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IRS waives penalty for many whose tax withholding and estimated tax payments fell short in 2018

The Internal Revenue Service announced today that it is waiving the estimated tax penalty for many taxpayers whose 2018 federal income tax withholding and estimated tax payments fell short of their total tax liability for the year.
The IRS is generally waiving the penalty for any taxpayer who paid at least 85 percent of their total tax liability during the year through federal income tax withholding, quarterly estimated tax payments or a combination of the two. The usual percentage threshold is 90 percent to avoid a penalty.
The waiver computation announced today will be integrated into commercially-available tax software and reflected in the forthcoming revision of Form 2210 and instructions.

> More…

Posted on: January 17, 2019


Saving Money on Prescription Drugs – Picking the right Part D plan is half the battle

Prescription drug pricing can be more than a little confusing. Drugs can also be costly, especially if you have a chronic illness. Choosing the right Medicare Part D plan, however, can save you a considerable amount of money on your prescriptions. With the Part D Annual Enrollment Period now open, it’s a good time to review your Part D elections.

Here are a few ways to save money on drugs: > More…

Posted on: November 15, 2018


IRS: Several tax law changes may affect bottom line of many business owners


The Internal Revenue Service today reminded business owners that tax reform legislation passed last December affects nearly every business.

With just a few months left in the year, the IRS is highlighting important information for small businesses and self-employed individuals to help them understand and meet their tax obligations.

Here are several changes that could affect the bottom line of many small businesses: > More…

Posted on: October 17, 2018


Topic Number 652 – Notice of Underreported Income – CP-2000

The IRS compares the payment information reported to the IRS by employers, banks, businesses, and other payers on income documents (Forms W-2, 1098, 1099, etc.) to the income, credits, and deductions you report on your income tax return. The Automated Underreporter (AUR) function uses an automated system for this comparison and sends out a Notice CP-2000 if you didn’t report income on your return that was reported to the IRS by a payer or if it appears that payments, credits, and/or deductions are overstated. The CP-2000 isn’t a bill, it’s a proposal to adjust your income, payments, credits, and/or deductions. The adjustment may result in additional tax owed or a refund of taxes paid. > More…

Posted on: September 26, 2018


Many small business and self-employed taxpayers should make quarterly estimated tax payments; third quarter deadline is Sept. 17

With the last third of the year now in full view, the IRS today reminded small business and self-employed taxpayers of the importance of meeting their tax obligations. Part of those obligations normally include making quarterly estimated tax payments.

This is the third in a series of four news releases aimed at helping taxpayers pay the right amount of tax and avoid an estimated tax penalty. This is part of the wider Paycheck Checkup campaign to encourage people to check their tax situation, including withholding and estimated tax payments. > More…

Posted on: September 12, 2018


Taxpayers with children, other dependents should check their withholding soon

WASHINGTON – The Internal Revenue Service urges taxpayers with children and other dependents to use the Withholding Calculator at IRS.gov to do a “paycheck checkup.” Changes made by the 2017 Tax Cuts and Jobs Act will affect 2018 returns that taxpayers will file in 2019.The law expanded and made significant changes to the Child Tax Credit. It also suspended the deduction for personal exemptions. Parents and caregivers should do a “paycheck checkup” to determine how these changes could affect their 2018 tax situation. > More…

Posted on: August 21, 2018


Tax credits help offset higher education costs


Taxpayers who pay for higher education in 2018 can see tax savings when they file their tax returns. If taxpayers, their spouses or their dependents take post-high school coursework, they may be eligible for a tax benefit.

There are two credits available to help taxpayers offset the costs of higher education. The American opportunity credit and the lifetime learning credit may reduce the amount of income tax owed. Taxpayers use Form 8863, Education Credits, to claim the credits.

The American opportunity credit is:

  • Worth a maximum benefit up to $2,500 per eligible student
  • Only for the first four years at an eligible college or vocational school
  • For students pursuing a degree or other recognized education credential
  • Partially refundable. This means if the credit brings the amount of tax owed to zero, 40 percent of any remaining amount of the credit, up to $1,000, is refundable.

The lifetime learning credit is:

  • Worth a maximum benefit up to $2,000 per tax return, per year, no matter how many students qualify
  • Available for all years of postsecondary education and for courses to acquire or improve job skills
  • Available for an unlimited number of tax years

To be eligible to claim the American opportunity credit, or the lifetime learning credit, the law requires a taxpayer or a dependent to have received a Form 1098-T from an eligible educational institution.

More Information:
Tax Benefits for Education: Information Center
Education Credits – AOTC and LLC
American Opportunity Tax Credit: Questions and Answers
Pub 970, Tax Benefits for Education

Posted on: August 02, 2018


Tips for Taxpayers Who Need to Amend a Return


Taxpayers who discover they made a mistake on their tax returns after filing can file an amended tax return to correct it. This includes changing the filing status and dependents, or correcting income, credits or deductions. The instructions for Form 1040X, Amended U.S. Individual Income Tax Return, list more reasons to amend a return. Taxpayers should not file an amended return to fix math errors, because the IRS will correct those.

Here are some tips on how a taxpayer amends a tax return. Taxpayers should: > More…

Posted on: May 21, 2018


American Legion to hold Community Shred Day

On Saturday May 19 the American Legion Auxiliary will hold a Community Shred Day.  The event will take place from 9 a.m. until noon in the parking lot of the Donelson Post 88 home located at 2864 Elm Hill Pike in Nashville.

Bring your bags or boxes of items to be shredded and Shred on the Run will bring their state of the art shredding truck.  You can watch youritems being shredded in a secure way. The shredded materials will be recycled, helping to keep our community green.

A suggested donation of $3 per box or bag of any size will be used to help support Post 88 charities including providing support for homeless veterans, Operation Stand Down, and children and youth programs.

Material that can be shredded include paper, photographs, CD’s, x-rays, blue prints, DVD’s, microfilm, credit cards, uniforms, photo film, floppy disks and notebooks.

Posted on: April 24, 2018


Form 14039 Can Be Filed Electronically – New IRS tax identity theft website

The Federal Trade Commission and the Internal Revenue Service (IRS) are teaming up to make it easier for consumers to report tax-related identity theft and to receive assistance in recovering from it.

The IRS will now allow consumers to report identity theft to the IRS electronically through the FTC’s IdentityTheft.gov website. Victims of tax-related identity theft need to file IRS Form 14039, Identity Theft Affidavit, before the IRS can begin resolving the problem. Until this new initiative, consumers could only file an IRS Form 14039 manually.

Identitytheft.gov allows consumers to report identity theft and to receive a personal recovery plan. In addition to an identity theft report that can be used in place of a police report to help clear their credit reports of fraudulent information, consumers can obtain customized letters they can send to creditors, debt collectors and others to help recover from identity theft causes.

Posted on: April 19, 2018


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