Don't Mess With Taxes

Al Sharpton's tax troubles

The Rev. Al Sharpton usually isn't one to shy away from attention, but no one likes it when the added interest comes from tax collectors.

The Associated Press reports that it has obtained government records indicating that Sharpton and his business entities owe nearly $1.5 million in overdue taxes and penalties.

Sharpton's personal debts include $365,558 in New York City income tax and $931,397 in federal income tax, according to an IRS lien filed last spring. Sharpton's for-profit company, Rev. Al Communications, owes New York state another $175,962 in delinquent taxes.

According to the wire service, the U.S. Attorney also is investigating Sharpton's National Action Network. Lawyers for the nonprofit group have been negotiating with the feds over the size of the debt, as well as trying to pay off tens of thousands of dollars owed for failing to properly maintain workers compensation and unemployment insurance.

This is not the first time Sharpton has tangled with the tax man.

In 1990, he was acquitted of tax fraud and charges that he stole from one of his charities. He followed that up with what was essentially another victory in a tax case by pleading guilty to a misdemeanor charge of failing to file a state return.

Really, just where the heck is my rebate!?!

A lot of taxpayers are starting to feel like these turkey vultures.

Yep, patience is starting to wear thin as folks wait for their rebate money.

Emotions range from frustrated but slightly apologetic Jesi:

I really don't want to bit** about this money because this time last year, I didn't  know or expect to be getting it and am grateful that I am now. But it's like dangling candy in front of a two-year-old. I was supposed to get mine today and nothing. I know that I do not owe anything and made all the qualifying items …

To the somewhat more agitated Kollette:

I'm on the "before May 5" schedule for direct deposits and have been looking for something ever since. How do we find out? Who do we talk to? If you give me something and tell me when you're going to give it to me, why should I have to find out when it's coming?

To the downright angry Pierre:

This is damned bull crap. A lot of the people I know who have last 2 digits in the 30s-70s range say they haven't received it. Its bull****. You do everything by the book and they still find a way to screw you over. Those dates might as well be lies to shut people up and give them false hope of a quick direct deposit. I did my taxes early and I waited patiently to the 9th of May and what? NOTHING! It must be a scam being played on us by this government. False hope, that's all we get here.

As Jesi also noted, the waiting is a problem many taxpayers are having. And they're starting to demand at least some answers as to why they haven't seen a cent of the economic stimulus payment yet.

Timetable travails: It certainly was exciting when, back on March 18 the IRS announced the timetable for rebate delivery. But the problem with putting out specific dates is that even if you qualify them by noting that other factors might mean your money won't show up exactly when you expect it, folks don't care about that.

What they care about is you -- IRS, Congress, Dubya -- said you were giving them money. You laid out some dates. You made us mark our calendars. Now deliver, in every sense of the word!

The expectation factor then got ramped up when Dubya and his Treasury Department minions decided he original rebated delivery schedule needed to be accelerated.

The interesting thing in all this is that even after the prez's announcement that the rebate money would be going out sooner, the IRS never adjusted its original delivery schedule posted on its Web site.

And the agency is in basic CYA mode in its latest rebate FAQs. There, one of the most common questions is, "I filed my return on time, but I haven’t received my stimulus payment, even though the payment date listed for my Social Security number has passed. Why?"

The official IRS answer, or to anxious taxpayers, non-answer to this increasingly asked question is:

In general, the payment schedule only applies if your return was received and the IRS finished processing it before April 15. If you filed your return on time, but close to the April 15 deadline, the IRS may not have finished processing it before April 15.

Processing times for tax returns and stimulus payments vary. If you are getting a regular income-tax refund, the IRS will send you that refund first. Normally, your stimulus payment will follow one to two weeks later.

If you are not expecting a regular tax refund, your stimulus payment generally should arrive a minimum of six weeks after you file.

Also, if you chose direct deposit and requested a Refund Anticipation Loan (RAL) or had your refund deposited into more than one account, you will receive a paper check based on the distribution schedule for paper checks.

So what the IRS essentially is saying is that although we put out a schedule, we have lots of other things that could keep us from meeting it.

Hmmm. Perhaps Pierre's analysis is correct.

So what to do? Right now, my best advice is to check the IRS' Where's My Rebate? online tracker (blogged about here).

