All Articles Tagged "taxes"
As you begin to keep your eyes peeled for your tax refund from Uncle Sam, you should cross your fingers you never get a letter from them indicating something is wrong. Sometimes we forget to carry the two or accidentally put the wrong number on the wrong line. Regardless of the reason, no one enjoys being a part of a tax audit investigation. Should they contact you, here are some do’s and don’ts on how to deal.
Do you have to pay fees for a rushed refund? Are there deductions you’re missing out on? And should you have your taxes professionally prepared at all? Read on to find out important money-saving secrets tax preparers won’t tell you.
A security scare that TurboTax described as “an increase in suspicious filings” prompted the service to shut down a portion of its services last week. Customers can now use its software to e-file state tax returns across the USA once again.
According to the tax preparation software company, it found that stolen personal data was being used to file phony state returns with state authorities. In response, TurboTax turned off the filing feature for almost a day to stop fraudsters from proceeding any potential fraud, reports USA Today.
“We are taking this issue very seriously and from the moment it emerged it has been all-hands-on-deck,” says Brad Smith, CEO of TurboTax publisher Intuit. “I am more than pleased we were able to resume transmission for our customers within about 24 hours.”
The situation came to light after the Minnesota’s Department of Revenue announced it will no longer accept tax filings submitted via TurboTax after two taxpayers in the state logged into TurboTax to submit their tax forms but were informed filings had already been made, reports the StarTribune.
When TurboTax conducted an internal investigation it found that it did not have a security breaches of their; the criminals had gotten the personal information from somewhere else.
If you have done an e-filing with Turbo Tax for their state returns, they should have any problems, according to the company. TurboTax will retransmit the again when they solve the security issue.
Federal tax returns were not affected and those services were never halted.
It hasn’t been an easy past few months for TurboTax.
Users of the software have been complaining about a hidden price increase which caused many investors and self-employed people to pay 50 percent more for the software. So the company suggests that anyone who purchases the less expensive Deluxe version to upgrade to the Premier or Home & Business version for free.
Solange may have been able to laugh off her tax lien misunderstanding. But Solange isn’t the only celebrity the IRS has been after recently. Uncle Sam has been cleaning serious house. And these celebrities have found themselves seriously in debt.
Customers definitely aren’t having it their way over at Burger King. In fact, fans of the fast food chain are upset that the U.S.-based company may be packing up and heading to Canada.
It’s all part of a plan by BK to avoid U.S. taxes through a merger deal with Canadian coffee and doughnut chain Tim Hortons. The new company would be headquartered across the border and BK would save a ton of money in taxes. “The corporate tax rate in the U.S. is 35 percent, the highest in the world. Canada’s is about 15 percent,” reports The Huffington Post. This process of American companies buying smaller international firms and relocating is called a “tax inversion” and is more than frowned upon by the U.S. government as even President Obama recently vowed to stop tax inversions. Burger King would still pay U.S. taxes on domestic sales.
People are taking to BK’s Facebook page to voice their outrage and have even threatened a boycott. “Thousands of Burger King’s seven-million-plus Facebook fans have described the fast-food restaurant with words like ‘traitor’ and ‘un-American’,” reports Business Insider.
Buying Tim Hortons will also help BK compete with rivals McDonald’s and Taco Bell in the fast-food war over breakfast.
But a boycott could stop the BK-TimHortons merger. When consumers vowed to boycott Walgreen recently, the chain axed its plan to re-incorporate in low-tax Switzerland. More than 300,000 signed a petition to boycott the chain. The same pressure is being planned for BK. According to Roger Hickey, the co-director of the Campaign for America’s Future, which spearheaded the Walgreen petition, the group will launch a similar public plea within the next few days.
There is another petition being organized on. And leftist Occupy Democrats group is calling for a boycott as well. Politicians have even gotten into the act. Sen. Sherrod Brown (D-Ohio) has urged customers to eat at Wendy’s or White Castle and to skip Burger King.
