Category Archives: IRS Tax Tips and Alerts

Electronic filing excise taxes, Electronic filing of Form 720, Federal Excise Tax Electronic Filing, IRS Tax Tips and Alerts

Taxpayers Who File Electronically Must Use e-Signatures!

In an effort to make electronic filing even more secure and paperless, the Internal Revenue Service now requires all taxpayers who file their tax returns electronically to also use electronic signatures. The IRS has eliminated the paper signature document for e-filed returns.

Just as the familiar automated teller machines use personal identification numbers, so does the IRS e-signature process. If filing a joint return, each taxpayer must create and use his or her own PIN to sign the tax return. The IRS also must verify your identity so there will be personal and tax-related questions. You should have your prior year 2009 tax return on hand if it’s available.

There are two ways to create an IRS e-signature PIN: self-select PIN method and practitioner PIN method.

Self-Select PIN Method

Taxpayers who are preparing their own returns using software must use the self-select PIN method. The self-select PIN allows taxpayers to select five numbers (except all zeros) to enter as their electronic PIN signature. The IRS still must verify the taxpayers’ identities. As part of the verification process, you must provide either your adjusted gross income listed on your 2009 tax return or your 2009 PIN used to e-file your return last year. It also will ask for date of birth. For joint returns, both taxpayers must create PINs using this method.
If you have never filed a tax return before, you can still use self-select PIN by using zero as your 2009 AGI. Do not leave this field blank. However, the space for the 2009 PIN should be left blank.
Practitioner PIN Method

Taxpayers who use a volunteer or paid tax preparer may use the practitioner PIN method or the self-select PIN method. The practitioner PIN method allows you to authorize your tax preparer to enter or generate your five-digit PIN on your behalf. You must sign Form 8879, IRS e-file Signature Authorization. The practitioner retains Form 8879 but does not mail it to the IRS. Some tax preparers may use an electronic signature pad for Form 8879 this year. Taxpayers who are age 16 and younger must use the practitioner PIN method.
IRS-issued Electronic Filing PIN

For taxpayers using the self-select PIN method but who cannot recall their 2009 adjusted gross income or their 2009 PIN, the IRS will issue a temporary Electronic Filing PIN (EFP.) This EFP can be used in place of the 2009 PIN and allow taxpayers to complete the self-select PIN method once their identity has been verified. Most tax software will contain a link to the EFP tool or you can search IRS.gov use keywords “ Electronic Filing PIN Request.” You also can use an automated, self-service telephone assistant by calling 1-866-704-7388.
Follow the instructions to receive your electronic filing PIN. Again, the IRS must verify your identity so you will need to provide some personal information and some tax-related information. You will need to know the filing status (i.e. single, married filing jointly, head of household, etc.) and the address used on your 2009 tax return.
The EFP will generate a five-digit number that you can substitute for your 2009 PIN. You can then return to the self-select PIN method, place the temporary EFP in the appropriate field and complete the signature process.
Ordering Your 2009 Tax Transcript

If you are unable to complete the EFP application and you cannot locate your 2009 tax return, you can order a transcript which will contain information such as your AGI that you can use to complete the self-select PIN method. There is no fee for a transcript.
The IRS has a new process for 2011 that allows you to order your transcript from IRS.gov. Just look for “online services” on the home page or search “Order a Transcript.” Your transcript will be sent to the address listed on the 2009 tax return. You also can call 1-800-908-9946 to order a transcript.
You can go to IRS.gov and print Form 4506T-EZ, Short Form Request for Individual Tax Return Transcript. The form can be completed and then faxed or mailed according to the form’s instructions. Generally, you do not need a copy of your exact tax return in order to complete the PIN process. Allow 7 to 10 days to receive the tax transcript.
Signing a joint return when spouse is not available.

If your spouse is serving in a combat zone and you do not have power of attorney, you can still create a self-select PIN for your spouse and e-file the return. After e-filing your return, just submit a signed statement explaining your situation with Form 8453, U.S. Individual Income Tax Transmittal for an IRS e-file Return, and mail according to the instructions.
If you have power of attorney for a military spouse or anyone who must file a tax return, you can use the self-selection PIN method to sign their return. You must also attach the power of attorney to Form 8453 and mail both to the IRS. Again, you should follow the mailing instructions on Form 8453.
Form 8453 can be used to submit any required paper documents in support of your tax return.
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Electronic filing excise taxes, Federal Excise Tax Electronic Filing, IRS Tax Tips and Alerts, Tax Excise Users Alert

Excise Tax Return Form 720 can be filed electronically!

