IRS/Tax information
2013 Tax Changes
- New Payroll tax rates have taken effect to include the 2% increase in social security withholding
- The new ceiling on social security wages has increased to 113,700.
- There is no wage base limit on medicare tax.
- Simple IRA contribution limits: individuals age 50 or older can make catch-up contributions up to a max of $5500 in 2012 and 2013 for the following plans
- 401(k)
- 403(b)
- SARSEP
- Gov't 457(b)
IRS Collection Procedures
As of May 2012 a complete new offer in compromise program was enacted with the following major change; Basically Settlements will be based on equity in assets and future earnings based on a 24 month period. Any settlement that is made must be paid in full over a 24 month period. The old procedures all offers to be paid over a longer period of time.
The IRS also has created a new procedure for installment agreements if an offer in compromise is not applicable. The new installment agreement allows
- Debt paid over life of statute(statute is 10 years)
- Monthly payment is based on your current ability to pay
- This agreement is reviewed every 2 years, and if your ability has increased your monthly payment will increase
The IRS also allows an individual to be put in an uncollectible status. This is based on many factors
- Annual income
- Age, because future income could decrease
- Assets and equity in those assets
- Ability to secure financing to pay off IRS debt(basically finance real estate or vehicles)
- Current health conditions and any potential or pending health issue
Understand that the above factors are just the general criteria for solving any IRS debt.
For a more in-depth look at what can be done to satisfy your IRS problem please contact me.
2014 Tax changes for 2014 relating to mileage rates:
The mileage allowance for 2013 is;
• 56.5 cents per mile for business
• 23.5 cents per mile for medical trips
• 14 cents per mile for charitable trips
For the year 2014 the mileage allowance will be;
• 56 cents per mile for business
• 23.5 cents per mile for medical trips
• 14 cents per mile for charitable trips
