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Sacramento Tax Law Blog

Bilateral India-US Advance Pricing Agreement Requests Open Feb. 16

The US Internal Revenue Service announced that their Advance Pricing and Mutual Agreement office will begin accepting requests for bilateral advance pricing agrements between the United States and India starting February 16, 2016.

Dependent Contractors? Third Classification of Workers May Evolve from the Sharing Economy

Entrepreneurs who participate in the "Sharing Economy" may be granted a new worker status as the traditional classifications of employee and independent contractor no longer fit this modern group of workers. Also known as the Gig Economy or the On-Demand Economy, workers in this sector have more independence from the control of their employer than a traditional employee, but they also do not maintain all of the characteristics of independent contractors who do not enjoy the protections of labor laws.

Do You Qualify for the Earned Income Tax Credit?

Taxpayers in the United States with valid Social Security numbers may be eligible for a federal Earned Income Tax Credit if they meet certain criteria. The Internal Revenue Service has created an online "EITC Assistant" to help you determine if you are one of these qualifying taxpayers.

FTB Offers FAQ for Enhanced myFTB Website

California's Franchise Tax Board, which is responsible for administering the state's personal income tax and corporation tax programs, has recently launched an enhanced version of the website California taxpayers use to file and pay their taxes. The improved site, "myFTB," allows individuals to access account information, take advantage of convenient online services, and communicate with FTB representatives. 

How to Find Out if Your Foreign Tax Qualifies for an IRS Credit

The Internal Revenue Service has published an article to help you determine whether foreign taxes you pay qualify for the Foreign Tax Credit.  They list four criteria for you to evaluate the taxes you paid outside the United States. In brief, they are:

IRS Increases Sophistication to Match Identity Criminals

The Internal Revenue Service has been working with the states and tax professionals to increase security for taxpayers. The IRS reminds taxpayers of scams to avoid as part of its "Dirty Dozen" series. Identity theft at tax season is the first on its list.

Department of Justice Reaches Its Final Non-Prosecution Agreement in the Swiss Bank Program

On January 27, 2016, the Department of Justice announced that it reached its final non-prosecution agreement under Category 2 of the Swiss Bank Program with HSZH Verwaltungs AG (HSZH). The department has executed agreements with 80 banks since March 30, 2015, when it announced the first Swiss Bank Program non-prosecution agreement with BSI SA.

The department has imposed a total of more than $1.36 billion in Swiss Bank penalties, including more than $49 million in penalties from HSZH. Every bank in the program, including HSZH, is required to cooperate in any related criminal or civil proceedings, and that cooperation continues through 2016 and beyond.

Confusion Over IRS Identity Protection PINs

Taxpayers have been receiving letters with incorrect Identity Protection PIN numbers from the IRS. Notices are listing an incorrect filing year, the agency reported, which has created confusion for many taxpayers and tax professionals. According to a statement updated on January 15, 2016, the PIN numbers issued are, in fact, valid for filing year 2015 (despite the filing year being listed as 2014).

Identity Theft

Tax season is here and so are criminals who want to steal your identity. Tax-related identity theft occurs when someone misuses your Social Security number to file a tax return or to report earnings. Warning signs of misuse of your Social Security number include learning that a tax return has already been filed using your Social Security number, that you owe additional taxes, that your refund has been offset to pay other liabilities, or that you earned wages or self-employment income from an employer for whom you did not perform work.

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