Hooray! The long awaited tax changes have finally been signed into law. The President finally signed into law the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010. (Try saying that fast 3 times in a row!) Let's keep things simple and refer to this as the 2010 Tax Relief Act. So the question is: Is this truly tax relief? Or is it a disguised tax increase? Well....the answer is Yes and No. The 2010 Tax Bill, costing Americans $857 Billion dollars, does include some pretty significant tax cuts, although not all of them will result in tax savings for us. Rather than addressing ALL the big and small changes, we want to break out the tax changes into a 3 article series: Individual Taxpayers, Business Owners, and Real Estate Investors. Each of these articles will address the changes as it relates specifically to these types of taxpayers as well as strategies that you can implement to take full advantage of the new tax cuts.
Keep Clear Lines Of Communication The worse thing you can do when you owe money to anyone is 'bury your head under the sand' in the hope that things will get better. Always keep the IRS informed about your present circumstances. Let them know in very clear terms that you have things in hand. This could easily result in them calling off the pursuit, not permanently of course, but long enough for you to get things in order.
The best bit of advice to give any person or company when behind on State or Federal Taxes is to stay current.
There are legitimate ways to settle your tax debt, but it's difficult to get the IRS to classify you as being uncollectable. This is why it's important that you take the time to invest in a suitable tax specialist, who'll be able to file the necessary forms.
Another factor that is a must is to have all tax returns current. The IRS will not work with anyone who is not current in their filing. Get all tax returns up to date and send to the IRS as soon as possible.
This way, when they review your case, they know that this is a taxpayer/business who is current and in full filing compliance.
ESTATE & GIFTING OPPORTUNITIES The highly anticipated estate tax change was finally determined as part of the 2010 Tax Relief Bill. Most taxpayers will be happy to know that the estate tax exemption was increased from $1 million per person all the way up to $5 million per person and the top tax rate will remain at the lower 35%. This is a significant change especially for high net worth families because now the dollar amount that is exempt from estate taxes is $10 million for married couples. For the first time, the estate, gift and generation-skipping taxes will be "unified" so that one $5 million exemption per individual applies to all three. This will make it much easier for wealthy taxpayers to make gifts during life to children & grandchildren. If you are a taxpayer who is in a high paying tax bracket, now is a really great time to plan for ways to shift some of your income to other family members who may be in lower tax brackets. There are countless ways that you can use Family Limited Partnerships to shift income to lower taxed family members without losing control of those assets. With the current depressed market values and the new $5 million exemption, now is the time to get your tax and estate planning in place!
As far as hiring a good Christian based tax firm, check out the bio's on the person and ask good solid questions about their faith and business practices. Also check the Better Business Bureau rating. Anyone not having an "A" rating is not walking the walk.
Keep Clear Lines Of Communication The worse thing you can do when you owe money to anyone is 'bury your head under the sand' in the hope that things will get better. Always keep the IRS informed about your present circumstances. Let them know in very clear terms that you have things in hand. This could easily result in them calling off the pursuit, not permanently of course, but long enough for you to get things in order.
The best bit of advice to give any person or company when behind on State or Federal Taxes is to stay current.
There are legitimate ways to settle your tax debt, but it's difficult to get the IRS to classify you as being uncollectable. This is why it's important that you take the time to invest in a suitable tax specialist, who'll be able to file the necessary forms.
Another factor that is a must is to have all tax returns current. The IRS will not work with anyone who is not current in their filing. Get all tax returns up to date and send to the IRS as soon as possible.
This way, when they review your case, they know that this is a taxpayer/business who is current and in full filing compliance.
ESTATE & GIFTING OPPORTUNITIES The highly anticipated estate tax change was finally determined as part of the 2010 Tax Relief Bill. Most taxpayers will be happy to know that the estate tax exemption was increased from $1 million per person all the way up to $5 million per person and the top tax rate will remain at the lower 35%. This is a significant change especially for high net worth families because now the dollar amount that is exempt from estate taxes is $10 million for married couples. For the first time, the estate, gift and generation-skipping taxes will be "unified" so that one $5 million exemption per individual applies to all three. This will make it much easier for wealthy taxpayers to make gifts during life to children & grandchildren. If you are a taxpayer who is in a high paying tax bracket, now is a really great time to plan for ways to shift some of your income to other family members who may be in lower tax brackets. There are countless ways that you can use Family Limited Partnerships to shift income to lower taxed family members without losing control of those assets. With the current depressed market values and the new $5 million exemption, now is the time to get your tax and estate planning in place!
As far as hiring a good Christian based tax firm, check out the bio's on the person and ask good solid questions about their faith and business practices. Also check the Better Business Bureau rating. Anyone not having an "A" rating is not walking the walk.
About the Author:
Harris Smith offers advice on home equity line of credit and obtaining credit. Applying for Debt Consolidation can help.