Monthly Archives: February 2016

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Tax Update by Taylor Vance

Category : Blog

Taylor Vance

Taylor Vance-JS Tax Accountant

  • The Foreign Account Tax Compliance Act (FACTA) requires foreign financial institutions (FFIs) to determine if their accounts are held by U.S. owners. The FFIs then must report any account information to the IRS. The IRS is providing relief to FFIs by moving the requirement to certify preexisting accounts to 2018 instead of the original date of 2016. It is important to note that even though the certification of preexisting accounts has been moved to 2018, FFIs must still complete the due diligence procedures for preexisting accounts by the original due date of 2016.
  • Employers and health insurance providers will generally give health insurance information to covered individuals by providing them a Form 1095-B or 1095-C.   The deadline for health insurance providers and employers to provide these forms is not until March 31, 2016. It is important to note that the Treasury stated that taxpayers are not required to attach these forms to their tax returns, and do not need to wait to receive them before filing their tax return.
  • A taxpayer who believes their Social Security number has been stolen and used to file a fraudulent tax return should contact the IRS by filing Form 14039, Identity Theft Affidavit. The form should be sent to the Identity Theft Victim Assistance organization. The taxpayer should anticipate that it will take 120 to 180 days to resolve their case. Also, the taxpayer may be placed into the Identity Protection PIN program.
  • The Chief Judge of the United States Tax Court is proposing to amend the court’s Rules of Practice and Procedure. The proposal is to change how petitions and other papers are filed. It would allow for more petitions and other papers to be filed electronically.
  • Missouri Storm Victims may be eligible for IRS disaster relief.
  • Congressional Budget Office predicted that the revenues from individual income taxes will increase by five percent in 2016.
  • Obama has proposed pooled 401(k) plans. The proposal would allow multiple unrelated employers to create a pooled 401(k) plan. This is to allow small businesses to be able to offer their employees more cost-effective plans.

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Improved Filing Season Predicted

Today’s blog post is brought to you by Jones Simkins’ Tax Team Member, Angie Thompson:

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Angie predicts improved filing season.  Her research has found:

  • During the 2015 filing season, IRS customer service hit an all-time low with less than 40 percent of taxpayers successfully reaching an IRS agent. To combat this significant barrier President Obama signed into law “The Consolidated Appropriations Act” which will provide an additional $290 million to areas of concern within the IRS such as the IRS’s customer service, cyber security and tax-related identity theft. The additional funding will provide the IRS with the resources necessary to hire an additional 1,000 customer service representatives to answer calls during the 2016 filing season. The IRS reminds taxpayers that even with these additional resources, individuals will still have wait times before getting through to a representative.
  • The IRS, along with state tax authorities and tax preparers are coming together to reduce the incidence of tax-related identity theft with its “Taxes. Security. Together.” campaign. Some changes made within this campaign are:
    • private-sector software has new requirements for passwords
    • IRS software has added new processing filters and safeguards.