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Free Texas tax prep is IRS-approved

February 17, 2011 By 1 Comment

By Deb Courson

AUSTIN, Texas – Free tax prep with no strings attached. That’s the offering at AARP Tax-Aide sites throughout Texas, where income taxes are prepared and filed by volunteers certified by the IRS. Those volunteers receive at least 80 hours of training and are re-certified every year. Some are retired accountants and executives, and others are accounting students getting hands-on experience. 

Harold Wiggins has been a Tax-Aide volunteer since 1997.

“I enjoy working with numbers; I also enjoy helping the people out there. They really appreciate our help, and they need our help.”

One tax break volunteers are trained to look for is the Earned Income Tax Credit (EITC). It’s a refund for lower-income taxpayers. 

IRS spokesman Richard Panick says EITC checks can range from a few hundred dollars to more than $5,000.

“What we’re seeing is folks in unusual economic circumstances, who perhaps in prior years weren’t eligible for the credit. But because of setbacks they may have suffered because of the economy, they may not know that they’re now eligible.”

Tax-Aide was created to help lower- and middle-income taxpayers with returns that aren’t too complex. Taxpayers don’t have to be an AARP member or senior citizen to use the free service. 

Information on Tax-Aide office locations is available by calling 888-227-7669 or online at www.AARP.org.

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IRS delays tax filing for certain taxpayers

January 20, 2011 By No Comments

By Kedra Williams

NDG Special Contributor

For most taxpayers, the 2011 tax filing season, which reports income and deductions for the calendar year 2010, began on January 14, 2011.   However, tax law changes enacted by Congress and signed by President Barack Obama on December 17, 2010 meant there were taxpayers that must wait until mid- to late February to file their tax returns so that the necessary allowance and extensions can be updated in the IRS systems.

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act  extended many of the tax provisions set to end in December, 2010.  Because these were still technically in affect at the time the Act was passed, there is no residual impact from these changes on this filing season.  However, there were three major provisions that were actually expired with the 2009 season that will need implanting for 2010.

Those who need to wait to file include:

  • Taxpayers Claiming Itemized Deductions on Schedule A. – Itemized deductions include mortgage interest, charitable deductions, medical and dental expenses as well as state and local taxes.  
  • Taxpayers Claiming the Higher Education Tuition and Fees Deduction – This deduction for parents and students – covering up to $4,000 of tuition and fees paid to a post-secondary institution – is claimed on Form 8917. However, the IRS emphasized that there will be no delays for millions of parents and students who claim other education credits, including the American Opportunity Tax Credit extended last month and the Lifetime Learning Credit.
  • Taxpayers Claiming the Educator Expense Deduction – This deduction is for kindergarten through grade 12 educators with out-of-pocket classroom expenses of up to $250. The educator expense deduction is claimed on Form 1040, Line 23 and Form 1040A, Line 16.

Even though some taxpayers have expenses that qualify for itemization, in order to itemize using Schedule A, the total deductions must exceed the standard deductions available based on your filing status.  For 2010 the standard deductions are: $11,400 for Married Filing Joint Filers; $5,700 for Married Filing Separately or Single Filers, and $8,400 for Head of Household Filers.  If your Schedule A Itemized deductions are below these thresholds and you are not affected by the provisions below, your filing deadline will not be delayed.

If you are unsure about how these tax items affect you and your filing deadline you should consult your professional tax advisor.

Kedra A. Williams CPA PC, 3940 St. Francis Avenue Suite 103, Dallas, TX 75228 specializes in complex tax issues and IRS negotiations. Williams can be reached at 469-449-9833 and www.kedrawilliams.com.

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Have you Heard?

December 15, 2010 By No Comments

By Tonya Whitaker

NDG Staff Writer

Kinda fishy

The You Outta Be Ashamed Award goes to Detroit DJ and soulster Keith Washington. The singer of the 1990s hit Kissing You sold out his “friend” Aretha Franklin by broadcasting a private conversation with her on his show, Kisses After Dark, on 105.9 Kiss FM. A source close to Franklin told Black Voices, “It was wrong. Aretha didn’t know she was getting taped.” I agree with the Black Voices source – that was flat out tacky. Washington issued an apology to Franklin and her family, and in the statement he said he knew the show was videotaped. Why didn’t Washington step out of the room to call the Queen of Soul? Sad to see that friendship takes a backseat when it comes to scooping a story.

Good rap, bad rap

Is there ever anything good to say about married NBA players? You definitely won’t hear a good word coming from Shaunie O’Neal. But, she did have one good thing to say in their defense. In a recent radio interview, Shaq’s ex-wife and VH-1’s Basketball Wives producer said the only NBA player she thinks is faithful is Grant Hill, who is married to singer Tamia. O’Neal is a really scorn woman to think there is only one faithful black NBA player in the league. NBA exs aren’t the only one hatin’ on hoopsters. Check out what Football Wives’ Chanita Foster, wife of former NFL player Greg Foster, says: “A basketball wife has more opportunities to get cheated on than a football wife. The NBA has 84 games a year, that’s 42 opportunities [for a basketball player] to do what they want in another city. The NFL has a total of 16 games and eight of them you leave on Saturday, play, and come back on Sunday.” Her rationale makes no sense to me. An athlete (or any nonprofessional athlete) who wants to cheat will find a way, regardless of the number of games played. Look at Brett Favre. He found a way to hook up with Jenn Sterger when he was a Jet.

