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In short the Earned Income Tax Credit (EITC) is a refundable tax credit for low to medium income families and taxpayers. The credit, which was originally created in 1975, was established to offset Social Security taxes for low-income families. It is a huge tax benefit for low-income families as a married couple with three children could see a credit of up to $5,891 depending on other factors. Even a single person with no children can benefit depending on income level. For more about who is … [Read more...]

The formal name for this document is IRS CP3219B Notice or Statutory Notice of Deficiency. It sounds very ominous but it would not be the first contact you had from the IRS regarding their intent to assess a tax deficiency. You would have first received a notice requesting that you check your tax return against information that the IRS has received regarding your financial matters. The notice is not a bill; however, you can pay the additional tax if you agree with the IRS. If not, then you … [Read more...]

Unless you are receiving a huge tax refund, you are probably dreading April 15. Taxpayers who do not have simple returns dread tax year each year because that means they have another chance of being audited by the Internal Revenue Service. The IRS audits tax returns based on several different criteria. Knowing what triggers an IRS audit may help you avoid this painful experience. In addition to being wealthy and having offshore accounts, thirteen more triggers will call attention to your … [Read more...]

Dionne Warwick filed for relief under the U. S. Bankruptcy Code in New Jersey claiming only $25,500 in assets but nearly $11 million in debts. Almost all of the debt is tax debt owed to the Internal Revenue Service and the state of California. The tax claims are from the late 80s and 90s according to Warwick’s publicist. The bankruptcy forms report an average monthly income of $20,950 with monthly expenses of $20.940. Financial mismanagement was cited as the reason for the debt. For more … [Read more...]

The proposed merger of US Airways and American Airlines was approved by a federal bankruptcy judge this week. This paves the way for the two airlines to merge together to form the world’s largest airline. The $11 billion deal also included an almost $20 million severance package for the CEO of AMR, the parent company of American. The judge declined to approve the severance package for Thomas Horton who will step down next year. However, even though the judge did not approve the severance … [Read more...]

The Internal Revenue Service has issued its top twelve tax scams for the current year. Each year the IRS issues a list to educate tax payers about the current scams designed to separate them from their hard earned money. The number one scam for 2013 is identity theft - - it was at the top of the list last year. Thieves use tax payers name and social security number to file false tax returns. Phishing came in second on the IRS list. Thieves use fake websites or emails to steal financial … [Read more...]

More tax payers have become familiar with the Internal Revenue Service’s Whistleblower Program since one person claimed over one million dollars for his role in exposing tax fraud. When you file a claim with the WBO (IRS Whistleblower Office), you will receive a claim number. Make sure that you give the office you correct contact information and you keep the claim number in case you need to follow up on your claim. For information about how to follow-up on a claim and check on delays read, … [Read more...]

If you prepare and file your own tax returns using one of the popular tax preparation software programs, you have probably been offered their audit insurance. This insurance costs an additional fee and offers a variety of services related to IRS audits. However, do you really need audit insurance if you file a simple, straight-forward tax return? Triggers for audits can include business income, missing information and high income. For more information on what triggers an IRS audit read, … [Read more...]

Affymax is cutting jobs and contemplating selling itself due to financial problems created by the recall of its major product. Affymax produces the drug Omontys which is used to treat anemia in patients on dialysis. The drug was recalled causing shares of Affymax to drop over fifty percent at the beginning of this week. Affymax says that it will lay off three-fourths of its workers and fire its chief commercial officer in an attempt to restructure rather than file for bankruptcy. For more … [Read more...]

Lon Morris College filed for Chapter 11 bankruptcy relief last year when it could no longer pay its creditors. Administrators of the state’s oldest junior college attempted to add a football team and expand the college; however, the expansion only created more debt. They also offered tuition discounts to grow enrollment but when that move proved successful, the school did not have the money to pay operations. Now the school is petitioning the court to sell off its mineral rights to pay … [Read more...]