Consents to disclose tax return information-Form 1040

What are consents to disclose tax return information for Form 1040 (1040, 1040A, 1040EZ, 1040NR) tax returns?

A criminal penalty applies to knowing or reckless disclosure or use of tax return information, but the penalty doesn’t apply to disclosures allowed by the Code or regulations. IRS regulations divide permissible disclosures into those that require taxpayer consent and those that do not. The regulations enumerate specified disclosures or uses of tax return information that may be made without taxpayer consent (e.g., disclosures under the Code or under a court order, disclosures to IRS, disclosures for quality or peer reviews).

 

Consent form for Tax Preparers

The regulations also provide that in other situations a tax return preparer won’t be allowed to disclose or use a taxpayer’s tax return information before obtaining a written consent from the taxpayer, which must be knowing and voluntary. This protects the privacy of taxpayers.

Tax return information is broadly defined. It means any information, including, but not limited to, a taxpayer’s name, address, or identifying number, which is furnished in any form or manner for, or in connection with, the preparation of a taxpayer’s tax return.

Generally, conditioning the providing of any services on the taxpayer furnishing consent will make the consent involuntary and ineffective. However, a tax return preparer may condition its providing of preparation services on a taxpayer consenting to allow the tax return preparer to disclose the taxpayer’s tax return information to another tax return preparer for the purpose of performing services that assist in the preparation of, or provide auxiliary services in connection with the preparation of, the taxpayer’s tax return.

 

Consent to Disclose Tax Return Information

All consents to disclose or use tax return information must include the tax return preparer’s name and the taxpayer’s name, and must be signed and dated by the taxpayer. The consent must also specify the tax return information to be disclosed or used by the return preparer. If a taxpayer consents to disclose tax return information, the consent must identify the intended purpose of the disclosure and, generally, the consent must also identify the specific recipient (or recipients) of that information. If the taxpayer consents to having his tax return information used, the consent must describe the particular use authorized. If a tax return preparer to whom the tax return information is to be disclosed is located outside the U.S., the taxpayer’s consent must be given before disclosure. Consents to disclose or use tax return information for a taxpayer filing a Form 1040 series return are subject to more stringent requirements than those that apply to taxpayers filing other returns. The consent forms must include certain statements that exactly follow language specified by the IRS.

 

Giving SSN to Tax Preparer

The most stringent restriction on consents to disclose or use tax return information for a taxpayer filing a Form 1040 series return is a rule providing that a tax return preparer located in the U.S., including any U.S. territory or possession (U.S. preparer), isn’t allowed to obtain consent to disclose a taxpayer’s social security number (SSN) to a tax return preparer located outside the U.S. or any U.S. territory or possession (non U.S. preparer). Thus, if a U.S. preparer obtains consent from a taxpayer to disclose tax return information to a non U.S. preparer, the U.S. preparer won’t be allowed to disclose the taxpayer’s SSN, and the U.S. preparer will have to redact or otherwise mask the taxpayer’s SSN before the tax return information is disclosed outside the U.S.

The regulations provide exceptions that apply (a) if a U.S. preparer initially received or obtained a taxpayer’s SSN from a non U.S. preparer or (b) if a U.S. preparer obtains consent to disclose the taxpayer’s SSN to a non U.S. preparer through the use of an adequate data protection safeguard and verifies the maintenance of the adequate data protection safeguard in the request for the taxpayer’s consent

Information About Capital Gains and Capital Assets

When you sell a ‘capital asset or’ sale usually results in a gain or loss equity. A ‘capital asset’ includes most of the (s) property (s) you own and use for personal or investment purposes. Here are 10 facts the IRS about gains and capital losses:

 

Information About Capital Gains and Capital Assets

  1. Capital assets are assets, like your home or car. They also include real estate, such as stocks and bonds investment.
  2. A capital gain or loss is the difference between the base and the amount you get when you sell an asset. Its base is usually what you paid for the asset.
  3. You must include all capital gains in income. From 2013, you may be subject to tax on net investment (NIIT, for its acronym in English). The NIIT is applied at a rate of 3.8 percent certain net investment income of individuals, trusts and family assets that have incomes above the statutory threshold amounts. For more details see IRS.gov / aca .

