I Need a Copy of My Tax Return

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Retaining copies of your federal tax return is important. Not only will you need the return in case of audit, but the tax return is often used to secure student aid, obtain loans, purchase a home or business, plus much more. What can you do if you cannot find a copy of your tax return?

Bullet Arrow E-filed tax returns have their data stored in software. One of the benefits of e-filed tax returns means there is a digital copy of your tax information. If necessary another digital copy could be produced.

Bullet Arrow IRS requested transcript. The IRS can provide you with a transcript of your current tax return or transcripts from the prior three years. To request a transcript from the IRS using their online tool go to www.irs.gov and search for their order a transcript tool. Information will be provided to you within approximately 5 to 10 business days.

Bullet Arrow Request an actual copy. If you require an actual copy of your tax return, one can be provided for $57 by filling out Form 4506. But plan accordingly, as it can take up to 60 days to process your request.

Bullet Arrow Copies of informational returns. If you are missing a W-2 or 1099 you can also contact the company that originally issued the tax form. They will have these forms on record for their own audit purposes.

Bullet Arrow Copies sent to third parties. Your request for transcript can also be sent to a third party with your authorization. If you wish to take this route, please note that you may lose some control as to who has this personal information.

Bullet Arrow Understand the different transcripts. When making a request for a transcript from the IRS you need to understand what you are requesting.

  • Return transcript. This includes most of the lines of your tax return as originally filed.
  • Account transcript. This is the status of your tax account. It includes the balance owed on your account, any record of any payments, and adjustments after the return was filed.
  • Record of account. This is a combination of the return transcript and the account transcript.

If need be, you can also request a verification of non-filing of a tax return.

The Coverdell ESA “Education Savings Account”. Lost in the mix?

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The tax code is filled with tax breaks to offset the cost of education. This includes programs like the Lifetime Learning Credit, the American Opportunity Credit, the Saver’s Credit, student loan interest destructibility, and the on-again off-again Tuition Deduction. Lost in all these options is the long-standing Coverdell Education Savings Account (ESA). Is it worth considering in your educational funding mix?

Coverdell ESA defined

The Coverdell account is a savings account that can be set up for the benefit of a student. After-tax contributions of up to $2,000 per student are available in any given year until the student is age 18. As long as the funds pay for qualifying educational expenses, any earnings made on the contributions are tax-free. The funds must be used by the time the beneficiary reaches the age of 30. If not, the funds must be given to another qualified student or the account holder must pay the tax on the earnings.

Coverdell advantages

While many think there are better savings options than the Coverdell ESA, here are some of the benefits of the account versus the popular 529 College Savings Plan and other educational savings alternatives.

Investment flexibility. Similar to Roth IRAs, Coverdell ESA’s have tremendous investment flexibility. This includes investing in stocks, bonds, mutual funds and regular bank products. Each state’s program manager limits Investment options within a particular 529 college savings plan.

Institution flexibility. Unlike most other educational tax programs, Coverdell ESA funds may also be used to pay for qualified elementary school and high school expenses. Other programs restrict use to post-secondary programs.

Broad qualified expenses. In addition to tuition, fees, books and classroom supplies, qualified expenses also include room and board when there is at least ½ time enrollment.

Great fill-in. The Coverdell ESA can be used for qualified educational expenses not covered by other programs. Coverdell ESA funds can not used to pay an expense already covered by another benefit.

Rollover flexibility. You can roll over unused funds to other qualified students. These rollovers are usually made to younger siblings.

The downsides

Funding limits. Coverdell ESA contributions are limited versus 529 College savings programs. Here are the major differences;

  Coverdell ESA 529 College Savings Plan
Annual contribution $2,000 per student Fairly unlimited; generally
$14,000 per contributor
per beneficiary
Income phase-out
No contribution if income over:
$110,000 single
$220,000 joint
No income limits
to contribute funds
Age limits
Funding:   until age 18
Use:   until age 30
No age limits

Ownership. Coverdell ESA balances can impact the amount of financial aid your student may receive. Contribution formulas weigh a student’s assets more heavily than a parent’s when determining aid. In addition, when the Coverdell ESA beneficiary reaches the age of 18, the funds are legally theirs. This lack of control means the funds might not be used for education. The same does not occur with the custodial nature of 529 Savings plans. Rollover strategies may be used to limit some of this risk.

