Tag Archives: Barack Obama

Your 2014 Taxes ˗ What You Need To Know

The Internal Revenue Service (IRS) has earmarked January 20 as the start of the tax filing period.

Yesterday, the IRS stated that US taxpayers can begin filing their taxes for 2014 January 20th. The tax filing period will begin on schedule unlike last year when there were delays, in spite of a late tax rule introduced by Congress and approved by President Obama, according to the taxing agency.

Previously this month, a bill was passed by Congress that extended over fifty tax breaks, which had expired this time last year. This new congressional tax rule prolongs the tax breaks to the end of the year, permitting taxpayers to take the tax breaks while filing their tax returns for 2014. President Barack Obama approved the bill on December 19.

During the past couple of years, late rule changes introduced by Congress have held up the start of tax filing periods. That will not be the case on this occasion though, said John Koskinen — the current IRS Commissioner.

In an interview, Koskinen stated that the IRS had examined the late changes to the tax laws, and decided that nothing should prevent them from carrying on upgrading and testing their systems.

On a yearly basis, TurboTax free tax returns are filed by millions of people throughout the initial weeks of the tax period. The IRS will be ready to receive this huge influx of tax returns at the start. Taxpayers should be able to obtain their tax refunds quickly after the start of the tax season.

Recently, the IRS stated that it managed to take action on the majority of tax refunds in three weeks. This applies to tax returns that were electronically filed. The IRS states that electronic filing is the quickest method of acquiring a tax refund and recommends it.

Lately, Koskinen informed journalists that tax refunds may be held up, due to agency budget cuts made after the IRS TeaParty targeting scandal. Nonetheless, he would not say how long they would be held up. Many consider this to be the agency hoping for an increase in funding by claiming the tax season will be slow due to a lack of resources.

The Internal Revenue Service will process roughly 150 million tax returns this tax season. For the 2014 reporting period, tax refunds averaged approximately $2800.

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Filing Confusion Faced By U.S. Citizens Living Abroad, June Deadline

Expats wondering about filing and health care requirements, have the opportunity of taking advantage of the expert advice and assistance offered to them by H&R Block, who estimate 1 in 3 expats haven’t filed a 2013 return. They are facing a filing deadline of June 16th this year.

To be of the greatest help to these taxpayers, H&R Block last season launched a remote filing service, and for this tax season, expanding it even more.

Roland Sabates, who is the director of the expat filing services offered by H&R Block has said “U.S. expats may miss many things, but the tax deadline should not be one of them”.

To understand their U.S. tax obligations, there are three questions that expats should be answering:

Are they required to file?
Which foreign assets must they report and how does money in foreign accounts get reported?
What is their responsibility to maintain health insurance, which is new this year?
Know the filing requirements

Regardless of wherever they may be living, for 2013, the minimum income requirements for filing are $10,000 for single filers, and $20,000 for married filers. Some taxpayers possibly can exclude all or some of the income earned abroad, which might offset taxes owed the United States.

Those working abroad unable to file by June 16th can file an extension moving their deadline to October 15th. They should know that on any balance from the filing deadline April 15th, interest will accrue.

Know the rules and regulations regarding the reporting of money in foreign accounts and assets

If at any time during the year an account owned or controlled by a U.S. citizen has a combined value exceeding $10,000, they must file an FBAR which is a foreign bank account reporting form. They must by June 30th submit this form to the Department of Treasury, and also include this info with the next tax return which will be due on June 16th, filing on Form 8938.

Also, by June 16th, taxpayers have to report data regarding ownership interests in foreign businesses and any securities not in any account.

Sabates has said that “it is important all the tax deductions and credits qualified for are claimed by these taxpayers”.

Understand health insurance obligations

For the most part, in 2014, the majority of U.S. citizens will be required to have health insurance. All should carefully check whether or not this applies to them.

Unless an exemption applies, the taxpayer will have to get themselves health insurance.

H&R Block stands ready with offices in over 14 US countries and territories to offer their experienced and excellent services.

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Experts Say Charitable Tax Deduction is Safe from Congress

According to experts from the nonprofit sector, charitable tax deduction laws will likely remain unscathed from Congress in the near future. However lawmakers are still dealing with several charitable tax break issues that expired in 2013 and there is uncertainty on whether such tax breaks for charities will continue to exist.

