TIMELY INFORMATION FROM THE
INTERNAL REVENUE SERVICE

 

 

Social Security Recipients to Receive Special Payment in May

On February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act (ARRA) of 2009. Among its provisions are one-time payments to Social Security and Supplemental Security Income (SSI) beneficiaries.

Nearly 55 million people who receive Social Security and SSI benefits will get a special one-time payment of $250. They should receive the one-time payment by late May 2009.

Social Security is the lead agency in terms of the distribution of the $250 payments. Read more about it in the current issue of Social Security Update.

 

Most Workers Will See Bigger Paychecks this Spring

On February 21, 2009 the IRS released new withholding tables that will result take-home pay this spring for millions of American workers. Employers have been asked to start using these new tables no later than April 1.

Eligible workers will get the benefit of this change without any action on their part. This means that workers don’t need to fill out a new W-4 withholding form to get the Making Work Pay credit reflected in their take-home pay. A Form W-4 will not need to be submitted for the automatic withholding change. Individuals and couples with multiple jobs may want to submit revised Form W-4 forms to ensure enough withholding is held to cover the tax for the combined income. Publication 919 provides additional guidance for tax withholding.

 

New Information to Help Employers Who Provide COBRA Coverage

On February 26, 2009, the Internal Revenue Service released detailed information that will help employers claim credit for the COBRA medical premiums they pay for their former employees. The IRS unveiled new information on the IRS Web site, that includes an extensive set of questions and answers for employers. In addition, the Web site contains a revised version of the quarterly payroll tax return that employers will use to claim credit for the COBRA medical premiums they pay for their former employees.

Form 941, Employer’s Quarterly Federal Tax Return, will also be sent to about 2 million employers in mid-March. The form is used to claim the new COBRA premium assistance payments credit, beginning with the first quarter of 2009.

released detailed information that will help employers claim credit for the COBRA medical premiums they pay for their former employees.

 

Job Loss Creates Tax Issues: IRS Publication 4128 Provides Helpful Information

The Internal Revenue Service recognizes that the loss of a job may create new tax issues. This IRS publication provides the information on severance pay, unemployment, getting a W-2 from an employer that’s out of business or in bankruptcy, what to do if you owe taxes and cannot pay them right away, and more.

Comprehensive Tax Guide for Individuals Available Online for Free

The IRS has placed its comprehensive tax guide for individuals on IRS.gov, updating it for tax year 2008. Publication 17, “Your Federal Income Tax,” provides information on how to file an individual tax return, what to include as income, how to calculate capital gains and losses, how IRAs and other expenses can affect how much income to report, whether to take the standard deduction or itemize, and how to figure taxes and credits. It has been updated with important changes for 2008, including information on the new recovery rebate credit, new first-time-homebuyer credit, and an additional standard deduction for real estate taxes.

Retirement Plan Information

Find tips on how to find, fix, and avoid common mistakes in: SEP, SIMPLE IRA Plan, and 401(k) Fix-It Guides are available in .pdf format.

New Exempt Organization Video

For those of you interested in the new Form 990, IRS Exempt Organization has developed a video mini-course on Preparing to File the New Form 990. You can stop the presentation at any time, come back, and resume where you left off. This video is part of a very useful IRS web site for Tax Exempt and Government Entities: http://www.stayexempt.org/

 

What Does this Mean for Taxpayers?

In a world with changing laws, breaches of ethics and security in the news daily, it is important for you as a taxpayer to be assured that the professional you entrust with the calculation of your tax liability has your best interest at heart.

What does the IRS have to say on this topic? You may be interested in reading their advice on Choosing a Tax Return Preparer and in Don't Be Taken In By Tax Scams.

What Does This Site Have To Offer You?

The public section of the site contains information useful both to the public and to tax professionals:

• Tax Forms and Additional Resources quickly direct visitors to appropriate sources.
• Tax Professionals can search the NATC database for all affiliated chapters, can view their newsletters, can contact their officers, and can visit their Web sites.
• Taxpayers can search the NATC member database for a tax professional in their area (Note: members are still in the process of update their profiles and authorizing their information for display).
• Taxpayers can also search for Tax Professionals with specific areas of expertise.

The Education section is focused on helping tax professionals stay at the top of their game:

• Upcoming educational events and conferences offering CPE credit are featured, with handy links to fliers and forms.
• The Event Calendars offer an at-a-glance view of education and meeting opportunities. They even have the capability of sending out "reminder" emails to users who request them.

The goal of the password-protected Members Only section is to foster community:

• The various Discussion Forums promote dialog – there is even a "classified" ads section for use by members.
• The Legislation page will offer solid and timely summaries of issues written from the informed perspective of an experienced practitioner.
• Members have access to the full directory of NATC members and chapters – This now includes the ability to search on specific areas of expertise.
• Members can edit their own online profiles – particularly what information they'd like to be made available to the public. Add referral data (areas of expertise) to your own profile.
• Authorized members can update chapter-specific information.