 

Deducting Capital Losses on Tax Return

  1. You can deduct capital losses on the sale of investment properties. You can not deduct losses from the sale of personal-use property .
  1. Gains and losses are capital; either long or short term, depending on how long you kept the property in his possession. If you held the property for longer than one year, your gain or loss is long-term. If the property had a year or less, the gain or loss is short-term.
  2.  If your long-term gains outweigh the losses in the long term, the difference between the two is a net capital gain in the long term. If your net capital gain in the long term is more than your net capital loss in the short term, you have a ‘net capital gain.’
  3. The tax rate that applies to net capital gains usually depend on your income. For low-income individuals, the rate may be zero in some or all of its net capital gains. In 2013, the maximum net rate of capital gains tax increased from 15 to 20 percent. A tax rate of 25 or 28 percent also apply to net capital gains of special types.
  1. If capital losses are more than your capital gains, you can deduct the difference as a loss on your tax return. This loss is limited to $ 3,000 per year, or $ 1,500 if married filing a separate return.
  2. If your total net capital loss exceeds the limit that can be deducted for that year, you may incur losses that can not deduct the tax return next year. You treat these losses as if they occurred in that year.
  3. You must file Form 8949 , Sales and Other Dispositions of Capital Assets (in English) with its federal tax return to report your income. You also need to file Schedule D, Capital Gains and Losses (in English) with its declaration.

 

Additional Resources IRS of Capital Gains and Losses

Download Tax Transcript from IRS Website Online

It is possible to download a copy of your IRS transcript directly from the IRS to see how you filed taxes in previous years.  You can find your IRS tax transcript by going to: http://www.irs.gov/Individuals/Get-Transcript

 

When do you need IRS Tax Transcript?

What are some potential uses for this?  As a simple individual tax filer what are some ways getting a tax transcript could help me?

This will be important for people needing the tax return transcripts for verification for Financial Aid through their schools or the government. Get a record of your past tax returns, also referred to as transcripts. IRS transcripts are often used to validate income and tax filing status for mortgage applications, student and small business loan applications, and during tax preparation.

 

Download IRS Tax Transcript Online

Right now, if you couldn’t get them transferred into your FAFSA (and that takes a couple days to get sent back to Fin. Aid), you had to order it through the website…which took 5 to 10 business days (and sometimes more) or call and wait on hold for up to three hours to have someone at the IRS fax them to you.

Sometimes 5 to 10 business days doesn’t work because students need there books, and the only way to get a book voucher if you needed tax return transcripts…where to wait on it to come in the mail.

Everyone should have kept their own copies of their tax returns, so unless something happened to your own copies, you shouldn’t need to go to the IRS to get a copy of your own returns. But in reality, I bet a lot of people probably don’t keep a copy at all. A good idea to keep all tax records for at least six years.

 

IRS Tax Links for getting tax transcript:

How is a Bonus from an employer taxed?

A large part of a persons compensation my come from a quarterly or end of year bonus. The general rule is that bonuses are taxed at the same rate as ordinary income.

 

How are bonuses taxed by IRS?

Your your bonus check probably gets withheld at a higher rate, that check won’t be taxed differently than your other checks. There is no difference in taxes paid between someone who makes $200k/year and someone who makes $100k/year with a $100k bonus. The reason your check is withheld differently is because of the way your employer calculated how much to withhold. Employers have several options on how to withhold taxes on the bonus that they pay. Your bonus is either withheld at a flat 25% or is withheld from the table using an income of your normal monthly pay plus your bonus.

 

Do people pay more money on taxes on bonuses?

The short thing to understand is, withholding will probably more than you’re used to, but any overpayment will be refunded at return time. This concept between withholding and taxing leads to lots of confusion over bonuses and mistakenly leads to the mis conception that bonuses are taxed at a rate differently than other types of income a taxpayer receives.

