Many people have side businesses or activities that they pursue for fun, but may also make money doing. Determining whether these activities qualify as a business or a hobby has serious tax consequences, especially after the passage of the Tax Cuts and Jobs Act...
Month: April 2019
When Tax Debt May Be Dischargeable
Some older income tax debts may be dischargeable in bankruptcy. There are a number of requirements that must be met, so consult a bankruptcy attorney and a tax resolution attorney to discuss your options before filing bankruptcy. General Requirements Generally, your...
How Is Tax Debt Treated in Bankruptcy?
Some tax debts may be dischargeable in either a Chapter 7 or Chapter 13 bankruptcy. There are many criteria that must be satisfied and complex rules that apply to the dischargeability of tax debt. The Automatic Stay First, the automatic stay of bankruptcy will protect...
What Causes a Delay of Your Tax Refund?
A delayed tax refund may mean your refund is being offset or put on hold temporarily. The IRS might just be verifying some information before releasing your refund, but it could also be an indication that you have some IRS tax problems. Refund Offsets A refund offset...
IRS Waives Underpayment Penalty for Some Taxpayers
The IRS has waived the underpayment penalty for some taxpayers whose withholding or estimated tax payments resulted in an underpayment for the 2018 tax year. If you qualify, you should complete Form 2210 and submit it along with your tax return to receive the penalty...
How the New Tax Deduction for Pass-Through Businesses Works
The Tax Cuts and Jobs Act included a deduction for pass-through business to level the playing field with corporations who received a significant tax break. If you are self-employed, an independent contractor, or own a business other than a C corporation, this new...
Innocent Spouse Relief vs. Offer in Compromise
Many factors will affect whether you should considering requesting innocent spouse relief or submitting an Offer in Compromise (OIC). Your eligibility and the benefits you will receive from each program depend on the following factors: Your financial situation. How...
Items On Your Tax Return That May Increase Your Audit Risk
The IRS can’t audit every tax return, so they use shortcuts to identify returns with major errors or red flags. If you have certain unusual items on your return, the computer programs used by the IRS may flag your return for closer scrutiny. Some items that increase...
How Many Years of Innocent Spouse Relief Can You Claim?
There is no limit to how many years of innocent spouse relief you can request. However, other factors may limit how many years of innocent spouse relief you will qualify for. Two-Year Limit to Request Relief For two of the three types of innocent spouse relief, you...
What to Do If Your Spouse Leaves You With Tax Debt
The IRS can go after either or both spouses for tax debt from a joint return. This is true even if you have a divorce settlement stating that your former spouse will handle the tax debt. If your former spouse won’t hold up their end of the bargain and resolve your tax...