Unlike in an employer-employee relationship where the employer withholds taxes from the employee’s paycheck and forwards it to the IRS, independent contractors are required to determine taxes on their own and pay them. Many times, independent contractors are not aware that they are in tax debt until they receive an IRS notice/letter regarding it. Since…
It is not always that taxpayers get into tax debt because they do not pay their full tax liability. Sometimes, claiming false tax credits can cause a tax debt. Though credits reduce the overall tax liability of a taxpayer, each credit has qualifying criteria that need to be met. Claiming false credits on a return…
The IRS’ Criminal Investigation (CI) has been asked to provide expertise and intelligence in order to assist efforts to enforce sanctions on Russia. The IRS will be working alongside other law enforcement agencies in order to investigate cybercriminals, Russian oligarchs and those who facilitate illegal movement of money/assets on their behalf. “CI has been called…
The IRS made an announcement in February this year that the interest the agency charges on tax debt will increase beginning April 1, 2022. This directly impacts taxpayers that pay less than what they owe in taxes this tax season, as they will be paying more in back taxes. Along with an increase in interest…
Tax scammers are not limited to anonymous entities operating from far. Many times, they can be somebody you hire the services of, such as a return preparer, owner of a company, or in this case, the founder of a tax return preparation service. Instant Tax Service Scam Fessum Ogbazion of Cincinnati was the founder of…
Payment platforms such as Venmo, PayPal, CashApp etc. are legally required to report certain financial transactions to the IRS and taxpayers. If financial transactions using a third party payment network exceeds a certain limit, the payer and the receiver of the pay may receive Form 1099-K. What is Form 1099-K? Form 1099-K, Payment Card…
Many people assume that the taxes in the U.S. are more severe than in other developed countries. However, facts prove that the US has a much more relaxed tax system, and a tax scale that is far lower than most European countries. The Tax Foundation, a leading independent tax policy nonprofit in the US, carried…
The tax season began on January 24th, 2022, 17 days earlier than last year. This tax season will be especially challenging for both the IRS and taxpayers due to the pandemic. Though the IRS said that it had been making preparations for the 2022 tax season for months, there could be processing delays. In order…
Non-fungible token (NFT) is a unique digital asset that can be sold or traded. An NFT is recorded, stored, and transferred on a blockchain, which is a kind of digital ledger, and can be purchased or sold using cryptocurrency or legal tender currency such as the U.S. dollar. In NFT, the term ‘non-fungible’ means…
California is considering increasing its taxes by $12,250 per household. This would double the taxes currently being paid by taxpayers whose income source is in California. The proposal to increase taxes is made to fund a single-payer healthcare system and healthcare cost control system. In California, both residents and non-residents are required to pay…
