Tax Guru – Ker$tetter Letter

Helping real people win the tax game.

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Archive for October, 2007

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Higher SS Taxes

Posted by taxguru on October 19, 2007


Social Security Announces 2.3 Percent Benefit Increase for 2008 – What the drive-by media aren’t publicizing is the other side of the equation, the increase in the income subject to the 12.4% Social Security tax from the 2007 level of $97,500 to $102,000 in 2008.  This is an increase in the SS tax of $558 for the 12 million people SSA estimates will be in this income level. 

As I’ve long predicted, and will almost certainly happen if the two-headed president is given a third term in the White House, the ceiling on income subject to this tax will be removed entirely, as it was for the 2.9% Medicare tax.  This will also be accompanied by a reduction or complete elimination of benefits to people in these higher income levels.

 

Posted in SSA | Comments Off on Higher SS Taxes

IRS Official 2008 Tax Rates

Posted by taxguru on October 18, 2007

IRS has announced their official calculations of the 2008 inflation adjusted tax rate schedules, standard deductions and exemptions.  They match the ones I posted earlier that had been computed by CCH.

You can download the IRS 20 page pdf file with all of the details.  This also includes a lot of other inflation adjusted figures that neither I nor CCH covered previously.

 

Posted in IRS | Comments Off on IRS Official 2008 Tax Rates

Verifying Donations?

Posted by taxguru on October 18, 2007

A little joke courtesy of Pastor Tim’s Clean Laughs:

*IRS Call*

When the minister picked up the phone, Special Agent Struzik from the IRS was on the line.

“Hello, is this the minister?”

“Yes, this is.”

“I’m calling to inquire about a member of your congregation, a Dr. Shipe. Do you recognize the name?”

“Yes, he is a member of our congregation. How can I be of service?”

“Well, on last year’s tax return, the doctor claimed that he made a sizable tax-deductable contribution to your church. Is this true?”

“Well, I’ll have to have our bookkeeper verify this information for you. How much did Dr. Shipe say he contributed?”

“Twenty five thousand dollars,” answered Agent Struzik. “Can you tell me if that amount is true?”

There is a long pause. “I’ll tell you what,” replied the minister…….

“Call back tomorrow. I’m sure it will be.”

 

Posted in humor | Comments Off on Verifying Donations?

Posted by taxguru on October 18, 2007

Tax Board Outs Simpson, Sinbad, Warwick – The entertainment press has picked up on my earlier piece on the Calif. FTB’s list of unpaid taxes by celebrities.  I didn’t recognize Sinbad’s name on my first review of the list; but now we know who that is and that he owes over $2.1 million to the FTB. 

 

Posted in StateTaxes | Comments Off on

Posted by taxguru on October 16, 2007

People will move due to taxes, a fact that short-sighted state rulers refuse to acknowledge.

Posted in comix, StateTaxes | Comments Off on

Telephone Tax Credit

Posted by taxguru on October 16, 2007


The IRS says taxpayers collected only half of the $8B available for the refund of phone taxes.

The form to claim this refund is very intimidating, with all of its lines and the need to have phone bill info going back into 2003. I have found that this has been another big benefit of having everything on QuickBooks and keeping multiple years running in the same file. When preparing tax returns, clients who didn’t use QuickBooks have had to settle for the tiny standard amounts of $30 to $60. For those with their data in QB, going back at least into 2003, I have been able to fill in all of the necessary data in Lacerte in about 12 minutes and the credits have been averaging several hundred dollars.

More from IRS.

Form 8913

Instructions for the 8913

Posted in Credits, QB | Comments Off on Telephone Tax Credit

Posted by taxguru on October 13, 2007

Posted in comix, cpa, Deductions, Kids | Comments Off on

Posted by taxguru on October 13, 2007

Posted in comix, cpa | Comments Off on

Posted by taxguru on October 13, 2007

IRS Steps Up Scrutiny On Popular Tax Strategy – Thanks to an alert reader for the heads up on this article about upcoming IRS scrutiny of 1031 exchanges.  A big stumbling block for IRS will be in educating its agents on the proper application of 1031 rules, especially the fact that different kinds of real estate qualify as like kind.  I’ve lost track of the number of IRS agents I’ve had to train on this and other 1031 related issues. 

 

 

 

 

Posted in 1031 | Comments Off on

Comparing tax software

Posted by taxguru on October 13, 2007

Interesting article from the Journal of Accountancy reporting on the results of their survey of professional tax preparers’ opinions on software.  Very handy side by side comparison of the features in the different programs in this pdf file.

I just received a copy of the 2006 Drake program and will be taking it for a test spin to see if it’s a suitable replacement for Lacerte after I make it through the October 15 crunch.

 

 TaxCoach Software: Finally! Plain-English Tax Planing That Builds Your Business!

 

Posted in preparers | Comments Off on Comparing tax software

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