President Barack Obama has consistently tried to limit the amount of tax savings the rich get for itemized deductions and will likely mention this issue is his upcoming proposed budget. However individual adjustments in tax policy typically don’t stand a chance in getting passed unless they’re grouped together

Charitable Tax Deduction

Ron Wyden and Nancy Bass Wyden by David Shankbone (Photo credit: Wikipedia)

with other tax items. Experts say creating such a large tax bill likely won’t happen before midterm election in November.

Adding to the difficulty of altering charitable tax deduction policy is the probable change in Congress. Democrat of Montana and chairman of the Senate Finance Committee, Sen. Max Baucus, is soon leaving Washington to become the ambassador to China and his likely replacement, Sen. Ron Wyden, is a strong supporter of charitable deduction. Baucus was expected to pass a broad tax overhaul before his retirement at the end of the year, but now people think it’s unlikely to happen because Wyden is expected to work at a slower pace.

According to Andrew Schulz, executive vice president of Foundation Source (a group that advises private foundations), “There’s zero percent chance any significant tax reform will happen this year.” Others who work with charities and nonprofits feel the same way.

Steve Tyler, senior vice president for public policy at United Way Worldwide, says 1,000 United Way leaders will be “vigilant” when talking with lawmakers if charitable tax deductions are discussed when they’re in Washington in May.

Documenting Donations for 2014

As long as proper documentation is provided, both individuals and businesses can deduct donations from taxable income. It is always best to check with the Internal Revenue Service (IRS) if you’re wondering what documentation is required. The IRS has strict guidelines for submitting charitable contributions as a write-off, which is an expense that gets deducted from your taxable income. You can learn more about tax smart contributions here.

If you want a donation to be seen by the IRS as a write-off, you’ll need proper documentation. This can be a cancelled check, credit card statement, bank records, or a receipt. The receipt must have the charity’s name on it as well as the amount you donated.

If you plan on donating to a charity and wish to submit it to the IRS as a tax write-off, you need to make sure the charity you’re supporting is approved by the IRS. Charities approved by the IRS are usually those that offer some kind of relief or are associated with religious and educational organizations. In a lot of cases local volunteer organizations such as animal rescue groups are approved by the IRS.

However don’t assume you’ll receive a tax break from the IRS without checking to see if the charity is approved. Just because the IRS’ list of approved charities is long doesn’t mean the organization you’re donating to will be on it.

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State Income Tax Worries On The Rise

State Income Tax

State Income Taxes Could Possibly be Eliminated by Selective States:

Many States are hoping to experiment with their plan to eliminated State tax returns. The States which consist of mainly Republicans are clinging tightly to this idea praying that it is a success.

State Income Tax Worries On The Rise

President Barack Obama talks with U.S. Coast Guard Commandant Admiral Thad Allen, who is serving as the National Incident Commander, and Louisiana Gov. Bobby Jindal, aboard Marine One as they fly along the coastline from Venice to New Orleans, La., May 2, 2010. John Brennan, Assistant to the President for Homeland Security and Counterterrorism, is in the background. (Photo credit: Wikipedia)

Across the U.S. as well as the South and Midwest, numerous Republicans have gained a majority of control when it comes down to state legislatures and governorships, thus gaining the power to test highly debated tax ideas.

Republican Governor Bobby Jindal of Louisiana, for example, has called on ending Louisiana residents income tax as well as corporate taxes, leaving sales taxes to make up for lost profits.

One thing is certain and that is that Tax Filing is becoming a hot topic for many individuals of the United states. Some say cutting Tax Refunds will eventually help all of America, while others see only hard times getting harder for the less privileged.

Eliminating even cutting income taxes could possibly alter the overall tax burden by causing higher sales taxes this is a long time goal of many tax experts. Critics argue fearing that this particular approach will be much too regressive and will unfairly burden the middle class and the poor which is much more than the fortunate or the rich, as the poor are estimated to spend more of their hard earned money on more items that are subject to these sales taxes.

While many are against this idea others are all for it, as others are trying to take a side; where do you stand?

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