 

Tax Withholdings on Bonus Income

The income tax portion of a bonus is only part of the equation and all other withholdings will be taken out from bonuses that are paid.  If your employer used the aggregate method, your withholding will most likely be even higher! However, if your effective tax rate is below 25% (or the federal tax bracket used with the aggregate method), then you will see some of this money back when you file your return.

 

A bonus or raise to the next tax bracket almost never nets you less money.

The fact is, only the extra money that puts your over the bracket line will get taxed at the higher rate. If you are single and make $87,800. This puts you in the 25% tax bracket, and only $50 away from the next tax bracket. Then you get a bonus of $100. $50 of your bonus will get taxed at 25%, and $50 will be taxed at 28%. The rest of your $87,800 is still taxed the same way as it would have been had you not gotten your bonus. The only way declining the bonus would be beneficial is – oh wait there is no way.

Deducting Sales Tax as Itemized Deduction on Federal Tax Return

How do you deduct sales tax on a federal tax return?

Taxpayers might have the option to deduct state sales tax that they have paid during the tax year. This might be very useful to taxpayers who would like to deduct sales tax paid on a new car. Sales tax on a new car is often a large amount and taxpayers have decent records to substantiate this claim with the IRS.The sales tax deduction was extended again in legislation H.B. 5771 (section 105) signed by President Obama on December 19, 2014. Congress let sales-tax deductions expire in 2007, 2009, 20011, 2012 and 2013, only to renew it retroactively months or even a year later.

Deducting Sales Tax as Itemized Deduction on Federal Tax Return

If you file a Form 1040, and itemize deductions on Schedule A, you have the option of claiming either state and local income taxes or state and local sales taxes (you can’t claim both). If you saved your receipts throughout the year, you can add up the total amount of sales taxes you actually paid and claim that amount.

 

Deducting Sales Tax

Remember though that deducting sales tax is not available to all taxpayers. You must choose between the deduction for your state income tax payments and deducting sales tax, but you can never take both on your Schedule A. This also assumes that the taxpayer will be itemizing their returns which is something that not all taxpayers do. In addition, the sales tax deduction is available between 2005 through 2013. Beyond 2014, the sales tax deduction might go away unless Congress chooses to extend the sales tax tax deduction.

People who claim the sales tax deduction, maybe on a new car purchase, do not have to report any state income tax refund as taxable income in the following year. So if your sales tax deduction is about the same as your income tax deduction, most taxpayers are better off taking the sales tax deduction.

 

Deduct Sales Tax or Income Tax

For most people, the state and local income taxes paid usually gives them the higher deduction on their federal tax returns, but for some taxpayers, the sales tax deduction may give them a greater benefit. Below are special instances when taxpayers may be better off taking the sales tax deduction.

  • Residents of states that don not collect state and local income tax (Alaska, Florida, Nevada,  South Dakota, Texas, Washington, and Wyoming)
  • Taxpayers who made major purchases during the tax year that were subject to sales tax. Some examples might include cars, boats, and airplanes.
  • Residents of states with a high sales tax rate than income tax rate.

 

IRS Sales Tax Calculator

The IRS has posted tables for each state estimating how much someone might have in a sales tax deduction. However, if you paid a greater amount, you will be able to deduct that larger amount if you documentation to support your claim.

 

Using IRS Sales Tax Calculator

The IRS also have a tool that is used to calculate the amount of sales tax paid. It is called the IRS Sales Tax Calculator. To figure the amount of optional general sales tax you are eligible to claim, just answer a few online questions and the system does the rest. First select the tax year for which you are preparing a return. Then, using your ZIP Code and just a few entries from your draft Form 1040, the Sales Tax Deduction Calculator will automatically figure the amount of state and local sales tax you can claim. Your entries are anonymous and the information is collected solely to allow you to determine your total allowable deduction.

