Smart TaxesSmart Taxes

Using a credit card to pay for taxes may be convenient, but there are extraordinary costs.

By TheStreet Staff Mar 29, 2010 12:35PM

TheStreetBy Bill Hardekopf, TheStreet


The tax deadline is more than two weeks away and consumers will soon be bombarded with messages encouraging them to pay with a credit card.


While this may sound appealing to consumers struggling to find ways to pay taxes in this turbulent economy, it should be avoided at all costs.


The Internal Revenue Service and some credit card issuers promote the benefits of paying taxes with a credit card. Payment with a credit card is easy and can be made via phone or online. It delays the pain of payment for another month. Consumers can even earn reward points on some cards.


Liability protection? Doubtful, and you'll get to spend more on your lawyer and accountant.

By Jeff Schnepper Mar 29, 2010 10:17AM

Don’t incorporate!


Only the lawyers and accountants make money when you incorporate.


Your attorney and CPA aren’t giving you the full story.


Decades ago, you could put aside and deduct more pension money for retirement if you were incorporated. That’s no longer so.


Incorporating and electing Subchapter S status may reduce your taxes. A Subchapter S corporation is treated like a partnership as a flow-through entity. But, all corporate income, after deducting any salary paid to you, is taxable as dividends, not subject to payroll taxes. Had you not incorporated, all income, both what you took as salary and the income of the corporation after the salary deduction, could be subject to payroll taxes. The difference escapes payroll taxation.


Too many callers can't get through or are given wrong answers.

By Jeff Schnepper Mar 26, 2010 9:14AM

Former Sen. Edward V. Long of Missouri called it an American “Gestapo,” but we know it now as the Internal Revenue Service.


I understand the “Internal” part because these financial vampires suck the monetary blood from your system.

I even understand the “Revenue” part because they want your money.


But, what happened to the “Service” part?


Agency seeks to find -- and tax -- money hidden in offshore accounts.

By Teresa Mears Mar 25, 2010 4:46PM

This news article comes from Martin Vaughan at partner site The Wall Street Journal:


The U.S. Internal Revenue Service for the moment has one person charged with investigating tax crimes stationed in Hong Kong, a jurisdiction that has played a prominent role in recent U.S. tax evasion cases.


That may be about to change. The IRS is in the process of hiring and training hundreds of agents world-wide to pursue U.S. tax dodgers who have hidden cash overseas. Tax attorneys and advisers in Hong Kong say they have been told the IRS plans to add several enforcement positions at the U.S. consulate here, though it isn't clear how soon.

IRS officials in Washington and Beijing, where the IRS senior attache for Asia is stationed, didn't immediately respond to inquiries about staffing levels.


Other agencies also provide free assistance with tax returns.

By Kay Bell Mar 25, 2010 4:22PM

Having trouble filling out your return? You can go straight to the Internal Revenue Service this Saturday for help.


More than 180 IRS offices will be open on March 27 from 9 a.m. to 2 p.m., local time, to help taxpayers.


"We are holding these special open houses to give taxpayers who are struggling in these difficult economic times more opportunity to work directly with IRS employees to resolve their tax issues," said IRS Commissioner Doug Shulman.


New law provides up to $7,621.60 in incentives for each unemployed person hired.

By Jeff Schnepper Mar 24, 2010 10:44AM

Congress wants you to get a job, and has provided new tax incentives to put you to work.


Maybe you blinked and missed the new tax law – and I’m not talking about the Health Care Bill.


Last week, President Obama signed the Hiring Incentives to Restore Employment (HIRE) Act.


The fraudster is one of the state's top 250 debtors. California's list includes Dionne Warwick and Burt Reynolds.

By Money Staff Mar 24, 2010 9:45AM

By Elizabeth Strott, MSN Money


Bernard Madoff © Daniel Acker/Bloomberg News/Landov
Disgraced financier Bernie Madoff's reputation just got worse, if that is even possible.


The convicted Ponzi schemer is No. 68 on New York's list of the top 250 tax deadbeats, owing the Empire State $984,280 in back taxes. The state has to get in line with the hundreds of others who were defrauded by Madoff and wait until bankruptcy proceedings are wrapped up.


The individual topping the list is the former owner of Scores strip clubs, Irving Bilzinsky. His tax bill is a whopping $15.3 million, going back to July 2007. Bilzinsky filed for bankruptcy in 1998. 


The IRS is beefing up its criminal-investigation unit -- a gentle reminder as the tax deadline approaches.

By TheStreet Staff Mar 23, 2010 2:12PM

By Joe Mont, TheStreetTheStreet


Lest you think you might be able to get away with it, the Internal Revenue Service's criminal-investigation unit has more than 4,100 employees worldwide who might suggest otherwise.


More than 1.4 million Americans were audited last year, the most in more than a decade. And with an additional $8.2 billion budgeted for tax-enforcement efforts, a 10% increase, the odds of getting away with something sneaky are going to get even slimmer.


There were 2,229 prison sentences handed down for tax-related offenses last year. The following are some of the scams, and how delinquents were caught.




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