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Friday, June 24, 2011

Internal Revenue Service Revises the Optional Standard Mileage Rates

Internal Revenue Service is revising the optional standard mileage rates for computing the deductible costs of operating an automobile for business, medical, or moving expense purposes and for determining the reimbursed amount of these expenses that is deemed substantiated.

This modification results from recent increases in the price of fuel.

The revised standard mileage rates are 55.5 cents per mile for business use of an automobile and 23.5 cents for use of an automobile as a medical or moving expense. (The mileage rate for use of an automobile as a charitable contribution is fixed by statute and remains 14 cents.)

The revised standard mileage rates apply to deductible transportation expenses paid or incurred for business, medical, or moving expense purposes on or after July 1, 2011, and to mileage allowances that are paid both (1) to an employee on or after July 1, 2011, and (2) for transportation expenses an employee pays or incurs on or after July 1, 2011.

Practical Note: If you expect to use the Optional Standard Mileage Rate for vehicle expenses in 2011, record your vehicle mileage on July 1, 2011 and keep it in a safe place.

From IRS Announcement 2011-40

Sunday, June 12, 2011

Preparing Your Tax Records for a Disaster

Planning what to do in case of a disaster is an important part of being prepared. A good disaster plan should include plans for taxpayers to safeguard their records. Some simple steps can help taxpayers and businesses protect financial and tax records in case of disasters. Here are some ideas on preparedness.

Take Advantage of Paperless Recordkeeping for Financial and Tax Records

Many people receive bank statements and documents by e-mail. This method is an outstanding way to secure financial records. Important tax records such as W-2s, tax returns and other paper documents can be scanned onto an electronic format.

Be sure you back up your electronic files and store them in a safe place. Making duplicates and keeping them in a separate location is a good business practice. Other options include copying files onto a CD or DVD.

When choosing a place to keep your important records, convenience to your home should not be your primary concern. Remember, a disaster that strikes your home is also likely to affect other facilities nearby, making quick retrieval of your records difficult and maybe even impossible.

Document Valuables and Business Equipment

The IRS has disaster loss workbooks for individuals ( Publication 584, Casualty, Disaster, and Theft Loss Workbook) and businesses ( Publication 584-B, Business Casualty, Disaster, and Theft Loss Workbook) that can help you compile a room-by-room list of your belongings or business equipment. This will help you recall and prove the market value of items for insurance and casualty loss claims.

One option is to photograph or video the contents of your home and/or business, especially items of greater value. You should store the photos with a friend or family member who lives away from the geographic area at risk.

Continuity of Operations Planning for Businesses

How quickly your company can get back to business after a disaster often depends on emergency planning done today. Start planning now to improve the likelihood that your company will survive and recover. Review your emergency plans annually. Just as your business changes over time, so do your preparedness needs. When you hire new employees or when there are changes in how your company functions, you should update your plans and inform your people.

There are real benefits to being prepared for disasters.

Update Emergency Plans

Emergency plans should be reviewed annually. Personal and business situations change over time and so do preparedness needs. Individual taxpayers should make sure they are saving documents everybody should keep including such things as home closing statements and insurance records. When employers hire new employees or when a company or organization changes functions, plans should be updated accordingly and employees should be informed of the changes.

Utilize the services of the IRS

Immediately after a casualty, you can request a copy of a return and all attachments (including Form W-2) by using Form 4506, Request for Copy of Tax Return (PDF).

If you just need information from your return, you can order a transcript by calling (800) 829-1040 or using Form 4506-T, Request for Transcript of Tax Return (PDF). There is no fee for a transcript. Transcripts are available for the current year and returns processed in the three prior years.

Friday, June 3, 2011

Tips for Lowering Your Property Taxes - Pope County Arkansas

Pay Real Estate Taxes in Pope County Arkansas? You may be paying too much.

Consider appealing your real property assessment.

The Arkansas Supreme Court has determined on what basis a property’s value should be changed upon appeal. The reasons have been summarized below and you should consider appealing your assessment if you find that any apply to you:

Is the assessment unfair, compared with other lands of the same kind similarly situated? Your property is appraised higher than neighborhood properties of the same use, size, materials and condition.

Is the assessment clearly erroneous?The appraisal relies on inaccurate or insufficient information about the property. Residential property example: the details of a building’s quality or condition have been disregarded. Commercial property example: market rental income generated by the property has not been considered.

Is the assessment manifestly excessive?The appraised value of a property greatly exceeds what a willing, knowledgeable and informed buyer would pay for a similar property. Selling prices of similar properties indicate whether the appraised value of a property is excessive or not.

You have the right to appeal your valuation to the Pope County Board of Equalization. They meet yearly, as needed during the months of August and September. To schedule an appointment with the Board, please contact the Pope County Assessor’s Office at 479-968-7418. You must schedule your appointment on or before the third Monday in August.

Further Appeal Rights:

You have the right to appeal the Board of Equalization’s decision to the County Court and then the County Court’s decision to the Circuit Court. You must first, however, appeal to the Pope County Board of Equalization before proceeding further in the appeals process.

Need assistance preparing an appeal? Contact me for a free consultation.

(from http://www.pope.countyservice.net/index.html)

Thursday, June 2, 2011

Tips for Lowering Your Property Taxes

Home values are down 30 percent from their peak and could drop another 7 to 9 percent this year. Despite these statistics property taxes continue to increase. Take action to get your home's property lowered in five easy steps:

Know the property tax process
When it comes to property assessments, every city is different. Make a stop at your local assessor's office. Find out how they go about assessing properties, what forms you need to file and when the deadlines are for filing that appeal. You typically have 60 days or less from the time your annual assessment was mailed to lodge your appeal.

Pick up a property card
While at the assessor's office, get a copy of your property card. This contains all the info the assessor used in determining your home's assessed value: home's square footage, the number of bedrooms and bathrooms, and features such as a garage or finished basement.

Know the neighborhood
We're talking comps here. You need to know what comparable homes have recently sold for, and compare your home in terms of size, location, amenities and more. This is where Zillow comes in handy. (www.zillow.com) Find at least three to five properties that are comparable to yours, and if you discover that yours is valued at least 5 to 10 percent higher, you likely have a case.

Make your case
If you have evidence that your home is over assessed, and the National Taxpayers Union estimates that as many as 60 percent of properties are, ask that it be re-assessed. Are there mistakes on your property card? For example, are there math errors? Is your home classified as "commercial"; even though it's "residential"? Mistakes as these are common (the inaccuracy rates on these cards are between 30 and 50 percent, according to the NTU). They can be corrected on the spot and you can avoid a formal hearing altogether.

File your appeal
Is it more than a simple math mistake? Do you think you have a legitimate case? File an appeal. While the rules for appeals vary from place to place, most appeals are submitted in written form to county boards with a statement explaining why you feel the evaluation is inaccurate. Support this claim with evidence (property cards and photos can be useful if comparing the condition of your home to others), and succinctly make your case, with your eye on the prize: One in three challenges results in a tax reduction and the average tax savings is $200 to $5,000 a
year, according to the NTU.

from Vera Gibbons: Zillow Blog http://www.zillow.com/blog and Twitter: @zillow.