LAP Financial Services

Special Tax Break Available for New Car Purchases This Year WASHINGTON — The Internal Revenue Service announced today that taxpayers who buy a new passenger vehicle this year may be entitled to deduct state and local sales and excise taxes paid on the purchase on their 2009 tax returns next year. “For those thinking about buying a new car this year, this deduction may give them a little more drive to make their purchase this year,” said IRS Commissioner Doug Shulman. “This deduction enables taxpayers to buy now and get cash back later on their tax returns.” The deduction is limited to the state and local sales and excise taxes paid on up to $49,500 of the purchase price of a qualified new car, light truck, motor home or motorcycle. The amount of the deduction is phased out for taxpayers whose modified adjusted gross income is between $125,000 and $135,000 for individual filers and between $250,000 and $260,000 for joint filers. IRS also alerted taxpayers that the vehicle must be purcha...

Top Ten Tips about IRA Contributions There is still time to make contributions to your traditional Individual Retirement Arrangement, better known as an IRA. Below are the top ten things you should know about money you put aside for retirement in an IRA. 1. You may be able to deduct some or all of your contributions to your IRA and you also may be eligible for a tax credit equal to a percentage of your contribution. 2. Contributions can be made to your traditional IRA at any time during the year or by the due date for filing your return for that year, not including extensions. For most people, this means contributions for 2008 must be made by April 15, 2009. 3. The amount of funds in your IRA are generally not taxed until you receive distributions from that IRA. 4. To figure your deduction for IRA contributions, use the worksheets in the instructions for the form you are filing. 5. For 2008, the most that can be contributed to your traditional IRA generally is the smalle...

Top Ten Tips for Last Minute Filers With the tax filing deadline close at hand, here are the top 10 tips for taxpayers still working on their tax return. 1. E-file your return. Consider filing electronically instead of using paper tax forms. Choosing to e-file is the best way to ensure your return is accurate and complete. 2. Review tax ID numbers. Remember to carefully check all identification numbers on your return. Incorrect or illegible Social Security Numbers can delay or reduce a tax refund. 3. Double-check your figures. Whether you are filing electronically or by paper, review all the amounts you transferred over from your W-2 or 1099. 4. Review your math. Taxpayers filing paper returns should also double-check that they have correctly figured the refund or balance due and have used the right figure from the tax table. 5. Sign and date your return. Both spouses must sign a joint return, even if only one had income. Anyone paid to prepare a return must also sign it...

Piece taken from Business.Gov With more parents working full time jobs, the demand for child care programs is extremely high; unfortunately, that demand heavily outweighs the current supply. There simply aren't enough programs to accommodate the millions of children that require care. Considering simple laws of supply and demand, it's no surprise that the price of child care has become nearly unaffordable. The average annual cost of child care programs is higher than the average tuition for public higher education. In many cases, this dynamic has made staying home a more affordable option than continuing to work while paying for child care. On a positive note, this dilemma has stimulated the creation of new small businesses. The large number of in-home child care providers is one indicator that people are beginning to make adjustments. Non-traditional child care programs such as these have become an attractive option for many working parents. The majority of child care provid...

First $2,400 of Unemployment Benefits Tax Free for 2009 WASHINGTON — All or part of unemployment benefits received in 2009 will be tax free for many unemployed workers, according to the Internal Revenue Service. “This morning we learned that a record 5.6 million people were receiving unemployment benefits in the middle of March. This underscores the need for the relief provided by the American Recovery and Reinvestment Act, which includes making the first $2,400 of unemployment insurance exempt from tax,” said IRS Commissioner Doug Shulman. “I urge all unemployed workers to take this special tax break into account as they plan their tax withholding and quarterly estimated tax payments for the year. This change offers a helping hand to millions of Americans who are out of work and struggling to make ends meet.” Under the American Recovery and Reinvestment Act, enacted last month, every person who receives unemployment benefits during 2009 is eligible to exclude the first $2,400 of these...

Ten Tips for Deducting Charitable Contributions When preparing to file your federal tax return, don’t forget your contributions to charitable organizations. Your donations could add up to a sizeable tax deduction if you itemize on IRS Form 1040, Schedule A. Here are a few tips to ensure your contributions pay off on your tax return: Contributions must be made to qualified organizations to be deductible. You cannot deduct contributions made to specific individuals, political organizations and candidates. You cannot deduct the value of your time or services. Nor can you deduct the cost of raffles, bingo or other games of chance. If your contributions entitle you to merchandise, goods or services, including admission to a charity ball, banquet, theatrical performance or sporting event, you can deduct only the amount that exceeds the fair market value of the benefit received. Donations of stock or other property are usually valued at the fair market value of the property. Special rules app...

