IRS Announces Late Start to Tax Season

The effects of the recent government shutdown are beginning to appear in various federal offices, including the Internal Revenue Service.

The IRS announced last week that the 2014 tax season, which was scheduled to begin on January 21, will be delayed by at least a week. The service will not be accepting or processing individual returns until at least January 28—though that date could be pushed back as far as February 4.

The delay may affect you as a taxpayer in two main ways—you won’t be able to file your return until possibly the beginning of February, and any communication you tried to make with the IRS during or immediately prior to the shutdown will receive a delayed response.

Nearly 90% of the IRS was closed during the shutdown, creating a 16-day delay that resulted in missed appointments, delayed implementation of installment plans, and a significant backlog of work that will … Read More

Do You Have Unreported Income?

The last thing you want is to get in trouble with the IRS—but many find themselves in the hot seat every year, having failed to accurately report all of their income. If the IRS finds a discrepancy between your records and the payment information on file, they will first send you a CP2000 Notice, giving you a chance to prove there has been a mistake and correct the situation. Penalties—from civil to criminal, depending on the situation—may await the taxpayer who fails to report his or her income accurately.

In addition, the IRS is getting much better at catching misreported returns, thanks to electronic means of tracking income and comparing forms 1099-K (Payment Card and Third Party Network Transactions) to business returns. The most likely taxpayers to underreport are high-income individuals and small businesses, so if you fall into either of those categories, you may also be more … Read More

Passing Down the Summer Cottage

A family’s summer cottage is a place for relaxation—a break from the stresses of work, city life, and winter’s grueling months. But this refuge can quickly turn into a source of stress itself when its owners try to pass the property along to their children. What was once a place of family union can turn into divisions between siblings, arguments over money, and a storm of emotions.

A number of baby boomers who grew up spending summers at the family cottage now face the responsibility of inheriting the property from their ageing parents. And the burden of making the transaction as smooth as possible often falls on the parents themselves. A recent article in the Wall Street Journal addresses the issue by presenting a number of possible solutions to make the transfer of property as easy as possible.

  1. Establish early on how the property is being funded in the long term.
Read More