The COVID-19 pandemic has impacted almost every facet of our lives. Schools are closing, offices are having workers work from home when possible and grocery stores are starting to have shopping hours for high-risk shoppers only.
New Year celebrations are done, and many may be reconsidering their resolutions. It is not too late to make another resolution, a resolution that financial professionals note will likely lead to eased mental stress and reduction of the stress that tax obligations can put on your finances. Make the resolution to get your taxes in order.
Getting a letter from the Internal Revenue Service (IRS) is likely to cause stress in even the most rule abiding taxpayer. But when should a notification really be of concern? Three specific times a taxpayer should worry include:
The Internal Revenue Service (IRS) keeps a close watch over tax return professionals. Tax preparers must file tax returns on behalf of their clients wisely, getting the best possible returns for their clients while remaining within the bounds of the law, or else faces serious consequences. Three recent cases provide an example of the severity of penalties that can result from an error.
Farmers may find their tax burden eased in 2020. Lawmakers passed a number of laws before heading out for the holiday break that will impact their tax obligations in the new year. Three examples include:
Now may be a good time to buy a lottery ticket. The most recent report shows the Mega Millions lottery is at $340 million. If no one wins at the drawing is coming Friday, the winnings will grow even more.
A failure to file tax returns can come with serious penalties for any taxpayer. However, those who specialize in filing tax returns as a profession can face even harsher penalties. These can include:
Certain retirement savings plans allow for a tax deferment. The Internal Revenue Service (IRS) will eventually expect taxpayers to pay taxes on those savings. In most cases, the agency requires the taxpayer to start taking required minimum distributions (RMDs) and making payments when they reach the age of 70 and ½.
The Department of Justice (DOJ) continues to crackdown on allegations of tax crime. In fact, the agency is so serious about tax crime that it has a Tax Division composed of over 350 attorneys focused solely on criminal and civil tax crime litigation. These individuals investigate and prosecute those who the agency believes are thwarting their tax obligations. Recently, this led to an investigation in Texas.
The Internal Revenue Service (IRS) recently released final and proposed regulations dealing with the global intangible low-taxed income (GILTI) provision. This provision was part of the Tax Cuts and Jobs Act (TCJA). The new regulations include a high-tax exception (HTE) to the GILTI.