Complicated planning. Given the age, limited annual contribution, and income limitations, a Coverdell ESA can make educational tax planning more complex. The lower account balance may make this exercise not worth the effort.

Is a Coverdell ESA an option worthy of your consideration? Perhaps. More important is starting your educational savings accounts early enough to benefit from earnings growth over time.



A thorough awareness of your federal tax obligations is one of the main concerns of climbing the ladders of success if you are gearing up for a business start-up. Not only knowledge about income taxes but also, information about payroll taxes hold responsible to help you sustain the recent trends in business blizzards. Give an unwavering glance at the following five tips that you must mold into action if you are looking for a successful kick-start for your business.

Business Structure: Choosing your business type is of utmost importance when looking for the ideation of a brainstorm. Some common types include sole proprietorship, partnership and corporation. You may also decide to be honed as an S corporation or Limited Liability Company. You must report your business activities using the IRS forms which are precisely considerable for your business type.


Business Taxes:Income tax, self-employment tax, employment tax and excise tax constitute the four basic categories of taxes. The type of taxes your business pays varies according to the type of business start-up you are bracing up for. Payment of taxes are done in accordance with a general estimation of taxes.


Employer Identification Number: An EIN might be a must have for federal tax purposes. If you do need one, we are available to guide you through the online process of applying for it. You can always give us a call to get to know whether an EIN is an absolute necessity for your type of business set-up.


Accounting Method:An accounting method is a basic preset that keeps track of your income and expenses reporting. A consistent accounting method is to be used for any new business. The cash method and the accrual method are the two most commonly used methods. Under the cash method, you normally report income in the year that you receive it and deduct expenses in the year that you pay them. Under the accrual method, you generally report income in the year that you earn it and deduct expenses in the year that you incur them. These rules does hold steady even if you receive the income or bear the expenses in a future year.


Employee Health Care:The Small Business Health Care Tax Credit helps small businesses and tax-exempt organizations pay for health care coverage they offer their employees. A small employer is eligible for the credit if it has fewer than 25 employees who work full-time, or a combination of full-time and part-time. Beginning in 2014, the maximum credit is 50 percent of premiums paid for small business employers and 35 percent of premiums paid for small tax-exempt employers, such as charities.

For 2015 and after, employers employing at least a substantial number of employees (generally 50 full-time employees or a combination of full-time and part-time employees that is on the same scale as 50 full-time employees) will be subjected to the Employer Shared Responsibility provisions.

Have a business idea? Call us at once. We will help you connect the dots and get the bull charging. The more you hesitate the tighter you get a hug from the bear. Time to substantiate your ideas into an up and running, successful business house.


Lifestyle Audits. A thing of the past?

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The word “audit” is enough to raise anyone’s blood pressure. If the IRS agent then tells you they want to see bank accounts and personal records you may need a heart monitor. Should this happen to you, you could be in a process known as a lifestyle audit.


The lifestyle audit was a tool used by auditor’s to ascertain if the income you claim on your tax return can support how you live.

As an extreme example, perhaps you claim $30,000 in taxable income, but drive a Ferrari and you have a $700,000 mortgage. Most of us would have a hard time believing the income claimed on this tax return could support this lifestyle.

Historically, tax returns that have a history of cash transactions would be a target for lifestyle audits. So if you ran a small business (schedule C) or worked in an industry like construction, fishing, and retail you could experience this lifestyle audit.

Reason first

As you might imagine, being the subject of a lifestyle audit is stressful. It could be a more involved process than responding to a letter from the IRS questioning part of your tax return. The best defense for this type of review is good record-keeping. Here are some tips:

Understand your lifestyle risk. Do you think you can substantiate how you live with the level of claimed income on your tax return? Most of us can, but if you inherited money that allowed you to buy a new house, car or other luxury items it might raise questions. If this is the case, keep copies of documentation that supports the event.

Awareness of gift limits. Remember, you may receive up to $14,000 in gifts from any individual in any given year without tax consequences. If you receive gifts from someone, please keep record of the event.

Sales receipts. For every small business deposit in your bank account have a supporting document that substantiates the deposit’s source.

Separation. Keep separate business and personal bank accounts and credit cards. It is easier to substantiate your lifestyle spending when you do this.

