The IRS Audit Blog

Archive for October, 2006

Question: If I claim 1 withholding allowance on my W-4, will I owe the IRS?

I am a single male, living in Michigan. I am not claimed as anyone else’s dependant. I make $66K per year. I own a home (not sure if this matters) via a mortgage.

I just took a new job and am filling out my W4 forms. After completing the worksheet, it appears I can claim up to 2 dependants/witholding allowances. However, I would rather be sure that all of my taxes are paid at the end of the year than get more $ per paycheck.

So, if I claim 1 dependant (myself) instead of 2, will I be in the clear at the end of the year with the IRS? I’m not concerned with getting a giant return. My biggest fear is owing at the end of the year.

Can someone help? If i need to post more information I would be happy to; just let me know what you need to know. Thanks!

Answer: it is impossible for anyone to tell you one way or another without all the information.

Claiming two, will make sure you have more money per month, but can have an adverse effect of your year end taxes. The effect usually isn’t a whole lot more then a few hundred dollars, but I would suggest that you claim one.

The other is that if you own your own home, you should be itemizing on your tax return, which helps with reducing your taxable income. 66k puts you in the 25% tax bracket.

Your taxes are determined from your (taxable income X tax bracket) – taxes paid = refund/return

Tax filing deadline looms

Tax consultants put in overtime as the filing deadline gets closer.

Tax Help : How to Fill Out W-4 Forms Correctly

Question: Will we be able able to claim my kids?

My fiance claimed my 2 kids and me on the 2005 income tax return
and IRS audited him and we did not have enough evidence that shows he
lives with me and maintains my kids finacially well we have to pay back
more than $5,000, he made a payment plan and is paying up to date. Now
we’re getting married this month and I know we can file joint returns
because now we’re gonna be married, now about the kids I’m not sure he
can claim them and I didn’t work these past 2 years( my son was
diagnosed autistic and had to drop everything to take care and look for
programs and help) What should we do for this year, everything is in my name
but as soon as we get married we’re gonna change all the bills and lease
in our name. How should we do this tax year so we don’t get in trouble
for just not knowing.

Answer: One of the main requirements to claiming dependents is meeting the relationship test.
If & when you get married just be sure to obtain a county marriage certificate and claim the filing status of married & most of IRS’ concerns will go away since your fiance will now be legally related to you as your husband and therefore your kids as well. Just be sure no one else besides the 2 of you tries to claim your kids.
Also, If you change your last name after marriage do not use it on your tax return until soc sec admin changes it on your soc sec card.

News Around Town

First Friday ML plans Foodapalooza Feb. 5

Question: Where can I obtain an ‘07 1099 form? The IRS website lists too many options!?

Answer: Go to your local IRS office. The link below will get you to the one that’s closest to you. Click on your State.

UNITED WAY OF ATLANTIC COUNTY LAUNCHES TAX SEASON CAMPAIGN

GALLOWAY — United Way of Atlantic County today launched its 2010 Earned Income Tax Credit (EITC) Campaign to assist thousands of working families in the county to maximize their tax refunds by utilizing the EITC. The campaign targets households with less than $48,000 in income who may qualify for the Earned Income Tax Credit, a tax supplement which can add up to $5,657 to their tax refund.

Tax Help : 1099-MISC Guidelines

Question: When can i start tracking my tax refund on “wheres my refund”?

I know it takes 6-8 weeks to receive my check in the mail…

But, how long til I could track it on the irs.gov website (wheresmyrefund)…?

i sent out my paper mailed refund forms on FEBUARY 8th….
don’t u think it would have arrived at the Irs building by now?…

how long would you guestimate it would take until someone physically opens my letter and adds my refund to the database(im guessing 3 weeks)..

i just want to know, because sometimes i get feelings that my letter was lost in the mail arrrghhhh lol…i just need this money now!!! lol’

thanx

Answer: For electric filing it usually takes about 2 weeks for them to recognize your return on “where’s my refund”. If you filed it the traditional way I would wait at least 3-4 weeks. Like the above answerer said, they are processing electronic filings first, so yours may take a little longer.

IRS to start regulating tax preparers

WASHINGTON (AP) — The Internal Revenue Service plans to start regulating paid tax preparers, requiring them to register with the government, pass competency tests and adhere to ethical standards.

Track Your Trades — generate IRS Schedule D for your tax return

Question: Are you aware of SB-2099…..?

Proposed, subtle changes to IRS tax law requiring all gun owners to pay a tax for each gun owned and be fingerprinted? It ties directly to HR 45, a new 2009 licensing act.

Is it a way to squeeze the Bill of Rights?

Answer: This really has taken on a life of it’s own. Obama is an arrogant and inept POTUS, but the man has unsurpassed knowledge of the Constitution and he KNOWS any attempt at compromising the Second Amendment Right to Bear Arms, would be met by the public aggressively. Make NO mistake…………..Obama WANTS serious gun controls and here’s HOW he will achieve them.
Obama “authorized” an independent study ( yeah, sure !!! ) to determine IF “owning guns are a hazard to the owners health”. With this “proven” study in hand, Obama will place GUN ownership UNDER the EPA ( his little Gestapo agency ). “They” not the IRS, will IMPOSE strict RULES and incredible TAXES on owning a weapon ( This might even fall under the Health Care Bill, since they want to penalize “people” who live “hazardously” ). The costs will go so HIGH the average citizen won’t be able to afford the purchase. End Result: GUN CONTROL.

Ten Benefits of Expatriation

Everybody has their own personal reasons for expatriating, but here are some of the benefits:

NH: Fed convoy whisks Browns from court (IRS, taxes)