Tucker’s comeback

The last time we heard from Chris Tucker, the Internal Revenue Service was riding his tail for $11 million in back taxes. Now, the Rush Hour actor is slated to star in Warner Bros. movie called The Rabbit. The action-comedy centers on a Las Vegas magician and escape artist who abandons the United States to work for hire on foreign soil. The premise does not sound like a box-office hit, but we got to do what we got to do to pay the bills.

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Texas State Representative Terri Hodge pleads guilty to federal charge and agrees to resign from public office

February 4, 2010 By 1 Comment

(NDG Wire) Gladys E. Hodge, also known as “Terri Hodge,” who was to go on trial early next month on charges outlined in a 31-count indictment charging 14 public officials and their associates with various offenses related to a bribery and extortion scheme involving affordable housing developments in the Dallas area, has pleaded guilty, announced U.S. Attorney James T. Jacks of the Northern District of Texas. As a condition of her plea with the government, Hodge, who was elected to the Texas House of Representatives, District 100, in 1996, and re-elected to the same position in 1998, 2000, 2002, 2004, 2006 and 2008, has agreed to resign her office and never seek or hold future public office.

Hodge entered her guilty plea this morning, before U.S. District Judge Barbara M.G. Lynn, to fraud and false statements on an income tax return. She faces a maximum statutory sentence of three years in prison, a $100,000 fine, and restitution to the IRS. At the hearing, Judge Lynn indicated that she would be setting the sentencing date as expeditiously as possible.

According to the factual resume filed in the case, over the course of her tenure as a state representative, Hodge supported Southwest Housing Development Company, Inc. (SWH) developments which, among others, included affordable housing developments in District 100. Co-defendant Cheryl L. Potashnik, the wife of co-defendant Brian L. Potashnik, a real estate developer and the founder, president and a principal of SWH, served in multiple roles in management and development of SWH, including that of chief operating officer and principal of SHW. Cheryl Potashnik pleaded guilty to bribery in connection with benefits given to Hodge by the Potashniks and SWH.

Brian Potashnik also pleaded guilty to bribery of various public officials. Both Potashniks are awaiting sentencing.

According to the factual resume filed, sometime on or before February 27, 2002, Hodge asked Brian Potashnik for assistance in the form of affordable housing for herself within the geographical boundaries of her political district. She indicated that she had financial problems and could not afford to pay the full rate for housing. Beginning in April 2002, the Potashniks made arrangements to provide Hodge with housing in one of SWH’s market-rate affordable housing development units, which was located at Rosemont at Arlington Park in District 100. Hodge moved into the apartment on April 1, 2002, and renewed her lease, at the same rental rate of $200 per month, in November 2002 and again in March 2003. As reflected in the executed lease agreements, the market rate for this unit was $899 per month, and the difference in rent was paid by the Potashniks.

In addition, the Potashniks paid the utility bills on the apartment from their development funds and provided new carpeting for her house located on Abrams Road in Dallas. The carpeting cost $1,995 and was paid for by the construction arm of SWH, a company named Affordable Housing Construction, Inc.

The total value of the rental subsidies, utilities and carpeting provided to Hodge by the Potashniks from 2002 through 2005 was $32,541. None of this amount was included as income on the corresponding federal income tax returns for the tax years in which it was received by Hodge.

The plea documents further state that Hodge had additional income, in tax years 2001 through 2005, totaling $41,465, comprised, in part, of campaign contributions which she used for her own personal benefit and which she did not include as income on the corresponding federal income tax returns for the tax years in which she received it.

Hodge admits that she filed a U.S. Individual Income Tax Return, Form 1040, with the IRS, that she knew she omitted income of $6,914 in 2001; $27,062 in 2002; $13,402 in 2003; $19,908 in 2004; and $6,720 in 2005. Hodge further admits that as a result, she owes the following in taxes (excluding penalties and interest) to the IRS: $1,937 for 2001; $1,496 for 2002; $1,908 for 2003, $3,887 for 2004, and $1,680 for tax year 2005, for a grand total of $10,908.

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Tax Tips: IRS is offering free tax help available nationwide

January 29, 2010 By 8 Comments

Nearly 12,000 free tax preparation sites will be open nationwide this year as the Internal Revenue Service continues to expand its partnerships with nonprofit and community organizations performing vital tax preparation services for low-income and elderly taxpayers.

