Five things You Must Know TODAY About Your Tax Situation.
By Anthony Rosania
5.) Tax Credit Phase-out Begins for Certain Ford Hybrids
The Alternative Motor Vehicle Credit for new hybrid automobiles manufactured by Ford Motor Company will be reduced in stages. A phase-out of the full tax credit begins after a manufacturer sells 60,000 hybrid automobiles. For Ford vehicles purchased for use or lease from April 1, 2009, through Sept. 30, 2009, the credit is 50% of the full amount. On Oct. 1, 2009, the credit drops to 25%. No credits will be given for hybrid automobiles made by Ford beginning on April 1, 2010.
4.) There's ANOTHER Stimulus Benefit For Buying A New Car Now.
No matter what state you live in, you can take advantage of a tax deduction for the purchase of a new motor vehicle. The American Recovery and Reinvestment Act (ARRA) of 2009 offers taxpayers who buy a new motor vehicle in 2009 to deduct state or local sales or excise taxes paid on the purchase. Also worth noting is that the IRS has formally stated that the deduction for state and local sales and excise tax paid on new vehicles is available for multiple purchases of new cars, light trucks, motor homes and motorcycles. The $49,500 purchase limitation is a per vehicle limitation, rather than an overall limitation on the deduction.
3.) Keep all supporting tax documentation for 7 years in case of an IRS tax audit.
An audit is an inspection of an individual's or entity's books and records by the IRS. If you're being audited, the IRS will send you a letter stating which type of tax audit applies to you. There are 3 types of tax audits: Correspondence Audit — You don't need to physically see an IRS agent for this type of audit. The IRS will request documentation, and you can mail it to them instead of delivering it in person.Field Audit — If the IRS needs to verify information about your home or business, they may come to see it. Field audits usually involve businesses.Office Audit — You must be seen in an IRS office and provide requested documentation.Returns claiming the Earned Income Credit are more likely to be audited by the IRS.
2.) Time's Running Out for First-time Homebuyers
Looking to to take advantage of the First-time Homebuyers Credit this year? We'll if you haven't found your perfect starter home yet, it's time to get cracking. The current First-time Homebuyers Credit is for homes purchased on or after Jan. 1, 2009, and before Dec. 1, 2009. (There is a different tax credit for homes bought in 2008.) So, in order to get this credit, you must close on your home by Nov. 30. Factor in that the closing of a home can take on average 30 to 45 days, and this means that the home needs to be under contract by mid-October.
1.) The requirement to pay taxes isn't optional.
Simply stated, If you fail to pay taxes, you'll face civil penalties and possibly criminal penalties (including fines and imprisonment). Also, the IRS rejects many common frivolous arguments that are used to avoid taxes.Some of the arguments rejected by the Tax Court include:
* Filing a tax return or payment of tax is voluntary.
* Only federal employees and persons living in Washington, D.C., are subject to federal income tax.
* Taxpayers can validate invalid returns or other invalid tax positions or documents by writing or stamping the phrase "nunc pro tunc" on the face of the return.
* Taxpayers are not required to file an income tax return because of the Paperwork Reduction Act of 1980.
If you haven't filed a prior tax return, contact your local H&R Block office. There are year round offices in your area, staffed with experienced Tax Professionals that can help you out. Because, at H&R Block, You Got People.
CONTACTH&R Block
1700 Madison Avenue
Lakewood, NJ 08701
732-364-3000
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