Southern California Tax Relief Services
IRS tax Relief, FTB tax Relief, BOE tax Relief, EDD tax relief
At Mike Habib, EA, a SoCal tax firm, we understand that being notified that your tax return is being challenged by the IRS or the FTB can be scary. When you are faced with an audit, or a collection action, [...]

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IRS Tax Levy – How to release federal tax liens and levies
Taxpayers have the right to appeal the IRS’ filing of a notice of a tax lien in the public record and petition for release. If filed in error, the IRS must release the lien and state that the lien was erroneous. The request for [...]

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Table 16.  Delinquent Collection Activities, Fiscal Years 2005-2008

[Money amounts are in thousands of dollars.]

Activity

2005

2006

2007

2008

(1)

(2)

(3)

(4)

Returns filed with additional tax due:

Total amount collected [1]

[r] 27,615,348   

[r] 29,172,915   

[r] 31,952,399   

28,465,648   

Taxpayer delinquent accounts (thousands):

Number in beginning inventory

5,981   

6,478   

7,074   

8,240   

Number of new accounts

5,870   

6,100   

7,146   

7,099   

Number of accounts closed

5,373   

5,504   

5,980   

6,107   

Ending inventory:

Number

6,478   

7,074    [...]

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IRS Back Taxes
Mike Habib, EA
You incur IRS back taxes when you haven’t been filing your income tax returns religiously every year. Tax season can be a stressful time and there are a lot of people who tend to overlook the deadlines so they find themselves having to rush to make it in time. For those [...]

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Back taxes shutters Jack in the Box
Source: Mercury-Register

A state tax dispute is behind the sudden Jack in the Box closures Thursday.
A press release issued this morning indicated that owner Abe Alizadeh, president of Kobra Properties, has temporarily closed the restaurants.
Alizadeh owns 70 Jacks in northern and central California, including ones in Chico, Paradise and [...]

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California – Corporate Income Tax: FTB Has Begun Contacting Return Nonfilers for 2007
The California Franchise Tax Board (FTB) has begun contacting more than 35,000 companies that did business in California in 2007, but failed to file a California corporation franchise or income tax return for that year. Businesses contacted by the FTB will have 30 [...]

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IRS Back Taxes Help for Financially Distressed Taxpayers
IRS Back Taxes – IRS Tax Tip
If you are facing financial difficulties and struggling to meet your tax obligations the IRS can help. As the 2009 tax filing season begins, in addition to new credits, deductions and exclusions, the IRS is taking steps to help people who owe [...]

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Construction Industry Tax Issues

Accumulated Earnings Tax

Closely held C corporations are more likely to accumulate earnings and profits beyond the reasonable needs of the business in order to avoid income taxes on its shareholders than are large C corporations. Each accumulated earnings case is unique. No pro forma guide for calculating a taxpayer’s reasonable [...]

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Getting to Grips with Wage Garnishment
Have you ever heard of a wage garnishment? If you haven’t, and you are responsible for paying the IRS what you owe them, then you should read on! If you’re in a position where you owe the IRS money already, then you shouldn’t just read on, but take note because [...]

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IRS to seek more regulation of tax preparers
The IRS reported that it is working on new rules that will require paid tax preparers to be licensed. This will improve tax compliance and reduce tax preparer fraud; IRS Commissioner Doug Shulman announced that on June 4, 2009.
A whopping eighty percent of taxpayers get help with their [...]

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IRS has a check for you

Mike Habib, EA Tax Relief & Tax Problem Resolution

IR-2009-16, March 3, 2009

WASHINGTON — Unclaimed refunds totaling approximately $1.3 billion are awaiting over a million people who did not file a federal income tax return for 2005, the Internal Revenue Service announced today. However, to collect the money, [...]

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Enhanced first-time homebuyer credit in the American Recovery and Reinvestment Act of 2009
Mike Habib, EA Tax Relief & Tax Problem Resolution

In hopes of spurring the housing industry, the recently enacted “American Recovery and Reinvestment Act of 2009” (the 2009 economic stimulus act) includes an enhanced tax credit for first-time homebuyers. Here are the [...]