 

IRS Information on Sales Tax Deduction

The deduction is available to taxpayers that itemize deductions, not those who take the standard deduction. The deduction is based on adjusted gross income and number of exemptions claimed. Taxpayers who keep all their receipts can deduct actual sales tax and use tax paid. For taxpayers who didn’t keep receipts, the IRS has an online Sales Tax Deduction Calculator to determine the amount of optional general sales tax to claim, or taxpayers can use the Optional State Sales Tax Tables.

Who should deduct sales tax on tax returns?

For most people, the state and local income taxes paid usually gives them the higher deduction, but for others, the sales tax deduction may give them a greater benefit, for example:

  • Residents of states that don’t collect state and local income tax (Alaska, Florida, Nevada,  South Dakota, Texas, Washington, and Wyoming)
  • Taxpayers who made major purchases during the tax year that were subject to sales tax (we’re talking major as in cars, boats, airplanes, RVs, etc.)
  • Residents of states with a high sales tax rate.

2012 IRS e-file Refund Cycle Chart

2012 IRS e-file Refund Cycle Chart for Tax Year 2011


* This is the projected date that the refund will be direct deposited or mailed. It may take up to 5 additional days for the financial institution to post the refund to your account, or for mail delivery

IRS Refund Chart for 2011

IRS accepts your return (by 11:00 am) between… Projected Direct Deposit Sent* Projected Paper Check Mailed*
Jan 17 and Jan 18, 2012 Jan 25, 2012 Jan 27, 2012
Jan 19 and Jan 25, 2012 Feb 1, 2012 Feb 3, 2012
Jan 26 and Feb 1, 2012 Feb 8, 2012 Feb 10, 2012
Feb 2 and Feb 8, 2012 Feb 15, 2012 Feb 17, 2012
Feb 9 and Feb 15, 2012 Feb 22, 2012 Feb 24, 2012
Feb 16 and Feb 22, 2012 Feb 29, 2012 Mar 2, 2012
Feb 23 and Feb 29, 2012 Mar 7, 2012 Mar 9, 2012
Mar 1 and Mar 7, 2012 Mar 14, 2012 Mar 16, 2012
Mar 8 and Mar 14, 2012 Mar 21, 2012 Mar 23, 2012
Mar 15 and Mar 21, 2012 Mar 28, 2012 Mar 30, 2012
Mar 22 and Mar 28, 2012 Apr 4, 2012 Apr 6, 2012
Mar 29 and Apr 4, 2012 Apr 11, 2012 Apr 13, 2012
Apr 5 and Apr 11, 2012 Apr 18, 2012 Apr 20, 2012
Apr 12 and Apr 18, 2012 Apr 25, 2012 Apr 27, 2012
Apr 19 and Apr 25, 2012 May 2, 2012 May 4, 2012
Apr 26 and May 2, 2012 May 9, 2012 May 11, 2012
May 3 and May 9, 2012 May 16, 2012 May 18, 2012
May 10 and May 16, 2012 May 23, 2012 May 25, 2012
May 17 and May 23, 2012 May 30, 2012 Jun 1, 2012
May 24 and May 30, 2012 Jun 6, 2012 Jun 8, 2012
May 31 and Jun 6, 2012 Jun 13, 2012 Jun 15, 2012
Jun 7 and Jun 13, 2012 Jun 20, 2012 Jun 22, 2012
Jun 14 and Jun 20, 2012 Jun 27, 2012 Jun 29, 2012
Jun 21 and Jun 27, 2012 Jul 4, 2012 Jul 6, 2012
Jun 28 and Jul 4, 2012 Jul 11, 2012 Jul 13, 2012
Jul 5 and Jul 11, 2012 Jul 18, 2012 Jul 20, 2012
Jul 12 and Jul 18, 2012 Jul 25, 2012 Jul 27, 2012
Jul 19 and Jul 25, 2012 Aug 1, 2012 Aug 3, 2012
Jul 26 and Aug 1, 2012 Aug 8, 2012 Aug 10, 2012
Aug 2 and Aug 8, 2012 Aug 15, 2012 Aug 17, 2012
Aug 9 and Aug 15, 2012 Aug 22, 2012 Aug 24, 2012
Aug 16 and Aug 22, 2012 Aug 29, 2012 Aug 31, 2012
Aug 23 and Aug 29, 2012 Sep 5, 2012 Sep 7, 2012
Aug 30 and Sep 5, 2012 Sep 12, 2012 Sep 14, 2012
Sep 6 and Sep 12, 2012 Sep 19, 2012 Sep 21, 2012
Sep 13 and Sep 19, 2012 Sep 26, 2012 Sep 28, 2012
Sep 20 and Sep 26, 2012 Oct 3, 2012 Oct 5, 2012
Sep 27 and Oct 3, 2012 Oct 10, 2012 Oct 12, 2012
Oct 4 and Oct 10, 2012 Oct 17, 2012 Oct 19, 2012
Oct 11 and Oct 17, 2012 Oct 24, 2012 Oct 26, 2012
Oct 18 and Oct 24, 2012 Oct 31, 2012 Nov 2, 2012
Oct 25 and Oct 31, 2012 Nov 7, 2012 Nov 9, 2012
Nov 1 and Nov 7, 2012 Nov 14, 2012 Nov 16, 2012
Nov 8 and Nov 14, 2012 Nov 21, 2012 Nov 23, 2012
Nov 15 and Nov 21, 2012 Nov 28, 2012 Nov 30, 2012
Nov 22 and Nov 28, 2012 Dec 5, 2012 Dec 7, 2012
Nov 29 and Dec 5, 2012 Dec 12, 2012 Dec 14, 2012
Dec 6 and Dec 12, 2012 Dec 19, 2012 Dec 21, 2012
Dec 13 and Dec 19, 2012 Dec 27, 2012 Dec 31, 2012
Dec 20 and Dec 26, 2012 Jan 3, 2013 Jan 7, 2013

