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It’s not too early to start thinking about how you will file your tax return in early 2016. Filing electronically is the easiest way to file a complete and accurate tax return as the software guides you through the filing process. IRS e-file can also help with the health care law tax provisions, by walking you through the lines on the tax forms that relate to the Affordable Care Act.

The bottom line is that e-file is much easier than doing your taxes by hand and mailing paper tax forms. Electronic filing options include: free Volunteer Assistance, IRS Free File, commercial software, and professional assistance.

You may qualify to have your taxes filed through the IRS Volunteer Income Tax Assistance or Tax Counseling for the Elderly programs. In general, VITA offers free tax preparation and e-file if you earned $53,000 or less. TCE offers help primarily to people who are age 60 or older. You can e-file through IRS Free File, the free tax preparation and e-file program available only on IRS.gov. You can also buy commercial tax software to e-file your return yourself, or ask your tax preparer to e-file your tax return on your behalf.

IRS e-file meets strict security guidelines. It uses secure encryption technology to protect your tax return. The IRS has safely and securely processed more than 1.3 billion e-filed tax returns from individuals since the program began.

For help with your income taxes call one of our offices:

Plymouth 734.454.4100,            Allen Park 313.388.7180,

Grayling 989.348.4055,      Madison Heights  248.544.6160,     Royal Oak 248.399.7331,

Saginaw 989.782.1985,         St. Clair Shores 313.371.6600

Below are all health coverage exemptions for the 2015 tax year. If you qualify for one of these exemptions, you don’t have to have insurance or pay the fee for the months the exemption applies.

In addition to the exemptions below, there are others based on “hardships.” Learn about hardship exemptions here.

Income-related exemptions

• The lowest-priced coverage available to you, through either a Marketplace or job-based plan, would cost more than 8.05% of your household income
• You don’t have to file a tax return because your income is below the level that requires you to file

Health coverage-related exemptions

• You were uninsured for no more than 2 consecutive months of the year
• You lived in a state that didn’t expand its Medicaid program but you would have qualified if it had

Group membership exemptions

• You’re a member of a federally recognized tribe or eligible for services through an Indian Health Services provider
• You’re a member of a recognized health care sharing ministry
• You’re a member of a recognized religious sect with religious objections to insurance, including Social Security and Medicare

Other exemptions

• You’re incarcerated (serving a term in prison or jail)
• You’re a U.S. citizen living abroad, a certain type of non-citizen, or not lawfully present (learn more about the definition of “lawfully present”)
• You experienced one of the listed hardships

For help with any income tax question call one of our offices:

Plymouth 734.454.4100,            Allen Park 313.388.7180,

Grayling 989.348.4055,   Madison Heights  248.544.6160,   Royal Oak 248.399.7331,

Saginaw 989.782.1985,         St. Clair Shores 313.371.6600

The IRS has a free program for anyone who wants to learn about taxes. “Understanding Taxes” is available 24/7 on IRS.gov. It was designed by the IRS and teachers to help you learn the “how’s” and “why’s” of taxes. The program can make learning about federal taxes as easy as A-B-C.

• Accessible (web-based)
• Brings learning to life
• Comprehensive

Here are six more reasons to study up on it:

1. Lessons on IRS.gov. Teachers and students will find that the nearly 40 lessons on IRS.gov are easy, relevant and fun!
2. User friendly site map.  You can quickly look through the program and skip to the part you want.
3. Tutorials, tests and more.  A series of tax tutorials guide you through the basics of tax preparation. Another feature is a chance to test your knowledge through tax trivia. There’s also a glossary of tax terms.
4. Customize to fit your style.  If you’re a teacher, you can make the interactive program fit your style. Use your own lesson plans and plan your own activities. It’s easy to add to your school’s curriculum.
5. No need to register.  You don’t need to register or login to use the program. You can take a break and return to where you left off whenever you choose. Just take note of the page and lesson number before you leave the page.
6. The how’s and why’s of taxes. Learn the basic concepts of taxes. Self-paced modules offer a step-by-step approach to tax preparation. The lessons are also a great way to learn about the history and theory of taxes in the USA.

You may use the program anytime during the year. Visit IRS.gov and type “Understanding Taxes” in the search box. The application contains lessons and practice problems based on 2014 tax law.

For more current tax law training, visit Link and Learn Taxes on IRS.gov. The IRS will update this program later this year. The Web address is http://apps.irs.gov/app/vita/. You can also find it if you type “Link and Learn” in the search box.

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.

