Author Archives: Taxman

New 100-percent depreciation deduction for business taxpayers

October 13, 2018

Tax reform legislation passed in December 2017 includes changes that affect businesses. One of these changes allows businesses to write off most depreciable business assets in the year they place them in service.

Here are some facts about this deduction to help businesses better understand how to claim it:

  • The 100-percent depreciation deduction generally applies to depreciable business assets with a recovery period of 20 years or less and certain other property.
  • Machinery, equipment, computers, appliances and furniture generally qualify.
  • The 100-percent depreciation deduction applies to qualifying property acquired and placed in service after Sept. 27, 2017.
  • Taxpayers who elect out of the 100-percent depreciation deduction for a class of property must do so on a timely filed return. Those who have already timely filed their 2017 return and did not elect out can still do so. These taxpayers have six months from the original filing deadline, to file an amended return. For calendar-year corporations, this means Oct. 15, 2018.
  • The IRS issued proposed regulations with guidance on what property qualifies and rules for qualified film, television and live theatrical productions, and certain plants.
  • For details on claiming the 100-percent depreciation deduction or electing out of claiming it, taxpayers should refer to the proposed regulations or the instructions to Form 4562, Depreciation and Amortization.

And as always, you may contact Tax On Wheels, LLC at 803 732-4288 if you need assistance with this or any other tax issue.

#IRSTaxTip:

https://go.usa.gov/xPkUb

Tax Relief for North and South Carolina Victims of Hurricane Florence

Posted September 30, 2018

SC-2018-01, Sept. 24, 2018

SOUTH CAROLINA — Victims of Hurricane Florence that took place beginning on Sept. 8, 2018 in South Carolina may qualify for tax relief from the Internal Revenue Service.

The President has declared that a major disaster exists in the States of North & South Carolina. Following the recent disaster declaration for individual assistance issued by the Federal Emergency Management Agency, the IRS announced today that affected taxpayers in certain counties will receive tax relief.

Individuals in South Carolina who reside or have a business in Chesterfield, Dillon, Georgetown, Horry, Marion and Marlboro counties may qualify for tax relief.

Individuals in North Carolina who reside or have a business in Beaufort, Bladen, Brunswick, Carteret, Columbus, Craven, Cumberland, Duplin, Greene, Harnett, Hoke, Hyde, Johnson, Lee, Lenoir, Jones, Moore, New Hanover, Onslow, Pamlico, Pender, Pitt, Richmond, Robeson, Sampson, Scotland, Wayne and Wilson counties may qualify for tax relief.

The declaration permits the IRS to postpone certain deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after Sept. 8, 2018 and before Jan. 31, 2019, are granted additional time to file through Jan. 31, 2019. This includes taxpayers who had a valid extension to file their 2017 return due to run out on Oct. 15, 2018. It also includes the quarterly estimated income tax payments due on Sept. 17, 2018 and Jan. 15, 2019, and the quarterly payroll and excise tax returns normally due on Oct. 31, 2018. It also includes tax-exempt organizations that operate on a calendar-year basis and had an automatic extension due to run out on Nov. 15, 2018.

In addition, penalties on payroll and excise tax deposits due on or after Sept. 8, 2018, and before Sept. 24, 2018, will be abated as long as the deposits are made by Sept. 24, 2018.

If an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date that falls within the postponement period, the taxpayer should call the telephone number on the notice to have the IRS abate the penalty.

The IRS automatically identifies taxpayers located in the covered disaster area and applies automatic filing and payment relief. But affected taxpayers who reside or have a business located outside the covered disaster area must call the IRS disaster hotline at 866-562-5227 to request this tax relief.

Covered Disaster Area

The counties listed above constitute a covered disaster area for purposes of Treas. Reg. §301.7508A-1(d)(2) and are entitled to the relief detailed below.

