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| Obamacare is a Tax |
As of today January 13, 2013, the IRS has not implemented and let everyone know about the new laws that will be regulating the current tax season 2013.
This alone comes as a shocker to many tax professionals including me. Usually the IRS is very good about having everything under control as early as December of the prior year, so this used to leave a good cushion of time to all the tax professional to be prepared for the tax season early.
All this is due to the recent fiscal Cliff battle in congress. All this is so recent that the IRS still had not put in place the new legislation and notified the people that need that information for the tax season.
I recently spoke with my tax software company and they informed me that the IRS still had not informed them about the new tax regulations for 2013 and until that happened they cannot implement it on their software.
I learned this by helping the early birds of this 2013 tax season, the software let me know in a big window that pops up on my laptop screen that the IRS had not implemented and notified the software developers of these changes yet.
This is not the only change that will be affecting the tax payers this 2013 tax season; another big change that struck me at the regular software questioning was that area that shows now asks about if the tax payer has the employer paid health coverage and if the family is cover by it.
So, if it happened that you are employed and do not have health insurance then Obama care will take a bite of your taxes this year (tax refund). I know it sucks, but if you have health insurance this employer expense will be reported as a deductible on you W-2.
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| Fiscal Cliff |
About this new health care tax I tell you not to worry too much because it will have to make sense, I came across some people that are already worry about this new tax. If you are a low income individual there is nothing to be worry about because this is going to a kind of subsidized health care. The less your income the more the government will pay for you.
You can find this at the IRS website:
"The Internal Revenue Service warned employers in a new regulatory proposal not to come up with clever schemes to avoid Obamacare’s employer health insurance mandate.
The IRS said it would soon issue “anti-abuse rules” to discourage employers from taking advantage of any regulatory loopholes.
“The Treasury Department and the IRS are aware of various structures being considered under which employers might use temporary staffing agencies (or other staffing agencies)… to evade application of section 4980H [the employer insurance mandate],” the IRS said in a proposed regulatory announcement issued December 28"
But that is not the only change for the current tax season, also there is the payroll tax cut that expired be impose to most tax payers because the congress let it out of the fiscal Cliff negotiations.
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| IRS - Department of Treasury |
Another area that surprised me was the fact that now the IRS asks tax professionals what kind of documents we are keeping for the dependents area, the earned income credit validation worksheet, this part require us to be more proactive regarding tax payers dependents, and my guess is that the IRS wants us to help them with the fraud that some dishonest tax payers do, like loaning dependents from other tax payers to get a bigger refund.
“Which documents bellow, if any did you rely on to determine EIC eligibility for the qualifying child(ren) listed on schedule EIC? Check all that apply. Keep a copy of any documents you rely on. If there is no qualifying child.”
The list that follows this statement goes from school records to social security service record statement.
And to finish this article my friends and followers I think this is going to be a quite different and challenging at times 2013 Tax Season.