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Tax changes affecting individuals and families in the American Recovery and Reinvestment Act of 2009
Mike Habib, EA Tax Relief & Tax Problem Resolution
The recently enacted “American Recovery and Reinvestment Act of 2009” (the 2009 economic stimulus act) contains a wide-ranging tax package that includes tax relief for low and moderate-income wage earners, individuals and [...]

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Seventh Circuit classifies computer programmer as an independent contractor

Suskovich v. Anthem Health Plans of Virginia, Inc., (CA 7 1/22/2009) 103 AFTR 2d ¶2009-385

The Court of Appeals for the Seventh Circuit, affirming a district court, has concluded that a computer programmer was an independent contractor and not an employee.

Facts. Anthony Suskovich worked for WellPoint/Anthem (WellPoint) [...]

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IRS urged to issue pre-April 15 guidance for Madoff victims

An influential voice in politics, former New York State Governor George Pataki, has asked IRS to issue pre-Apr. 15 guidance for victims of the Ponzi scheme alleged to have been perpetrated by dealer and advisor Bernard Madoff and his firm. Separately, members of the Senate Banking [...]

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While the new law tax changes in the Emergency Economic Stabilization Act of 2008 were the most significant developments in the final quarter of 2008, many other tax developments may affect you, your family, and your livelihood. These other key developments in the final quarter of 2008 are summarized below. Please call us for [...]

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As you start to organize your records for your 2009 tax preparation, I thought you might find this brief rundown of 2009 tax changes useful.
* ADOPTION TAX CREDIT increases to $12,150 for adoption
of an eligible child.
* SECTION 179 maximum deduction decreases to $133,000.
Phase-out threshold is $530,000. (It is generally
expected that a stimulus law in early [...]

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No More Tax Problems in 2009

Mike Habib, EA

Here is a New Year resolution you can’t afford to ignore… No more tax problems!! Yes, you can get rid of your tax problems in 2009.

You can solve your tax problems and get tax relief through our tax resolution services. You can finally get a [...]

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Taxpayer’s failure to timely file breached offer-in-compromise justified renewed collection action Trout, (2008) 131 TC No. 16

Mike Habib, EA
The Tax Court has concluded that IRS didn’t abuse its discretion in finding that a taxpayer had breached his offer-in-compromise (OIC) and deciding to proceed with its collection efforts where the OIC made timely filing [...]

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Capital contributions did not restore or increase shareholders’ tax bases in loans to S corporations Nathel, (2008) 131 TC No. 17
Mike Habib, EA
The Tax Court has held that taxpayers’ capital contributions to S corporations did not constitute income to the S corporations and that the contributions did not restore or increase their tax [...]

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IRS reminds taxpayers to make use of recent tax law changes before December 31st [Fact Sheet 2008-26]:
Mike Habib, EA
With the end of tax year 2008 just weeks away, IRS has issued a number of tax tips that taxpayers should consider.
Among the tips are the following—first-time homebuyers (those who have not owned [...]

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IRS tips for year-end charitable contributions IR 2008-138
Mike Habib, EA
IRS reminds individuals and businesses making contributions to charity that they should keep in mind several important tax law provisions that have taken effect in recent years. One provision offers older owners of individual retirement arrangements (IRAs) a different way to give to charity. [...]

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A roadmap to disaster area tax relief in 2008 legislation
Mike Habib, EA

The 2008 calendar year has seen more than the usual share of natural disasters in the U.S., and legislation designed to provide tax relief to the victims. By and large, legislative relief has been granted on an ad-hoc basis, with an attempt [...]

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IRS boosts 2008 housing cost allowances for those working abroad in high-cost areas Notice 2008-107, 2008-50 IRB
Mike Habib, EA
A new Notice effectively increases the maximum housing cost exclusion for U.S. citizens and residents working abroad in specified high-cost locations. The increases are based on geographic differences in foreign housing costs relative to U.S. [...]

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Gambling winnings or losses?

Mike Habib, EA

As a US taxpayer, you can deduct gambling losses only if you itemize your deductions on form 1040. You can claim your gambling losses as a miscellaneous deduction on IRS Form 1040, Schedule A. However, the amount of losses you deduct can not total more than the amount of [...]

