In an effort to slash over $700,000 from their budget, NY State has eliminated the mailing of form 1099-G (Statement for Recipients of State Income Tax Refunds) to New York taxpayers. 1099-G’s are issued to taxpayers that receive NY State refunds–which are considered taxable income on the following year’s income tax return.
In the absence of this form, taxpayers (especially those that self-prepare their returns) run the risk of neglecting to include their previous state refund on their 2009 tax return this year, which could result in a delayed refund and potential penalties and/or interest as it could take years for the IRS to notify taxpayers of errors. Furthermore, NY State has delayed many refunds over the last year and a lot of NY taxpayers have yet to receive their 2008 refunds. In this case, one would NOT have to claim their 2008 NY refund on their 2009 tax return. Very confusing, I know.
All returning R&G Brenner clients will not have any problems relating to this as our tax software was specifically programmed to carry over the necessary information to your 2009 tax returns. However, for non-clients that would like to obtain 1099-G information, you can do so by:
By now, everybody is aware of the sheer devastation inflicted on the people of Haiti by a massive earthquake that struck 9 days ago. It has been estimated that in excess of 200,000 people have been killed or are still missing. The global outpouring of aide & donations are setting records daily. However, in an effort to reward those that have made donations to Haiti–as well as provide an incentive to those that have not–a bi-partisan bill is being introduced by the Leaders of the House Ways & Means Committee that would allow for donations made between January 12 and February 28 to count toward your 2009 taxes, thereby potentially lowering 2009 tax liabilities.
“This measure provides an immediate benefit for those who have already given and incentive for those who are considering a charitable contribution,” Committee Chairman Charles B. Rangel, D-NY, said in a prepared statement.
Similar legislation was passed in 2005 to boost contributions in the aftermath of the Indian Ocean tsunami that occurred in late 2004. Typically, charitable contributions count toward the year in which they are made. The current measure would mean taxpayers don’t have to wait until next year to claim the benefit on their 2010 tax returns.
There are many organizations, charities & relief funds you can donate to. Click here to see some of your available options.
Jaskson Hewitt–the 2nd largest tax preparation business behind H&R Block–has lost over 50% of their Refund Anticipation Loan (RAL) funding for the 2010 tax season. Due to regulatory crackdowns, the bank that funded Jackson Hewitt’s RAL program–Pacific Capital Bankcorp Inc.–was blocked by the Office of the Comptroller, and ordered to leave the RAL business.
“It’s potentially disastrous for Jackson Hewitt,” said Vishnu Lekraj, an analyst at Morningstar Inc. “If they lose the ability to provide RALs … they also lose the ability to service taxpayers, who would go to competitors.”
RALs and other refund bank products are geared toward lower-income taxpayers; usually those without bank accounts. They offer customers a fast way to receive their refund (sometimes in as little as 1 day) while simultaneously debiting the tax preparation fee from their refund check so the taxpayer incurs no out-of-pocket expenses.
Jackson Hewitt has basically relented to the fact that over half of their offices will not be able to offer RALs:
“The company does not expect to have a RAL program in place by the beginning of the 2010 tax season on January 15, 2010 for the remainder of the RAL program,” the filing said. “The company is continuing all efforts to assist in securing RAL funding … for the 2010 tax season,” but “no assurances can be given.”
Translation: Jackson Hewitt is screwed. Also, Liberty Tax processed a portion of their RAL program through Pacific Capital (though not nearly on the scale of Hewitt). Nevertheless, a significant portion of both Liberty Tax’s & Jackson Hewitt’s revenue is generated by the ability to offer and fund these bank products. The inability to offer these products is set to cause a major shift in early season bank product business…with lasting consequences.
R&G Brenner currently has a relationship with up an accredited bank, and is authorized to offer Refund Anticipation Loans & Refund Anticipation Checks (RACs) for the 2010 Tax Season.
