the United States. The Treasury Department in 2006 reported, based on Internal Revenue Service (IRS) data, the share of federal income taxes paid by taxpayers of various income levels.
Inflation and tax brackets

Most tax laws are not accurately indexed to inflation. Either they ignore inflation completely, or they are indexed to the Consumer Price Index (CPI), which some argue understates real inflation. In a progressive tax system, failure to index the brackets to inflation will eventually result in effective tax increases (if inflation is sustained), as inflation in wages will increase individual income and move individuals into higher tax brackets with higher percentage rate.

Federal income tax

Depending on individual income, the marginal tax rate ranges from zero to 35%. Income tax is also imposed on the taxable income of most corporations and again on dividends paid to stockholders, although individuals usually pay a preferential tax rate on dividends; this is sometimes referred to as double taxation.

One unique aspect of federal income tax in the United States, is that the U.S. uses citizenship in addition to residency in determining whether a person's income is subject to U.S. taxation. All U.S. citizens, including those who do not live in the United States, are subject to U.S. income tax on their worldwide income.

Tax deductions/credits

The U.S. government rewards certain behavior with tax deductions or tax credits. For example, amounts used to pay mortgage interest on a personal home may be deductible, if the taxpayer elects to itemize. Taxpayers who do not participate in an employer-sponsored pension plan may contribute up to $4,000 ($5,000 if age 50 or above) into an individual retirement account, and deduct that contribution from their gross income if they fall within certain income limits.

Methods of calculation

There are two required ways to calculate the U.S. income tax. The "regular tax" is based on the gross income minus any applicable deductions and then a marginal tax percentage is applied according to the taxpayer's income bracket.

The second way, the "Alternative Minimum Tax" (AMT) is based on the gross income, computed without regard to certain tax preference items (such as tax-exempt interest on certain private activity bonds) and with a reduced number of exemptions and deductions.

Early Tax Returns Show Numerous Recovery Refund Errors

The IRS reported that an early sampling of this year’s tax returns shows great perplexity about last year’s recovery rebate. According to the Service, about 15% of all individual tax returns filed so far contain errors involving the recovery rebate credit.

The mistakes include returns that claim the credit when the taxpayer is not permitted to it, returns that claim the wrong amount for the credit, and returns that have the amount of last year’s rebate check improperly entered on the recovery rebate credit line (line 70 of the 2008 Form 1040).

The IRS sent out about 139 million recovery rebate checks last year, as provided by the Economic Stimulus Act of 2008, P.L. 110-185. The rebate represented an advance tax credit for tax year 2008 and was available to individuals other than nonresident aliens, dependents and estates or trusts.

On their 2009 returns, taxpayers must reconcile the amount they received last year in a recovery rebate check (if any) with the amount of the credit they were actually entitled to. If the amount of the check exceeds the amount of the allowable credit, the taxpayer will not have to recognize the excess as taxable income. If the amount of the check was less than the amount of credit the taxpayer is entitled to, the taxpayer will be eligible to claim the difference on the 2008 return.

The 2008 Form 1040 instructions include a worksheet for properly figuring the amount of the credit.

Tax Crisis Looming for Self-Employed

The self-employed face a New Year tax crunch that could cost them dear. 3.5m will be hit by the usual demands from Revenue & Customs for advance tax payments based on the previous year's earnings - but these make no allowance for the economic slowdown. They can ask for these payments to be reduced to reflect lower expectations by contacting their tax office.

But if business picks up again, they will have to pay interest on the difference - at a whopping 5.5%. And this interest is not tax-deductible. This is an issue well worth flagging up for self-employed people.

Mike Warburton, tax partner at accountant Grant Thornton, said: 'In January, self-employed people are liable to pay not only what they owe from their earnings on 2007-2008, but a down payment on expected tax due in 2008-2009. A second down payment is due in July.

'The Revenue assumes they will make the same profit as they did last year, without taking account of what has since happened to the economy.'

Whiting said: 'I am not sure the Revenue exactly highlights the fact people can ask for these estimates to be reduced. You can tell them it has not been such a good year as last year.

'But if you get it wrong, you have to pay interest. And there are also penalties available to the Revenue if you really frankly were trying it on. 'I would advise people to ask for a reduction if their circumstances have changed, but do not be silly about it.'

Home Buyer Tax Credit to be Extended and Eligibility Expanded

I was told this is a done deal, but I haven't seen an announcement yet - so it might still change. The tax credit was expanded to move-up and higher income buyers. The amount of the credit was reduced to a maximum of $7,290.

Senate Close to Deal Replacing Homebuyer Tax Credit

The details:

• Income eligibility for first-time home buyers stays at $75,000 for individuals and $150,000 for couples.
• For move-up buyers, income eligibility is $125,000 for individuals and $250,000 for couples.
• There is a minimum 5 year residency requirement in their current home for move-up home buyers.
• The tax credit is the lesser of $7,290 or 10% of the purchase price.
• The credit runs from Dec. 1, 2009 to April 30, 2010, with an additional 60 day period to close escrow. (So end of April to sign contract, end of June to close escrow)
• Expect bill to be signed by Friday.

This is obviously bad economics, but it must be good politics. The first-time home buyer impact will fade (and will probably cost over $100,000 per additional home sold). The move-up portion will probably be even less effective.

Apparently this tax credit will be combined with the extension of the unemployment benefits to avoid a veto (the real reason the extension was being held up).

Issuance of Voucher and Briefings

OHFA's goals and objectives are intended to assure that families selected to participate are equipped with the tools necessary to locate an acceptable housing unit. Families are provided sufficient knowledge and information regarding the program and how to achieve maximum benefit while complying with program requirements.

