The IRS recently announced that it will be holding additional compliance events throughout this year, sending revenue officers to areas that have been underserved in recent years. The agency has identified those areas and is choosing high-priority taxpayers to visit in person.
The IRS has announced inflation adjustments in dozens of areas, some prompted by the Taxpayer First Act of 2019. Taxpayers should use the new amounts when planning for their 2020 taxes. For example, starting in 2020, the penalty for failing to file a return goes up to $330.
If you owe more in tax debt than you can realistically repay, you should talk to a tax attorney about negotiating an offer in compromise (OIC) with the IRS. An OIC allows you to settle your tax debt for less than the full amount. Getting one approved, however, can be something of a challenge.
The Tax Cuts and Jobs Act was signed into law in December 2017. One of the more notable things the law changed was the increase to the standard deduction, which made it unnecessary for most people to itemize their deductions. It also increased the child tax credit and lowered some tax rates.
Many investors in Bitcoin and other virtual currencies have been confused about how those investments are taxed. As we've noted before on this blog, cryptocurrency gains are taxed like capital gains. That means that you'll need to keep detailed records on what you paid and what you got when you sold the virtual currency. You will be taxed based on the difference.
In April, the nonprofit newsroom ProPublica reported on a surprising imbalance at the IRS. Although it would almost certainly be both more effective and bring in more revenue if it focused on auditing the rich, the agency does not do this. No, it audits the working poor at almost the exact same rate as it does the richest 1% of Americans.
If you've won or settled a lawsuit this year, you need to be aware that some kinds of awards and settlements are taxable. Moreover, you will be taxed on the entire award or settlement, even though 30% or 40% may have gone to your lawyer. The Tax Cuts & Jobs Act increased the tax rate on qualifying awards and settlements.
If you're a Minnesota snowbird, you may have been watching Hurricane Dorian with special attention. Was your second home or vacation property damaged? Or, you may have a farm or agricultural property that was damaged in the spring flooding. Either way, you might have a casualty loss deduction to claim on your federal tax return.
Many people don't realize that they could lose their passports if they are found to be seriously delinquent in their tax liabilities. This is a relatively new penalty for nonpayment that was created under the 2015 Fixing America's Surface Transportation Act (FAST Act). The Act requires the IRS to certify seriously delinquent debts to the State Department, which will then pull the taxpayer's passport.
The IRS doesn't send unsolicited emails at all, and it certainly doesn't email taxpayers about the status of their refunds. That's the first thing you need to know if you receive an email that looks like it came from the IRS.