* The IRS does not guarantee a specific date that a refund will be deposited into a taxpayer’s financial institution account or when it will be mailed.

 

2012 IRS e-file Refund Cycle Chart

You can check the status of your refund 72 hours after IRS acknowledges receipt of your e-filed return. For the fastest information call 1-800-829-1954 or 1-800-829-4477.

Based on the date your return was accepted by the IRS, the earliest your refund will be direct deposited or mailed is shown on the chart above. This is a projected date based on normal processing. On the Wednesday prior to the projected date, you can go to www.irs.gov and click on Where’s my refund? to get any changes to the projected date.

pub17-full

New Tax Guide Features Recovery Tax Breaks

Taxpayers can get the most out of new recovery tax breaks and get a jump on preparing their 2009 federal income tax returns by consulting a newly revised comprehensive tax guide now available.

pub17-full

Publication 17, Your Federal Income Tax, features details on taking advantage of new tax-saving opportunities, such as the making work pay credit for most workers, American opportunity credit for parents and college students, energy credits for homeowners going green, first-time homebuyer credit, sales or excise tax deduction for new car buyers, and the expanded child tax credit and earned income tax credit for low- and moderate-income workers. This useful 308-page guide also provides more than 6,000 interactive links to help taxpayers quickly get answers to their questions.

 

New Tax Guide Features Recovery Tax Breaks

Publication 17 has been published annually by the IRS for more than 65 years and has been available on the IRS Web site since 1996. As in prior years, this publication is packed with basic tax-filing information and tips on what income to report and how to report it, figuring capital gains and losses, claiming dependents, choosing the standard deduction versus itemizing deductions, and using IRAs to save for retirement.