Ask why. The passing of the 1998 IRS Restructuring and Reform Act limits the ability of IRS agents to conduct lifestyle audits. In current practice, a lifestyle audit may only be undertaken if the IRS agent has a reasonable cause to conduct the review. The cause might be based on information provided on your tax return or based upon information reports it has received from others. It is reasonable for you to ask for clarification from the auditor as to why they believe a lifestyle audit is in order. Perhaps proper documentation may be all that is required to answer the auditor’s questions.

Ask for help. Remember, should you receive notice by the IRS with questions regarding your tax return, ask for assistance. The same is true with notices from any other taxing authority. You are not going to be as well versed in the tax code as your auditor, so why not ask for help from someone who is.

IRS Takes Steps to Reduce Fraud


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In its ongoing effort to tackle the increase in fraud and identity theft at the IRS, there are a number of security enhancements announced to deal with the problem.

Limiting direct deposits into a single account

The problem: Would be thieves set up a deposit account at a local bank. They then file numerous tax returns claiming refunds early in the tax filing season. The tax returns request the refunds be sent to this single bank account. The account is then electronically drained of the stolen funds and the thieves are long gone.

The solution: Effective in early 2015, the IRS is limiting refund deposits into any single bank account to a total of three times. Any additional requests to deposit funds into the same account will automatically reject and a paper check will be issued to the taxpayer.

Matching account names with the taxpayer

The problem: The financial institution account holder may not necessarily match the name on the filed tax return. This could be the case with a parent filing for a child or stepchild. Unfortunately, it is also the case with massive tax fraud rings.

The solution: The IRS will now try to match the bank account holder to the name on the tax return.

TIN and SSN security

The problem: The publishing of Social Security Numbers (SSN’s) on documents creates an identity risk as thieves target mailboxes to obtain these key numbers. Tax Identification Numbers (TINs) also have the same problem.

The solution: Fewer documents will show the entire SSN or TIN. In addition, there will be an effort to inactivate unused identification numbers.

Use of Personal Identification Numbers (PINs)

The problem: When the IRS opens a case of identity theft for a taxpayer, what steps are taken to ensure your filed tax return is accepted and not the one created by identity thieves?

The solution: If you are a victim of identity theft, be prepared to file your tax return in paper format. The IRS has also created a Personal Identification Number (PIN) system to provide an added level of tax identification for those impacted by the theft of their personal information. In this case you must fill in your IRS PIN in addition to your Social Security Number.

Additional steps are being taken as well. Please remember that the IRS never asks for personal information via email or telephone. If you are ever approached in this fashion, you should be wary that these thieves are trying to make you their next victim. To find out more or to report suspicious behavior please visit the irs web site at: http://www.irs.gov/uac/Report-Phishing

Job Search Expenses May Lower Your Taxes


September is often a time of transition, when people decide to make major life decisions–such as changing jobs. If you’re looking for a new job, then you may be able to claim a tax deduction for some of your job hunting expenses–as long as it’s in your same line of work.

Here’s what you need to know about deducting these costs:

1. Same Occupation. Your expenses must be for a job search in your current occupation. You may not deduct expenses related to a search for a job in a new occupation.

2. Reimbursed Costs. If your employer or another party reimburses you for an expense, you may not deduct it.

3. Placement Agency. You can deduct employment and job placement agency fees you pay while looking for a job.

4. Resume Costs. You can deduct the cost of preparing and mailing copies of your resume to prospective employers.

5. Travel Expenses. If you travel to look for a new job, you may be able to deduct your travel expenses. However, you can only deduct them if the trip is primarily to look for a new job.

6. Work-Search Break. You can’t deduct job search expenses if there was a substantial break between the end of your last job and the time you began looking for a new one.

7. First Job. You can’t deduct job search expenses if you’re looking for a job for the first time.

8. Schedule A. You usually deduct your job search expenses on Schedule A, Itemized Deductions. You’ll claim them as a miscellaneous deduction. You can deduct the total miscellaneous deductions that are more than two percent of your adjusted gross income.

9. Premium Tax Credit. If you receive advance payment of the premium tax credit in 2014 it is important that you report changes in circumstances, such as changes in your income or family size, to your Health Insurance Marketplace. Advance payments of the premium tax credit provide financial assistance to help you pay for the insurance you buy through the Health Insurance Marketplace. Reporting changes will help you get the proper type and amount of financial assistance so you can avoid getting too much or too little in advance.

Give us a call if you have any questions about tax deductions related to a job search.