Month: April 2014

Delray Beach, FL (PRWEB) April 25, 2014

The Internal Revenue Service (October 31, 2013) warned taxpayers late last year of what is purported to be the largest IRS phone scam in history. Criminals have been calling taxpayers and demanding immediate payments for taxes owed. The fraudsters claim to be IRS agents and tell the victims they owe thousands of dollars to the IRS. They demand immediate payment which must be in the form of prepaid debit cards or wire transfers. Thousands of victims have already lost over $1 million through this elaborate ruse which often preys on recent immigrants to the United States.

The Washington Post (April 16th, 2014) recently covered the issue and posted a recorded conversation of one of the scam phone calls. They also report that the reason for immigrants being targeted in the scam relates to the threat of deportation that the criminals use to force the victim into paying whatever they demand. However, they also report that the scam has now spread to any taxpayer that can be conned into believing that they are indeed IRS agents. Furthermore the scam involves the use of VOIP (Voice Over Internet Protocol) technology so it appears the call is coming directly from the IRS. The call will show up on the victim’s caller ID as 1-800-829-1040 which is the main IRS phone number.

The IRS has warned taxpayers of several ways to tell if a phone call they receive could be a scam. The first sign is if you have not received notification in the mail prior to the phone call. The IRS will always communicate any past due taxes via mail first. Also if the caller becomes threatening or tries to intimidate you this is also a sign that it is a scam. Perhaps the simplest advice to follow is always to call the IRS first at 1-800-829-1040 to check if you do indeed owe taxes. If this is the case then payments arrangements can be made via the legitimate IRS call centers.

Sigma Tax Pro provides a full range of essential services for tax professionals.This includes industry leading software solutions as well as technical support, tax preparation support and client retention strategies. Sigma Tax Pro specializes in helping tax preparation firms expand their businesses, open new offices and increase their client base. Clients can already renew their software licenses for next year’s tax season and ensure the lowest pricing available in the industry.

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SIGMA TAX PRO RECENTLY LEARNED THAT THE IRS JUST ANNOUNCED IT HAS $760 MILLION FOR TAXPAYERS WHO DID NOT FILE A TAX RETURN IN 2010, BUT RETURNS MUST BE FILED BY APRIL 15, 2014.

A recent announcement by the IRS should be of interest to tax professionals across the United States. IRS commissioner John Koskinen advises any taxpayer who has not filed their return for 2010 to do so before April 15th of this year. He notes that it is often students and part time workers who have not filed their returns. Sigma Tax Pro advises tax professionals to check with their clients to ensure they filed a return for 2010 and if not to file before the upcoming deadline.

The law provides taxpayers with a three year window in which to claim refunds, the 2010 tax return deadline was originally April 15th, 2011 for this reason the window will close this year on April 15th marking exactly three years. Often taxpayers who earned relatively small amounts of money do not realize they may be eligible for a refund. However the IRS estimates that half of the outstanding refunds are more than $571 and there are close to one million refunds still waiting to be claimed. Furthermore there is no penalty for claiming a late refund, many taxpayers may be under the impression that they will incur penalties for filing late.

Tax pros should advise their clients that their 2010 refund checks can be withheld if they have not filed returns for 2011 and 2012. Moreover if the taxpayer has unpaid child support, outstanding student loans or other federal debt the refund can also be withheld. For low income taxpayers the potential loss is even greater as they will be unable to claim any Earned Income Tax Credit (EITC) which can be as much as $5,666.

Sigma Tax Pro provides a full range of essential services for tax professionals.This includes industry leading software solutions as well as technical support, tax preparation support and client retention strategies. Sigma Tax Pro specializes in helping tax preparation firms expand their businesses, open new offices and increase their client base. Clients can already renew their software licenses for next year’s tax season and ensure the lowest pricing available in the industry.

 

Sigma Tax Pro Breaks Down IRS Education Tax Credits

Tax professionals are often challenged by the complex nature of education tax credits such as the American Opportunity Credit and the Lifetime Learning Credit.

Many professional tax preparers have run into challenges in recent years when their clients have claimed education tax credits. The IRS reported in 2011 that 72 per cent of education tax credits were claimed incorrectly. In many cases this was due to the student not having actually attended college at all. However these incorrect claims are often attributable to honest mistakes by the tax professional who does not understand which clients are eligible for which credit and which are not eligible at all.

The American Opportunity Credit is worth up to $2,500 per eligible student and is only available for the first four years at an eligible college or vocational school. This means it cannot be claimed for graduate programs but it can be subtracted from your taxes and also give you a refund of up to $1,000 if it’s more than your taxes. It must be for students who are earning a degree or other recognized credential and are going to school at least half-time for at least one academic period that started during the tax year. Finally it can be claimed for the cost of tuition, books and required fees and supplies.

The Lifetime Learning Credit is limited to $2,000 per tax return, per year, no matter how many students qualify. However unlike the American Opportunity Credit it is for all years of higher education and includes classes for learning or improving job skills. Another distinction between the two is that the Lifetime Learning Credit is limited to the amount of your taxes. The Lifetime Learning Credit is also applicable to the cost of tuition and required fees, plus books, supplies and equipment, but you must buy them from the school. The two credits are quite similar but tax pros must know how to distinguish the two in order to provide excellent service to their clients. For more information please consult Publication 970 on the IRS website.

Sigma Tax Pro provides a full range of essential services for tax professionals. This includes industry leading software solutions as well as technical support, tax preparation support and client retention strategies. Sigma Tax Pro specializes in helping tax preparation firms expand their businesses, open new offices and increase their client base. Clients can already renew their software licenses for next year’s tax season and ensure the lowest pricing available in the industry.