Form 720, Quarterly Federal Excise Tax Return, is used to report and on excise taxes collected by the business for a variety of products and services. Use Schedule A to show the amount of your total liability for excise taxes for the quarter.

When Must Form 720 Be Filed

The form must be filed quarterly:
1st quarter – April 30

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2nd quarter – July 31
3rd Quarter – October 31
4th Quarter – January 31.

Trust Fund Tax

Excise taxes are a trust fund tax, meaning that they are collected by the business and held in trust, then paid to the IRS at specific times. If the full amount of the tax is not submitted when due, a trust fund recovery penalty may be imposed.

A payment voucher is included with Form 720. Include it when you send your payment. Send the form and payment to:

Department of the Treasury
Internal Revenue Service

Is electronic filing of Form 720 required?

Electronic filing of Form 720 is optional for any taxpayer who chooses to e-file.  Still IRS recommends e-filing.

How do I choose a transmitter to e-file Form 720 returns?

IRS has posted the contact information of all approved e-file transmitters .  You will need to select one to your liking.  IRS does not endorse any one provider and cannot make recommendations.  All listed providers are approved to submit returns to the IRS electronically.

When can I e-file Forms 720?

IRS is currently accepting electronically-filed Forms 720. Forms can be submitted online 24 hours per day.

Where and how do I access the electronic Form 720 returns?

Taxpayers will be required to submit their electronic Excise Tax forms through an approved transmitter/software developer.

Will it cost anything to e-file Form 720 returns?

Yes.  To electronically file Form 720 taxpayers will incur the cost of the provider’s required service fee for online submission.

What are all Excise Tax forms can be filed electronically?

At this point, the Excise forms available for electronic filing are Form 2290, Heavy Highway Vehicle Use Tax, Form 720, Quarterly Federal Excise Tax and Form 8849, Claim for Refund of Excise Taxes (Schedules 1,2,3,5 & 6,8).

How will e-file of Form 720 improve results?

Electronic filing of Form 720 will allow IRS to provide expedited and improved service and reliability to taxpayers while reducing processing time and errors.

www.tax720.com, an online website to file a “Quarterly Federal Excise Tax Return – Form 720”. Businesses and Tax Professionals can now file their quarterly Federal Excise taxes electronically (e-file) or a standard paper return using our product. We support forms 6627, 6197, Schedule C, Schedule T and Schedule A, for both paper and electronic filings.

ThinkTrade, Inc. has a successful proven track record of supporting Heavy Vehicle Use Tax Form 2290 (www.tax2290.com) and Claim for refund of Excise taxes Form 8849 (www.tax8849.com). All of these excise tax filing forms are grouped into a single website at: www.taxexcise.com for your convenience !!

Federal Excise Tax Electronic Filing, Form 720 Quarterly Excise Tax Efile, IRS Tax Tips and Alerts, Tax Excise Users Alert

Ten Tips for Taxpayers Who Owe Money to the IRS

IRS
www.irs.gov

While the majority of Americans get a tax refund from the Internal Revenue Service each year, there are many taxpayers who owe and some who can’t pay the tax all at once.   The IRS has a number of ways for people to pay their tax bill.

The IRS has announced an effort to help struggling taxpayers get a fresh start with their tax liabilities. The goal of this effort is to help individuals and small business meet their tax obligations, without adding unnecessary burden.  Specifically, the IRS has announced new policies and programs to help taxpayers pay back taxes and avoid tax liens.

Here are ten tips for taxpayers who owe money to the IRS.

