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Recent News Updates

Amending your tax return
11/13/13, 5:12AM

Today I was reviewing a tax return. The taxpayer told me that she and her husband supported their three children, and also both of their mothers. As I looked at their return, however, I saw they had only claimed their children as dependents. The taxpayer told me she thought you could only claim children, not adults. She has made the same mistake for the last five years.

 

I explained to her the process for amending a tax return. Generally you can amend a return up to three years from the date it was due, or two years from the date you paid the tax, whichever is later. That means it is too late for her to get any extra money from her 2008 and 2009 returns. We can still make changes to 2010, 2011 and 2012.

 

The form we use to amend the return is called 1040X. First we list all the numbers that were on the originally filed tax return. Then we list the numbers as they should have appeared, and write an explanation to tell the IRS what we have changed. The 1040X cannot be filed electronically at this time, it must be mailed to IRS, and if you have money coming back to you, it will generally take about 12 weeks. As an added bonus, the IRS will pay you interest too, since they kept your money longer than they should have!

 

My client has gone home to check and make sure that her mother and mother-in-law qualified as her dependents in each year. If they meet the test, we will prepare three separate amendments, and mail them to the IRS in three separate envelopes. Last thing to remember, if IRS pays her interest, she must report that interest as income on next year's tax return, just like she would any other interest received.


Latest fraud alert
11/2/13, 4:45PM

WASHINGTON — The Internal Revenue Service today warned consumers about a sophisticated phone scam targeting taxpayers, including recent immigrants, throughout the country.

 

Victims are told they owe money to the IRS and it must be paid promptly through a pre-loaded debit card or wire transfer. If the victim refuses to cooperate, they are then threatened with arrest, deportation or suspension of a business or driver’s license. In many cases, the caller becomes hostile and insulting.

 

“This scam has hit taxpayers in nearly every state in the country. We want to educate taxpayers so they can help protect themselves. Rest assured, we do not and will not ask for credit card numbers over the phone, nor request a pre-paid debit card or wire transfer,” says IRS Acting Commissioner Danny Werfel. “If someone unexpectedly calls claiming to be from the IRS and threatens police arrest, deportation or license revocation if you don’t pay immediately, that is a sign that it really isn’t the IRS calling.” Werfel noted that the first IRS contact with taxpayers on a tax issue is likely to occur via mail.

 

Other characteristics of this scam include:

 

Scammers use fake names and IRS badge numbers. They generally use common names and surnames to identify themselves.
Scammers may be able to recite the last four digits of a victim’s Social Security Number.
Scammers spoof the IRS toll-free number on caller ID to make it appear that it’s the IRS calling.
Scammers sometimes send bogus IRS emails to some victims to support their bogus calls.
Victims hear background noise of other calls being conducted to mimic a call site.
After threatening victims with jail time or driver’s license revocation, scammers hang up and others soon call back pretending to be from the local police or DMV, and the caller ID supports their claim.

 

If you get a phone call from someone claiming to be from the IRS, here’s what you should do:

 

If you know you owe taxes or you think you might owe taxes, call the IRS at 800-829-1040. The IRS employees at that line can help you with a payment issue – if there really is such an issue.
If you know you don’t owe taxes or have no reason to think that you owe any taxes (for example, you’ve never received a bill or the caller made some bogus threats as described above), then call and report the incident to the Treasury Inspector General for Tax Administration at 800-366-4484.
If you’ve been targeted by this scam, you should also contact the Federal Trade Commission and use their “FTC Complaint Assistant” at FTC.gov. Please add "IRS Telephone Scam" to the comments of your complaint.

 

If you receive a scam email, you can report it by forwarding to [email protected]

 

 



So what does this mean for you? The IRS will NEVER contact you by email, facebook, text or any other form of social media. It is very unusual for them to call you directly, but it could happen. 99% of the time, if there's a problem, you will receive a letter in the good old US Mail.

 

If you have any contact with the IRS at all, you are allowed to tell them you want to consult with a tax professional before you speak to them. All of us at Tax Partners Northwest can act as your representative and deal with the IRS on your behalf. The best action you can take when you hear from the IRS is to bring everything straight to us!


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