The IRS Audit Blog

Archive for March, 2009

Question: We now have to itemize our NY refund on IRS return . How can we decrease the NY refund to pay less fed tax?

Each year we get about $500 back from NYS. Starting two years ago we have itemized, so we have to declare the refund amount as income and get taxed on it by the IRS. We were told it is illegal to increase our withholdings from our present correct 2. Our taxes are pretty easy since all we own is a co-op. My job claims they are deducting the right taxes. It seems somehow the IRS is penalizing us for overpaying our NYS taxes. Is this just the way it is?

Answer: It won’t make any difference if you reduce your withholdings. You’d have a smaller itemized deduction this year and a smaller refund to claim as taxable next year. The differences would cancel each other out.

Whoever told you it was illegal to change your withholdings is simply WRONG. You have every right to do so as long as you pay in enough to cover your tax liability. Feel free to adjust your withholdings enough to reduce the size of your refund. Just bear in mind that the whole thing with the taxability of the refund is a wash. Your total tax liability year in and year out will not change because of this.

Peppini.com – #17 Student Loan Took All My Tax Refund

Question: Is there a certain amount of time the IRS has to review past tax returns?

I don’t mean an audit really, but if a 1099 is forgotten on a tax return, is there a statue of limitations or anything for the IRS to do anything about that?
I am not sure what kind of 1099 it is but its for a DJ job my husband did in 2006 and it amounts to about $6000 dollars.

Answer: Usually they are on a 3 year cycle. After 3 years you are usually safe. Technically, they can check 7 years back. If they find evidence of fraud, the limit is extended .

UPDATE: Sen Dodd Faces Tough Choices To Pass Financial Overhaul

(Adds details and comments on consumer financial protection agency.)

mission life intro

Question: Are Lions Club donations deductible as charitable contributions on the federal tax return?

I am a Lions Club member and wondered if the money I spend on dues and auto are considered charitable contributions per IRS rules? Is Lions a 501(c)3 organization? Please give reference. Thanks.

Answer: No, your dues are not deductible as a charitable contribution. Any donations that you make above and beyond the annual dues ARE deductible, however.

Secretary Kemp Warns Consumers about Potential Scams Following the Recent Disaster in Haiti

Secretary Kemp issues tips for charitable giving to victims of the Haitian earthquake.

IRS TAX TIPS: Charitable Contributions (ASL, CAPTIONS, & AUDIO)

New forms help people check out charities

The New IRS Form 990 means more disclosures from nonprofits and more information available to their potential donors.

made by Ashley, to cheer me upp 0.o

First Campbell Center Raffle Drawing Winner Donates Prize

Campbell Center Board members announced that Seth Crippen’s ticket was drawn Saturday, August 14, 2010 at the Campbell Center Board’s monthly meeting. The raffle is a fundraiser to help pay for damage that occurred last winter to the Center’s campus water pipe system.

Alex Jones Tv {Sunday Edition} 6/8:Pelosi “Buy a $15,000 Policy or Go to Jail”