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Daily News 2018

Below please find daily updates pertaining to the latest in financial, business, and tax news:

Is it really the IRS calling?

Many taxpayers have encountered individuals impersonating IRS officials – in person, over the telephone and via email. Don’t get scammed. We want you to understand how and when the IRS contacts taxpayers and help you determine whether a contact you may have received is truly from an IRS employee.

The IRS initiates most contacts through regular mail delivered by the United States Postal Service.

However, there are special circumstances in which the IRS will call or come to a home or business, such as when a taxpayer has an overdue tax bill, to secure a delinquent tax return or a delinquent employment tax payment, or to tour a business as part of an audit or during criminal investigations.

To understand how and when the IRS contacts taxpayers and determine if it’s truly the IRS see: How to know it’s really the IRS calling or knocking on your door.

 

Consumer Alerts on Tax Scams

‪Note that the IRS will never:

  • Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail you a bill if you owe any taxes.
  • Threaten to immediately bring in local police or other law-enforcement groups to have you arrested for not paying.
  • Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe.
  • Ask for credit or debit card numbers over the phone.

For more information on tax scams, please see Tax Scams/Consumer Alerts. For more information on phishing scams, please see Suspicious e-Mails and Identity Theft.

 

 

 

Are Pennsylvania Lottery prizes taxable?

Updated 08/25/2016 01:19 PM

Yes. Beginning with prizes paid January 1, 2016, Pennsylvania Lottery monetary prizes are taxable income and should be reported by winners when filing federal and state taxes.

Under law, Lottery cash prizes over $5,000 are subject to withholding. This means that the Lottery will withhold 25 percent in federal taxes and 3.07 percent in state taxes before paying the prize.

For all prizes of $600 or more, winners will receive a W-2G form from the Lottery to submit with their tax returns. These forms usually arrive by mail in February for prizes awarded in the preceding calendar year.

A winner's total tax liability on Lottery prizes depends on factors including income, deductions, exemptions and other factors, so please consult a qualified tax professional with any questions before filing a tax return. The Lottery cannot provide tax filing advice to individuals.

For more information about Pennsylvania's Personal Income Tax, visit the Pennsylvania Department of Revenue online at www.revenue.pa.gov. A page specifically pertaining to Lottery winnings is found here:  www.revenue.pa.gov/lotterywinnings

 

Taxpayer Advocate Service Feed

Get information on TAS office closures related to Hurricane Florence

Mon, Sep 17, 2018

The Taxpayer Advocate Service temporarily closed some offices due to Hurricane Florence. The following offices in South Carolina and North Carolina will resume regular business operation hours on Tuesday, Sept. 18:  Charlotte, North Carolina Greensboro, North Carolina Columbia, South Carolina For a listing of all TAS offices, visit our Contact Us page....

NTA Blog: The IRS Might Recover EITC Using Its Newly Discovered Post-Processing Math Error Authority, but Is It Constitutional?

Thu, Sep 13, 2018

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog. My June Report to Congress included an Area of Focus entitled: “The IRS Has Expanded Its Math Error Authority, Reducing Due Process for Vulnerable Taxpayers, W...

Help us spread the news about our new Tax Reform Changes website

Tue, Sep 11, 2018

Is your business or association involved in helping others understand federal income taxes and the ramifications of changes to those laws each year? If yes, we invite you to visit our new site and then help us spread the word about the Taxpayer Advocate Service's Tax Reform Changes website. After your visit, we think you’ll see the value it might have for those in the tax community and ev...

NTA Blog: As a Result of TAS Advocacy, the IRS is Working to Address a Computer Glitch That Allowed Collection Activity on Accounts with Expired Collection Statute Expiration Dates but Many Issues Remain Unresolved

Fri, Sep 07, 2018

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog. About two years ago, TAS received cases where either the taxpayer or the Power of Attorney (POA) correctly questioned the validity of a collection statute expiration...

New tax law brings changes to tax withholding for 2018; here’s what you need to know

Fri, Aug 31, 2018

Major tax reform was approved by Congress in the Tax Cuts and Jobs Act (tax reform) on Dec. 22, 2017. One change directly affected the rate at which taxes are withheld from paychecks. Our federal income tax is a pay-as-you-go tax system and there are two ways to pay as you go, either through withholding or estimated tax payments. Note: For more information on what other items changed or didn&rs...

NTA Blog: The Systemic First Time Abatement Policy Currently Under Consideration by the IRS Would Override Reasonable Cause Relief and Jeopardize Fundamental Taxpayer Rights

Wed, Aug 29, 2018

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog. The IRS offers a First Time Abatement (FTA) program that is intended to be, and often is, taxpayer-favorable. Nevertheless, as currently implemented, the FTA sometim...

NTA Blog: TAS Cases Demonstrate the Harm Caused by IRS Policies on Passport Certification

Wed, Aug 22, 2018

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog. My last blog on passport issues discussed the IRS’s continued refusal to exclude already open TAS cases from passport certification and my efforts to advocate ...

NTA Blog: IRS Administration of the Section 965 Transition Tax Contravenes Congressional Intent and Imposes Unintended Burden on Taxpayers

Thu, Aug 16, 2018

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog. When Congress passes legislation as comprehensive and technical as the Tax Cuts and Jobs Act (TCJA), drafting and implementation glitches inevitably arise. This week...

NTA Blog: IRS Continues to Close Taxpayer Assistance Centers, Despite Taxpayer Advocate Service and Congressional Concerns

Thu, Aug 09, 2018

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog. For many years I have reported on the state of service at IRS Taxpayer Assistance Centers (TACs), formerly known colloquially as walk-in sites. In my previous blog, ...

New Tax Reform Changes Website Explains What Is Changing and What Is Not

Thu, Aug 09, 2018

You may know that Congress approved major tax reform in the Tax Cuts and Jobs Act (TCJA) on Dec. 22, 2017. The IRS is currently working on implementing this complex tax legislation that will affect both individuals and businesses. In light of the extensive list of items under the TCJA, particularly those affecting individuals, the Taxpayer Advocate Service has created the Tax Reform Changes ...