“Burger King’s decision to abandon the United States means consumers should turn to Wendy’s Old Fashioned Hamburgers or White Castle sliders,” the Ohio Democrat said in a statement. “Burger King has always said ‘Have it Your Way’; well my way is to support two Ohio companies that haven’t abandoned their country or customers.”
Shareholders however seem to like the relocation idea. The company’s stock price jumped nearly 20 percent to $32.40 on Monday.
Last month, we reported the state of California placed Brian McKnight on the Top 500 Delinquent Tax Payer list. Prior to this, McKnight sued his accounting firm, Vernon Brown and Company because he believed their actions — or inaction — ruined his credit. Today, The Jasmine Brand in an exclusive update, reports Brian McKnight’s legal woes are over.
McKnight claimed he worked with Vernon Brown and Company for several years but their relationship ended in 2010 when he realized his finances were in bad shape. He says his taxes hadn’t been paid in a decade, which lead to penalties, a lien on his home, a suspended driver’s license and frozen royalties. The accounting company reported the “Anytime” singer was solely responsible for his finances. They also stated that the company tried to help McKnight out of his financial rut, but he was in a predicament before he hired them.
With this behind him, maybe we’ll get some new music. Let’s just hope there’s no more of this.
Earlier this year, we reported R&B crooner Brian McKnight sued Vernon Brown and Company, an accounting firm for allegedly ruining his credit. Today, the “Back At One” singer opens up about his $1 million dollar debt. While interviewing with Huffington Post Live, McKnight shared the risks he took by having other people manage his finances.
“When you have business managers, when you have folks managing your money, it’s very important that you know where every single penny of yours, not just the dollars, is going. And that those people are doing their diligence to make sure that you’re on time with the things that you need to be on time with. Because we basically all work just to pay taxes, let’s be real about that. Practically in my tax bracket. And when those things lapse, there can be some bad things that happen.”
Despite his remorse for his financial woes, McKnight landed on California’s Top 500 Delinquent Taxpayers list.
Watch more of McKnight’s segment on HuffPo and learn more about the singer’s upcoming album, below!
If you haven’t by now, please read Ta-neshi Coates’ phenomenon piece entitled The Case for Reparations, on why it is a scam that black people in America pay taxes.
In fact, go read the article first and then come back and read this because seriously without the context, this entire conversation will likely confuse you. And I am not saying this to be snarky. But rather acknowledging the depth of information and valuable perspective, which is covered within this 17 page cover story.
I know this sort of dedication might be too much for the TL, DR clan (okay that was a bit of snark), so I will try to capture the gist as best I can: basically Coates wants us to consider Mr. Clyde Ross of Chicago, whose lifetime of enduring systemic racism and discrimination policies, specifically as it relates to housing, has left him and his family as permanent second class citizens, unable to build wealth. And worse, many of these discrimination practices were co-signed by the government including redlining, and the denial of low-interest home loans through the government sponsored G.I. Bill (which ultimately led blacks to seek out homeownership through predatory lenders), the state-sanctioned air-bombing of “Black Wall Street” in Tulsa, Oklahoma and the denial of blacks into the newly formed suburbs, etc…
He also goes to great strides to dispel myths that the failures of our communities in America are due to African Americans not trying hard enough, being lazy and criminal or lacking moral integrity. In one of the more compelling passages, he writes:
“From the White House on down, the myth holds that fatherhood is the great antidote to all that ails black people. But Billy Brooks Jr. had a father. Trayvon Martin had a father. Jordan Davis had a father. Adhering to middle-class norms has never shielded black people from plunder. Adhering to middle-class norms is what made Ethel Weatherspoon a lucrative target for rapacious speculators. Contract sellers did not target the very poor. They targeted black people who had worked hard enough to save a down payment and dreamed of the emblem of American citizenship—homeownership. It was not a tangle of pathology that put a target on Clyde Ross’s back. It was not a culture of poverty that singled out Mattie Lewis for “the thrill of the chase and the kill.” Some black people always will be twice as good. But they generally find white predation to be thrice as fast.”