This piece was taken from the Heritage Blog @ AskHeritage.com The Angst about 0.1% but hey, lets tax them and get back our money. I mean its fair right? The top 5% of income earners pay only an approx 68.5% of all taxes so they can pay more taxes right? Lets single them out and tax them.......until its your turn....you decide..... This Saturday a bus filled with about 40 people [1] pulled into a cul-de-sac in Fairfield County, Connecticut where a pastor and a steelworker disembarked and made their way to the front door of one of the large homes in the neighborhood. The protestors did not make it to the door however, as they were met by a security guard working to protect the home’s owner: AIG executive Doug Poling. The identities of most current and former AIG employees remain private, for now, but for those executives whose names are known, life now includes security guards at their homes, reporters in their driveways, and vehicles invading their neighborhoods. Nobody was hurt and th...

Its unfortunate during this economic climate where every buck counts, we find unscrupulous maggots taking advantage of the business community. Business owners, If you are looking for grants to keep afloat or expand please conduct an extensive research. Come on Buddy if it sounds too good to be true, it most likely is. Simply by logging on to OFFICIAL Government websites, you can find official grants that are applicable to you. Here is a piece from Business.Gov....... If you have looked for a government grant for your business, it is very likely you have encountered several websites promising access to "free government grants that you don’t have to pay back" and testimonials from apparent business owners who received tens of thousands of dollars to start a business. Are these legit? No. They are scams. Here’s how they work: The company guarantees that you will get a small business grant or your money back. For a fee of $30 - $50 you get a subscription to a grants database...

A Sweet Deal for First-Time Homebuyers The ins-and-outs of the $8,000 First-Time Homebuyer Tax Credit If you are - like many Americans - trying to figure out the best time to make your first home purchase, then you may want to take a closer look at the first-time homebuyer tax credit included in the American Recovery and Reinvestment Act, which was signed into action by President Barack Obama on February 17, 2009. And don't be confused by the name. The credit included in this year's stimulus package is markedly different (read: better) than its predecessor from the 2008 package. So, what makes this tax credit different from the previous and just what exactly does it mean for you? We'll start off by highlighting the two main differences between the 2008 and the 2009 credit and then we'll really dive into the benefits of this credit to first-time homebuyers. KEY DIFFERENCES - 2008 vs. 2009 CREDIT Repayment Perhaps the biggest departure from the 2008 credit is that the 200...

Ten Things You May Not Know about Farm Income and Deductions If you are in the business of farming, here are some things you may want to know before filing your federal tax return. 1. Crop Insurance Proceeds You must include in income any crop insurance proceeds you receive as the result of crop damage. You generally include them in the year you receive them. 2. Sales Caused by Weather-Related Condition If you sell more livestock, including poultry, than you normally would in a year because of weather-related conditions, you may be able to choose to postpone reporting the gain from selling the additional animals until the next year. 3. Farm Income Averaging You may be able to average all or some of your current year's farm income and refiguring your tax over the three prior years. This may give you a lower tax if your current year income from farming is high, and your taxable income from one or more of the three prior years was low. 4. Deductible Farm Expenses The ordin...

Claiming a Deduction for Your Home Office Taxpayers who use a portion of their home for business purposes may be able to take a home office deduction if they meet certain requirements. In order to claim a business deduction, you must use part of your home for one of the following two reasons: 1. Exclusively and regularly as either: your principal place of business, or as a place to meet or deal with patients, clients or customers in the normal course of your business. Where there is a separate structure not attached to your home, the regular and exclusive use does not need to be your principal place of business as long as the use is in connection with your trade or business. 2. On a regular basis for certain storage use -- such as storing inventory or product samples -- as rental property, or as a home daycare facility. Generally, the amount you can deduct depends on the percentage of your home that you used for business. Your deduction for certain expenses will be limited if you...