The state of California has announced that they would like to make good on over $50 Millon in uncashed I.O.U.’s–also known as Registered Warrants–to some 59,000 residents and businesses as a result of last years budget crisis; almost half of which are due to Los Angeles County residents.
John Chiang, the state controller, promised Thursday to contact every one of the nonredeemers in an effort to “close an ugly chapter in California fiscal history.” Mr. Chiang practically begged them to drain the treasury.
“We have your money,” he said. “Ask for it. We want to give it back to you.”
California issued about 450,000 I.O.U’s totaling approximately $2.6 Billion, and starting redeeming them–with interest–this past September. However, not everyone has cashed in yet.
With unemployment hovering around 12%, this money is desperately needed…but some may not even realize they have money coming to them.
If you would like to redeem your I.O.U., California residents & businesses must do so BEFORE September, 2010. In the event that you don’t want to wait for CA to contact you, There are a few ways you can collect your well deserved refund:
The only certainties in life are Death & Taxes as the old saying goes. But thanks to the inaction of Congress, wealthy taxpayers have one less tax to pay in 2010. On the surface this should be a good thing, but unfortunately, it’s not that simple…
Tax planners across the country were certain that Congress would extend the Estate Tax–also known as the “Death Tax”–which was set to expire this year. The House acted, but the Senate did not. So for the first time since 1916 there is no estate tax, and this is throwing the collective tax industry into a frenzy.
But before you start drawing up plans to sabotage your rich Grandma, there could be serious negative consequences (aside from, you know, the legal ramifications of snuffing out Grandma): Taxpayers who never thought they would wind up paying an Estate Tax, could end up paying a Capital Gains Tax instead. Continue reading »
I am proud to announce that R&G Brenner Income Tax Consultants is the recipient of the 2009 Best Of Business Award in the category of tax return preparation services by the Small Business Commerce Association (SBCA). I would like to thank all R&G Brenner associates; from our Senior Tax Consultants, Executives and clerical staff for allowing us to receive this outstanding reward. In a time when small businesses are becoming an extinct species, you are the foundation that allows us to persevere in this current economic climate. Keep up the great work and hopefully we can capture this award again in 2010.
Sincerely,
Benjamin K. Brenner, PRESIDENT
FOR IMMEDIATE RELEASE
R&G Brenner Income Tax Consultants Receives 2009 Best of Business Award
Ahhh H&R Block. You really are the McDonalds of income tax preparation. It’s like I always say, if you wan’t a good burger, you don’t go to McDonalds. Sure, it tastes good going down, but you’ll be sorry later…
Here’s H&R Block big wig Russ Smyth being interviewed about why he favors the new tax preparer regulations. One of his answers: Because it will drive smaller Mom & Pop industries out of business. He then quickly followed up that statement with “H&R Block encourages competition..,”
Well, sir, it’s easy to ecourage competition when a) you really have no competition and b) when you are simultaneously driving your collective competition out of business.
In the wake of the newly imposed regulations governing paid tax preparers, Nina E. Olson of the office of The National Taxpayer Advocate–an IRS watchdog–issued a report faulting the IRS on collecting delinquent taxes. She called it “…an astonishing lack of transparency as to what is included in these revenue figures and how they are computed,”. After the IRS reported $118 Billion in collected delinquent taxes, the figure turned out to be more like $86 Billion. This 27% difference was essentially buried in the footnote of the report with no explanation for the miscalculation.
Furthermore, the reports specifically addresses other IRS shortcomings including a lack of customer service, excessive use of liens, and criticisms of the new regulations governing paid tax preparers.
Regarding I.R.S. customer service:
The single biggest problem at the agency was getting an I.R.S. representative to pick up the phone when a taxpayer called with questions.
Only six out of 10 callers now get through, after an average waiting time of 12 minutes, compared with eight out of 10 three years ago. The report called the I.R.S.’s customer service — a focus of the agency — “unacceptable.”
