Fair?

“Of all the powers conferred upon Government that of taxation is most liable to abuse.”

Supreme court of the Unites States
Citizens’ Savings & Loan Association v. City of Topeka
87 U.S. 655 (1874)

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Tax Refunds May Be Applied to Offset Certain Debts

Past due financial obligations can affect your current federal tax refund. The Department of Treasury’s Financial Management Service, which issues IRS tax refunds, can use part or all of your federal tax refund to satisfy certain unpaid debts.
Here are eight important facts the IRS wants you to know about tax refund offsets:

1. If you owe federal or state income taxes, your refund will be offset to pay those taxes. If you had other debt such as child support or student loan debt that was submitted for offset, FMS will apply as much of your refund as is needed to pay off the debt and then issue any remaining refund to you.

2. You will receive a notice if an offset occurs. The notice will include the original refund amount, your offset amount, the agency receiving the payment and its contact information.

3. If you believe you do not owe the debt or you are disputing the amount taken from your refund, you should contact the agency shown on the notice, not the IRS.

4. If you filed a joint return and you’re not responsible for the debt, but you are entitled to a portion of the refund, you may request your portion of the refund by filing IRS Form 8379, Injured Spouse Allocation. Attach Form 8379 to your original Form 1040, Form 1040A, or Form 1040EZ or file it by itself after you are notified of an offset. Form 8379 can be downloaded from the IRS website at www.irs.gov.

5. You can file Form 8379 electronically. If you file a paper tax return you can include Form 8379 with your return, write “INJURED SPOUSE” at the top left of the Form 1040, 1040A or 1040EZ. IRS will process your allocation request before an offset occurs.

6. If you are filing Form 8379 by itself, it must show both spouses’ Social Security numbers in the same order as they appeared on your income tax return. You, the “injured” spouse, must sign the form. Do not attach the previously filed Form 1040 to the Form 8379. Send Form 8379 to the IRS Service Center where you filed your original return.

7. The IRS will compute the injured spouse’s share of the joint return. Contact the IRS only if your original refund amount shown on the FMS offset notice differs from the refund amount shown on your tax return.

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The Secret

Today, be grateful. Be grateful for your favorite music, for movies that make you feel good, for your phone that connects you with people, for your computer, and for the electricity that lights up your life. Be grateful for air travel that flies you everywhere. Be grateful for the roads and traffic lights that keep the traffic in order. Be grateful to those who built our bridges. Be grateful for your pet, for your child, for your loved ones, for your eyes that enable you to read this. Be grateful for your imagination. Be grateful that you can think. Be grateful that you can speak. Be grateful that you can laugh and smile. Be grateful that you can breathe. Be grateful that you are alive! Be grateful that you are You!
Be grateful that there are two words that can change your life.
Thank you! Thank you! Thank you!

May the joy be with you,

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What to Do If You Are Missing a W-2

Make sure you have all the needed documents, including all your Forms W-2, before you file your 2011 tax return. You should receive an IRS Form W-2, Wage and Tax Statement, from each of your employers. Employers have until Jan. 31, 2012 to issue your 2011 Form W-2 earnings statement.
If you haven’t received your W-2, follow these four steps:
1. Contact your employer If you have not received your W-2, contact your employer to inquire if and when the W-2 was mailed. If it was mailed, it may have been returned to the employer because of an incorrect or incomplete address. After contacting the employer, allow a reasonable amount of time for them to resend or issue the W-2.
2. Contact the IRS If you do not receive your W-2 by Feb. 14, contact the IRS for assistance at 800-829-1040. When you call, you must provide your name, address, Social Security number, phone number and have the following information:
• Employer’s name, address and phone number
• Dates of employment
• An estimate of the wages you earned, the federal income tax withheld, and when you worked for that employer during 2011. The estimate should be based on year-to-date information from your final pay stub or leave-and-earnings statement, if possible.
3. File your return You still must file your tax return or request an extension to file by April 17, 2012, even if you do not receive your Form W-2. If you have not received your Form W-2 in time to file your return by the due date, and have completed steps 1 and 2, you may use Form 4852, Substitute for Form W-2, Wage and Tax Statement. Attach Form 4852 to the return, estimating income and withholding taxes as accurately as possible. There may be a delay in any refund due while the information is verified.
4. File a Form 1040X On occasion, you may receive your missing W-2 after you file your return using Form 4852, and the information may be different from what you reported on your return. If this happens, you must amend your return by filing a Form 1040X, Amended U.S. Individual Income Tax Return.

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He’s Such a Clown!

President Barack Obama has preached that all Americans should pay their fair share in taxes, but a government report finds that tens of thousands of federal employees — from staffers in Congress to federal agencies and even Obama’s executive office — collectively owe the government billions in back taxes.

Data from the Internal Revenue Service found that more than 279,000 federal employees and retirees owed $3.4 billion in back income taxes as of Sept. 30, 2010.