I know; it seems counterintuitive to trust the IRS with regard to anything associated with the rebates. But the rebate tracking program is based on the similar Where's My Refund? system, and that seems to work well.

So the rebate one should (and I say that with my fingers crossed, making it hard to type!) help you discover just what the hold up is with your stimulus money.

I do know that some checks and direct deposits have been sent out. Here's hoping yours is next in line.

Mother's Day gift ideas

It's been a crazy week and Mother's Day almost sneaked up on me. But a little while ago I called a florist in my mother's town and was assured they could deliver a nice flower arrangement later today or tomorrow.

A gift for my Mom is easy. First of all there's the card; that's a must, preferably a mushy one.

She also loves flowers, and my tardiness this year made that choice a no-brainer. Costume jewelry also is a welcome present, as are various accessories like scarves and fashion belts.

You could spend a lot for those gifts, or you could find some nice but less budget busting versions of everything but the fresh flowers at a local department or discount store.

Spending on Mom: This year, with recession on everyone's mind, it looks like thriftier options will win.

One recent survey, reported in Progressive Grocer (which, by the way, notes that fresh flowers are available at most supermarkets), found that consumers are planning to scale back a bit on the number of gifts they buy Mom this year.

According to the National Retail Federation's 2008 Mother's Day Consumer Intentions and Actions Survey, conducted by BIGresearch, consumers will spend an average of $138.63 this year, compared to $139.14 last year. Total consumer spending is expected to reach $15.8 billion.

While the majority of consumers will invest in one major gift (such as jewelry) for Mom, they are likely to spend at least some money on the aforementioned flowers ($2 billion expected in this category), gift cards or gift certificates ($1.6 billion), housewares and gardening tools ($696 million), and, of course, greeting cards ($672 million).

Most shoppers (35 percent) told pollsters that they will shop at specialty stores, with the rest of those surveyed heading to department (28.8 percent) and discount (25.7 percent) stores. Other outlets for Mom's gifts include specialty clothing stores and online and catalog merchants.

Other gift ideas: If you're still looking for ideas, check out Our Fourpence Worth's frugal but thoughtful Mother’s Day gift suggestions.

Mrs. Nespy's World has a wide-ranging five-part collection of gift ideas (part 1, part 2, part 3, part 4 and part 5).

And all you who procrastinated longer than I did will want to check out Slashfood's yummy gift list, ParentDish's last-minute gift guide and Mother's Day gifts for the procrastinator, part 1 and part 2, from Wordcandy Bookshelf.

Happy shopping and to all moms, grandmothers, aunts, nieces, godmothers and nurturing women everywhere, a well-deserved and very Happy Mother's Day!

Mom heart logo courtesy of LogoGolfwear.com.

No tax transparency from Cindy McCain

If John McCain wins in November, don't expect to ever see his wife's tax returns.

"You know, my husband and I have been married 28 years and we have filed separate tax returns for 28 years. This is a privacy issue. My husband is the candidate," Cindy McCain said in an NBC Today show interview aired Thursday (video here; transcript here).

As blogged about here, the Arizona senator released his married filing separately tax return last month. His wife's return was not made public.

She's heiress to a Phoenix-based beer distributing company with a reported fortune in the $100 million range. Thanks to a prenuptial agreement, much of the family's assets are solely in Mrs. McCain's name.

Political scolding: As expected, much is being made by political opponents about Mrs. McCain's decision to keep her tax data to herself.

Democratic National Committee Chairman Howard Dean said Cindy McCain's refusal to release her tax returns gives the appearance of a double standard on the part of her husband.

"What is John McCain trying to hide?" asked Dean in a statement. "Throughout this campaign, he has acted like his own calls for openness and accountability apply to everyone but himself. Now he thinks he can bring that same double standard to the White House."

In response, Republican National Committee spokesman Danny Diaz said, "Howard Dean continues to lower the bar in this election."

Who really cares? Aside from satisfying our society's current celebrity/tabloid thirst for tell-all personal details, what purpose does release of tax returns really serve?

The whole process is voluntary and the details revealed range from bare bones (see Dick and Lynne Cheney) to TMI (35 pages from the Obamas; they're obviously new to this!).