For help with any tax question call one of our offices:                                       

Plymouth 734.454.4100,    Allen Park 313.388.7180,    Grayling 989.348.4055,                           Royal Oak 248.399.7331,    Saginaw 989.782.1985,    St. Clair Shores 313.371.6600

The IRS continues to warn consumers to guard against scam phone calls from thieves intent on stealing their money or their identity. Criminals pose as the IRS to trick victims out of their money or personal information. Here are several tips to help you avoid being a victim of these scams:

• Scammers make unsolicited calls.  Thieves call taxpayers claiming to be IRS officials. They demand that the victim pay a bogus tax bill. They con the victim into sending cash, usually through a prepaid debit card or wire transfer. They may also leave “urgent” callback requests through phone “robo-calls,” or via phishing email.
• Callers try to scare their victims.  Many phone scams use threats to intimidate and bully a victim into paying. They may even threaten to arrest, deport or revoke the license of their victim if they don’t get the money.
• Scams use caller ID spoofing.  Scammers often alter caller ID to make it look like the IRS or another agency is calling. The callers use IRS titles and fake badge numbers to appear legitimate. They may use the victim’s name, address and other personal information to make the call sound official.
• Cons try new tricks all the time.  Some schemes provide an actual IRS address where they tell the victim to mail a receipt for the payment they make. Others use emails that contain a fake IRS document with a phone number or an email address for a reply. These scams often use official IRS letterhead in emails or regular mail that they send to their victims. They try these ploys to make the ruse look official.
• Scams cost victims over $23 million.  The Treasury Inspector General for Tax Administration, or TIGTA, has received reports of about 736,000 scam contacts since October 2013. Nearly 4,550 victims have collectively paid over $23 million as a result of the scam.

The IRS will not:

• Call you to demand immediate payment. The IRS will not call you if you owe taxes without first sending you a bill in the mail.
• Demand that you pay taxes and not allow you to question or appeal the amount you owe.
• Require that you pay your taxes a certain way. For instance, require that you pay with a prepaid debit card.
• Ask for your credit or debit card numbers over the phone.
• Threaten to bring in police or other agencies to arrest you for not paying.

If you don’t owe taxes, or have no reason to think that you do:

• Do not give out any information. Hang up immediately.
• Contact TIGTA to report the call. Use their “IRS Impersonation Scam Reporting” web page. You can also call 800-366-4484.
• Report it to the Federal Trade Commission. Use the “FTC Complaint Assistant” on FTC.gov. Please add “IRS Telephone Scam” in the notes.

If you know you owe, or think you may owe tax:

• Call the IRS at 800-829-1040. IRS workers can help you.

Phone scams first tried to sting older people, new immigrants to the U.S. and those who speak English as a second language. Now the crooks try to swindle just about anyone. And they’ve ripped-off people in every state in the nation.

Stay alert to scams that use the IRS as a lure. Tax scams can happen any time of year, not just at tax time. For more, visit “Tax Scams and Consumer Alerts” on IRS.gov.

For help with any tax question call one of our offices:                                       

Plymouth 734.454.4100,    Allen Park 313.388.7180,    Grayling 989.348.4055,                           Royal Oak 248.399.7331,    Saginaw 989.782.1985,    St. Clair Shores 313.371.6600

There is a lot of information in the news and online about the health care law and its effect on your taxes. For the most up-to-date answers to questions you may have, visit IRS.gov/aca.

From A to Z and ISRP to MEC, the IRS website covers a wide range of health care topics and how they relate to your taxes.

The IRS knows that you want to understand how the health care law may affect you when filing your taxes next year. When questions come up, IRS.gov is a great place for you to begin finding the answers you need – when you need them.

This information is especially important for individuals.  Health coverage providers and employers will provide health coverage statements to covered individuals for the first time in 2016. The IRS will continue to post information as you get ready to prepare and file your 2015 tax return.

At IRS.gov/aca, you’ll find frequently asked questions, legal guidance, and links to other useful sites. You can also access valuable information about specific topics, including the premium tax credit for individuals, rules and responsibilities for employers, as well as tax provisions for insurers, tax-exempt organizations and other businesses.

Aside from IRS.gov, we also post new guidance and information about the health care law on the official IRS Twitter, Tumblr and Facebook accounts. You can also access a web-based IRS flyer, Health Care Law Online Resources, for links to other federal agencies that also have a role in the health care law.