When eligibility has been determined, OHFA will conduct an obligatory briefing to ensure that families know how the program works. The briefing will provide a broad description of owner and family responsibilities, OHFA’sprocedures, and how to lease a unit. The family will also receive a briefing packet, which provides more detailed information about the program including the benefits of moving outside areas of poverty and minority concentration.

ISSUANCE OF VOUCHERS

When financial support is available, OHFA will issue vouchers to applicants whose eligibility has been determined. The number of vouchers issued must ensure that OHFA stays as close as possible to100 percent lease-up. OHFA performs a monthly calculation electronically to determine whether applications can be processed, the number of vouchers that can be issued, and to what extent the PHA can over-issue (issue more vouchers than the budget allows to achieve lease up).

OHFA may over-issue vouchers only to the extent essential to meet leasing goals. All vouchers that are over-issued will be honored, as long as there is funding to support the over-issued vouchers. If OHFA finds it is over-leased, it must adjust future issuance of vouchers in order not to exceed the ACC budget limitations over the fiscal year.

Vouchers: Not Yet Dead

The Washington, D.C., voucher program is not dead yet. It has set its execution date, slipping a provision into last month’s omnibus spending bill to end the program unless it is re-authorized by Congress next year. With anti-voucher members of Congress in a clear majority, supporters of the program are glum about its political prospects. The pall has extended to voucher programs around the country. If our legislators can terminate the D.C. program without too much political cost, might they decide to become serial killers, targeting vulnerable programs in Milwaukee, Ohio, and elsewhere?

Oddly, Congress chooses to act even as the programs continue to produce solid evidence of academic effectiveness. Just this week, the U.S. Department of Education released the results of its official evaluation of the D.C. voucher program. It found that students selected by lottery to receive vouchers to attend private schools made significantly greater progress in reading than did lottery losers who stayed in D.C. district or charter schools. A student attending a private school with a voucher typically was four months ahead of the average public-school student in reading after three years. The first cohort of voucher students to participate in the program was ahead of their public-school counterparts by the equivalent of 19 months of reading instruction after three years in private schools.

Education reformers need to get out of their huff. First, they need to keep goals for educational improvement realistic and continue pursuing evidence-backed reforms like vouchers, even if they are currently out of favor in national politics. And the positive evidence may well save D.C. vouchers and others facing execution. They may even get a reprieve from President Obama, who has declared: “If there was any argument for vouchers it was, all right, let’s see if this experiment works, and then if it does, whatever my preconceptions, my attitude is you do what works for the kids.” If doing what works for the kids decides the issue, vouchers have a very promising future.

Why I am opposed to vouchers.

I have had several queries asking about my position on vouchers or asking why I oppose them. Here is my response.

1. The main reason I oppose universal vouchers in Utah is financial. It will cost Utah money and we don't have any to spare.

* Before I ran for school board, I was in support of vouchers because I believed that they would save Utah taxpayers money and that they would put more dollars into public ed. That argument is basically the "Oreo cookie" analogy that was given during the voucher debates. I have learned that education funding isn't quite as simple as Oreo cookies and that the truth about vouchers is that they will cost Utah a great deal of money.

* Utah currently has 19,000 private school students that Utah is paying NOTHING for. In order for vouchers to save us any money, we would need to have OVER 19,000 additional students leave public schools.

* The Oreo cookie analogy used an average per pupil cost. But the truth is, that some students cost much more to educate and some cost less. That's what "average" is. As a general rule, the students who leave to attend private schools with a voucher are the "below average" ($$) to educate. The most expensive students are left behind to educate with less money.

2. Another reason I oppose universal vouchers is that I don't believe that taxpayers should subsidize wealthy parents to send their children to private schools. I have friends who send their children to expensive private schools and they agreed with me on this issue.

* I believe that parents already have educational "choice" for their children: public schools, private schools, charter schools, home school. Proponents for universal vouchers say that the parents who choose private school are "paying twice" because they pay taxes for public schools. EVERYONE pays taxes, including old people, businesses and childless couples.

* Here is a dangerous assumption: that the taxes we individually pay should serve us personally. If we each have a right to "use" what we pay in taxes for our personal use, then we have lost the whole idea of cities, counties, states or country. We collectively pay taxes to serve the common good: roads, sewers, electricity, police, parks, libraries, schools, etc. To say that those who send their children to private schools should get some of ‘their' tax dollars back is like suggesting that those of us who don't use the libraries, roads, buses, postal services, or parks should not have to pay for them. If I choose to use a private security company for my protection, can I have a rebate on my taxes please? Can I have a tax credit for sending my kids to a private university? Ridiculous. Our forebears understood the common good that comes from an educated society. They recognized that the best way to improve the circumstances of the poor is to educate them. Public schools do that.

3. There is not a single other state in the nation who has passed universal vouchers. The largest voucher programs are in two of the lowest performing districts in the nation. (Milwaukee and Washington DC)

* I have spent the past six years studying vouchers. I have a huge file about vouchers in other states and the effect they are having both economically and educationally. The conclusion: vouchers are NOT working. Why should the state who is dead last in per pupil funding be the national experiment?

* There are some interesting studies from the Utah Foundation that talk about education funding in Utah. The last one is entitled "How Much Can $3,702 Buy?" That's how far below average Utah is in comparison with 10 other states with similar demographics. I believe we need to make a greater effort in Utah to adequately fund our student's education and vouchers are not the way.

One last concern I have about vouchers. There are some who believe that ALL education should be privatized and vouchers is the way to do that. I believe that shifting the burden of education to families not only will burden families, but could lead to a great division in our society based on the opportunities for education that some will have and others will not. Education based on the ability to pay. Public education is a great unifying force in our country, giving opportunity to every child to seek the American dream. Our forebears recognized the value of an educated populace and decided it was a "common good" worth funding. I agree.