The IRS Volunteer Income Tax Assistance (VITA) Program offers free tax help to people who earn less than $49,000. The Tax Counseling for the Elderly (TCE) Program offers free tax help to taxpayers who are 60 and older.

Today, partners and local officials will be hosting news conferences or issuing news releases nationwide to highlight the Earned Income Tax Credit (EITC) and their free tax preparation programs. The EITC is already the government’s largest cash assistance program targeted to low-income Americans. However, not all eligible taxpayers may be aware or claim the EITC.

Taxpayers need to bring to the VITA/TCE sites the following items:

Photo identification
Valid Social Security cards for the taxpayer, spouse and dependents
Birth dates for primary, secondary and dependents on the tax return
Current year’s tax package, if received
Wage and earning statement(s) Form W-2, W-2G, 1099-R, from all employers
Interest and dividend statements from banks (Forms 1099)
A copy of last year’s federal and state returns, if available
Bank routing numbers and account numbers for direct deposit
Other relevant information about income and expenses
Total paid for day care
Day care provider’s identifying number
To file taxes electronically on a Married Filing Jointly tax return, both spouses must be present to sign the required forms.

Trained community volunteers can help eligible taxpayers with all special credits, such as the EITC, Child Tax Credit or Credit for the Elderly. Also, many sites have language specialists to assist people with limited English skills.

In addition to free tax return preparation assistance, most sites use free electronic filing. Individuals taking advantage of the e-file program will receive their refunds in half the time compared to returns filed on paper. Taxpayers who use e-file and direct deposit can receive their refund in as few as 10 days. This year, taxpayers also can use the refunds to purchase U.S. Savings Bonds.

Taxpayers who file electronically also can opt to file now and pay later. If taxpayers owe, they can make a payment April 15 by authorizing an electronic funds withdrawal (direct debit) from a checking or savings account, paying by credit (Discover Card, American Express, MasterCard or VISA Card), or by check or money order (made out to the United States Treasury) using Form 1040-V, Payment Voucher.

As part of the IRS-sponsored TCE Program, AARP offers the Tax-Aide counseling program at nearly 7,000 sites nationwide during the filing season. Trained and certified AARP Tax-Aide volunteer counselors help people of low-to-middle income with special attention to people age 60 and older. To locate the nearest AARP Tax-Aide site, call 1-888-227-7669 or visit AARP’s Internet site.

The military also partners with the IRS to provide free tax assistance to military personnel and their families. The Armed Forces Tax Council (AFTC) consists of the tax program coordinators for the Army, Air Force, Navy, Marine Corps and Coast Guard. The AFTC oversees the operation of the military tax programs worldwide, and serves as the main conduit for outreach by the IRS to military personnel and their families. Volunteers are trained and equipped to address military specific tax issues, such as combat zone tax benefits and the effect of the EITC guidelines.

For taxpayers who want to prepare and e-file their own tax returns, there is IRS Free File. This is a free service offered by approximately 20 companies who make their software available for free. Taxpayers with incomes of less than $57,000 are eligible to use Traditional Free File, which is the easy-to-use, interview-style software. For people with incomes of more than $57,000 or people who need little assistance, there is Free File Fillable Forms. For either service, taxpayers must go through irs.gov/freefile to access the programs.

EITC-eligible taxpayers also can seek free assistance at the 400 IRS Taxpayer Assistance Centers nationwide. To assist EITC taxpayers, 167 IRS TACs will offer Saturday service on Jan. 30, Feb. 6 and Feb. 20.

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Tax Tips: Five Filing Facts for Recently Married or Divorced Taxpayers

January 26, 2010 By No Comments

If you were married or divorced recently, there are a couple of things you’ll want to do to ensure the name on your tax return matches the name registered with the Social Security Administration.

Here are five facts from the IRS for recently married or divorced taxpayers. Following these steps will help avoid problems when you file your tax return.

If you took your spouse’s last name or if both spouses hyphenate their last names, you may run into complications if you don’t notify the SSA. When newlyweds file a tax return using their new last names, IRS computers can’t match the new name with their Social Security Number.

If you were recently divorced and changed back to your previous last name, you’ll also need to notify the SSA of this name change.

Informing the SSA of a name change is a snap; you’ll just need to file a Form SS-5, Application for a Social Security Card at your local SSA office.

Form SS-5 is available on SSA’s Web site at www.socialsecurity.gov, by calling 800-772-1213 or at local offices. It usually takes about two weeks to have the change verified.

If you adopted your spouse’s children after getting married, you’ll want to make sure the children have an SSN. Taxpayers must provide an SSN for each dependent claimed on a tax return. For adopted children without SSNs, the parents can apply for an Adoption Taxpayer Identification Number – or ATIN – by filing Form W-7A, Application for Taxpayer Identification Number for Pending U.S. Adoptions with the IRS. The ATIN is a temporary number used in place of an SSN on the tax return. The W-7A is available on IRS.gov, or by calling 800-TAX-FORM (800-829-3676).

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