I should preface my thoughts by noting that this is not the definite case for reparations; just a really good one. As someone, who has been championing the cause of reparations for a while (And by that I mean I made a White House.gov petition on the issue not too long ago, but nobody gave a damn so…), I feel like this is our only grievance politically. Not high crime or low graduation rates. Not single mothers or deadbeat dads. Not littering in Harlem, rolled eyes or sagging pants. Not unemployment, underemployment and not have the right job skill training. All of those issues, as far as I see it, are only symptoms to the largely issue of black subjugation in this country – if they are issues at all. Sometimes what we perceive as “issues” are just diversions to derail the conversation we need to be having: and that is how America plans on really addressing past and current injustices against black people.
However it would appear that even among us black folks, there is an inability to even consider the possibilities And I mostly get it: “what’s the point? It’s not going to happen anyway. Plus what does reparations look like and how will it be paid anyway? And to whom are we to pay considering there is no way to know who is descendant from slavery?” These are just some of questions, which have come up lots in the last few days since the article was published. Although I believe these questions to be defeatist, I do believe they are legitimate. And while there are more studied and brilliant minds around, I would like to take a stab at answering them.
What should reparations looks like?
Good question. Here is one of my ideas: Black people should not have to pay taxes. No income taxes. No sales taxes. No wage taxes. No business privilege taxes. No property taxes. No gas or utility taxes. No Exise taxes. No telecommunication taxes. Not a single iota of money, which is collected by the United States government should come from the pockets of black people. It is just unconscionable at this point to ask people, who are descendants of slaves to foot the bill for any maintenance of this country. And the way I see it, the lack of tax burden will provide incentive and space enough for black folks to acquire and more importantly maintain wealth in this country. It certainly would serve as an incentive for global corporations to seek out partnerships with black owned businesses, who too would benefit from not having to be held down by a whole bunch of business-related taxes
This is an important point considering many black folks, with newly acquired wealth find themselves indebted to the government for failure to pay taxes including Lauryn Hill and Wesley Snipes, who both went to prison for failure to pay back taxes. So did Ron Isley too. And then there was Lil Kim, Nas, Kelis, Chris Tucker, Toni Braxton, Doug E. Fresh, Lil’ Jon…the list is honestly way too long to just be a coincidence. And according to at least one study, targeting blacks in particular is actually quite common.
So are you saying that white people (and other non-blacks) should take care of black people?
No. I’m saying the tax burden of this country should no longer be placed on the backs of black people. Everything cost more in poor, particularly for black neighborhoods. Some call it a poverty tax, but it often results in mostly poor African Americans and Latinos paying in upwards of thousands of dollars extra in fees because they live in economically disenfranchised communities.
But for how long?
Well how long was slavery? Around 250 years. At least that long plus time incurred through Jim Crow and American apartheid to present installations of subjugation and inequality. Monied white folks certainly were able to benefit from all that free labor we gave them. So around 350 years should be long enough for black folks to play catchup.
But how do we determine, who should receive reparation by way of the tax exclusion?
Ah yes, the ole’ but everyone is mixed up argument. It would be a legitimate concern if not for the fact that throughout history, local and state governments, sanctioned and often co-signed by the federal government, put into place certain structures, which already help us determine such colorful issues. And I’m talking about the “purity” laws, which were mostly enacted to deter the miscegenation of the white race. Not only were interracial marriages and families banned, but places like Louisiana, as well as other places down South, often established freedoms based upon how much “black blood” you had.
Such was the case of Alexina (Jane) Morrison, who in 1850s sued her slaveholder on three separate occasions for freedom, claiming that her blonde hair and blue eyes meant that she “been born free and of white parentage.” She eventually won, due to a forged bill of sale provided by the owner. However if not for the fraudulent piece of paper, it was likely that Morrison, who for all intents and purposes was a white woman, would have to spend the remainder of her life as a black slave.
The point is that this system of color coding people has longed been used to help the government determine who could be kept for enslavement and who could be disenfranchised legally. And I don’t see how we can’t use the same system as a way to properly award restitution.
