The IRS Audit Blog

Posts Tagged ‘rules’

Question: my wife and I have an IRS lien listed, will it affect our tax return?

The IRS has put a hold on the collection process due to financial hardship, will that affect us also??

Answer: You’ll need to call them. Normally an IRS lien means they keep the tax retrun.

Briefs – Feb. 18

Senior Meal every third Sunday at Clarinda Regional Health Center

Whip Up on the IRS by Scouting Them First both Inside & Out!

Question: my husband turned 70 1/2 this year, he has an IRA cd he has been taking the interest from and it covers the?

RMD for IRS rules ( this year he gets a government break ) for 2010 and the future BUT the cd matures next year, how does he handle the princable in the IRA, can it be taken all out and placed wherever he wants etc ?? does it have to stay in the same bank it is in now etc ?? does the government still have “control” over what he does with it now that he is ” of age” THANKS in advance.

Answer: First, look at the amount of money he’s got. If he took it all at once, what would the tax bill look like? If he took it over the next 5 years, what would the tax bill look like? (Remember, this is income that can make his SSA benefits taxable.) What if he took out over the RMD estimated life expectancy?

If he can take the money slowly and not pay any tax, I’d go for that. If he will always be paying tax and is in the 10% tax bracket, I’d probably consider taking as much as it takes to max out the 10% bracket each year (and then not spend it all).

As for the account, the IRA is the account holder. The IRA can be held as cash, in a CD, in stocks, in bonds, etc.

You are correct that a CD may or may not be the best choice at this point. Depending on the amount of money involved, you can buy multiple CDs, each with different maturities–but realize that you have to take out the RMD each year (the 50% penalty is nasty!).

If the bank that has the CD isn’t willing to do let him keep the money they way he wants, call around to, say, Fidelity, Schwab, Morgan Stanley, etc. All of those will let him open an IRA, will do the trustee to trustee rollover, etc. (But watch the fees!)

Wealthier Investors Get Do-Over With Roth IRA Rules (Correct)

(Corrects IRA charitable donation expiration in 16th paragraph.) Jan. 28 (Bloomberg) — U.S. investors who convert a traditional Individual Retirement Account into two or more Roth accounts to make a bet on the market rising can save on taxes if it doesn’t.

Investment Advice : IRA Rules for Investing

Question: Where does a taxpayer in Pocatello,Idaho file their return? Sioux Falls,South Dakota-where file tax return?

Where does an individual taxpayer who resides in Pocatello Idaho file a return and where does an individual taxpayer living in Sioux Falls South Dakota file a return?

What type of a tax return does a LLC (limited liability corporation) file? If I am self employed, what publication is available on the IRS website to help me with my issues?

Answer: “Where does an individual taxpayer who resides in Pocatello Idaho file a return”

with Idaho State Tax Commission:

http://tax.idaho.gov/

“where does an individual taxpayer living in Sioux Falls South Dakota file a return?”

with South Dakota Department of Revenue & Regulation:

http://www.state.sd.us/drr

“What type of a tax return does a LLC (limited liability corporation) file?”

Sounds like you are single member LLC so your business income/expenses on the federal side would be filed with your individual return (Schedule C). Check with your state, as they may follow federal, or has its own regulations.

“If I am self employed, what publication is available on the IRS website to help me with my issues?”

http://www.irs.gov/businesses/small/index.html

Hopi Tribal Council’s new structure irks some critics

KYKOTSMOVI, Ariz. – Following recent elections, the Hopi Tribal Council’s official position is one of can-do optimism, fueled by a reorganization that elevates the status of a tribal council-controlled manager and diminishes the clout of the tribal chairman.

Pounder: Accounting Is Not a Spectator Sport

Avoid common mistakes when changing to a Roth IRA

As years go, 2010 is on course to be a blockbuster for retirement-account owners. Starting in January, all Americans who own a traditional IRA — not just those who have modified adjusted gross income under $100,000 — will be able…

Atlanta IRA|401k Rollover Retirement Plan is I.O.U for the IRS!

Question: IRS rules about withdrawals from a regular IRA?

How much do you have to withdrawal from your IRA after you reach 70 and 1/2? Or how little can you withdrawal from your IRA after 70 and 1/2?

Answer: You have several options. The right one depends on whether or not the IRA is needed for retirement income. If the IRA is going to sit “for a rainy day”, then there is a mathmatical formula that calculates your Required Minimum Distribution (RMD). This is the minimum amount that Uncle Sam says has to be liquidated yearly. Its his little way of making sure that you remember that he gave you tax-deferral for years, and now he is wanting to collect his taxes. As the balance on the IRA grows, so does the amount that must be liquidated. Talk to your financial advisor or insurance professional about purchasing a Lifetime Income Annuity that will not only satisfy the RMD, but will guarantee a stream of income as long as the IRA owner lives. Otherwise, its time to annuitize the IRA to create income, either with a period certain or lifetime income.

New Roth IRA rules may lower tax bill

The new Roth IRA rules may be one of the few tax changes that provide a win-win opportunity for both investors and the government.

Protect Your IRA & 401k From the IRS!!!! * Workshop*