Aug 21, 2013

IRS Website Explains Tax Provisions of the Health Care Law

Here is a word from the Goodfellas at the IRS:

IRS Health Care Tax Tip 2013-01

The IRS has launched a new Affordable Care Act Tax Provisions website at to educate individuals and businesses on how the health care law may affect them. The new home page has three sections, which explain the tax benefits and responsibilities for individuals and families, employers, and other organizations, with links and information for each group. The site provides information about tax provisions that are in effect now and those that will go into effect in 2014 and beyond.

Topics include premium tax credits for individuals, new benefits and responsibilities for employers, and tax provisions for insurers, tax-exempt organizations and certain other business types.
Visitors to the new site will find information about the law and its provisions, legal guidance, the latest news, frequently asked questions and links to additional resources.

Several other federal agencies have a role in implementing the health care law, including the Department of Health and Human Services, which has primary responsibility. To help locate additional online resources from the Department of Health and Human Services, the Department of Labor and the Small Business Administration, the IRS has issued a new Web-based flyer - Healthcare Law Online Resources (Publication 5093).

Visit for more information regarding the tax provisions of the Affordable Care Act.

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Aug 20, 2013

Back-to-School Tax Tips for Students and Parents


Here is a word from the Goodfellas at the IRS:

IRS Summertime Tax Tip 2013-19

Going to college can be a stressful time for students and parents. The IRS offers these tips about education tax benefits that can help offset some college costs and maybe relieve some of that stress.

American Opportunity Tax Credit. This credit can be up to $2,500 per eligible student. The AOTC is available for the first four years of post secondary education. Forty percent of the credit is refundable. That means that you may be able to receive up to $1,000 of the credit as a refund, even if you don’t owe any taxes. Qualified expenses include tuition and fees, course related books, supplies and equipment. A recent law extended the AOTC through the end of Dec. 2017.

Lifetime Learning Credit. With the LLC, you may be able to claim up to $2,000 for qualified education expenses on your federal tax return. There is no limit on the number of years you can claim this credit for an eligible student.

You can claim only one type of education credit per student on your federal tax return each year. If you pay college expenses for more than one student in the same year, you can claim credits on a per-student, per-year basis. For example, you can claim the AOTC for one student and the LLC for the other student.

You can use the IRS’s Interactive Tax Assistant tool to help determine if you’re eligible for these credits. The tool is available at

Student loan interest deduction. Other than home mortgage interest, you generally can’t deduct the interest you pay. However, you may be able to deduct interest you pay on a qualified student loan. The deduction can reduce your taxable income by up to $2,500. You don’t need to itemize deductions to claim it.

These education benefits are subject to income limitations and may be reduced or eliminated depending on your income.

For more information, visit the Tax Benefits for Education Information Center at Also, check Publication 970, Tax Benefits for Education. The booklet’s also available at or by calling 800-TAX-FORM (800-829-3676).

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Aug 19, 2013

Confessions of A Mad Tax Accountant #5: Arrogance of Some (Not All) Old Tax Accountants (30+ years)


“Share your knowledge. It is a way to achieve immortality.”
― Dalai Lama XIV

I'm the type of individual that respects his elders. Why reinvent the wheel when you can learn so much from the past? I absolutely enjoy picking "seasoned" professionals' brains. However, there have been many of times that I got either flat out rejected or even worse disrespected by some older tax accountants (30 + years experience). Let it be known that I asked for strictly advice and not charity. I didn't approach these individuals looking for clients, jobs or money. To be brutally honest, we all know that the world isn't perfect. I do believe that some bad encounters happened due to my race, gender and age. Some people will never like me no matter what I do. I'm not trying to doubters into believers because my life is too short.

I never will forget when I attend a tax organization meeting (I will not drop names) and I was the youngest attendees by decades. The meeting only had about fifteen attendees. I don't know whether I had a bad odor or somrthing but my attempts to communicate with some attendee were met with cold silence. Imagine trying to talk to someone and they don't respond. Trust me when I say that I'm not lying or joking about this experience! Another time, I approached an older tax accountant and he started to talk about himself (maybe he was crazy) and left me. I mean dude literally didn't hear a word I said and left within two minutes (without even saying that he was leaving our conversation). Another older tax accountant tried to sell me something instead of listening to me. Some older accountants don't return emails I sent requesting advice. I have many other moments that I'm not proud to experience.

No need to throw a pity party for me. I don't let bad encounters discourage my quest for knowledge. In fact, I have met many great "seasoned" tax professionals. I don't like dropping names but these individuals shared great advice with me. Some relationships started by simply asking for advice via email. My advice to young tax professional is not to be shy. Young professionals MUST seek advice from "seasoned" tax professionals. You will meet some jerks but hey that's life! You have to keep on striving for excellence. My advice to "seasoned" tax professionals is don't be greedy. "Seasoned" professionals MUST share their knowledge. I'm pretty sure someone helped them along their journey. Now is their time to help tax professionals like myself to carry the torch. Don't view all young tax professionals as people that are trying to steal your titles or clients.

Next Confessions: "Arrogance of Some Young Tax Professionals." I'm going to really get myself into trouble after this confession!

