The Latest Tax Developments From The IRS

By: Aazdak Alisimo

You are expected to be up to date on tax laws and regulations. Not knowing is no excuse when it comes to paying your taxes. This is true even though the tax code and regulations cover thousands of pages.

As with evolution, tax law tends to slowly modify without major leaps and jumps. This can be good or bad depending on how you look at it. What is not debatable is the fact there are recent changes you need to be aware of and here they are.

Off the bat, the big news is the fires in Southern California. It is a horrible tragedy and the IRS is stepping up to the plate. Anyone in the declared disaster areas now has till January 2008 to file any tax forms due from October 21, 2007 till then.

Ah, but what about businesses and employees? The IRS is doing good again. All deposit penalties for failing to file between October 21st and November 5th are waived automatically as long as the deposits are made by the 5th.

In other news, the IRS is talking poker. Specifically, it is closing a loophole in reporting regulations. Starting March 4th of 08, people or businesses putting on poker tournaments will be required to report certain winnings by players.

Once the regulation goes into effect, poker tournament sponsors will be required to report winnings of $5,000 or more. Said sponsors will not, however, be required to withhold taxes from the winnings for deposit with the IRS.

On the business side of things, the IRS has taken steps to help small businesses with S incorporation. Many form corporations without realizing they must file the application for an "S" quickly and end up stressing trying to get it done.

It took a long time, but the IRS is finally acting. For corporations that file the "S" designation late, the agency is allowing an additional time buffer of the months up till the time the corporation files its first 1120S return.

Finally, there is little secret the real estate bubble has burst like an over-inflated balloon. We are talking disaster city. Many people are being pushed into foreclosure and are surprised to learn this is a taxable event.

Obviously, stacking a huge income tax liability on someone that has just lost a home makes little sense. The IRS is acknowledging so much. More surprising, it has come up with specific solutions to resolve things.

Tax issues surrounding home loss are complex, so the IRS has come up with a variety of solutions for homeowners in trouble. You need to apply the facts specific to your situation to find a solution, so visit the site of the IRS.

The thing to understand about taxes is they are complex and will only continue to grow more so. The government will keep changing them and we will continue to be confused, but at least you now know the latest changes.