I don't really care what any candidate or sitting lawmaker at any governmental level makes as long as he or she reports it all to the IRS and/or applicable state tax collectors.

If the feds or their state/local cousins are investigating a candidate for suspected tax evasion (see Al Franken), that's when I want to know all the dirty allegedly law-breaking details.

Otherwise, the only return I'm going to worry about is my own.

NYC gets ugly ... Ugly Betty, that is

Production of the ABC comedy Ugly Betty is heading home.

The show, now winding down its second season, is set in New York City. But only the program's pilot was shot there. Subsequent takes were all on a Hollywood studio lot.

In the beginning, according to the Los Angeles Times, shooting in Tinsel Town saved money. But now the Empire State has come up big with a big bucks production tax break to lure Betty Suarez, her crazy family and crazier fictional Mode fashion magazine colleagues to the Big Apple.

A recently enacted tax credit (designed to combat production losses to neighboring states like Connecticut) will make filming much more appealing to Betty and, New York officials hope, other television and movie projects.

Feature films, television series, pilots, and TV movies and miniseries that complete at least 75 percent of their stage work at a qualified production facility in the state are eligible for a 35 percent refundable tax credit.

Such a break makes it easy to see why Walt Disney Co.'s ABC Studios, which produces Ugly Betty, decided to move. It reportedly costs $3 million to make one episode.

While the move will benefit Disney executives and bean counters, the on-set staff is not so lucky. Most of Ugly Betty's 150 crew members, including directors, set designers and carpenters, are expected to lose their jobs.

Where's the rest of my rebate?

I was talking last week to a tax preparer who was steeling herself for an onslaught of calls from clients wanting to know how come their rebate amounts are less, and potentially much less, than they were expecting.

"I tried to tell them about offsets, but they didn't want to hear it," she said.

Ah, yes. The back-door tax collection method.

If you owe the IRS federal taxes from previous tax years or have ignored a variety of nonfederal debts you owe, Uncle Sam can take those uncollected amounts out of any federal money you might be due.

Treasury Offset Program: Congress has given the Department of Treasury's Financial Management Service (FMS), which issues IRS tax refunds, the power to conduct the Treasury Offset Program. Through this program, any refund, overpayment or special tax allotment such as the stimulus package payment (aka rebate) may be reduced, or offset, to pay those outstanding debts.

These include past–due child support, federal agency nontax debts such as student loans, or state income tax obligations.

The Treasury, via the FMS, will automatically pull out the applicable amounts if the agency to which you owe money has submitted the debt as part of the federal offset program. FMS will take as much of your refund as is needed to pay off the debt (or debts) and send it to the agency (or agencies) you owe.

If there's anything left after offset, it will be issued to you as a check or directly deposited if that's what you requested on your return.

You can read more about the Treasury Offset Program at this IRS Web page. It also tells you what you can do if you believe you do not owe the debt or you want to dispute the amount taken from your refund.

Unfortunately, some folks who perhaps haven't filed for ages but decided to do so this year just to get the rebate might find they opened up a can of tax and other debt worms.

More IRS rebate FAQs: The issue of offsets and rebate money is included in a new set of most frequently asked questions the IRS has just issued in connection with the stimulus payments.

In addition to offsets, these FAQs cover other commonly asked questions, such as how receipt of a refund anticipation loan will affect delivery of your rebate (and which I blogged about here), how to make sure your payment follows you if you moved after filing your return and how to double check your rebate amount using the IRS' stimulus payment calculator.

The calculator is especially useful if your income was high enough ($$75,000 for a single taxpayer or over $150,000 for married taxpayers) to trigger a phase down (or out) of your rebate amount.

That's another reason your rebate might be less than you were expecting.

Carnival of Personal Finance #151

The latest Carnival of Personal Finance is now available at  Alpha Consumer. The theme for this 151st PFC is managing money in tight times.

Some of my favorite carnival bloggings this week include:

• Smart Easy Money takes a look at America's relatively low-priced gasoline.

• Trees Full of Money tells us how to get the best price for your car by selling it yourself.

• And Squawkfox is back. In a previous Carnival, she listed 10 things not to carry in your purse or wallet. This time she looks at 10 essentials to carry with you at all times.

My post on the vagaries of rebate check delivery methods also made the Carnival as one of the "hot topics."