The data showed that 467 employees of the House of Representatives, or about 4.2 percent of the workforce, owed more than $8.5 million. In the Senate, 217 employees, or about 3 percent of the workforce, owed $2.13 million.

Obama’s staff was not immune, either, with 36 people in Obama’s executive office of nearly 1,800 workers — about 2 percent — owing the government $833,970 in back taxes.

Obama used part of his State of the Union address Tuesday night to promote economic fairness, arguing for changes in the tax code that would create a minimum tax rate of at least 30 percent on anyone making more than $1 million. The finances of one of his chief Republican rivals, Mitt Romney, has been scrutinized because he, like many millionaires, pays a lower rate because most of his income came from investments, which are taxed at a lower rate.

The IRS report attracted the attention of Republicans, who said it undercut the president’s argument on taxes. “If Obama wants people to pay their ‘fair share,’ perhaps he should start with his own staff,” tweeted Republican National Committee chairman Reince Priebus.

White House officials noted that the delinquency rate among executive office staff had fallen from nearly 3 percent in 2008. In 2009, 41 employees in the president’s executive office owed about $830,000, representing about 2.3 percent of its workforce.

White House spokeswoman Amy Brundage said the annual report was released by the IRS because there is a “high standard for government employees.”

“Though the report shows that fewer executive office employees owe taxes than in the last year of the previous administration and we expect all employees to pay their taxes in full, more needs to be done to ensure compliance and the president has asked his team to work on this issue,” Brundage said.

Overall, the total amount owed is down slightly from September 2009, when more than 282,000 federal workers owed $3.3 billion in taxes.

The report does not offer specific explanations for the delinquencies. Many people who owe back taxes file returns but cannot pay the full amount when their taxes are due, said IRS spokesman Anthony Burke. Others may be disputing the bill, may have filed jointly with a spouse who owes taxes or may have had their tax bills increased by an audit and cannot pay the higher amount.

The statistics on federal employees do not include those who are on payment plans. The IRS doesn’t provide a comparable delinquency rate for income taxes paid by the public.

Among Cabinet agencies, the departments of Education and Housing and Urban Development had the highest delinquency rates, at nearly 4 percent. The Treasury Department had the lowest delinquency rate, at nearly 1 percent.

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Eight Facts to Help Determine Your Correct Filing Status

Determining your filing status is one of the first steps to filing your federal income tax return. There are five filing statuses: Single, Married Filing Jointly, Married Filing Separately, Head of Household and Qualifying Widow(er) with Dependent Child. Your filing status is used to determine your filing requirements, standard deduction, eligibility for certain credits and deductions, and your correct tax.

Some people may qualify for more than one filing status. Here are eight facts about filing status that the IRS wants you to know so you can choose the best option for your situation.

1. Your marital status on the last day of the year determines your marital status for the entire year.

2. If more than one filing status applies to you, choose the one that gives you the lowest tax obligation.

3. Single filing status generally applies to anyone who is unmarried, divorced or legally separated according to state law.

4. A married couple may file a joint return together. The couple’s filing status would be Married Filing Jointly.

5. If your spouse died during the year and you did not remarry during 2011, usually you may still file a joint return with that spouse for the year of death.

6. A married couple may elect to file their returns separately. Each person’s filing status would generally be Married Filing Separately.

7. Head of Household generally applies to taxpayers who are unmarried. You must also have paid more than half the cost of maintaining a home for you and a qualifying person to qualify for this filing status.

8. You may be able to choose Qualifying Widow(er) with Dependent Child as your filing status if your spouse died during 2009 or 2010, you have a dependent child, have not remarried and you meet certain other conditions.

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Giving opens up the door to receiving.

You have so many opportunities to give every day.
Give kind words. Give a smile. Give appreciation and love. Give compliments. You can give courtesy to other motorists while you are driving. You can give a smile to the car parking attendant. You can give a warm greeting to the newspaper stand person or the person who makes your coffee. You can give by allowing a stranger to go ahead of you into an elevator, and you can give by asking which floor they are going to and pressing the button for them. If someone drops something you can give a helping hand and pick it up for them. You can give warm embraces to those you love. And you can give appreciation and encouragement to everyone.
There are so many opportunities for you to give and thereby open the door to receiving.

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Your life is a learning process

You can only become wiser from learning. Sometimes you might have to attract making a painful mistake to learn something important, but after the mistake you have far greater wisdom. Wisdom cannot be bought with money – it can only be acquired through living life. With wisdom comes strength, courage, knowing, and an ever-increasing peace.
May the joy be with you,

Rhonda Byrne

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A Gift from the IRS

Since April 15th falls on a Saturday this year and Monday, April 16th is Patriots Day is a Legal Holiday in Massachusetts, we have until Tuesday April 17th to file this year!

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Comparing the GOP Candidates Tax Proposals

”Tax

Tax Proposals Infographic by: Certified Tax Coach.

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