- Beware of Trust Fund Penalties
- The term “trust fund recovery penalty” refers to a tax penalty assessed against the directors or officers of a business entity that failed to pay a required tax on behalf of its employees. For example, employers withhold income taxes and FICA payroll taxes from employees’ wages. These funds actually belong to the government and are referred to as “trust funds.” They cannot be used by the employer to pay other business expenses.
- The Alimony Gap
- Individuals who pay alimony can deduct the amount paid from income on their tax return to reduce the amount of their personal income tax. Conversely, individuals who receive alimony must claim the amount received as income on their tax returns.
- Scammers Getting More Brazen
- We have previously cautioned you not to be duped by Internet and mail scams dreamed up by some pretty enterprising thieves. Most of those revolve around the Internet and e-mails, trying to steal your identity or have you pay tax liabilities that don’t exist.
- Have You Reviewed Your Will or Trust Lately?
- Your will or trust was prepared so that your assets will be distributed according to your wishes after your death. These documents can also reduce estate taxes. However, certain events can cause these documents to become outdated and create family stress and unpleasant tax results.
- The Earned Income Tax Credit: the IRS's Nemesis
- Years ago, Congress created the earned income tax credit (EITC) as a refundable tax credit for people who work but have lower incomes. This credit has been a nemesis for the IRS to administer ever since because, on the one hand, it is the frequent target of fraud and excess credit claims and, on the other hand, 20% to 25% of those who qualify for the credit do not claim it.
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