The tax-relief industry loves to make IRS problems sound impossible without them. They're not. I'm Darrin Mish. I've been representing taxpayers before the IRS for 32 years. Let me explain how this actually works.<\/p>\n
Tax Breaks for the Unemployed
\nIf you have been laid off or had to take a salary cut last year, you are eligible for some tax breaks from the IRS.\u00a0Click here to watch or read more information on IRS Back Taxes.<\/a> At the same time, you do have to pay your taxes on certain types of income.\u00a0 Here\u2019s what you need to know:
\nFirstly, if you have lost your job or been furloughed, took a salary cut or had to work reduced hours, you might qualify for the Earned Income Tax Credit benefit.\u00a0 Your eligibility would depend on your salary, tax and family situation.\u00a0 Since this tax break is specifically for the benefit of the poor, if you earn less than $48,279, you could qualify for it.\u00a0 For example, a person who files his tax returns as the head of a household with one qualifying child and who earns not more than $35,463 could receive a credit for $3,043.
\nSecondly, your severance salary, sick leave pay, unemployment benefits and money you received for vacations accrued are all taxable.\u00a0 However, under the American Recovery and Reinvestment Act (ARRA) the first $2,400 of benefits you received in 2009 will be exempted from taxes.
\nThirdly, the amount you spend in trying to get another job in your same profession is deductible from your taxable income, even if you were not successful in landing the job.\u00a0 More information can be obtained from IRS Publication 529<\/a> and the IRS website, www.irs.gov.
\nCarwash Owes IRS Four Cents
\nHarv\u2019s Metro Carwash in Midtown, Sacramento owes the IRS money, but it is not a debt of millions of dollars as you might expect.\u00a0 The carwash owes the IRS four cents in back taxes!
\nPenalties, interests and late fees have brought the amount to its present day $202.35.\u00a0 The owners of the carwash were ignorant of the existence of the overdue taxes all this while and learned about it only this week when IRS officers paid them a visit.
\nAccording to the IRS, their procedure is to send out notices for payment to delinquent taxpayers for one year before their officers go a-calling.\u00a0 The actual amount of unpaid taxes is immaterial.
\nAaron Zeff, the owner of the carwash, did confirm receiving a notice from the IRS, once.\u00a0 It was a letter last October stating that tax returns have been filed and confirming there was no outstanding balance.\u00a0 Furthermore, car wash companies are regulated by the state thus ensuring that their returns are filed and taxes paid each year as they fall due.<\/p>\n