Internal Revenue Service Releases Updated Withholding Guidance for 2013 Income Taxes

(Source: IRS) - WASHINGTON — The Internal Revenue Service today released updated income-tax withholding tables for 2013 reflecting this week’s changes by Congress.


The updated tables, issued today after President Obama signed the changes into law, show the new rates in effect for 2013 and supersede the tables issued on December 31, 2012. The newly revised version of Notice 1036 contains the percentage method income-tax withholding tables and related information that employers need to implement these changes.

In addition, employers should also begin withholding Social Security tax at the rate of 6.2 percent of wages paid following the expiration of the temporary two-percentage-point payroll tax cut in effect for 2011 and 2012. The payroll tax rates were not affected by this week’s legislation.

Read the rest of the article here: http://www.loansafe.org/internal-revenue-service-releases-updated-withholding-guidance-for-2013-income-taxes#comment-666268

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The Lopsided Fiscal Cliff Deal: All Tax Hikes, No Spending Restraint

Republicans were just rolled – yet again. Throughout the 2012 presidential campaign, and up until New Year’s Eve, President Barack Obama kept insisting that any solution to the U.S. “fiscal cliff” required what he called a “balanced approach” — meaning that forthcoming federal budget deficits should be narrowed partly by tax hikes (on “millionaires and billionaires”) and partly by spending restraints. Of course, we all know that Mr. Obama and the Democrats wanted only tax hikes, while the Republicans mainly wanted only spending restraint.

In the November election, we know Democrats won the White House, while the GOP won the House of Representatives. Thus a “balanced” result seemed justified. But instead, the so-called “fiscal cliff” deal that was struck last week in Washington, approved by the Senate (89-8) and House (257-167) alike, was lopsided: it entails all tax hikes (on the rich and middle class alike) and no spending restraint.

How can this be? Find out the rest of the story by visiting the original article here: http://www.forbes.com/sites/richardsalsman/2013/01/08/the-lopsided-fiscal-cliff-deal-all-tax-hikes-no-spending-restraint/

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Miami's Scummiest Tax Scams of 2012: Marine-Bilkers, Football Frauds, and Laundry Cheats

As another tax season descends, you might want to hold onto your W-2s and 1099s a little more tightly. In 2012, the U.S. Attorney's Office in Miami busted more than a dozen tax frauds using info stolen from a variety of people, including the elderly, the disabled, Marines in Afghanistan, and even a corpse.

Make sure you know who handles your income taxes.

Each case will make you want to scrub your existence from the Internet and equip your debit cards with the latest CIA-worthy encryption software. Here are the year's most egregious:

Semper infidelis: On February 9, the feds busted into Dorothy Boulin's studio apartment in Miami and found several lists with the names, birth dates, and social security numbers of dozens of Marines serving in Afghanistan. A month earlier, Boulin had used the information to obtain tax refund checks. Turns out she got the data from the Marines' fellow unit member, 23-year-old Jobson Cenor. The day of the raid, the feds spied on a conversation between Boulin and Cenor as he talked about splitting up the loot. Both pleaded guilty. Boulin received 70 months in prison, and Cenor got 57.

Dirty laundry man: On October 4, law enforcement officials raided Frantz Auguste's dry-cleaning business in North Miami Beach to find a locked room packed with handwritten notes containing stolen personal info from more than 100 people and corresponding fake tax returns. Many of the victims were elderly folks at a nearby assisted living facility. Auguste recently pleaded guilty to two felonies.

Check out the other types of scams that were discovered here(link to full article) include:
Information jackers:
Enterprising law clerk:
Personal foul penalty:

These posts are for informational use only to educate people about their online income taxes and the financial world around them. If you found this helpful, share the original article or this one, and help spread the word! With tax season rapidly approaching let us get you the best income tax return you can possibly have by e-filing! Please leave a comment if you want to inform readers of other tax scams to be aware of!

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Electronic Tax Filing News Update: Scam Targets Elderly Texans

Texas Attorney General Greg Abbott said the state is investigating a fraudulent tax return scheme and warned East Texas residents to avoid recruiters from Syam Tax Services LLC.

The Texas Attorney General’s Office does not typically acknowledge investigations but disclosed the investigation into Syam Tax Services in order to help prevent additional victims from being harmed by the tax fraud scheme.

Although the state’s investigation is still ongoing, the preliminary results show that Syam Tax Services enlisted recruiters to canvass small East Texas churches and senior residences for elderly victims who receive Social Security or disability benefits. Prospective victims are told that low-income Social Security recipients are eligible for a cash benefit under a federal stimulus funds program.

Elderly Texans beware, your identities could be at risk!

Next, victims are told to complete a form, which includes providing their driver’s license, Social Security and bank account numbers to Syam’s recruiters in order to receive their federal stimulus benefits. Without the victim’s knowledge, Syam subsequently prepares and files a fraudulent tax return in the victim’s name.

