BusinessWeek Publishes Misleading Article on Federal Withholding Changes in 2011
All taxpayers should be concerned about the impending expiration of tax cuts (from both the Bush and Obama years) but no one should have a heart attack reading BusinessWeek’s latest estimates of how much higher the taxes will be. They’re way too high.
In an article yesterday, BusinessWeek purports to show how much more will be withheld from each two-week paycheck this coming January, assuming all the tax cuts expire. They make several errors, though, so taxpayers should either wait for the official tables from the IRS or check out the Tax Foundation’s calculator at MyTaxBurden.org.
Since Congress has yet to act to extend any of the cuts, it is increasingly likely the IRS will release initial 2011 withholding tables to employers assuming that the cuts expire. This would result in smaller paychecks beginning next year.
BusinessWeek crunches the numbers and claims, for example, that a married couple making $80,000 per year would pay an additional $224.48 twice every month, for a total of $5,315.52 per year, and links to a calculator showing withholding changes for a number of different taxpayers. This claim is being repeated across the blogosphere.
This is an excerpt of an article posted on the Tax Foundation's Tax Policy Blog. To read the rest of the article, please click the link at the top of the post.
Friday, October 29, 2010
IRS Consumer Alert
The IRS does not send taxpayers unsolicited e-mails about their tax accounts, tax situations or personal tax issues. If you receive such an e-mail, most likely it's a scam. IRS impersonation schemes flourish during filing season. These schemes may take place via phone, fax, Internet sites, social networking sites and particularly e-mail.
Many impersonations are identity theft scams that try to trick victims into revealing personal and financial information that can be used to access their financial accounts. Some e-mail scams contain attachments or links that, when clicked, download malicious code (virus) that infects your computer or direct you to a bogus form or site posing as a genuine IRS form or Web site.
Some impersonations may be commercial Internet sites that consumers unknowingly visit, thinking they're accessing the genuine IRS Web site, IRS.gov. However, such sites have no connection to the IRS.
For more information on scams and what to do if you're subject to one, see our Problem Alerts page, Online Scams that Impersonate the IRS, Suspicious e-Mails and Identity Theft and How to Report and Identify Phishing, E-mail Scams and Bogus IRS Web Sites.
Reposted from http://www.irs.gov/newsroom/article/0,,id=97322,00.html
Many impersonations are identity theft scams that try to trick victims into revealing personal and financial information that can be used to access their financial accounts. Some e-mail scams contain attachments or links that, when clicked, download malicious code (virus) that infects your computer or direct you to a bogus form or site posing as a genuine IRS form or Web site.
Some impersonations may be commercial Internet sites that consumers unknowingly visit, thinking they're accessing the genuine IRS Web site, IRS.gov. However, such sites have no connection to the IRS.
For more information on scams and what to do if you're subject to one, see our Problem Alerts page, Online Scams that Impersonate the IRS, Suspicious e-Mails and Identity Theft and How to Report and Identify Phishing, E-mail Scams and Bogus IRS Web Sites.
Reposted from http://www.irs.gov/newsroom/article/0,,id=97322,00.html
IRS Begins Notifying Tax Return Preparers on PTIN Renewals
WASHINGTON — The Internal Revenue Service has begun notifying about 1 million tax return preparers to remind them that they must renew their Preparer Tax Identification Numbers (PTIN) if they are still paid preparers. Use of the PTIN will be required on all federal returns prepared by paid tax return preparers starting Jan. 1.
Tax return preparers can register immediately using a new PTIN sign-up system available through www.IRS.gov/taxpros. Preparers will need to create an account, complete the PTIN application and pay a $64.25 fee before getting their PTINs.
The IRS will be sending approximately 125,000 notification letters each week for eight weeks. The notifications are based on those tax return preparers who currently have PTINs. Tax return preparers who received their PTINs prior to the new system launch on Sept. 28, 2010, must register using the new sign-up system. Existing PTIN holders who register through the new system will generally be reassigned their same numbers.
The PTIN was created several years ago as a nine-digit number that tax return preparers could obtain from the IRS to use on tax returns instead of their Social Security numbers.
The PTIN requirement is one of the main provisions in a new oversight program to help regulate the tax preparation industry. Anyone paid to prepare all or substantially all of any federal tax return or claim for refund must have a PTIN. The requirement applies to all tax return preparers, including those who are enrolled agents, certified public accountants and attorneys.
Reposted from http://www.irs.gov/newsroom/article/0,,id=229602,00.html
Tax return preparers can register immediately using a new PTIN sign-up system available through www.IRS.gov/taxpros. Preparers will need to create an account, complete the PTIN application and pay a $64.25 fee before getting their PTINs.
The IRS will be sending approximately 125,000 notification letters each week for eight weeks. The notifications are based on those tax return preparers who currently have PTINs. Tax return preparers who received their PTINs prior to the new system launch on Sept. 28, 2010, must register using the new sign-up system. Existing PTIN holders who register through the new system will generally be reassigned their same numbers.
The PTIN was created several years ago as a nine-digit number that tax return preparers could obtain from the IRS to use on tax returns instead of their Social Security numbers.
The PTIN requirement is one of the main provisions in a new oversight program to help regulate the tax preparation industry. Anyone paid to prepare all or substantially all of any federal tax return or claim for refund must have a PTIN. The requirement applies to all tax return preparers, including those who are enrolled agents, certified public accountants and attorneys.
Reposted from http://www.irs.gov/newsroom/article/0,,id=229602,00.html
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