IRS Competency Testing
Remember that you only have until the end of 2013 to take and pass the IRS Competency Test.
With over 330,000 tax return preparers still needing to take and pass the test it is in your best interest to take the test as soon as possible. At the present time there are plenty of open spots at a Prometric testing site. However, if you wait until this time next year you may have difficulties making an appointment for the test. Read more
PTIN Renewal
A PTIN is good for each calendar year. The time to renew your PTIN for 2013 is approaching. To ensure that your PTIN is valid for 2013 you have from October 15 – December 31, 2012 to renew your PTIN. Read more
Click here to read the entire CrossLink Tax Update that includes further information on Testing and PTIN Renewal Requirements for Tax Return Preparers, as well as information on Continuing Education and Background Checks.
Wednesday, September 19, 2012
Wednesday, September 12, 2012
Changes to IRS Form 2848 (Power of Attorney)
The most recent revision (Rev. March 2012) of Form 2848 (Power of Attorney) has some changes that you should be aware of. As a reminder, this is the form that a taxpayer uses to authorize their tax return preparer to represent them before the IRS – usually regarding tax returns for specified years.
Below are the changes to Form 2848:
Click here to read the entire CrossLink Tax Update that includes further information on the changes to IRS Form 2848 (Power of Attorney).
Below are the changes to Form 2848:
- In order to represent a married couple on a joint return, both the husband and wife must now complete and submit separate Forms 2848.
- If you wish to have the IRS send copies of all notices and communications to you, the box next to each representative’s name and address must be checked.
- Click here to read more.
Click here to read the entire CrossLink Tax Update that includes further information on the changes to IRS Form 2848 (Power of Attorney).
Thursday, August 9, 2012
CrossLinkTax.com Now in Spanish!
As CrossLink continues to serve a growing number of Latino-owned and Latino-serving tax preparation businesses, we recognize the importance of providing bilingual resources for you and your clientele.
We are pleased to announce the launch of a Spanish version of our website which you can access at www.CrossLinkTax.com/EnEspanol by clicking on the “En Español” link in the top right-hand corner of any page on our English website. We invite you to keep in touch with us by liking our Facebook page and, as always, encourage you to contact a CrossLink Team Member for any of your needs.
Thank You!
Your CrossLink Team
We are pleased to announce the launch of a Spanish version of our website which you can access at www.CrossLinkTax.com/EnEspanol by clicking on the “En Español” link in the top right-hand corner of any page on our English website. We invite you to keep in touch with us by liking our Facebook page and, as always, encourage you to contact a CrossLink Team Member for any of your needs.
Thank You!
Your CrossLink Team
Wednesday, August 8, 2012
IRS Update: IRS to Give Greater Scrutiny to Compliance with IRA Rules
The IRS is about to begin a new initiative to go after taxpayers who make excess contributions to their Individual Retirement Arrangement (IRA) account or do not begin to withdraw funds from their traditional IRA account when they reach age 70.
Excess Contributions
Generally, an excess contribution is any amount made to a traditional IRA that exceeds $5,000 ($6,000 if 50 or older) per year. However, a taxpayer’s maximum IRA contribution may be less than this amount because a taxpayer cannot contribute more than their earned income. Click here to read more.
Required Withdrawals from Traditional IRA
Taxpayers with traditional IRAs must begin making withdrawals by April 1 of the year they reach 70. Failure to do so may result in a penalty of 50% on the required distribution.
According to the Treasury Inspector General for Tax Administration, there were approximately 255,000 taxpayers who failed to comply with the withdrawal requirements in 2006 and 2007 – costing the government approximately $174 million.
Click here to read the entire CrossLink Tax Update that includes further information on increased IRS scrutiny for IRA rules compliance.
Excess Contributions
Generally, an excess contribution is any amount made to a traditional IRA that exceeds $5,000 ($6,000 if 50 or older) per year. However, a taxpayer’s maximum IRA contribution may be less than this amount because a taxpayer cannot contribute more than their earned income. Click here to read more.
Required Withdrawals from Traditional IRA
Taxpayers with traditional IRAs must begin making withdrawals by April 1 of the year they reach 70. Failure to do so may result in a penalty of 50% on the required distribution.
According to the Treasury Inspector General for Tax Administration, there were approximately 255,000 taxpayers who failed to comply with the withdrawal requirements in 2006 and 2007 – costing the government approximately $174 million.
Click here to read the entire CrossLink Tax Update that includes further information on increased IRS scrutiny for IRA rules compliance.
Friday, July 27, 2012
IRS Update: EITC Warning Letters and Self-Employed Deductibility of Medicare Premiums
IRS Warning Letters for Tax Preparers Who Did Not Submit Form 8867 with EITC Returns
Beginning this filing season the Internal Revenue Service (IRS) requires that any tax return claiming EITC that is completed by a paid preparer must have the Form 8867 (Paid Preparer’s EIC Checklist) attached to it. The failure to comply with this requirement means that the paid preparer is not meeting their due diligence requirements and is therefore subject to a $500 penalty for each tax return that does not have Form 8867 attached to it.
The IRS has begun sending out warning letters to preparers who have submitted Tax Year 2011 EITC tax returns without attaching Form 8867. This letter warns the preparer that they did not meet their due diligence requirements in 2012. The IRS will not assess any penalties for the 2012 Filing Season. Click here to read more.
Self-Employed Taxpayers Can Deduct Medicare Premiums
The IRS Office of Chief Council has advised IRS attorneys that self-employed taxpayers may deduct Medicare premiums when calculating the self-employed health insurance deduction on Form 1040, line 29.
This reverses the IRS stance held before 2010 when the IRS stated that self-employed taxpayers could not include any Medicare premiums in the self-employed health insurance deduction. This decision also expands what the IRS permitted in 2011, allowing self-employed taxpayers to include only Medicare Part B premiums when calculating the self-employed health insurance deduction.
Click here or to read the entire CrossLink Tax Update that includes further information on EITC Warning Letters and Self-Employed Deductibility of Medicare premiums.
Beginning this filing season the Internal Revenue Service (IRS) requires that any tax return claiming EITC that is completed by a paid preparer must have the Form 8867 (Paid Preparer’s EIC Checklist) attached to it. The failure to comply with this requirement means that the paid preparer is not meeting their due diligence requirements and is therefore subject to a $500 penalty for each tax return that does not have Form 8867 attached to it.
The IRS has begun sending out warning letters to preparers who have submitted Tax Year 2011 EITC tax returns without attaching Form 8867. This letter warns the preparer that they did not meet their due diligence requirements in 2012. The IRS will not assess any penalties for the 2012 Filing Season. Click here to read more.
Self-Employed Taxpayers Can Deduct Medicare Premiums
The IRS Office of Chief Council has advised IRS attorneys that self-employed taxpayers may deduct Medicare premiums when calculating the self-employed health insurance deduction on Form 1040, line 29.
This reverses the IRS stance held before 2010 when the IRS stated that self-employed taxpayers could not include any Medicare premiums in the self-employed health insurance deduction. This decision also expands what the IRS permitted in 2011, allowing self-employed taxpayers to include only Medicare Part B premiums when calculating the self-employed health insurance deduction.
Click here or to read the entire CrossLink Tax Update that includes further information on EITC Warning Letters and Self-Employed Deductibility of Medicare premiums.
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