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The Professor Nedley Series

Tax Tips for  2007 & 2008

Thursday, May 08, 2008

     Find current tax rates, this year's exemption amounts, the starting point for the phase out of those exemptions and a quick summary of the earned income credit for this year - plus - a link that will actually explain the Earned Income Credit.

How to get Tax Returns From the Other Side - Right Now!!

Judges, Lawyers and individuals:  You know that awkward situation where no one quite believes what is reported in the tax return that is presented to the court, because they are never file-stamped copies, and they never seem to be the ones that are signed by both parties.  This is not unusual because (a) the IRS doesn't file-stamp your copies for you when you file them and (b)people typically don't sign the copies that they keep or if they file electronically the copy is kept in your computer and is not signed.  Professor Nedley has a solution to your dilemma - file IRS Form 4506-T.  Form 4506 is a request for a copy of the filed return and this probably will take several months, but 4506-T is a request for a TRANSCRIPT of the tax return, which is usually more than enough to verify the actual information that was actually filed and the turnaround time is as close to 10 days as the IRS can make it. Either party may make the request for a transcript by filling out a one-page form and sending it to:

For Individuals:

RAIVS Team
Stop 38101
Fresno, CA 93888, Phone 559-253-4990 Fax

For Business Entities:

RAIVS Team
P.O. Box 9941
Mail Stop 6734
Ogden, UT 84409, Phone 801-620-6922 Fax

The party may also call 1-800-829-1040.  There is no fee and the requestor may have the response mailed directly to the courtroom in question.  The transcript will have a printout of most of the line items on the return.  Note that this may be done for forms 1040, 1120 (corporations) and 1065 (partnerships) as well as the shortened versions of theses same returns (ie1120S).  I would assume these are under the business records exception or the judicial notice sections.

NOTE: You can do this right in the courtroom while you wait.  The return transcript is likely to be there by the tiime of the next hearing.  It can have a return address of the clerk of that courtroom.  You have the necessary parties all right there.  If you're a lawyer or a party - ask the judge to order it done right there and give it to the clerk for mailing.  If you're the judge - WHY NOT?

Here are some HotLinks right to the source of all Knowledge & Forms - The IRS web   Home  |  Contact IRS  |  About IRS  |  Site Map  |  Español  |  Help   Advanced Search   Search Tips   IRS Resources Compliance & Enforcement Contact My Local Office e-file Forms and Publications Frequently Asked Questions  Where To File 2007 Federal Tax Rate Schedules   Note: These tax rate schedules are provided so that you can compute your federal estimated income tax for 2007. To compute your actual income tax, please see the instructions for 2007 Form 1040, 1040A, or 1040EZ as appropriate when they are available. Schedule X — Single If taxable income is  over-- But not over-- The tax is: $0 $7,825 10% of the amount over $0 $7,825 $31,850 $782.50 plus 15% of the amount over 7,825 $31,850 $77,100 $4,386.25 plus 25% of the amount over 31,850 $77,100 $160,850 $15,698.75 plus 28% of the amount over 77,100 $160,850 $349,700 $39,148.75 plus 33% of the amount over 160,850 $349,700 no limit $101,469.25 plus 35% of the amount over 349,700   Schedule Y-1 — Married Filing Jointly or Qualifying Widow(er) If taxable income is over-- But not over-- The tax is: $0 $15,650 10% of the amount over $0 $15,650 $63,700 $1,565.00 plus 15% of the amount over 15,650 $63,700 $128,500 $8,772.50 plus 25% of the amount over 63,700 $128,500 $195,850 $24,972.50 plus 28% of the amount over 128,500 $195,850 $349,700 $43,830.50 plus 33% of the amount over 195,850 $349,700 no limit $94,601.00 plus 35% of the amount over 349,700   Schedule Y-2 — Married Filing Separately   If taxable income is over-- But not over-- The tax is: $0 $7,825 10% of the amount over $0 $7,825 $31,850 $782.50 plus 15% of the amount over 7,825 $31,850 $64,250 $4,386.25 plus 25% of the amount over 31,850 $64,250 $97,925 $12,486.25 plus 28% of the amount over 64,250 $97,925 $174,850 $21,915.25 plus 33% of the amount over 97,925 $174,850 no limit $47,300.50 plus 35% of the amount over 174,850   Schedule Z — Head of Household   If taxable income is over-- But not over-- The tax is: $0 $11,200 10% of the amount over $0 $11,200 $42,650 $1,120.00 plus 15% of the amount over 11,200 $42,650 $110,100 $5,837.50 plus 25% of the amount over 42,650 $110,100 $178,350 $22,700.00 plus 28% of the amount over 110,100 $178,350 $349,700 $41,810.00 plus 33% of the amount over 178,350 $349,700 no limit $98,355.50 plus 35% of the amount over 349,700

Tax Exemptions for 2007; Exemptions are worth $3400 for tax year 2007, but they start to phase out when you get to the following levels of income:

                        Married Filing Separately           $112,875*

                        Single                                              $150,000

                        Head of Household                      $188,000

                        Married Filing Joint                      $225,750

*These phaseout numbers have yet to be upped for inflation

Earned Income Credit: (See Pub 596)

You get the following credits against taxes if you have children or you fall below a certain income or a combination of both: Remember a credit is a direct reduction of taxes as opposed to an exemption which is a reduction of income upon which the taxes are to be calculated.

                    Max Credit            # Children                Max Income

                      $2747                           1                              $32,000

                      $4536                       1 or more                  $36,348

                      $ 412                            none                      $12,000

You can have this credit applied against your withholding taxes all year long by submitting the proper form to your employer (See Pub 596, See link above)