But Charing won’t that result in white folks today being hurt financially and economically based upon past injustices, which they had nothing to do with?
Yup but that’s the point. A transfer of power so that it is no longer held by a select group of people based upon race. And to put it crudely – some folks are truly going to have to ante up. And while some non-black folks might see their wealth decline, black owned enterprises and industries in particular will now have opportunities to rise in their places. And without justice, there is no equality. The real question to ask is how fair is it that America should continue to reap the benefits of inequality?
No seriously, how is that fair though? Not every white person held slaves.
True. However it is safe to say that the majority of white folks benefitted from slave labor and American apartheid. And it doesn’t matter when they arrived in this country and by what aim; they too benefitted from the spoils of slavery. After all great grandfather Johann from Poland likely couldn’t have bootstrapped his family up through society, based upon his own merits, if not for the total exclusion and denial of access from those same merit-based opportunities. From colleges and universities, to country clubs to neighborhoods and parks and trails and museums, etc and so on, Your ancestors got access to places where mine could only enter by holding a broom and a mop.
But where will the government get the money?
Where did the government get the money for two damn wars at the same time? And black folks are around 12 percent of the population, so I imagine that it would cost lots less than what we are led to believe. Besides, the government should consider suing or even taxing corporations, who have ties to the trans-atlantic slave trade.
But Charing, the Republicans are never going to take it serious though. I mean it’s not really realistic to think of that.
Again another truism, but the obstructionists in Congress also has to be the dumbest reason not to pursue our just cause. I mean, if that is the case, why do I bother to go vote considering the Republicans are just going to block and hinder progress. Just like every cause we have fault, it will be up to us to make reparations a political issue. We must not only speak on it but be infatuated in our claims. Likewise we have to hold our politicians and civil and human organizations accountable for their lack of leadership in getting reparations into the national conversation.If gay rights and immigration are national platforms, why can’t the cause for black reparations be treated with the same dignity and respect?
So that is my plan for helping to right the wrongs of the past. And just like Coates, this is not the definite idea of what reparations looks like; just one (and a damn good one I think). I’m curious as to what are some ideas folks have about what black reparations should look like. Remember at this moment, there is no right or wrong answer; just as long as we are talking and thinking actively on the issue.
One would think that government workers would be up on their taxes. But according to recently released Internal Revenue Service data, federal employees owe a whopping $3.3 billion in back taxes to the federal government.
As of last September, 318,462 federal employees owed back taxes, an increase of 2.6 percent from the previous year. When calculating the average tax bill, it comes to $10,391 per person, according to IRS data obtained by USA Today under the Freedom of Information Act.
While this may seem a bit outrageous, it also turns out that federal workers are really better at paying their taxes than the average taxpayer. They only have a delinquency rate of 3.19 percent while the population at large has a rate of 8.7 percent.
But it does depend on the arm of government they work in. “The non-payment rate for employees of the House of Representatives is 4.87 percent. In the Senate, it’s 3.24 percent. That’s 714 tax delinquents on Capitol Hill owing a total of $8.6 million — more than one for each representative or senator. Thirty-six employees in the Executive Office of the President are delinquent on their taxes, for a rate of 2.06 percent,” reports USAT.
And on Capitol Hill tax delinquencies are four times more common than at the Treasury Department. Recently the Treasury Department came under congressional scrutiny regarding bonuses paid to IRS employees who owed taxes. The IRS issued more than $1 million in bonuses to employees who didn’t pay their federal taxes. Despite this the Treasury Department has the best rate of tax compliance in the federal government with only a 1.2 percent delinquency rate.
Oddly, the highest rates of tax delinquency are at small federal agencies that deal with civil rights and the disabled, such as The National Council on Disability (11.54 percent), the Committee for Purchase from People Who Are Blind (10 percent) and the Civil Rights Commission (9.52 percent).
It’s about time! Tax season is coming to an end and Uncle Sam can finally get off our backs — unless you’re Terrell Owens and you’ve been slapped with a $244,000 tax lien, but I digress.
