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 IRS.gov/aca 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 IRS.gov/aca for more information regarding the tax provisions of the Affordable Care Act.

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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 IRS.gov.

• 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 IRS.gov. Also, check Publication 970, Tax Benefits for Education. The booklet’s also available at IRS.gov or by calling 800-TAX-FORM (800-829-3676).

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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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