For help with any income tax question call one of our offices:                                       

Plymouth 734.454.4100,    Allen Park 313.388.7180,    Grayling 989.348.4055,                           Royal Oak 248.399.7331,    Saginaw 989.782.1985,    St. Clair Shores 313.371.6600

The 2014 extended tax deadline will be over on October 15th and while many will scramble to make the tax deadline, some of you may miss it and are wondering what to do.  Don’t worry!  If you missed the extended tax deadline, here are answers to 5 of your burning questions to help you figure out what to do next.

I missed the tax deadline. Should I still file?

Yes, you should still file your taxes as soon as possible.

How should I file my taxes?

IRS e-file closes October 15, but there is good news.  You can still file by mailing in your tax return.

Will the IRS charge penalties for not filing by October 15th?

If you have a tax refund coming, there is no penalty for filing late.  Penalties are calculated based on amounts due.

If I owe money, will I be charged penalties and interest?

Unfortunately, you will receive three separate penalties on balances due on late tax returns as follows:

• Failure-to-file penalty
• Failure-to-pay penalty
• Interest

The failure-to-file penalty can be the most steep, as it starts out at 5% for each month the tax return is not filed, up to a total penalty of 25% of your balance due, which is why you should file your taxes as soon as possible.  Even if you owe money and can’t pay it you should still file to eliminate this penalty.  In addition, you may be eligible for other payment options under the IRS Fresh Start Initiative.

If I have a hardship will I still have to pay penalties?

If you show the IRS reasonable cause for not filing on time, you may not have to pay penalties.

Hopefully this puts your mind at ease and moves you closer to filing your taxes. Just because you didn’t make the tax deadline doesn’t mean you should forget about filing altogether.  Who knows?  You may be missing out on a tax refund.

For help with your income tax extension call one of our offices:

Plymouth 734.454.4100,    Allen Park 313.388.7180,    Grayling 989.348.4055,                           Royal Oak 248.399.7331,    Saginaw 989.782.1985,    St. Clair Shores 313.371.6600

If you, your spouse or a dependent are heading off to college this fall, some of your costs may save you money at tax time. You may be able to claim a tax credit on your federal tax return. Here are some key IRS tips that you should know about e tax credits:

• American Opportunity Tax Credit. The AOTC is worth up to $2,500 per year for an eligible student. You may claim this credit only for the first four years of higher education. Forty percent of the AOTC is refundable. That means if you are eligible, you can get up to $1,000 of the credit as a refund, even if you do not owe any taxes.
• Lifetime Learning Credit.  The LLC is worth up to $2,000 on your tax return. There is no limit on the number of years that you can claim the LLC for an eligible student.
• One credit per student. You can claim only one type of education credit per student on your tax return each year. If more than one student qualifies for a credit in the same year, you can claim a different credit for each student. For instance, you can claim the AOTC for one student, and claim the LLC for the other.
• Qualified expenses. You may use qualified expenses to figure your credit. These include the costs you pay for tuition, fees and other related expenses for an eligible student. Refer to IRS.gov for more on the rules that apply to each credit.
• Eligible educational institutions. Eligible schools are those that offer education beyond high school. This includes most colleges and universities. Vocational schools or other postsecondary schools may also qualify. If you aren’t sure if your school is eligible:

o Ask your school if it is an eligible educational institution, or

o See if your school is on the U.S. Department of Education’s Accreditation database.

• Form 1098-T. In most cases, you should receive Form 1098-T, Tuition Statement, from your school by Feb. 1, 2016. This form reports your qualified expenses to the IRS and to you. The amounts shown on the form may be different than the amounts you actually paid. That might happen because some of your related costs may not appear on the form. For instance, the cost of your textbooks may not appear on the form. However, you still may be able to include those costs when you figure your credit. Don’t forget that you can only claim an education credit for the qualified expenses that you paid in that same tax year.

For help with any income tax question call one of our offices:                                       

Plymouth 734.454.4100,    Allen Park 313.388.7180,    Grayling 989.348.4055,                           Royal Oak 248.399.7331,    Saginaw 989.782.1985,    St. Clair Shores 313.371.6600

The Health Care Law and You: Nine Facts about Letters Sent by the IRS

The IRS sent letters to taxpayers this summer who were issued a Form 1095-A, Health Insurance Marketplace Statement, showing that advance payments of the premium tax credit were paid on the taxpayer’s behalf in 2014. At the time, the IRS had no record that the taxpayer filed a 2014 tax return.

