Everson Bullish on IRS Enforcement Despite Bleak Funding Outlook

Luxury SUV Loophole Curbed in ETI Bill – Remember that it doesn’t actually take effect until President Bush signs this into law, which will probably be next week. The auto dealerships should be crowded this weekend with people trying to get in under the wire.

Educators Should Save Receipts for Reinstated Deduction – This small but useful tax deduction was extended retroactively to the beginning of 2004. The best way to make sure you are able to properly claim the appropriate amount is to keep track of all of your expenditures (cash, checks, credit cards, etc) with QuickBooks.

2005 Toyota Prius Certified for Clean-Fuel Deduction; New Law Restores Full Deduction Amount for 2004 and 2005 – This is one of the only deductions available for purchases of non-business vehicles. However, with the reinstatement of the itemized Schedule A deduction for sales tax for some people, there will be more tax breaks for individuals buying non-business vehicles.

As always at this time of year, a new annual version of QuickBooks is just around the corner from being released to the public. You can see what is new and improved in the 2005 programs here. As always, my advice to anyone considering taking the wise step of upgrading from an older version to hold off for another three or four weeks and then buy the 2005 program rather than getting the 2004 and being a year behind in state of the art.

I did receive my free trial CD of the new Simple Start version of the program a few weeks ago; but was too busy with the October 15 crunch. I’m hoping to take it for a test spin this weekend and will report on whether it makes sense or not. Believe it or not, as big a fan of many Intuit products as I am, they do put out their fair share of crappy programs that are a waste of time and money. My first impressions of this new program are not good; but that could be wrong.

As I’ve long said, it’s much better to take your time and file as accurate an original tax return as possible than to rush and do a half-assed job that requires filing an amended return later.

This is even more important now than ever because I have noticed a recent trend in IRS starting full blown audits of tax returns where an amended return was filed requesting a refund of overpaid taxes. I will write more later about my experiences with this tactic, which is nothing more than an abusive and punitive fishing expedition by IRS, hoping to find other errors that can be used to offset the refund request.

So, rather than whip together an erroneous 1040 to meet today’s deadline for the first additional extension request, it’s best to send in another Form 2688. We just sent off 75 of them to the IRS service centers, requesting a new filing date of December 15.

We will probably be sending another 30 or so 2688s by Dec. 15, moving the due date to February 15, 2005 because of traumatic events in the lives of those clients (deaths, illnesses, etc) that have made it impossible to even start working on their 2003 income taxes.