Affected Taxpayers

Taxpayers considered to be affected taxpayers eligible for the postponement of time to file returns, pay taxes and perform other time-sensitive acts are those taxpayers listed in Treas. Reg. § 301.7508A-1(d)(1), and include individuals who live, and businesses (including tax-exempt organizations) whose principal place of business is located, in the covered disaster area. Taxpayers not in the covered disaster area, but whose records necessary to meet a deadline listed in Treas. Reg. § 301.7508A-1(c) are in the covered disaster area, are also entitled to relief. In addition, all relief workers affiliated with a recognized government or philanthropic organization assisting in the relief activities in the covered disaster area and any individual visiting the covered disaster area who was killed or injured as a result of the disaster are entitled to relief.

Grant of Relief

Under section 7508A, the IRS gives affected taxpayers until Jan. 31, 2019, to file most tax returns (including individual, corporate, and estate and trust income tax returns; partnership returns, S corporation returns, and trust returns; estate, gift, and generation-skipping transfer tax returns; and employment and certain excise tax returns annual information returns of tax-exempt organizations; and employment and certain excise tax returns), that have either an original or extended due date occurring on or after Sept. 8, 2018 and before Jan. 31, 2019.

Affected taxpayers that have an estimated income tax payment originally due on or after Sept. 8, 2018 and before Jan. 31, 2019, will not be subject to penalties for failure to pay estimated tax installments as long as such payments are paid on or before Jan. 31, 2019. The IRS also gives affected taxpayers until Jan. 31, 2019 to perform other time-sensitive actions described in Treas. Reg. § 301.7508A-1(c)(1) and Rev. Proc. 2007-56, 2007-34 I.R.B. 388 (Aug. 20, 2007), that are due to be performed on or after Sept. 8, 2018 and before Jan. 31, 2019.

This relief also includes the filing of Form 5500 series returns, (that were required to be filed on or after Sept. 8, 2018 and before Jan. 31, 2019, in the manner described in section 8 of Rev. Proc. 2007-56. The relief described in section 17 of Rev. Proc. 2007-56, pertaining to like-kind exchanges of property, also applies to certain taxpayers who are not otherwise affected taxpayers and may include acts required to be performed before or after the period above.

Unless an act is specifically listed in Rev. Proc. 2007-56, the postponement of time to file and pay does not apply to information returns in the W-2, 1094, 1095, 1097, 1098, or 1099 series; to Forms 1042-S, 3921, 3922 or 8027; or to employment and excise tax deposits.  However, penalties on deposits due on or after Sept. 8, 2018 and before Sept. 24, 2018, will be abated as long as the tax deposits were made by Sept. 24, 2018.

Casualty Losses

Affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either the year in which the event occurred, or the prior year. See Publication 547 for details.

Individuals may deduct personal property losses that are not covered by insurance or other reimbursements. For details, see Form 4684, Casualties and Thefts and its Instructions.

Affected taxpayers claiming the disaster loss on a 2017 return should put the Disaster Designation, “South Carolina, Hurricane Florence” at the top of the form so that the IRS can expedite the processing of the refund.

Other Relief

The IRS will waive the usual fees and expedite requests for copies of previously filed tax returns for affected taxpayers. Taxpayers should put the assigned Disaster Designation “South Carolina, Hurricane Florence” in red ink at the top of Form 4506, Request for Copy of Tax Return, or Form 4506-T, Request for Transcript of Tax Return, as appropriate, and submit it to the IRS.

Affected taxpayers who are contacted by the IRS on a collection or examination matter should explain how the disaster impacts them so that the IRS can provide appropriate consideration to their case. Taxpayers may download forms and publications from the official IRS website, irs.gov, or order them by calling 800-829-3676. The IRS toll-free number for general tax questions is 800-829-1040.

As always, Tax On Wheels, LLC is available to assist taxpayers with all tax filing needs.  Tax On Wheels, LLC can be reached by calling 803 732-4288.

IRS provides tax relief for victims of Hurricane Florence

September 15, 2018

WASHINGTON — Hurricane Florence victims in parts of North Carolina and elsewhere have until Jan. 31, 2019, to file certain individual and business tax returns and make certain tax payments, the Internal Revenue Service announced today.

