New online tool to pay taxes
The new IRS Direct Pay lets taxpayers pay tax bills or make estimated tax payments directly from checking or savings accounts without any fees or pre-registration.
The new IRS Direct Pay lets taxpayers pay tax bills or make estimated tax payments directly from checking or savings accounts without any fees or pre-registration.
Some upcoming dates to be aware of for your 2013 tax year filings:
Please call us if you have any questions or require further assistance at 408-252-1800.
LMGW Certified Public Accounts
The attached client organizer is designed to help you gather tax information needed to prepare your 2013 personal income tax return. Click on the link below to access the client organizer.
The Internal Revenue Service was created in 1862 as the federal agency responsible for collection of tax and interpretation and enforcement of the Internal Revenue Code. As with any collection of laws and regulations the Internal Revenue Code is open to varying levels of interpretation. Congress and the IRS have developed, over time, an effective set of tools and remedies for taxpayer disputes with the IRS arising out of the varying interpretations of the complex set of laws and regulations that compromise the Internal Revenue Code.
The remedies provided to taxpayers and the IRS in resolving disputes can be divided into four major categories:
One of the most common tools used in estate planning is a revocable living trust that splits into one or more irrevocable trusts upon the death of the grantor. Most often, the income earned by these irrevocable trusts is distributed to the income beneficiary during his or her lifetime and is taxed on the income beneficiary’s individual tax return. The problem is that not everything we think of as income is considered trust income. For example, capital gains are generally considered principal and not income.
Who Pays Tax on Trust Income? Income received by the trust is taxed either on the trust return (Form 1041) or on your individual income tax return (Form 1040). In order for you to pay the tax, rather than the trust, the income must be distributed to you. Please see more details about distributions later.
What Governs Taking Trust Distributions? The short answer is that most trust documents provide that income earned by the trust may be distributed to the income beneficiary at least annually. However, some receipts of a trust are considered principal rather than income. Unless the trust documents specifically permit the trustee to allocate these receipts to income, receipts such as capital gains are not permitted to be distributed to an income beneficiary and are taxed on the trust return.
Who Pays the Higher Tax? Prior to The Affordable Health Care Act and The American Taxpayer Relief Act of 2012, it made little difference to the ultimate tax bill whether the income beneficiary or the trust paid taxes. Generally, long-term capital gains and qualified dividends were taxed at 15% regardless of who paid the tax. With the passage of these two new laws, the question of who pays the tax will become quite significant. Read more