Same-sex couples in California are facing both a simpler and more complex tax landscape this year, as they have the option to file federal income tax returns jointly for the first time and must choose whether to amend previous years filings as well. For many couples this will require an extensive examination of past years finances and deductions to determine the most advantageous approach, along with a look forward to start planning for the new tax landscape.
In the process of beginning to create an estate plan a lot of people have probably heard that it is best to give away a substantial portion of one’s wealth before they are gone in order to minimize tax liability and to make sure that gifts go to the people and organizations that they are intended for. This can be a very good method for pre-emptively managing an estate, but in some circumstances might not be the best possible option.
A federal court recently struck down an Internal Revenue Service proposal that the agency be permitted to oversee professional tax preparers. The concept was fought by tax preparers from several states as well as libertarian groups who believed it was an overreach of government intervention in business.
The conflict between the Internal Revenue Service and the estate of legendary pop singer Michael Jackson continues as the IRS announces huge penalties for the alleged purposeful undervaluing of the estate. We covered this issue in a post last year when it first came to light that there was a valuation issue.
This time of year, tax audits are on everyone’s minds as we rush to compile financial paperwork and sit down for the task of completing our annual income tax returns. The ominous threat of the tax audit lurks in the background, waiting to jump out like a boogeyman if we make a mistake or miscalculate our tax liability. One of the reasons why so many people are nervous about a tax audit is because we have some ideas in our minds that might not be totally true, urban tax audit legends, if you will.
Tax season is officially in full swing, as most California taxpayers have now received all of the necessary forms to start the process of filing their taxes. For some people this means entering one or two simple forms into a free online program and calling it a day, while others require a bit more effort to make sure they are doing everything correctly.