The IRS is offering this relief to any area designated by the Federal Emergency Management Agency (FEMA), as qualifying for individual assistance. Currently, this only includes parts of North Carolina, but taxpayers in localities added later to the disaster area, including those in other states, will automatically receive the same filing and payment relief. The current list of eligible localities is always available on the disaster relief page on IRS.gov.

The tax relief postpones various tax filing and payment deadlines that occurred starting on Sept. 7, 2018 in North Carolina. As a result, affected individuals and businesses will have until Jan. 31, 2019, to file returns and pay any taxes that were originally due during this period.

This includes quarterly estimated income tax payments due on Sept. 17, 2018, and the quarterly payroll and excise tax returns normally due on Sept. 30, 2018. Businesses with extensions also have the additional time including, among others, calendar-year partnerships whose 2017 extensions run out on Sept. 17, 2018. Taxpayers who had a valid extension to file their 2017 return due to run out on Oct. 15, 2018 will also have more time to file.

In addition, penalties on payroll and excise tax deposits due on or after Sept. 7, 2018, and before Sept. 24, 2018, will be abated as long as the deposits are made by Sept. 24, 2018.

The IRS disaster relief page has details on other returns, payments and tax-related actions qualifying for the additional time.

The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. Thus, taxpayers need not contact the IRS to get this relief. However, if an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date falling within the postponement period, the taxpayer should call the number on the notice to have the penalty abated.

In addition, the IRS will work with any taxpayer who lives outside the disaster area but whose records necessary to meet a deadline occurring during the postponement period are located in the affected area. Taxpayers qualifying for relief who live outside the disaster area need to contact the IRS at 866-562-5227. This also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization.

Individuals and businesses in a federally declared disaster area who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either the return for the year the loss occurred (in this instance, the 2018 return normally filed next year), or the return for the prior year (2017). See Publication 547 for details.

The tax relief is part of a coordinated federal response to the damage caused by severe storms and flooding and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.

Please feel free to contact Tax On Wheels, LLC at 803 732-4288 if you need assistance in meeting your tax filing obligations.

Taxpayers should know the telltale signs of a scam

June 5, 2018

Many taxpayers recently filed their taxes and may be waiting for a response from the IRS. Because of this summertime tends to be a period when thieves increase their scam attempts. They try to get people to disclose personal information like Social Security numbers, account information and passwords.

To avoid becoming a victim, taxpayers should remember these telltale signs of a scam:

The IRS and its authorized private collection agencies will never:

  • Call to demand immediate payment using a specific method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes. All tax payments should only be made payable to the U.S. Treasury. Taxpayers should never make checks out to third parties.
  • Threaten to immediately bring in local police or other law-enforcement groups to have the taxpayer arrested for not paying.
  • Demand that taxes be paid without giving the taxpayer the opportunity to question or appeal the amount owed.
  • Ask for credit or debit card numbers over the phone.
  • Use email, text messages or social media to discuss personal tax issues, such as those involving bills or refunds.

For anyone who doesn’t owe taxes and has no reason to think they do, they should:

For anyone who owes tax or thinks they do, they can:

  • View tax account information online at IRS.gov to see the actual amount owed. Taxpayers can then also review their payment options.
  • Call the number on the billing notice.
  • Call the IRS at 800-829-1040. IRS workers can help.

More information:

Tax On Wheels, LLC is always available to assist you if you have questions or concerns about being contacted by any taxing authority, including the Internal Revenue Service.  Please feel free to give us a call at 803 732-4288 if we can be of assistance to you.

IRS now billing those who filed but didn’t pay; Many payment options available

May 29, 2018

IRS YouTube Videos:

Easy Ways to Pay My IRS TaxesEnglish | Spanish | ASL

WASHINGTON — The Internal Revenue Service today advised those now receiving tax bills because they filed on time but didn’t pay in full that there are many easy options for paying what they owe to the IRS.

