IRS Issues Final Call to Renew EA Status and More!

NSTPInternal Revenue Service (IRS)

Enrolled Agents with Social Security numbers ending in 7, 8 or 9, or those without a Social Security number and who have not timely renewed their enrollment status, need to do so as soon as possible: The IRS will soon begin moving these EAs to inactive or terminated status. Next month, the IRS will begin sending letters to EAs whose enrollment status is being inactivated or terminated because of failure to renew. EAs with SSNs ending in 7, 8 or 9, or without an SSN, who did not renew for the 2015 cycle will have their enrollment placed in inactive status. EAs with SSNs ending in 7, 8 or 9, or without an SSN, who have not renewed for the previous two cycles will have their enrollment placed in terminated status. If you have questions about your enrollment status, e-mail the Enrolled Agent Policy and Management mailbox at epp@irs.gov. Report changes in circumstances that could affect your 2015 Premium Tax Credit: If you have enrolled for health coverage through the Health Insurance Marketplace and receive advance payments of the premium tax credit in 2015, it is important that you report changes in circumstances, such as changes in your income or … Read More

10 Tips to Help You Stay Married to a Tax Professional

NSTPTax Professionals

Article originally written by Kelly Phillips Erb The fabulous Jeena Cho recently wrote a piece for The Lawyerist entitled “How To Stay Married To A Lawyer.” She made a number of good points, not the least of which is that your spouse’s profession can have a significant impact on your relationship: not all jobs are created equal. It got me thinking and, with a little nod and a wink to her (and the understanding that she’s much more zen and much less snarky than me), I offer you 10 tips to help you stay married to a tax professional: Don’t ask why the client didn’t get that information to us sooner. Because the answer will always be the same, “because they didn’t.” I know that it drives you crazy that as we creep closer to tax filing deadlines, the work seems to pile on and get bigger, not smaller. It’s the nature of the beast. No matter how many times we tell clients that we need all of their data by a certain deadline, you can be sure that something will get left out. Every year. Remarking that it shouldn’t happen won’t make it not happen (yes, a double negative). … Read More

Taxpayers with Foreign Assets may have U.S. Tax Filing Requirements

NSTPInternal Revenue Service (IRS), Tax Professionals, Tax Refund, Taxpayer

The IRS has reminded U.S. citizens and resident aliens, including those with dual citizenship who have lived or worked abroad during all or part of 2014, that they may have a U.S. tax liability and a filing requirement in 2015. Most People Abroad Need to File A filing requirement generally applies even if a taxpayer qualifies for tax benefits, such as the foreign earned income exclusion or the foreign tax credit , that substantially reduce or eliminate their U.S. tax liability. These tax benefits are not automatic and are only available if an eligible taxpayer files a U.S. income tax return. The filing deadline is Monday, June 15, 2015, for U.S. citizens and resident aliens whose tax home and abode are outside the United States and Puerto Rico, and for those serving in the military outside the U.S. and Puerto Rico, on the regular due date of their tax return. To use this automatic two-month extension, taxpayers must attach a statement to their return explaining which of these two situations applies. See U.S. Citizens and Resident Aliens Abroad for details. Nonresident aliens who received income from U.S. sources in 2014 also must determine whether they have a U.S. tax obligation. … Read More

Issuing Form 1099-C for Non-payment Of Client Fees

NSTPInternal Revenue Service (IRS), Tax Professionals, Tax Refund, Taxpayer

In the February 5, 2015, bulletin from the Office of Professional Responsibility (OPR) they answered questions from tax practitioners regarding the use of Form 1099-C to report unpaid tax preparation billings. “What are the Circular 230 implications, if any, for a Tax Professional who, as an alternative to pursuing collection of an earned fee from a client, files with the IRS a Form 1099-C, Cancellation of Debt, reporting the amount of the client’s unpaid bill as a discharged debt? “My firm and I want to use Forms 1099-C, as a collection technique with delinquent/ nonpaying clients. I am a tax professional subject to Circular 230. I own and operate a small firm that provides various tax representation services for compensation. My firm usually enters into a written fee agreement with a client for the services agreed upon. For most clients, the firm does not require a retainer or the payment of fees in advance. The firm generally bills clients for the services after the fact, requesting payment within 30 days. Invoices unpaid after 30 days are considered delinquent and treated as subject to collection regardless of whether the client disputes the liability. “We periodically write-off balance-due amounts as uncollectible based … Read More

Identity Theft Victims Waiting for Refunds:

NSTPIdentity Theft, Tax Refund

A recent TIGTA report found that on average, the IRS took 278 days to resolve the tax accounts of identity theft victims due a refund, according to TIGTA’s review of a statistically valid sample of 100 identity theft tax accounts resolved in the Accounts Management function in fiscal year 2013. That represents an improvement, however, compared to the average 312 days it took the IRS to resolve tax accounts of identity theft victims due a refund in FY 2012. TIGTA also continues to find that the information the IRS reports related to the time period for case processing and resolution is misleading. For example, the IRS informs taxpayers who inquire about the status of their identity theft case that cases are resolved within 180 days. TIGTA made the following recommendations: Analyze identity theft case reassignments and revise inventory management processes to reduce case reassignments. Develop a comprehensive identity theft training course to ensure that assistors are capable of handling complex cases. Develop processes and procedures to ensure that case closing actions and adjustments are accurate. Develop processes and procedures to calculate the average time it takes to fully resolve taxpayer accounts affected by identity theft. Develop processes and procedures to accurately … Read More

Penalty Relief Related to Advance Payments of the Premium Tax Credit for 2014 (Clarified)

NSTPTax Professionals

See link: NOTICE 2015-9 The IRS recently provided additional clarification regarding the penalty relief for taxpayers with a balance due on their 2014 individual income tax return, due in or part or whole, by the repayment of the advanced Premium Tax Credit. If a taxpayer has a balance due on their return of which any amount is attributable to the repayment of the advanced PTC, the entire balance due can be relieved of the §6654 penalty for underpayment of estimated tax. Pursuant to this Notice, the Service will abate the §6651(a)(2) penalty for taxable year 2014 for taxpayers who (i) are otherwise current with their filing and payment obligations; (ii) have a balance due for the 2014 taxable year due to excess advance payments of the premium tax credit; and (iii) report the amount of excess advance credit payments on their 2014 tax return timely filed, including extensions (Line 46 of Form 1040 or Line 29 of Form 1040A). Further, the Service will waive the §6654 penalty for taxable year 2014 for an underpayment of estimated tax for taxpayers who have an underpayment attributable to excess advance credit payments if the taxpayers (i) are otherwise current with their filing and … Read More