The IRS has changed their processing of tax returns for the 2011 tax returns. The first and most important is the IRS will process tax returns each day. Previously they only processed returns on Thursdays. So if we prepared and e-filed your return on Friday it was on hold at the IRS for a week. When it was processed if there was a correction that was needed we had already lost a week in processing. Now the IRS will process every day and the refunds will be direct deposited in 3 to 5 days.
Second big issue is the Schedule E for rental properties. Anyone paid $600 or more over the year must receive a 1099. That includes the yard maintenance people, the pool people, plumber, painters, home handyman, attorney or tax preparer. If you don't issue a 1099 you don't get the write off on your tax return. Plus you may be subject to 2 penalties. One penalty for not giving the individual their 1099 and a seperate penalty for not sending the copy to the IRS.
Thats like having a question marked wrong on a test for not having the correct answer and marked wrong again for having the wrong answer. If you did not have a 1099 for the individual how would you have a copy to send to the IRS?
If you don't have the name address and social security number of everyone you pay for maintenance, repairs and services be sure to get them now. KatTax can prepare your 1099s.
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