  1. Tax bill payments If you get a bill this summer for late taxes, you are expected to promptly pay the tax owed including any penalties and interest.  If you are unable to pay the amount due, it is often in your best interest to get a loan to pay the bill in full rather than to make installment payments to the IRS.
  2. Additional time to pay Based on your circumstances, you may be granted a short additional time to pay your tax in full. A brief additional amount of time to pay can be requested through the Online Payment Agreement application at www.irs.gov or by calling 800-829-1040.
  3. Credit card payments You can pay your bill with a credit card. The interest rate on a credit card may be lower than the combination of interest and penalties imposed by the Internal Revenue Code. To pay by credit card contact one of the following processing companies: Link2Gov at 888-PAY-1040 (or www.pay1040.com), RBS WorldPay, Inc. at 888-9PAY-TAX (or www.payUSAtax.com), or Official Payments Corporation at 888-UPAY-TAX (orwww.officialpayments.com/fed).
  4. Electronic Funds Transfer You can pay the balance by electronic funds transfer, check, money order, cashier’s check or cash.  To pay using electronic funds transfer, use the Electronic Federal Tax Payment System by either calling 800-555-4477 or using the online access at www.eftps.gov.
  5. Installment Agreement You may request an installment agreement if you cannot pay the liability in full. This is an agreement between you and the IRS to pay the amount due in monthly installment payments. You must first file all required returns and be current with estimated tax payments.
  6. Online Payment Agreement If you owe $25,000 or less in combined tax, penalties and interest, you can request an installment agreement using the Online Payment Agreement application atwww.irs.gov.
  7. Form 9465 You can complete and mail an IRS Form 9465, Installment Agreement Request, along with your bill in the envelope you received from the IRS.  The IRS will inform you (usually within 30 days) whether your request is approved, denied, or if additional information is needed.
  8. Collection Information Statement You may still qualify for an installment agreement if you owe more than $25,000, but you are required to complete a Form 433F, Collection Information Statement, before the IRS will consider an installment agreement.
  9. User fees If an installment agreement is approved, a one-time user fee will be charged.  The user fee for a new agreement is $105 or $52 for agreements where payments are deducted directly from your bank account.  For eligible individuals with lower incomes, the fee can be reduced to $43.
  10. Check withholding Taxpayers who have a balance due may want to consider changing their W-4, Employee’s Withholding Allowance Certificate, with their employer. A withholding calculator atwww.irs.gov can help taxpayers determine the amount that should be withheld.

For more information about the Fresh Start initiative, installment agreements and other payment options visit www.irs.gov.  IRS Publications 594, The IRS Collection Process, and 966, Electronic Choices to Pay All Your Federal Taxes, also provide additional information regarding your payment options. These publications and Form 9465 can be obtained from www.irs.gov or by calling 800-TAX-FORM (800-829-3676).

TaxExcise
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If you have any Excise Tax claims with the IRS, use http://www.taxexcise.com The ONE STOP SHOP for all your Excise Tax needs. For any further support call us at 1-866-245-3918 or simple write to us at support@taxExcise.com
Links:

  • Publication 594, The IRS Collection Process (PDF)
  • Publication 966, Electronic Choices to Pay All Your Federal Taxes (PDF)
  • Form 9465, Installment Agreement (PDF)
  • Excise Tax Blog, click here
Issue Number: IRS Summertime Tax Tip 2011-14
Federal Excise Tax Electronic Filing, IRS Tax Tips and Alerts

IRS Gives Truckers Three-Month Extension; Highway Use Tax Return Due Nov. 30

Date: July 16th, 2011.

 

Authorized E-File Provider
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The Internal Revenue Service today advised truckers and other owners of heavy highway vehicles that their next federal highway use tax return, usually due Aug. 31, will instead be due on Nov. 30, 2011.

Because the highway use tax is currently scheduled to expire on Sept. 30, 2011, this extension is designed to alleviate any confusion and possible multiple filings that could result if Congress reinstates or modifies the tax after that date. Under  temporary and proposed regulations filed today in the Federal Register, the Nov. 30  filing deadline for Form 2290, Heavy Highway Vehicle Use Tax Return, for the tax period that begins on July 1, 2011, applies to vehicles used during July, as well as those first used during August or September. Returns should not be filed and payments should not be made prior to Nov. 1.

To aid truckers applying for state vehicle registration on or before Nov. 30, the new regulations require states to accept as proof of payment the stamped Schedule 1 of the Form 2290 issued by the IRS for the prior tax year, ending on June 30, 2011.  Under federal law, state governments are required to receive proof of payment of the federal highway use tax as a condition of vehicle registration. Normally, after a taxpayer files the return and pays the tax, the Schedule 1 is stamped by the IRS and returned to filers for this purpose.  A state normally may accept a prior year’s stamped Schedule 1 as a substitute proof of payment only through Sept. 30.