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Year-end tax planning client letter with checklist
As the end of the year approaches, it is a good time to think of planning moves that will help lower your tax bill this year and possibly the next. Factors that compound the challenge include the stock market’s swoon, the difficult economic climate we’re in right now, [...]

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As I’m sure you’re aware, on Oct. 3, 2008, the President signed into law the Emergency Economic Stabilization Act of 2008 (P.L. 110-343). Although virtually all of the press coverage of this law has concentrated on its hotly debated $700 billion financial industry bailout plan, the legislation also contains scores of tax changes, mostly [...]

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TIGTA review finds small number of cases where IRS employees harassed taxpayers while attempting to collect taxes [Audit Report No. 2008-10-162]:
In 2007, there were five cases involving Fair Tax Collection Practices (FTCP) violations for which an IRS employee received administrative disciplinary action, according to a recent audit by the Treasury Inspector General [...]

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Do you have back tax returns that are Unfiled? Are you missing the records and forms necessary to file your tax returns?
The IRS will not allow you to file an offer in compromise or get an installment agreement if you are not current on filing your back tax returns.
If you have a refund coming to you and you file more than 3 years past the due date, the IRS will keep the refund.

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Employer not required to obtain worker status determination before withholding taxes

Nino v. Ford Motor Company, DC MI, 102 AFTR 2d ¶2008-5215, Dkt. No. 07-13545, 8/8/08

A federal district court has dismissed an employee’s pro se (“for self”; non-attorney) complaint that he should not have had withholding deducted until his employer obtained a worker status determination [...]

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If It Seems Too Good to Be True, It Probably Is
Tax Return Preparer Fraud
Mike Habib, EA
Dishonest tax return preparers can cause many problems for taxpayers who fall victim to their schemes. These scam artists make their money in a number of ways including skimming a portion of their clients’ refunds, charging a percentage of [...]

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IRS official pledges improved collection of billions in unpaid payroll taxes from businesses
WASHINGTON (AP) — A top IRS official promised Congress Tuesday that the agency “will do better” in collecting billions in taxes that businesses supposedly withheld from employees’ paychecks but never remitted to the government.
Linda Stiff, a deputy Internal Revenue Service commissioner, agreed [...]

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Final regs on dependent child of divorced or separated parents or parents who live apart T.D. 9408, 07/01/2008; Reg. § 1.152-4 Mike Habib, EA
IRS has issued final regs on the rules for claiming a child as a dependent by parents who are divorced, legally separated under a decree of separate maintenance or a [...]

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IRS may prepare substitute returns in worker classification cases Chief Counsel Advice 200822026
A Chief Counsel Advice (CCA) has concluded that, in employment tax cases where worker classification issues are present, revenue officers have authority under Code Sec. 6020(b) to prepare employment tax returns, but the requirements of Code Sec. 7436 must be [...]

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Tax Problem Resolution Services
I specialize in resolving tax problems for individuals, small-size companies, mid-size companies, and fortune 1,000 companies. I represent individuals and businesses before the IRS and any taxing authority, therefore the taxpayer does not have to deal with the IRS directly.
Mike Habib, EA
IRS strengthened enforcement policies, along with their new and complex tax [...]

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Enhanced tax breaks make it an especially good time to buy business autos Mike Habib, EAmyIRSTaxRelief.com
Thanks to economic woes in general and financial trouble for auto manufacturers in particular, it’s a good time to shop for a new vehicle, if you can afford to do so. Thanks to bonus first year depreciation deductions under the [...]

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You missed the tax deadline April 15th, so now what?

Mike Habib, EA
myIRSTaxRelief.com
Although the IRS has received a record number of returns this year, there are still thousands of people who did not file tax returns on April 15th. The reasons for this are numerous, but the IRS research shows that often people do not [...]

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Memo explains how state property tax credits are taxed and reported – Chief Counsel Advice 200814022
Mike Habib, EA
myIRSTaxRelief.com
In Chief Counsel Advice, IRS has explained the proper federal income tax treatment of certain state property tax credits and the extent to which the state must provide information reports about the credits to IRS [...]