If a tax return was filed but the balance due remains unpaid, the taxpayer will receive a letter or notice in the mail from the IRS, usually within a few weeks. These notices, including the CP14 and CP501, both of which notify taxpayers that they have a balance due, are frequently mailed in the months of June and July.

How to pay

Taxpayers may pay taxes by electronic funds transfer, credit card, check, money order or cash:

  • Taxpayers can use Direct Pay to pay directly from a checking or savings account. This service is free.
  • Taxpayers can take advantage of the Electronic Federal Tax Payment System (EFTPS) to pay by phone or online. EFTPS® is a free service of the U.S. Department of Treasury.
  • Taxpayers may also initiate a debit or credit card payment. The IRS doesn’t charge a fee for this service but the processing company may. Fees vary by company.
  • Taxpayers may pay by check or money order made payable to the United States Treasury (or U.S. Treasury) either in person or through the mail.
  • Taxpayers should not send cash through the mail. They can pay cash at some IRS offices or at a participating PayNearMe location. Some restrictions apply.

Taxpayers who are unable to pay what they owe should contact the IRS as soon as possible. Several payment options are available including:

  • Online Payment Agreement — Individuals who owe $50,000 or less in combined income tax, penalties and interest and businesses that owe $25,000 or less in payroll tax and have filed all tax returns may qualify for an Online Payment Agreement. Most taxpayers qualify for this option, and an agreement can usually be set up in a matter of minutes. Online applications to establish tax payment plans, like online payment agreements and installment agreements, are available Monday – Friday., 6 a.m. to 12:30 a.m.; Saturday., 6 a.m. to 10 p.m.; Sunday, 6 p.m. to midnight.
  • Installment Agreement — Installment agreements paid by direct deposit from a bank account or a payroll deduction will help taxpayers avoid default on their agreements. It also reduces the burden of mailing payments and saves postage costs. Taxpayers who don’t qualify for a payment agreement may still pay by installment. Certain fees apply.
  • Delaying Collection — If the IRS determines a taxpayer is unable to pay, it may delay collection until the taxpayer’s financial condition improves.
  • Offer in Compromise — Some struggling taxpayers qualify to settle their tax bill for less than the amount they owe by submitting an offer in compromise. To help determine eligibility, use the Offer in Compromise Pre-Qualifier tool.

In addition, taxpayers can consider other options for payment, including getting a loan to pay the amount due. In many cases, loan costs may be lower than the combination of interest and penalties the IRS must charge under federal law.

Even if a taxpayer works out a payment solution with the IRS, the agency may still need to file a Notice of Federal Tax Lien to secure the government’s interest. Federal law requires the lien to establish priority as a creditor in competition with other creditors in certain situations, such as bankruptcy proceedings or sales of real estate. Once the IRS files a lien, it may appear on a taxpayer’s credit report and harm their credit rating. Therefore, it’s important that they work to resolve a tax liability as quickly as possible before lien filing becomes necessary. Once the IRS files a lien, the agency generally cannot issue a Certificate of Release of Federal Tax Lien until the taxpayer pays taxes, penalties, interest and recording fees in full.

Stay current

Taxpayers can take steps now to make sure they don’t fall behind on their taxes in the future. The IRS encourages several key groups of taxpayers to perform a “paycheck checkup” to check if they are having the right amount of tax withholding following recent tax-law changes.

Employees can increase their tax withholding by filling out a new Form W-4, Employee’s Withholding Allowance Certificate, and giving it to their employer. To have more tax withheld, claim fewer withholding allowances or ask the employer to take out a fixed amount of additional tax each pay period. To help figure the right amount to withhold, use the IRS Withholding Calculator  on IRS.gov.