Here are nine facts about these letters and the actions you should take:

• IRS letters 5591, 5591A, or 5596 remind you of the importance of filing your 2014 federal tax return along with Form 8962, Premium Tax Credit.
• You must file a tax return to reconcile any advance credit payments you received in 2014 and to maintain your eligibility for future premium assistance.
• If you do not file, you will not be eligible for advance payments of the premium tax credit in 2016.
• Even if you don’t usually file or if you requested an extension to Oct. 15, you should file your 2014 tax return as soon as possible.
• Until you file a 2014 tax return to resolve the issue with your Marketplace, you will not be eligible to get advance payments of the premium tax credit to help pay your health coverage premiums in 2016 from the Marketplace.
• You should have received a Form 1095-A, Health Insurance Marketplace Statement, earlier this year if you or a family member purchased health insurance coverage through the Marketplace in 2014.  This form provides the information you need to complete Form 8962. You must attach Form 8962 to the income tax return you file.
• Contact your Marketplace if you have questions about your Form 1095-A.
• If you have recently filed your 2014 tax return with Form 8962, you do not need to file another tax return or call the IRS about these letters.   In general, if you filed your tax return electronically, it takes three weeks before it is processed and your information is available. If you mailed your tax return, it takes about six weeks. However, processing times can vary based on other circumstances.
• You should follow the instructions on any additional IRS correspondence that you receive to help the IRS verify information to process your tax return.

In addition to these letters from the IRS, your health insurance company may contact you to remind you to file your 2014 federal tax return along with Form 8962. In some cases, they may contact you even if you did not receive advance credit payments in 2014. If you are not otherwise required to file a tax return, you do not have to file a return if you or anyone on your return did not receive advance credit payments in 2014.

For help with any income tax question call one of our offices:                                       

Plymouth 734.454.4100,    Allen Park 313.388.7180,    Grayling 989.348.4055,                           Royal Oak 248.399.7331,    Saginaw 989.782.1985,    St. Clair Shores 313.371.6600

Beginning with the 2015 tax season, City of Detroit tax filers will be able to submit their returns electronically.  Your Detroit return will be processed along with your State of Michigan Individual Tax return.  Both resident and non-resident filers will be able to file electronically.  This should improve accuracy, allow for online notifications and faster refunds.

This is part of Detroit’s post-bankruptcy plan and will apply to the 2015 tax year and beyond.  The city should get increased revenues with the electronic filing.

For help with any income tax question call one of our offices:                                       

Plymouth 734.454.4100,    Allen Park 313.388.7180,    Grayling 989.348.4055,                           Royal Oak 248.399.7331,    Saginaw 989.782.1985,    St. Clair Shores 313.371.6600

If you move your home you may be able to deduct the cost of the move on your federal tax return next year. This may apply if you move to start a new job or to work at the same job in a new location. In order to deduct your moving expenses, your move must meet three requirements:

1. Your move must closely relate to the start of work. In most cases, you can consider moving expenses within one year of the date you start work at a new job location. Additional rules apply to this requirement.
2. Your move must meet the distance test. Your new main job location must be at least 50 miles farther from your old home than your prior job location. For example, let’s say that your old job was three miles from your old home. To meet this test, your new job must be at least 53 miles from your old home.
3. You must meet the time test.  You must work full-time at your new job for at least 39 weeks the first year after the move. If you’re self-employed, you must also meet this test. In addition you must work full-time for a total of at least 78 weeks during the first two years at the new job site. If your tax return is due before you meet the time test, you can still claim the deduction if you expect to meet it.

See Publication 521, Moving Expenses, for more information about the rules.

If you qualify for this deduction, here are a few more tips from the IRS:

• Travel.  You can deduct certain transportation and lodging expenses while moving. This applies to costs for yourself and other household members while moving from your old home to your new home. You may not deduct your travel meal costs.
• Household goods and utilities.  You can deduct the cost of packing, crating and shipping your property. This may include the cost to store or insure the items while in transit. You can deduct the cost to disconnect or connect utilities at your old and new homes.
• Expenses you can’t deduct.  You may not deduct:
  • Any part of the purchase price of your new home.
  • The cost of selling your home.
  • The cost of breaking or entering into a lease.

See Publication 521 for more examples.

• Reimbursed expenses.  If your employer later pays you for the cost of a move that you deducted on your tax return, you may need to include the payment as income. You must report any taxable amount on your tax return in the year you get the payment.
• Address change.  When you move, make sure to update your address with the IRS and the U.S. Post Office. To notify the IRS, file Form 8822, Change of Address.

For help with any income tax question call one of our offices:

Plymouth 734.454.4100,   Allen Park 313.388.7180,   Grayling 989.348.4055,                             Royal Oak 248.399.7331,   Saginaw 989.782.1985,   St. Clair Shores 313.371.6600