Check it and the other items in that category out, as well as bloggings on saving, shopping and spending, money management, budgeting, insurance, investing and much, much more, all at the Carnival of Personal Finance #151.

Where's my stimulus rebate?

The IRS apparently got tired of folks calling its main 800 number to find out about the status of their economic stimulus package rebate check. To handle such inquiries, the agency has created an online tracking tool, Where's My Stimulus Payment.

The Web tool operates along the lines of the agency's popular Where's My Rebate feature.

To find our just where in the system your rebate check is mired, click here.

Once that page opens, you'll need to enter your Social Security number (if you filed a joint return, use the SSN of the spouse listed first on your 1040), your filing status and the number of exemptions you claimed on your 2007 return.

Then click "submit" and the system will tell you what's up with your rebate.

Possible problems: If you're like the hubby and me and still haven't filed your 2007 Form 1040 (I know, I know ...), you'll get a screen that tells you, "We are sorry. Specific information about your Stimulus payment is not available."

The Web page then lists possible reasons you're still waiting for your money:

• Your payment may still be coming, but has not yet been scheduled. Information will be available here as payments are issued based on the last two digits of the primary Social Security number shown on your 2007 tax return. Specific information about your Stimulus Payment will not be available until about one week before your payment is scheduled to be issued. See the complete Payment Schedule below for more information.

• You did not file a tax return for 2007 or your return is still being processed. Additional information about filing requirements is available.

• The information entered did not match our records. Be sure to check the information you entered. You may Re-Enter your information as necessary.

The page also lists the original delivery schedule, even though that delivery timetable has been accelerated.

And the IRS reminds anxious taxpayers to "Please allow 6 weeks after filing your tax return before checking on the status of your Stimulus Payment."

Telephone option, too: As mentioned in the 36th Carnival of Taxes, there's also a way to check on your rebate by phone.

Just call the IRS Rebate Hotline toll-free at 1-866-234-2942. You'll need the same information that the online tracking system requires.

In addition to the IRS information, check out some other common questions and answers about the rebate check delivery system in this blog post.

And if you're still waiting for your regular tax refund check, Where's My Refund? will help you find that money, too.

Savings from suspending state gas taxes

The debate between presidential candidates and economists over the efficacy of a temporary suspension of the federal gas tax rages on and likely will continue at least through the summer vacation season.

But, as noted in this earlier blog, state gas taxes add much more to the price of a gallon of gas than the 18.4 cents per gallon that goes to Uncle Sam.

So some state politicians, seeing a chance to get in on the demagoguery, also are calling for reductions at that level.

According to a story in today's New York Times, lawmakers in Florida, Missouri, New York and Texas have proposed a summer break from their states' gas taxes. Candidates for governor in Indiana and North Carolina also are sparring over fuel price relief ideas.

The legislators, both already in office and those hoping to be, know what the number crunchers are ignoring:

"The [political] response speaks not just to the reality of skyrocketing gas prices. It also highlights the political potency of anything that affects Americans' bonds with their cars. Gas is a product that no one can ignore — and one that inspires intense emotion."

Motorist savings per state: In addition to the story, the Times' has a nice table that estimates the savings per driver in each state and the District of Columbia if the jurisdictions took a summer break from their gas tax collections.

California motorists would net the most, with potential savings of $81.07 if the Golden State's 46 cents per gallon levy was suspended in June, July and August.

The smallest boost to a driver's bank account would be in Washington, D.C., with motorists there realizing only $12.26 in savings for those three months. That's 88 cents less than what drivers in Alaska would pay even though the 49th state's gas tax is only 8 cents a gallon vs. 20 cents a gallon in the nation's capital.

The difference comes because in calculating the estimated savings, the Times looked at not only the state tax rates, but also the number of drivers and the average amount of gasoline sold in each state during the summer.

Tax Carnival #36: A Cinco de Mayo Tax Celebration

Hola fellow taxpayers and Welcome to the 36th Carnival of Taxes, a joint celebration of Cinco de Mayo and Taxes.

OK, I know only hard-core tax geeks use the word "celebrate" in connection with taxes. But hey, isn't that you? You are reading this after all. So since this latest Tax Carnival falls on Cinco de Mayo, the day in 1862 when Mexican forces halted, at least temporarily, the French incursion into their nation, we're going to celebrate in our own tax geeky way, too.