The Tax Cuts and Jobs Act, enacted in December 2017, changed the way tax is calculated for most taxpayers, including those with substantial income not subject to withholding. Among other things, the new law changed the tax rates and brackets, revised business expense deductions, increased the standard deduction, removed personal exemptions, increased the child tax credit and limited or discontinued certain deductions. As a result, many taxpayers may need to raise or lower the amount of tax they pay each quarter through the estimated tax system.

The newly revised estimated tax package, Form 1040-ES, now available on IRS.gov, is designed to help taxpayers figure these payments correctly. Among other things, the package includes a quick rundown of key tax changes, income tax rate schedules for 2018 and a useful worksheet for figuring the right amount to pay. The IRS also mailed 1 million Form 1040-ES vouchers with instructions in late March to taxpayers who used the Form 1040-ES last year.

For more information, see Publication 505, Tax Withholding and Estimated Tax.

As always, you should contact Tax On Wheels, LLC at 803 732-4288 if you need assistance in dealing with the IRS or arranging payments on a tax bill.  We are here to help you.

The Right to Retain Representation: Taxpayer Bill of Rights #9

April 19, 2018

The right to retain representation when dealing with the IRS is one of ten rights in the Taxpayer Bill of Rights. Taxpayers who interact with the IRS should be aware of their rights.

The right to representation means:

  • Taxpayers have the right to retain an authorized representative of their choice to represent them in their dealings with the IRS.
  • Taxpayers who are heading to an interview with the IRS may select someone to represent them.
  • Taxpayers who retain representation don’t have to attend with their representative, unless the IRS formally summons them to appear.
  • In most situations, the IRS must suspend an interview if the taxpayer requests to consult with a representative, such as an attorney, certified public accountant or enrolled agent.
  • Any attorney, CPA, enrolled agent, enrolled actuary or other person permitted to represent a taxpayer before the IRS, who’s not disbarred or suspended from practice before the IRS, may submit a written power of attorney to represent a taxpayer before the IRS.
  • Taxpayers have the right to seek assistance from a Low Income Taxpayer Clinic if they cannot afford representation.
  • Taxpayers with income below a certain level may ask an LITC to represent them in their tax dispute before the IRS or a federal court. Help from an LITC can be free or for a minimal fee. Many LITCs offer services in languages other than English. Although LITCs receive partial funding from the IRS, they and their employees and volunteers are completely independent of the IRS.

As an enrolled agent, I am enrolled to practice before the IRS and can assist you with all matters pending before the IRS. When you get THE LETTER, give Tax On Wheels, LLC a call at 803 732-4288 so we can assist you in resolving your tax issues.

More Information:
Publication 1, Your Rights as a Taxpayer
Taxpayer Advocate Service

#IRSTaxTip: The Right to Retain Representation: Taxpayer Bill of Rights #9 https://go.usa.gov/xQbnA

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What Taxpayers Should do When They Need More Time to Pay

April 16, 2018

All taxpayers should file their taxes on time, even if they can’t pay what they owe. This saves them from a potential failure-to-file penalty. While taxes are due by the original due date of the return, some taxpayers are unable to pay them by the deadline.

Here are some tips for those who can’t pay their taxes in full by the April 17 deadline:

  • File on Time and Pay as Much as Possible. Taxpayers can pay online, by phone, by check or money order, or with their mobile device using the IRS2Go app.
  • Get a Loan or Use a Credit Card to Pay the Tax. The interest and fees charged by a bank or credit card company may be less than IRS interest and penalties.
  • Use the Online Payment Agreement tool. Taxpayers should not wait for the IRS to send a bill before setting up a payment plan. The best way to do this is to use the Online Payment Agreement tool. Taxpayers can also file an Installment Agreement Request with their return and set up a direct debit agreement, eliminating the need to send a check each month.
  • Don’t Ignore a Tax Bill. The IRS may take collection action against taxpayers who don’t respond to notices. Taxpayers should contact the IRS right away by calling the phone number on their bills to talk about options. The IRS will work with taxpayers suffering financial hardship.

