Thompson & McCarty, P.C. CPA

The 2009 Standard mileage rates are:

Business Miles - 55 cent per mile

Medical Miles and Moving - 27 cents per mile

Charity - 14 cents per mile.

Keep in mind that to make your mileage deduction bullet proof in an audit you need a good mileage log.

The IRS is trying to clean up the slew of people that report Head of Household and claim EIC.  That have instituted new due diligence requirements for tax preparers designed to make the client really follow the rules of eligibility for this filing status and refundable tax credit.  What the taxpayer will be hearing from "Qualified" preparers this year is a list of questions designed by the IRS to help determine the eligibility for a the Head of Household filing status and the eligibility to receive EIC.

I personally don't like the questions they are making me ask this year but I applaud them in what they are attempting to do.  The problem, as reported today on Fox 6 News, is that many tax preparers are just not following the rules.  What you should know is that unless a tax preparer has some kind of professional license (Certified Public Accountant, Public Accountant, Enrolled Agent, etc..) then they likely do not answer to any higher authority than the customer.  So pick your preparer with care.  You are responsible for the contents of your return. 

I recently wanted to check and see if I could save enough money to warrant refinancing my home.  I thought that it would be easier to call my current mortgage company than to call a new mortgage company or originator. 

My first attempt to contact my existing mortgage company was on the internet.  After making multiple attempts to log in I realized that they had changed their log in process and my old user name and password were not valid.  So I attempted to change them and the system notified me that my access had been blocked due to invalid input.  I would have to contact customer support to reset the system.  After an hour and 15 minutes of trying I got frustrated and gave up for the evening.

For the 2008 tax year homeowner's will be getting a tax break for property taxes even if they are unable to itemize.  The deduction will be added to the standard deduction and is the lessor of actual property tax or $500 per taxpayer ($1000 for Married filing joint).  I think it is interesting that Congress feels that it is important enough to address this issue then limit the deduction to $500 per taxpayer.  That comes straight from the political handbook of tell them your helping them then take it back.

I recently had a client that had an issue with the IRS. This is their story and how it all turned out. The very start of the story began with us making a mistake on their 2006 tax return. We left a zero off of a deduction that cost the taxpayer a substantial deduction. The return had been transmitted before the taxpayer discovered the error. The balance due on the original return had not been paid. In our defense, the deduction was verbally stated and undocumented to us so it was impossible to discover the error with our review process. There is a lesson in that, but I digress.

You can hear the commercials on most any syndicated talk radio show in America. The pitch goes something like "Settle Your Debt With The IRS For Pennies on The Dollar". Is it possible? Yes it is. It happens all the time. But there are many factors that determine when an IRS debt can be settled.

The method used to settle debt for pennies on the dollar with the IRS is called The Offers in Compromise Program. It is a program offered by the IRS so that honest taxpayers can settle debts that they can not afford to pay. Let me reiterate. The program that can be use to settle debt with the IRS for "Pennies on the Dollar" is called the Offers in Compromise Program. It is designed for honest taxpayers to settle debt that they can not afford to pay.You have to be able to prove that you lack the ability to pay in order to qualify for this program.

This is a reprint from an email I received. It is supposedly advice from an attorney and whether true or not I can see the wisdom in the advice so I am sharing with all that will take the time read.

ATTORNEY's ADVICE - NO CHARGE

Not A Joke!! If you dislike attorneys..... You will love them for these tips.

Read this and make a copy for your files in case you need to refer to it someday. Maybe we should all take some of his advice! A corporate attorney sent the following out to the employees in his company.

1. Do not sign the back of your credit cards. Instead, put 'PHOTO ID REQUIRED.'

The tax rebates for 2008 will happen and the IRS has stated that they will begin sending checks in early May. That is sooner than first projections of late May or early June so give the IRS credit on this.

Rebates will be keyed to tax liability. Married Couples will get a maximum rebate of $1200, single people will get get a maximum of $600. Filers with dependent children under the age of 17 will get an additional $300 per child. Married Couples with at least $3000 in income will get $600 and singles with at least $8750 will get $300. Dependents of another will not receive a check.

I have clients that call and ask me about employee poster requirements in Alabama. It seems that every so often someone that is LESS THAN HONEST sends out a mailing that SCARES the crap out of Employers because the letters look official and they are intentionally trying to make you think that you need the posters to comply with the Alabama tax laws. Well crap, Who could blame you? With all the stuff that employers have to do to comply with Governmental interference, no wonder they get scared that they have possibly missed something. Well I have good news....I just saved 15% on my car insurance. ;-) JUST KIDDING!