Monthly Archives: December 2015

IDENTITY THEFT & FRAUDULENT RETURNS

Tax Return FraudIf you have been a victim of identity theft and have discovered that a fraudulent return was filed and accepted by the IRS using your name and Social Security Number, it is now possible to request a redacted copy of the fraudulent return from the IRS.  This will help victims determine what information was stolen.  Instructions for requesting a copy of a fraudulent return can be found at https://www.irs.gov/Individuals/Instructions-for-Requesting-Copy-of-Fraudulent-Returns.

Jerry Dreier
Manager – Packer Thomas
Feel free to contact Jerry with your questions:  jdreier@packerthomas.com
(800) 943-4278
(330) 533-9777

OHIO INCOME TAX CHANGES

OhioThe Ohio income tax form will have a new look for the 2015 year (i.e. the return filed in 2016 covering the 2015 year).  There will just be one form, the IT 1040, that will cover what was previously handled by three separate forms (the IT 1040, IT 1040EZ, and IT 1040X).  In addition, there will just be one Schedule of Credits that will encompass credits previously claimed on Schedules B, C, D, and E of the previous year IT 1040.  There are a number of other changes in the Ohio return, including changes in the calculation of the Business Income Deduction.  Be alert!

Jerry Dreier
Manager – Packer Thomas
Feel free to contact Jerry with your questions:  jdreier@packerthomas.com
(800) 943-4278
(330) 533-9777

IRA TAX TRAP

Tax TrapWhen individuals invest IRA funds in partnerships, they will owe tax on certain partnership income exceeding $1,000.  When this tax applies, it almost always catches the IRA owner by surprise.  This tax is known as Unrelated Business Income Tax.  A recent article in The Wall Street Journal highlighted this potential tax trap.

The IRA trustee is responsible for preparing Form 990-T to calculate the tax but the IRA owner is generally responsible for ensuring that the tax is paid.  To avoid this complexity and cost, IRA owners should consult with their investment advisor about any publicly traded partnerships already owned by their IRA and consider making these types of investments in non-IRA accounts in the future.

Jerry Dreier
Manager – Packer Thomas
Feel free to contact Jerry with your questions:  jdreier@packerthomas.com
(800) 943-4278
(330) 533-9777