IRS YouTube Videos:
Owe Taxes But Can’t Pay? – English | Spanish | ASL

#IRSTaxTip: What Taxpayers Should do When They Need More Time to Pay https://go.usa.gov/xQbnG

Tax filing season begins January 29, 2018

R-2018-01, Jan. 04, 2018

WASHINGTON ― The Internal Revenue Service announced today that the nation’s tax season will begin Monday, Jan. 29, 2018 and reminded taxpayers claiming certain tax credits that refunds won’t be available before late February.

The IRS will begin accepting tax returns on Jan. 29, with nearly 155 million individual tax returns expected to be filed in 2018. The nation’s tax deadline will be April 17 this year – so taxpayers will have two additional days to file beyond April 15.

Many software companies and tax professionals will be accepting tax returns before Jan. 29 and then will submit the returns when IRS systems open. Although the IRS will begin accepting both electronic and paper tax returns Jan. 29, paper returns will begin processing later in mid-February as system updates continue. The IRS strongly encourages people to file their tax returns electronically for faster refunds.

The IRS set the Jan. 29 opening date to ensure the security and readiness of key tax processing systems in advance of the opening and to assess the potential impact of tax legislation on 2017 tax returns.

The IRS reminds taxpayers that, by law, the IRS cannot issue refunds claiming the Earned Income Tax Credit (EITC) and the Additional Child Tax Credit (ACTC) before mid-February. While the IRS will process those returns when received, it cannot issue related refunds before mid-February. The IRS expects the earliest EITC/ACTC related refunds to be available in taxpayer bank accounts or on debit cards starting on Feb. 27, 2018, if they chose direct deposit and there are no other issues with the tax return.

The IRS also reminds taxpayers that they should keep copies of their prior-year tax returns for at least three years. Taxpayers who are using a tax software product for the first time will need their adjusted gross income from their 2016 tax return to file electronically. Taxpayers who are using the same tax software they used last year will not need to enter prior-year information to electronically sign their 2017 tax return. Using an electronic filing PIN is no longer an option. Taxpayers can visit IRS.gov/GetReady for more tips on preparing to file their 2017 tax return.

The IRS also announced that the filing deadline to submit 2017 tax returns is Tuesday, April 17, 2018, rather than the traditional April 15 date. In 2018, April 15 falls on a Sunday, and this would usually move the filing deadline to the following Monday – April 16. However, Emancipation Day – a legal holiday in the District of Columbia – will be observed on that Monday, which pushes the nation’s filing deadline to Tuesday, April 17, 2018. Under the tax law, legal holidays in the District of Columbia affect the filing deadline across the nation.

The IRS also has been working with the tax industry and state revenue departments as part of the Security Summit initiative to continue strengthening processing systems to protect taxpayers from identity theft and refund fraud. The IRS and Summit partners continued to improve these safeguards to further protect taxpayers filing in 2018.

As always, please feel free to contact Tax On Wheels, LLC at 803 732-4288 if we can be of assistance to you in managing your tax obligations.

Retirement Plans Can Make Loans, Hardship Distributions to Victims of Hurricane Harvey

August 30, 2017

WASHINGTON —The Internal Revenue Service today announced that 401(k)s and similar employer-sponsored retirement plans can make loans and hardship distributions to victims of Hurricane Harvey and members of their families. This is similar to relief provided last year to Louisiana flood victims and victims of Hurricane Matthew.

Participants in 401(k) plans, employees of public schools and tax-exempt organizations with 403(b) tax-sheltered annuities, as well as state and local government employees with 457(b) deferred-compensation plans may be eligible to take advantage of these streamlined loan procedures and liberalized hardship distribution rules. Though IRA participants are barred from taking out loans, they may be eligible to receive distributions under liberalized procedures.

Retirement plans can provide this relief to employees and certain members of their families who live or work in disaster area localities affected by Hurricane Harvey and designated for individual assistance by the Federal Emergency Management Agency (FEMA). Currently, parts of Texas qualify for individual assistance. For a complete list of eligible counties, visit https://www.fema.gov/disasters. To qualify for this relief, hardship withdrawals must be made by Jan. 31, 2018.

