The Internal Revenue Service has recently issued the 2017 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning on Jan. 1, 2017, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:
- 53.5 cents per mile for business miles driven, down from 54 cents for 2016
- 17 cents per mile driven for medical or moving purposes, down from 19 cents for 2016
- 14 cents per mile driven in service of charitable organizations
The business mileage rate decreased half a cent per mile and the medical and moving expense rates each dropped 2 cents per mile from 2016.
The charitable rate is set by statute and remains unchanged.
The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.
Taxpayers always have the option of calculating the actual costs of using their vehicle Continue reading
What Is The Pennsylvania Tax Amnesty Program?
The PA Tax Amnesty program creates an incentive for taxpayers to pay there tax liabilities during a narrow time period that ends on June 19, 2017. While this program is open, the PA Department of Revenue will waive all penalties and half of the interest for anyone who participates in the Tax Amnesty program.
What tax periods are eligible for the Tax Amnesty program?
Eligible periods for tax amnesty are those where a delinquency exists as of December 31, 2015, whether the delinquency is known or unknown to the department.
What taxes are eligible for the Tax Amnesty program?
The taxes administered by the department, listed below, are eligible for the Tax Amnesty program:
- Agriculture Cooperative Tax;
- Bank and Trust Company Shares Tax;
- Capital Stock or Foreign Franchise Tax;
- Cigarette Tax;
- Corporate Net Income Tax;
- Corporate Loans Tax;
- Electric Cooperative Tax;
- Employer Withholding Tax;
- Financial Institutions/Title Insurance Company Shares Tax;
- Fuel Use Tax;
- Gross Premiums Tax;
- Gross Receipts Tax
- Hotel Occupancy Tax, including the state administered 1% Local Hotel Occupancy Tax for Philadelphia and Allegheny County;
- Inheritance and Estate Tax;
- Liquid Fuels Tax;
- Malt Beverage Tax;
- Marine Underwriting Profits Tax;
- Motor Carriers Road Tax, for IFTA vehicles, PA portion only;
- Motor Vehicle Carriers Gross Receipts Tax;
- Mutual Thrift Institutions Tax;
- Oil Company Franchise Tax;
- Parimutuel Wagering and Admissions Tax;
- Personal Income Tax;
- Public Transportation Assistance (PTA);
- Public Utility Realty Tax;
- Realty Transfer Tax, including Local Realty Transfer Tax;
- Sales and Use Tax, including Local Sales and Use Tax for Philadelphia and Allegheny County;
- Surplus Lines Tax;
- Unauthorized Insurance Tax, monthly; and Vehicle Rental Tax (VRT)
Note: The Tax Amnesty program does not apply to Unemployment Compensation because it is administered by the Pennsylvania Department of Labor and Industry.
Note: Also, the Tax Amnesty program does not apply to any tax administered by another state, local government or the federal government/Internal Revenue Service.
What are the benefits of the Tax Amnesty program?
You may resolve your tax amnesty eligible debt by paying the tax and half of the interest. The benefits of the tax amnesty program are the following:
Starting in 2017, the IRS has revised its user fee schedule for installment agreements. The new fee schedule applies to installment agreements entered into, restructured or reinstated on or after January 2, 2017.
The final regulations increase the existing user fees (except for low-income taxpayers) and create two new types of online installment agreements, each subject to a separate fee. Five of these rates are based on the full cost of establishing and monitoring installment agreements, while the sixth rate is for low-income taxpayers.
Here are the new fees effective starting in 2017:
(1) A top rate of $225, up from the current rate of $120, applies to taxpayers who enter into installment agreements in person, over the phone, by mail, or by filing Form 9465, Installment Agreement Request, with the IRS.
Note: This includes taxpayers requesting installment agreements with their e-filed returns.
(2) A reduced rate of $107, up from $52, applies to a direct debit agreement.
(3) A taxpayer who sets up an installment agreement through IRS.gov and agrees to make payments either by mailing a check or through the Electronic Federal Tax Payment System (EFTPS) will pay $149.
You Do Not Want To Be In This Position
As tax season approaches, the Internal Revenue Service, in IR-2016-164, has just reminded taxpayers to be on the lookout for an array of evolving tax scams related to identity theft and refund fraud.
Every tax season, there is an increase in schemes that target innocent taxpayers by email, by phone and on-line. Taxpayers and tax professionals can not be too careful and should be on the lookout for these deceptive schemes.
“Whether it’s during the holidays or the approach of tax season, scam artists look for ways to use tax agencies and the tax industry to trick and confuse people,” said IRS Commissioner John Koskinen. “There are warning signs to these scams people should watch out for, and simple steps to avoid being duped into giving these criminals money, sensitive financial information or access to computers.”
Here are Seven of the Most Prevalent IRS Impersonation Scams:
Posted in identity theft, Income Taxes, IRS, IRS collections, IRS Notices, iRS Procedures, IRS tax scams, tax scams, Taxes
Tagged income tax, tax law, tax scams, Taxes, Tips To Prevent Being Tax Scammed
The Internal Revenue Service announced on December 1, 2016 (IR-2016-155) the launch of an online application that will assist taxpayers with straightforward balance inquiries in a safe, easy and convenient way.
This new and secure tool, available on IRS.gov allows taxpayers to view their IRS account balance, which will include the amount they owe for tax, penalties and interest.
It also should be pointed out that taxpayers may also continue to take advantage of the Continue reading
IMPORTANT TAX ALERT:
New Jersey Governor Chris Christie on Tuesday, November 22, 2016, reinstated a four-decade old tax reciprocity agreement with Pennsylvania that allows residents who work in either state to pay income taxes at their home state’s rate. You can almost hear the collective sigh of relief of the many commuters that would have been adversely impacted by this new law. Continue reading
Each year, the IRS mails millions of notices and letters to taxpayers for a variety of reasons. This can be extremely upsetting when receiving this form of communication, whether it is from the IRS or any other taxing authority. The following tips are presented to reduce your anxiety and to provide a specific action plan for any correspondence received from the IRS (or from your state or local taxing authority):
- Don’t Panic: You can usually deal with a notice simply by responding to it. You should immediately contact your tax attorney, CPA or tax adviser to discuss this matter in more detail.
- Tip: Waiting can only compound and complicate your tax problems.
- Most IRS notices are about federal tax returns or tax accounts: Each notice has specific instructions, so read your notice carefully because it will tell you what you need to do. Follow the instructions very carefully. The goal here is to give a specific and detailed response to the tax issue in question.
- Tip: Only respond to the particular issue and do not provide or discuss issues that are not being raised by the IRS.
- Taxes You Owe or Payment Request: Your notice will likely be about changes to your account, taxes you owe or a payment request. However, your notice may ask you for more information about a specific issue.
- Tip: Do not assume that the taxes owed are correct. In many cases, the IRS calculates taxes without all the relevant facts.