Publication 17 – Your Federal Income Tax

vw-jetta

2010 Advanced Lean-Burn Vehicles

Credit Amounts for 2010 Advanced Lean-Burn Vehicles

Model Year Make Model Credit Amount
2010 Audi A3 2.0L TDI Automatic $1,300
2010 Audi Q7 3.0L TDI $1,150
2010 Volkswagen Golf 2.0L TDI 2 door and 4 door automatic $1,700
2010 Volkswagen Golf 2.0L TDI 2 door and 4 door manual $1,300
2010 Volkswagen Jetta 2.0L TDI
(manual and automatic)
$1,300
2010 Volkswagen Jetta 2.0L TDI SportWagen
(manual and automatic)
$1,300
2010 Volkswagen Touareg 3.0L TDI $1,150

2010 Model Year Hybrid Vehicles

Credit Amounts for 2010 Model Year Hybrid Vehicles (as of 10-30-09)

Model Year

Make

Model

Credit Amount

NOTE:

2010

Cadillac

Escalade Hybrid (2WD & $WD)

$2,200

2010

Chevrolet

Malibu Hybrid

$1,550

Silverado Hybrid C15 2WD

$2,200

Silverado Hybrid K15 4WD

$2,200

Tahoe Hybrid C1500 2WD

$2,200

Tahoe Hybrid K1500 4WD

$2,200

2010

Ford

Escape Hybrid 4×2

$3,000

If purchased before 04-01-09: Full Credit Amount

$1,500

If purchased on 04-01-09 and on or before 09-30-09 Credit is 50% ($1500)

$750

If purchased on 10-01-09 and on or before 03-31-10 Credit is 25% ($750)

Escape Hybrid 4×4

$2,600

If purchased before 04-01-09: Full Credit Amount

$1,300

If purchased on 04-01-09 and on or before 09-30-09 Credit is 50% ($1,300)

$650

If purchased on 10-01-09 and on or before 03-31-10 Credit is 25% ($650)

Fusion Hybrid

$3,400

If purchased before 04-01-09: Full Credit Amount

$1,700

If purchased on 04-01-09 and on or before 09-30-09 Credit is 50% ($1700)

$850

If purchased on 10-01-09 and on or before 03-31-10 Credit is 25% ($850)

2010

GMC

Sierra Hybrid C15 2WD

$2,200

Sierra Hybrid K15 4WD

$2,200

Yukon Hybrid C1500 2WD

$2,200

Yukon Hybrid K1500 4WD

$2,200

Yukon Denali Hybrid C1500 2WD

$2,200

Yukon Denali Hybrid K 1500 4WD

$2,200

2010

Mercury

Mariner Hybrid 4×2

$3,000

If purchased before 04-01-09: Full Credit Amount

$1,500

If purchased on 04-01-09 and on or before 09-30-09 Credit is 50% ($1500)

$750

If purchased on 10-01-09 and on or before 03-31-10 Credit is 25% ($750)

Mariner Hybrid 4×4

$2,600

If purchased before 04-01-09: Full Credit Amount

$1,300

If purchased on 04-01-09 and on or before 09-30-09 Credit is 50% ($1,300)

$650

If purchased on 10-01-09 and on or before 03-31-10 Credit is 25% ($650)

Milan Hybrid

$3,400

If purchased before 04-01-09: Full Credit Amount

$1,700

If purchased on 04-01-09 and on or before 09-30-09 Credit is 50% ($1700)

$850

If purchased on 10-01-09 and on or before 03-31-10 Credit is 25% ($850)

2010

Nissan

Altima Hybrid

$2,350

2008 Tax Guide

Download IRS 2008 Tax Guide For Individuals

2008 Tax Guide
2008 Tax Guide

The IRS has placed its comprehensive tax guide for individuals on IRS.gov, updating it for tax year 2008. The updated on-line version of IRS Publication 17, “Your Federal Income Tax,” contains more than 900 interactive links.

Publication 17 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. It has been published annually by the IRS for more than 65 years and has been available on the IRS Web site since 1996.

 

Download IRS 2008 Tax Guide For Individuals

As in prior years, the publication 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.

Download: Publication 17

Publication 17 is available on line, however, for those who do not have access to the Internet can call 1-800-829-3676 to request a free copy from the IRS. Printed copies will be available in January 2009.

IRS Newswire