The IRS is also relaxing procedural and administrative rules that normally apply to retirement plan loans and hardship distributions. As a result, eligible retirement plan participants will be able to access their money more quickly with a minimum of red tape. In addition, the six-month ban on 401(k) and 403(b) contributions that normally affects employees who take hardship distributions will not apply.

This broad-based relief means that a retirement plan can allow a victim of Hurricane Harvey to take a hardship distribution or borrow up to the specified statutory limits from the victim’s retirement plan. It also means that a person who lives outside the disaster area can take out a retirement plan loan or hardship distribution and use it to assist a son, daughter, parent, grandparent or other dependent who lived or worked in the disaster area.

Plans will be allowed to make loans or hardship distributions before the plan is formally amended to provide for such features. In addition, the plan can ignore the reasons that normally apply to hardship distributions, thus allowing them, for example, to be used for food and shelter. If a plan requires certain documentation before a distribution is made, the plan can relax this requirement as described in Announcement 2017-11.

The IRS emphasized that the tax treatment of loans and distributions remains unchanged. Ordinarily, retirement plan loan proceeds are tax-free if they are repaid over a period of five years or less.  Under current law, hardship distributions are generally taxable and subject to a 10-percent early-withdrawal tax.

Further details are in Announcement 2017-11, posted today on IRS.gov. More information about other tax relief related to Hurricane Harvey can be found on the IRS disaster relief page. For information on government-wide relief efforts, visit www.USA.gov/hurricane-harvey.

Please contact Tax On Wheels, LLC at 803 732-4288 if we can be of assistance to you during this tragedy.

Beware of Fake Charity Scams Relating to Hurricane Harvey

August 30, 2017

WASHINGTON ― The Internal Revenue Service has issued a warning about possible fake charity scams emerging due to Hurricane Harvey and encouraged taxpayers to seek out recognized charitable groups for their donations.

While there has been an enormous wave of support across the country for the victims of Hurricane Harvey, people should be aware of criminals who look to take advantage of this generosity by impersonating charities to get money or private information from well-meaning taxpayers. Such fraudulent schemes may involve contact by telephone, social media, e-mail or in-person solicitations.

Criminals often send emails that steer recipients to bogus websites that appear to be affiliated with legitimate charitable causes. These sites frequently mimic the sites of, or use names similar to, legitimate charities, or claim to be affiliated with legitimate charities in order to persuade people to send money or provide personal financial information that can be used to steal identities or financial resources.

IRS.gov has the tools people need to quickly and easily check the status of charitable organizations.

The IRS cautions people wishing to make disaster-related charitable donations to avoid scam artists by following these tips:

  • Be sure to donate to recognized charities.
  • Be wary of charities with names that are similar to familiar or nationally known organizations. Some phony charities use names or websites that sound or look like those of respected, legitimate organizations. The IRS website at IRS.gov has a search feature, Exempt Organizations Select Check, through which people may find qualified charities; donations to these charities may be tax-deductible.
  • Don’t give out personal financial information — such as Social Security numbers or credit card and bank account numbers and passwords — to anyone who solicits a contribution. Scam artists may use this information to steal a donor’s identity and money.
  • Never give or send cash. For security and tax record purposes, contribute by check or credit card or another way that provides documentation of the donation.
  • Consult IRS Publication 526, Charitable Contributions, available on IRS.gov. This free booklet describes the tax rules that apply to making legitimate tax-deductible donations. Among other things, it also provides complete details on what records to keep.

Taxpayers suspecting fraud by email should visit IRS.gov and search for the keywords “Report Phishing.”

More information about tax scams and schemes may be found at IRS.gov using the keywords “scams and schemes.” Details on available relief can be found on the disaster relief page on IRS.gov.

As always, please feel free to contact Tax On Wheels, LLC directly at 803 732-4288  if we can be of assistance to you.