As always the information presented on this blog can be found on the IRS website. Consult your Tax Professional or Attorney to discuss your situation. Revenue Procedure 2009-20 provides an optional safe harbor method for eligible taxpayers to deduct theft losses from criminally fraudulent investment arrangements that take the form of “Ponzi” schemes. The safe harbor method provides a uniform, simplified method for eligible taxpayers to determine the amount and timing of their theft loss deductions. Revenue Ruling 2009-09 addresses the tax treatment of losses from criminally fraudulent investment arrangements that take the form of “Ponzi” schemes. The ruling holds that the losses are theft losses and provides guidance on the character, timing, and amount of the loss deduction. Revenue Procedure 2009-20 and Revenue Ruling 2009-09 will be published in Internal Revenue Bulletin 2009-14 on April 6, 2009.

Top Ten facts about the Tuition and Fees Deduction The Tuition and Fees deduction of up to $4,000 is available to help parents and students pay for post-secondary education. Below are ten important facts about this deduction every student and parent should know. 1. You do not have to itemize to take the Tuition and Fees deduction. You claim a tuition and fees deduction by completing Form 8917 and submitting it with your Form 1040 or Form 1040A. 2. You may be able to claim qualified tuition and fees expenses as either an adjustment to income, a Hope or Lifetime Learning credit, or – if applicable – as a business expense. 3. You cannot take the tuition and fees deduction on your income tax return if your filing status is married filing separately. 4. You cannot take the deduction if you are claimed, or can be claimed, as a dependent on someone else's return. 5. The deduction is reduced or eliminated if your modified adjusted gross income exceeds certain limits, based o...

Additional Standard Deduction for Real Estate Taxes There is an additional standard deduction for those who don’t qualify to itemize their tax deductions, but who do pay state or local real estate taxes. This deduction is available for the 2008 and 2009 tax years. Here are six things you need to know about the additional standard deduction for real estate taxes: The additional deduction amount is equal to the amount of real estate taxes paid. The amount can be up to $500 for single filers or up to $1,000 for joint filers. The taxes must be imposed on you. You must have paid the taxes during your tax year. The taxes must be charged uniformly against all property in the jurisdiction and must be based on the assessed value. Many states and counties also impose local benefit taxes for improvements to property, such as assessments for streets, sidewalks and sewer lines. These taxes usually cannot be deducted. Real estate taxes paid on foreign or business property do not qualify for the incr...

Get Credit for Retirement Savings Contributions If you make eligible contributions to an employer-sponsored retirement plan or to an individual retirement arrangement, you may be able to take a tax credit. The Savers Credit, formally known as the Retirement Savings Contributions Credit, applies to individuals with a filing status and income of: Single with income up to $26,500 Head of Household with income up to $39,750 Married Filing Jointly, with incomes up to $53,000 To be eligible for the credit you must be at least age 18, not a full-time student, and cannot be claimed as a dependent on another person’s return. If you make eligible contributions to a qualified IRA, 401(k) and certain other retirement plans, you may be able to take a credit of up to $1,000 or up to $2,000 if filing jointly. The credit is a percentage of the qualifying contribution amount, with the highest rate for taxpayers with the least income. When figuring this credit, you generally must subtract the amount of ...

Five Tips to Avoid Tax Time Stress Are you looking for ways to avoid the last-minute rush for doing your taxes? Here are some stress-relieving tips to help you. Don’t Procrastinate – Resist the temptation to put off your taxes until the very last minute. Your haste to meet the filing deadline may cause you to overlook potential sources of tax savings and will likely increase your risk of making an error. Visit the IRS Online – In 2008, there were more than 330 million visits to IRS.gov . Anyone with Internet access can find tax law information and answers to frequently asked tax questions. File Your Return Electronically – Nearly 90 million taxpayers filed their returns electronically in 2008. Aside from ease of filing, IRS e-file is the fastest and most accurate way to file a tax return. If you’re due a refund, the waiting time for e-filers is half that of paper filers. Don’t Panic if You Can’t Pay – If you cannot pay the full amount of taxes you owe by the April deadline, you should ...

March 11, 2009 TG-53 Prepared Statement by Treasury Secretary Tim Geithner in Advance of G-20 Finance Ministers and Central Bank Governors Meeting Washington, DC-- This week, the G-20 will meet in London amid a severe global economic downtown and ongoing stress in the world's financial markets. This is a global crisis which calls for a global response. The G-20 Finance Ministers have two agenda items for that global response: how to ensure recovery and restart growth, and how to reform and coordinate the international regulatory and supervisory system to ensure that no such crisis occurs again. The global recession is deepening. The International Monetary Fund (IMF) has estimated that the global economy is likely to contract by 0.5 percent in 2009. Unemployment is rising and world trade is likely to decline by at least 3 percent and probably more in 2009. Last week's jobs report showed that unemployment in the United States rose to 8.1 percent in February. In the fourth quarter...