I've divided the carnival into cinco sections. Sure it's an arbitrary format and a couple of Carnival items and squeezed into a category or two, but hey, it's a tax party! Have another margarita and it'll all make sense.

Uno: Hanging onto your tax money
OK, I'll guarantee that this will be the hands-down most popular post of this 36th Tax Carnival. Shawna tells us how to check the status of stimulus checks in Where's my economic stimulus check?!? It's posted at her blog that shall remain nameless here because we're a family friendly Internet operation.

Mitchel Harad urges us to consider Rebate Responsibility when we do get our checks. His post is over at Holy Cash Cow.

Steve Faber examines Tax Return Questions – Some of the Most Common, posted at Debt Free.

Investors always worry about taxes. Barb A. Ryan discusses that component (and more) in Asset Allocation, Investment Asset Tax Location, and Emergency Cash Management, posted at Pasadena Financial Planner.

More investing and taxes courtesy of Passive Income Investor, who discusses the Tax Benefits Of Passive Income. It's posted at LIVING OFF DIVIDENDS & PASSIVE INCOME.

Dos: Tangling with the IRS
Chief Family Officer presents 3 Signs You May be a Victim of Tax-Related Fraud, posted at Chief Family Officer.

In It's jail time for tax evader Wesley Snipes, Leon Gettler wonders what signal does that send other would-be tax defiers? How will Snipes fill his time in jail? And who’s going to kill the vampires now? You find Leon's reflections at Sox First.

Nate presents Three Things You Can Do To Be Prepared For An Audit, posted at Build Your Own Ecommerce Website!

Diane Dean presents What happens if you don't file your past due return with the IRS? It's posted at Need IRS Help?

And we get a personal confession from Madison, who, over at My Dollar Plan, tells us What I Learned About Taxes This Year.

Tres: Going beyond Form 1040
Most of us, understandably so, focus on getting our personal tax return to Uncle Sam. But there are many other ways taxes reach into our lives, whether we want them to or not.

Michael Bass says taxes are just one of many reasons Why Americans Can’t Afford Credit, posted at Debt Prison.

Wenchypoo presents Inflation + Shortages = Stealth Tax Increase, posted at Wisdom From Wenchypoo's Mental Wastebasket.

Robert D Flach has emerged from the abyss of tax return filing (welcome back!) to warn us that when it comes to maximum tax rates, It Ain’t Necessarily So, posted at THE WANDERING TAX PRO.

Cathy Ley presents A Short Sale, the IRS, and Your Mortgage Tax Bill, posted at Tips for Moms & Baby Websites.

Dan Meyer who blogs at Tick Marks tell us Baucus Starts Senate Finance Work on Tax Reform and AMT Patch.

David Gross continues his examination of tax resistance. His latest subject is war tax resistance by American Quakers from the 17th through the 19th century in The Quaker Experiment in Pennsylvania, posted at The Picket Line.

Cuatro: Taking a global tax view
Since we're celebrating a Mexican holiday today, it's fitting that Tax Carnival #36 looks at some global tax matters.

Beckie answers the question, Do I Have to Pay Taxes if I Live and Work Abroad? You'll find it over at A Tax Consultant for All Seasons.

For our readers in India, Raag Vamdatt presents Understanding Section 80C Deductions, posted at Financial Planning Demystified.

And Ian Cunningham offers our British readers information on UK Tax Returns, posted at The Business Lounge.

Cinco: Taking a tax entertainment break
Finally, since this is a tax party, we've got to have some entertainment.

That comes courtesy P.L. Frederick, with his tax-filing poem You Can Count On My Return. The verse commemorating tax time, accountants, and some late night returns is posted at Small & Big.

Well, that wraps up our 36th Carnival of Taxes, in plenty of time for you to get ready for your Cinco de Mayo party. Thanks for reading, and thanks to all our tax blog contributors.

Join us again in another month, June 2 to be exact, for our 37th Tax Carnival. If you have a tax item -- and please, send only tax-specific bloggings for Carnival consideration -- pass them along via our Blog Carnival page.

Now I'm off to make the guacamole, find the salt and limes and rev up the blender!

Numerals courtesy Courtney's Portfolio.