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The most important IRS Tax Development in Q1 2008
Mike Habib, EA
myIRSTaxRelief.com
While the Economic Stimulus Act of 2008 was the most significant development in the first quarter of 2008, many other tax developments may affect you, your family, and your livelihood. The new law changes and other key developments are summarized below. Please [...]

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New, changed and expired provisions affect 2008 individual estimated tax Mike Habib, EAMyIRSTaxRelief.com
Apr. 15, 2008 is the due date for affected calendar year taxpayers to make their first installment of 2008 estimated tax. There aren’t any drastic changes in the estimated tax rules themselves for 2008. However, there are a number of new, changed [...]

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Truckers Tax Relief – Are you a truck driver with tax problems?
If you’re a truck driver and owe the IRS, you’re better off resolving your tax debt now. As you know, tax problems do not go away by themselves! Stop your IRS wage garnishment today, stop your IRS bank levy today, and release your [...]

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Tax breaks for qualifying relatives are limited – what you should knowInternal Legal Memorandum 200812024
Mike Habib, EAmyIRSTaxRelief.com
An Internal Legal Memorandum (ILM) explains that various tax breaks are not allowed for qualifying relatives. Specifically, the ILM concludes that, apart from a dependency exemption, a taxpayer’s qualifying relative may not qualify him for the [...]

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IRS Has $1.2 Billion for People Who Have Not Filed a 2004 Tax Return
Mike Habib, EA
MyIRSTaxRelief.com
IRS-2008-46, March 19, 2008
IRS WASHINGTON — Unclaimed refunds totaling approximately $1.2 billion are awaiting about 1.3 million people who failed to file a federal income tax return for 2004, the Internal Revenue Service announced today. However, to collect the [...]

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How falling interest rates and the declining stock market affect tax and estate planning
Mike Habib, EA
myIRSTaxRelief.com
Interest rates have dropped significantly in recent months and may drop even more given the state of the economy. Sagging rates can have a significant impact on many tax and estate planning strategies. Lower interest rates affect the income, [...]

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“Makeup” required minimum distributions salvage lifetime payouts to nonspouse IRA beneficiaryMike Habib, EAmyIRSTaxRelief.comA private letter ruling allows the nonspouse beneficiary of an IRA to salvage lifetime payouts even though she failed an essential rule requiring distributions to begin by the end of the year following the year of the IRA owner’s death. She made up [...]

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Starting March 2008, casinos and other sponsors of poker tournaments will be required to report most winnings to winners and the Internal Revenue Service, according to the IRS.
Mike Habib, EAmyIRSTaxRelief.com
The new requirement, which went into effect on March 4, 2008, was contained in guidance released Sept. 4 by the Treasury Department and the IRS. The [...]

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IRS provides guidance on new rules for employment tax levies
Mike Habib, EA
The IRS has issued interim guidance to its directors and collection area offices that explains when it is permissible to issue a levy to collect employment taxes without first giving the taxpayer a pre-levy collection due process (CDP) notice.
The IRS is authorized to take [...]

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Reconstructing Your Records
Mike Habib, EA
Reconstructing records after a disaster may be essential for tax purposes, getting federal assistance or insurance reimbursement. Records that you need to prove your loss may have been damaged or destroyed in a casualty. While it may not be easy, reconstructing your records may be essential for:
* Tax [...]

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Direct from the IRS
Mike Habib, EA
Is an Offer in Compromise Right for You?
Should the IRS determine that a taxpayer is unable to pay the liability in a lump sum or through an installment agreement and has exhausted the search for other payment arrangements the last option would be to file an Offer in Compromise (OIC).
An [...]

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Final substitute return regs adopt temporary and proposed regs with one minor changeT.D. 9380, 2/12/2008; Reg. § 301.6020-1
Mike Habib, EA
In 2005, IRS issued temporary (also issued as proposed regs) that broadened the scope of when IRS-prepared substitute returns (SFR) are valid. Specifically, the temporary regs provide that a document or set of documents (including a [...]

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