Standard or Itemized Deductions Whether to itemize deductions on your tax return depends on how much you spent on certain expenses last year. Money paid for medical care, mortgage interest, taxes, charitable contributions, casualty losses and miscellaneous deductions can reduce your taxes. If the total amount spent on those categories is more than the standard deduction, you can usually benefit by itemizing. The standard deduction amounts are based on your filing status and are subject to inflation adjustments each year. For 2008, they are: Single $5,450 Married Filing Jointly $10,900 Head of Household $8,000 Married Filing Separately $5,450 * Some taxpayers have different standard deductions. The standard deduction amount depends on your filing status, whether you are 65 or older or blind, whether an exemption can be claimed for you by another taxpayer, whether you plan to claim the additional standard deduction for state and local real estate taxes, and whether you have a ...

If your mortgage debt is partly or entirely forgiven during tax years 2007 – 2012, you may be able to claim special tax relief and exclude the debt forgiveness income. Normally, debt forgiveness results in taxable income. However, under the Mortgage Forgiveness Debt Relief Act of 2007, you may be able to exclude up to $2 million of debt forgiven on your principal residence. The limit is $1 million for a married person filing a separate return. Taxpayers may exclude debt reduced through mortgage restructuring, as well as mortgage debt forgiven in a foreclosure. To qualify, the debt must have been used to buy, build or substantially improve your principal residence and be secured by that residence. Refinanced debt proceeds used for the purpose of substantially improving your principal residence also qualify for the exclusion. However, proceeds of refinanced debt used for other purposes (for example, to pay off credit card debt) do not qualify for the exclusion. If you qualify, you claim ...

Five Important Tax Credits Check it out! You might be eligible for a tax credit. A tax credit is a dollar-for-dollar reduction of taxes owed. Some credits are even refundable. That means you might receive a refund rather than owe any taxes. Here are five popular credits you should consider before filing your 2008 Federal Income Tax Return: 1. The Earned Income Tax Credit is a refundable credit for low-income working individuals and families. Income and family size determine the amount of the credit. For more information, see IRS Publication 596, Earned Income Credit. 2. The Child and Dependent Care Credit is for expenses paid for the care of your qualifying children under age 13, or for a disabled spouse or dependent, to enable you to work or look for work. For more information, see IRS Publication 503, Child and Dependent Care Expenses. 3. The Child Tax Credit is for people who have a qualifying child. The maximum amount of the credit is $1,000 for each qualifying child. This credit...

Contact me VIA Email Tony@lapinvest.com for time, date, and location when we do free income tax assistance under the IRS VITA program. Also you can visit www.lapinvest.com Our CFO Tony Patterson is a VITA IRS volunteer Free Volunteer Income Tax Assistance Need help filing your tax return? If so, then you should look into the free, IRS-sponsored, volunteer tax return preparation programs. Trained community volunteers can help eligible taxpayers with all special credits, such as the Child Tax Credit or the Credit for the Elderly. Also, many sites have language specialists to assist people with limited English skills. Nearly 12,000 free tax preparation sites will be open nationwide this year as the Internal Revenue Service continues to expand its partnerships with nonprofit and community organizations performing vital tax preparation services for low-income and elderly taxpayers. The IRS Volunteer Income Tax Assistance Program offers free tax help to people who earn less than $42,000. Th...

IRS Has $1.3 Billion for People Who Have Not Filed a 2005 Tax Return WASHINGTON — Unclaimed refunds totaling approximately $1.3 billion are awaiting over a million people who did not file a federal income tax return for 2005, the Internal Revenue Service announced today. However, to collect the money, a return for 2005 must be filed with the IRS no later than Tuesday, April 15, 2009. Especially in these tough economic times, people should not lose out on money that is rightfully theirs," said IRS Commissioner Doug Shulman. “People should check their records, especially if they had taxes withheld from their paychecks but were not required to file a tax return. They may be leaving money on the table, including valuable tax credits that can mean even more money in their pockets." The IRS estimates that half of those who could claim refunds for tax year 2005 would receive more than $581. Some individuals may not have filed because they had too little income to require filing a t...