For those acquiring and registering a new or used vehicle during the July-to-November period, the new regulations require a state to register the vehicle, without proof that the highway use tax was paid, if the person registering the vehicle presents a copy of the bill of sale or similar document showing that the owner purchased the vehicle within the previous 150 days.

In general, the highway use tax applies to trucks, truck tractors and buses with a gross taxable weight of 55,000 pounds or more. Ordinarily, vans, pick-ups and panel trucks are not taxable because they fall below the 55,000-pound threshold.

For trucks and other taxable vehicles in use during July, the Form 2290 and payment are, under normal circumstances, due on Aug. 31. The tax of up to $550 per vehicle is based on weight, and a variety of special rules apply to vehicles with minimal road use, logging or agricultural vehicles, vehicles transferred during the year and those first used on the road after July.

Last year, the IRS received about 650,000 Forms 2290 and highway use tax payments totaling $886 million. Get ready for the new tax year 2011-12, efile through www.TaxExcise.com. Call our Support Center at 1-866-245-3918 or write to us support@taxexcise.com for any further support. We are always happy to help you through in your tax return efiling.

Federal Excise Tax Electronic Filing, Form 2290 Amendment, IRS Tax Tips and Alerts

IRS Form 2290 Amendment efiling

Tax Form 2290IRS Form 2290 Amendments:

When reporting an original Form 2290, Heavy Motor Truck Tax with IRS for the tax year, you would have changed some information like VIN, Gross Weight, Mileage Limit then IRS wants you to file amendments to the originally filed form 2290. There are three types of amendments available for form 2290

For a vehicle that will be used within 5,000 miles or less (7,500 miles or less for agricultural vehicles) during the period, it can be reported as a suspended/exempt vehicle from tax liability.

Suspended/Exempt Vehicles exceeding the mileage use limit:

Once a suspended vehicle exceeds the mileage use limit, the tax becomes due. Mileage use limit means the use of a vehicle on public highways 5,000 miles or less (7,500 miles or less for agricultural vehicles). The mileage use limit applies to the total mileage a vehicle is used during a complete tax period, regardless of the number of owners.

We will figure the tax based on the month the vehicle was first used in the period. The tax due has to be paid to the IRS by available Payment Options. By e-filing the amended Form 2290, by the last day of the month following the month in which the mileage use limit was exceeded.

A corrected schedule-1 copy with the VIN and other details will be stamped by IRS and the same will be sent to you by email. You have the option of printing the corrected Schedule-1 copy by logging into your personal account. You also have the option to subscribe for a copy by FAX.

Additional Tax from Increase in taxable gross weight:

The taxable gross weight of a vehicle increases during the period and the vehicle falls in a new category then you are suppose to report an 2290 Amendment and pay the tax due on time.

For instance, an increase in maximum load customarily carried may change the taxable gross weight.

Report the additional tax for the remainder of the period on Form 2290, e-file Form 2290 and Schedule 1 by the last day of the month following the month in which the taxable gross weight increased.

Figure the additional tax using the following:

1. Identify the month the taxable gross weight increased.

2. Determine the new taxable gross weight category.

If the increase in taxable gross weight occurs in July after you have filed your return, you still have to report a new amendment form for the additional tax.

A corrected schedule-1 copy with the VIN and new category [Gross Weight] will be stamped by IRS and the same will be sent to you by email. You have the option of printing the corrected Schedule-1 copy by logging into your personal account. You also have the option to subscribe for a copy by FAX.

VIN Correction:

If you are correcting a vehicle identification number (VIN) listed on a previously filed Schedule 1 (Form 2290). While reporting a Form 2290 for your vehicle, by mistake if you have filed for a wrong Vehicle Identification Number [VIN] then you have to file a new amendment for VIN correction.

A corrected schedule-1 copy with the correct VIN and other details will be stamped by IRS and the same will be sent to you by email. You have the option of printing the corrected Schedule-1 copy by logging into your personal account. You also have the option to subscribe for a copy by FAX.

Call our Support Center [HELP DESK] at 1-866-245-3918 for any queries or write to us at support@taxexcise.com, At taxexcise.com we are always happy to help you through your filing process.