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May 2011 Archives

Corporate Tax Code Is Too Full of Loopholes

It seems fair to say that no one is entirely happy with the American corporate tax code. It is also fair to say that many people who deal with the corporate tax code hate it passionately. One of the biggest problems with the code is an aspect of it that corporate America might be the happiest with: it is constantly Changing as a result of successful lobbying by corporations to have new tax breaks inserted into the corporate tax code.

Guilty Plea in Offshore Bank Account Case

A frequent topic of this blog is the handling of offshore bank accounts. Specifically, post after post has included warnings about the dangers of failing to report offshore accounts. The penalties for non-reporting are some of the most severe in all of tax law. What is more, in recent years the federal government has made a concerted effort to root out tax revenue from all possible sources, and one source that is perceived as ripe for the picking is unreported assets held in offshore bank accounts.

Small Businesses Want Deductions for Health Care, Offices

Last year, Congress passed the Small Business Jobs Act, which included a provision that allowed self-employed taxpayers to deduct health insurance costs from their self-employment tax. Unfortunately, the deduction only applied to 2010 taxes. Unless Congress moves to extend the deduction, it will not be there for 2011 taxes.

California Tax Hike Extension Proposed by Governor

California state tax hikes that have expired or are set to expire would be extended under a plan recently forwarded by Governor Jerry Brown. The governor says that the extension would bring in an additional $9.3 billion in revenue to state government coffers. He also is proposing spending cuts amounting to $2.6 billion.

Tips on Filing the Foreign Bank Account Report, or FBAR

In the last post, we were discussing the importance of filing the Foreign Bank Account Report, or FBAR, if you hold offshore bank accounts or other specified offshore assets. Many taxpayers make the mistake of reporting offshore income on their tax returns, and then failing to file the FBAR as required.

Know the Differences Between Employees and Contractors

Many business owners hire workers as either independent contractors or as employees. Correct classification of these workers will affect how much those business owners will owe in taxes, and whether or not there should be withholding from the workers' paychecks. There are also differences in the tax documents that need to be filed regarding each type of worker.

Qualifying for, and Requesting, Injured Spouse Relief

What do you do if you filed a joint tax return with your spouse, and the refund is applied to your spouse's back taxes? Tax refunds are commonly applied to past-due taxes for state or federal authorities, or to back child support or spousal support payments. They can even be applied to outstanding student loans. If your spouse has some of these debts and your money is seized to pay for them, what recourse do you have?