April 15th has arrived and I think it’s about time we delve into this year’s tax season — by the numbers, shall we?
Americans are pretty irritated by the amount they must pay in federal income taxes, according to a Gallup poll. Fifty-two percent say that it’s just “too high” — that’s a six-point increase from 2012’s 46 percent. Breaking it down by income levels, 49 percent of Americans who earned less than $30,000 also believe it’s too high; 60 percent of Americans raking in more than $75,000 say the same.
Now the upper-income Americans, specifically, felt the pinch this tax season — federal income taxes have indeed increased for them this year.
“The top 1 percent of earners will pay an average tax bill of $525,231, up more than $36,000 from last year, according to the nonpartisan Tax Policy Center. It will surge to $670,000 for 2014 taxes,” CNBC wrote. The tax rate for nation’s elite has jumped from 35 percent in 2012 to the current 39.6 percent.
The Obamas, whose tax rate was at 20.4 percent, were actually exempt from the higher tax rates because their taxable income is lower than $450,000, according to Bloomberg. Both Michelle and Barack reported adjusted gross income of $481,098 in 2013. POTUS and FLOTUS both paid $98,169 in taxes — this includes $2,310 for Obamacare.
Now let’s talk about the fun part — refunds, baby! About three quarters of Americans get refunds, which is why, in many ways, the April 15 deadline isn’t so huge. Penalties only apply to those who owe.
As of March 28, the IRS has an issued an average of $2,381 in refunds, CNN Money reports; this is a 1.5 percent increase compared to last year. According to Hipmunk Survey (via Mashable), 45 percent of Americans will save their refund. When asked what they wish they could do with the money, 54 percent said they would go on vacation.
“While saving money may be more responsible, it isn’t very fun. This explains the discrepancy between what people want to do and what they feel obliged to do,” Mashable adds.
For those who do want to splurge, about 25 percent of Americans will blow their refund on a new car, according to GOBankingRates. “The average tax refund is equivalent to a 20 percent down payment on a $15,000 auto loan; combined with today’s very low interest rates, it is a great time to buy a car,” said GOBankingRates Managing Editor Casey Bond, Cars.com reports.
Groups that are most likely to purchase a car are taxpayers under the age of 35 (29 percent), parents (26 percent), and residents of the South (22 percent).
Surprisingly enough, the IRS still has $760 million sitting in the treasury for 918,600 people who failed to file their 2010 tax return. If no one steps up to claim this money by midnight of April 15th, the cash will become property of the federal government. Retired taxpayers and low-income earners make a large percentage of those owed money — many do not know they’re eligible for Earned Income Tax Credit.
“The Earned Income Tax Credit could be worth as much as $5,000 to a taxpayer, depending on their situation,” Fox News reports. Students who worked jobs, but didn’t meet the income level required to file, are also a population that might not have claimed part of that $760 million — they had taxes withheld and could get that money back.
California has the highest number of people owed money — 85,000 residents. New York and Texas follow with 80,600 and 57,400 respectively.
Meanwhile, as many Americans who are truly deserving of a tax refund have no idea that they’re missing out on a large chunk of cash, scam artists cashed in on $4 billion in fraudulent tax returns last year — this a 66 percent jump from the year prior. Criminals have been using other people’s personal information to file, USA Today reports.
“Thieves steal Social Security numbers in any number of ways, including from publicly available sources or workplaces. Victims include school children, prisoners, Medicaid beneficiaries and the deceased. Criminals use the information to file false returns and then pocket the refund checks, often before the legitimate taxpayers have had a chance to submit their own returns,” the paper adds.
On a lighter note, there is one thing that will ease your stress through tax season — Tax Day! This means free dinner, free cookies, and even free massages at the Hard Rock Cafe, European American Bakery Café, and Hydromassage locations, respectively. There’s plenty more where that came from! Check out News-Press’ list of generous locations and see to it that you get your much needed R&R this Tax Day Tuesday.