It's one of the worst things that can appear on your credit report - a federal tax lien can take between 50 to 200 points off your credit score. This can increase your borrowing costs and have a long term impact.
One of this year's hit movies was called Silver Linings Playbook. The story follows the craziness of falling love, with the added plot test of a leading character who is struggling to overcome a mental health issue.
We've naturally been paying close attention to the story of how federal budget cuts will affect the IRS. When we last wrote about it, on March 4, the word was that the IRS intended to delay furloughs of employees until after the April 15 income tax filing deadline. Furloughs are essentially mandatory, unpaid vacation days that are used to implement cuts in agency budgets.
Beauty, it's often said, is in the eye of the beholder. But that isn't really true of tax deductions. No matter how necessary a certain expense may seem to a given taxpayer, that doesn't mean the IRS will agree.
In our February 11 post, we discussed the prospect that federal budget cuts could affect the ability of the IRS to assistance taxpayers and to enforce tax law through audits and investigations. These cuts, known by the shorthand term "sequester," began taking effect on March 1.
The problem of tax-return fraud involving identity theft is so large that there are many different aspects to it. Last week, we wrote about the issue of how the IRS is responding to the challenge of processing returns without undue delays.
The 2012 London Olympics are rapidly approaching their conclusion and they have provided quite a thrill to viewers in California and around the world. From unexpected triumph to heartbreaking disappointment, the Olympics present a compelling and unfiltered view of some of the human emotions that come out during athletic competition.
The past few years have undoubtedly been difficult on a number of California small businesses. Owners and entrepreneurs have had to tighten their belts to meet the realities of an economy slow to embrace a lasting recovery. One popular strategy has been to hire independent contractors to perform work because a company can reduce the benefits it pays out while incurring lower payroll taxes.
Investors will soon be able to own a portion of California-based Facebook when the company goes public. While the imminent initial public offering is a source of excitement for some, it may be cause for concern among some Facebook employees. Because of an interesting provision in the Tax Code, Facebook estimates that its workers will owe the Internal Revenue Service and the state of California a total of $4 billion in taxes when the company's shares hit the open market.
At this time of year, taxpayers in California and around the country are hoping to avoid the dreaded tax audit letter. The good news is that the Internal Revenue Service only audits a small percentage of the overall population--currently about 1 percent. The bad news is that audit rates are much higher among certain groups of taxpayers, whose returns single them out for additional IRS scrutiny.