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Aug 14, 2013

Ten Cool Reasons to Visit in Español This Summer

Here is a word from the Goodfellas at IRS:

IRS Summertime Tax Tip 2013-17

Tax information can be difficult to understand in any language. It can be even more difficult if English is not your first language. The IRS provides a wide range of free products and services on its Spanish language web pages. Visit to get federal tax help in Spanish.
Here are ten features “en Español” you can find this summer:
1. Get answers 24 hours a day, seven days a week. is available all day, every day for individuals and businesses. Find answers to many questions such as:
• Do I have to file a tax return?
• What credits or deductions am I eligible to take on my tax return?
• Where can I get free tax help to complete my tax return?
2. Get tax forms and publications.  View and download several tax forms and publications in Spanish directly from
3. E-file your federal tax return.  E-file your 2012 federal income tax return from the comfort of your own home through Oct. 15, 2013. Available in English or Spanish, IRS e-file is fast, easy and safe. There are free e-file options for everyone.
4. Check the status of your tax refund.  Check the status of your refund through the online tool “¿Dónde está mi reembolso?” on our secure website.
5. Find out if you qualify for the Earned Income Tax Credit.  EITC is a refundable tax credit for people who work but don’t earn a lot of income. Use “Asistente EITC” to find out if you’re eligible for this valuable tax credit.
6. Get help in difficult financial times.  The loss of a job, taking part in a debt forgiveness program or tapping into a retirement fund can affect your taxes. Find out what you need to know by visiting “Centro Tributario para Asistir a Contribuyentes Desempleados.” You can also type the keywords “Qué pasa si” into the search box.
7. Get updated information on new tax laws.  You can get the most up-to-date information on tax law changes that may apply to you or your business on the website. Just type “Noticias en Español” in the search box.
8. Get up to date at the Multimedia Center.  Video tax tips and audio podcasts on various IRS topics are available in English and Spanish. Search using the keywords “Centro Multimediático.”
9. Follow IRS on Twitter.  Connect with IRS through social media to get the latest IRS tax news and information “en español” through Twitter @IRSenEspanol.
10. Order a transcript of your tax returns.  Order free transcripts en Español online and get them within 5 to 10 business days.
The official IRS website address is Don’t be fooled by sites that end in .com, .net, .org or other designations other than .gov.

Visit the new and improved Tax Factor blog @

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Aug 12, 2013

Confessions of a Mad Tax Accountant #4: Receiving CPE Offers


C - Continuing

P - Professional

E - Education

“The more I live, the more I learn. The more I learn, the more I realize, the less I know.”
― Michel Legrand
Education is in my blood. My father was a principal and my mom was a day care director. In fact, I moonlight as an adjunct professor at a local college. I'm a strong believer in the importance of Continuing Professional Education (CPE). As an Enrolled Agent, I must obtain 72 hours of CPE every three years. I have no problem with the 72 hour requirement. However, I do have a problem with the tons of email I receive from CPE providers. Who is selling my information? How did these companies get my email address? Most people get spam mail about an inheritance scam or Viagra pills but people like myself get spam about CPE!
Honestly, I probably only used three online CPE providers. I like to stick with companies that I already trust. I'm not saying that other companies are scam artists. I just don't want to be bother with all of these offers. I find myself always unsubscribing from a mailing list that I never signed up for in the first place! My advice would be to just stick with two CPE providers. Life is already too complex to deal with more than two CPE providers.
I won't offer any recommendations about which CPE provider to chose. I believe that your CPE provider should be chosen based on your personal preference. For example, I only use CPE providers who have websites that don't look like they are stuck in the 90s (or early 2000s). This is my personal preference and I'm not saying everyone should follow it.
If you are the one selling my information to CPE providers.....shame on you!
Next confession: Arrogance of Some (Not All) Old Accountants (30+ years)
Check out the new and improved The Tax Factor blog @
IT'S COMING.......
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Aug 9, 2013

Top Tax News Story: IRS Postpones August Furlough Day - Forbes

IRS Postpones August Furlough Day - Forbes

Danny Werfel, acting IRS Commissioner, has announced that the planned August 30, 2013, furlough day has been postponed.Read Article >

Confessions of a Mad Tax Accountant #3: Dealing With The IRS

"Behind every successful man stands a woman and the IRS. One takes the credit, and the other takes the cash."
For the most part, I have no problems with the IRS. I have to protect my clients against the IRS so I consider the IRS my fierce rival. For me to say that I like the IRS would be similar to Tom Brady saying that he likes Peyton Manning during the fourth quarter of the Super Bowl. I respect the IRS but I come to win when I'm dealing with them. I don't hate the IRS but I hate some things about dealing with them. Here are some things that drive me crazy about dealing with the IRS:
  1. Not being able to communicate with the IRS via email is insane! Faxing, mailing and calling is so the 80s. The IRS has to find a way to act like it is the year 2013. A lot of time spent on my IRS cases could have been reduced in half, if I was able to email correspondences.
  2. Calling the IRS toll-free number is like being stuck in rush hour traffic in CHINA! There has been times that I waited over an hour to get an operator. Don't even try to call the IRS in March or April. One time, I called the IRS and went to lunch. I was still on hold when I came back from lunch.
  3. Waiting for tax-exemption status approval is longer than a full season of professional baseball. I have completed many tax-exemption applications (Form 1023). The average completion time is around six months. It only takes me about a week to complete the application. However, the IRS is so understaffed that it takes forever for them to review your application. During the waiting period, I have to calm my clients down at least four times.
  4. Dealing with a overworked IRS employee is like dealing with an ex-girlfriend who hates you for no reason. Some IRS agents are just plain old nasty. It is not my fault that Congress didn't approve the IRS budget so stop being mad at me for your workload!
Despite this list, I have learned that you should always treat the IRS with respect. Even if the IRS agent is Satan himself, you must treat them with respect. Don't get respect confused with fear. If you are "on-point" with your case, you have nothing to fear.
Next confession: Receiving CPE offer emails
Visit the new and improved The Tax Factor blog @
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