Read the rest of the article for tips to avoid this scam and what to do if your identity is stolen: http://www.accountingtoday.com/news/Tax-Scam-Targets-Elderly-Texans-65028-1.html

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IRS Issues Statement On Tax Legislation, Makes No Promises About Start Of Tax Season

So about that new tax deal… The Internal Revenue Service (IRS) doesn’t have much to say, so far, it seems. On their website, they have this headline, IRS Statement on Jan. 1 Tax Legislation Passed by Congress, which sounds promising, right? Until, of course, you read the statement which says this:

How some income tax preparers are
feeling waiting for the news from the IRS

 "The IRS is currently reviewing the details of this week’s tax legislation and assessing what impact it will have on this year’s filing season. The IRS will soon make available additional information on when taxpayers can start filing 2012 tax returns."

No, I didn’t skip over anything. That’s the whole statement. There’s apparently not a lot to say at this point.

I don’t, of course, blame IRS for this fiasco. With the tax season officially kicking off on January 22, 2013, it couldn’t have passed anyone’s notice – even those in Congress – that giving an agency less than three weeks’ notice about how to administer returns for 140 million taxpayers (give or take a million) is, to put it mildly, optimistic.

I know what you’re thinking: the tax deal was for 2013, so what’s the hold up for 2012?

The hold up is that the tax deal did more than a few things retroactively. The most significant move was fixing the alternative minimum tax (AMT). While the focus on the AMT in the press was for 2013 and forward, for taxpayers, it was for 2012. Congress didn’t patch the AMT after 2011 which meant that the lower thresholds applied; in simple terms, an additional 30 million taxpayers were to be subject to the AMT without a fix.

This article has several other great points and you should definitely give it a read: http://www.forbes.com/sites/kellyphillipserb/2013/01/07/irs-issues-statement-on-tax-legislation-makes-no-promises-about-start-of-tax-season/

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How new tax rates will affect you in 2013

Full article at: http://www.cbsnews.com/8301-505146_162-57562381/how-new-tax-rates-will-affect-you-in-2013/

(MoneyWatch) In passing the American Taxpayer Relief Act of 2012 and averting the dreaded "fiscal cliff," Congress ensured that workers will pay more in payroll taxes and that some folks will pay more income taxes.

The good news is that many of the new tax rules are permanent, which will give individuals and business owners a welcome sense of stability. Also, these changes were better than the higher income taxes that would have burdened just about all taxpayers had the tax cuts been allowed to simply expire without further action.

Here is a summary of the new tax rules that have been made permanent by the new law:

Tax rates on ordinary taxable income. For workers with taxable income below certain levels, their tax rates will remain at 10 percent, 15 percent, 25 percent, 28 percent, 33 percent and 35 percent. For single filers with taxable income above $400,000, married filers with income over $450,000, married filing separately over $225,000 and heads of household with taxable income over $425,000, the new 39.6 percent rate will replace the 35 percent tax rate for income over these amounts. So a married couple with a taxable income of $650,000 will pay an additional $9,200 of income tax just due to this change.

Higher tax rates for long-term capital gains and dividend income. Like the income tax rates for people with incomes below certain levels, the tax rates that apply to their capital gains and dividends will remain the same. But for taxpayers with the higher incomes noted above, their rate increases from 15 percent to 20 percent. So a taxpayer with $10,000 in capital gains and $10,000 in dividend income would pay an additional $1,000 of income tax due to this change.

View the full article for these other topics as well:
Medicare surtax.
Phase-out of the personal and dependent exemptions.
Phase-out of itemized deductions.

What do you think about these changes? Leave a comment if you want to voice your opinion!

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Budget Deal Provides Tax Breaks For Green Energy

Taken from: http://www.npr.org/2013/01/04/168590135/budget-deal-provides-tax-brakes-for-green-energy

Whether you're a homeowner who bought an energy-saving refrigerator last year or a company hoping to build a wind farm, the tax package Congress just approved may give you a reason to cheer.

"It's got something in there, a Christmas gift if you will, for almost everyone — American homeowners, workers who commute via transit, and manufacturers of efficient equipment like clothes washers, dryers, refrigerators," says Kateri Callahan, president of the Alliance to Save Energy.

Homeowners can save up to $500 on taxes for 2012 or 2013 for installing more insulation or an energy-efficient furnace, for example.

The tax package is especially meaningful to clean-energy businesses that rely on tax benefits to stay profitable.

Read the rest of the article to finish the story. I hope Congress continues to give people incentives to use our dwindling resources more efficiently! These posts are for informational use only to educate people about their online income taxes and the financial world around them. If you found this helpful, share the original article or this one, and help spread the word!

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