Governor Lingle Proposes Delaying State Tax Refund Checks

Don't bank on a quick state tax refund to make it through the spring.

The governor wants to hold on to your money for a little while to patch a budget gap.

Next year's tax refunds would be paid in July according to the governor's latest budget plan.

A sting to the counties could end up hitting your pocket too, if they have to make up for lost hotel tax.

When you file your taxes for 2009, expect to wait until july 2010 for any refund.

That's because the governor needs 275 million dollars from refunds to wait a bit before mailing out, in order to lapse into the next fiscal year on the state books

"Those funds will get back to people, they will get into the economy, they're not permanently take out, but that delay allows us to get through that 2010 budget crisis that we have right now," said Governor Lingle.

A crisis that's grown to a 1.2 billion dollar shortfall over just the rest of this fiscal year plus the next one.

We asked what about a crisis of a family's budget waiting on that money.

"This is a heads up that you need to start planning," said the Governor.

What about cash in hand?

It's illegal for your employer to pay you cash in hand without deducting tax and National Insurance contributions from your wages.

If you accept money in this way, you risk losing your employment rights and the right to some benefits, such as:

• maternity or paternity leave
• sick pay
• Jobseeker's Allowance

In addition you could end up having to pay the tax and National Insurance contributions yourself.

14 companies participated in the days of career development in the HST

14 Bulgarian and international companies participated in the second forum "Career Development Day" in the VTU St. Cyril and Methodius. The forum was organized by the Faculty of Philology and university career center. Participants in the forum are leading Bulgarian and international companies that offer training and employment of graduate students and young people who speak foreign languages.Our company was one of them.Objective was to unite efforts identify new opportunities for professional development, and assist employers in recruiting suitable staff. More than 500 graduates of VTU visited the forum.

IRS Tax Returns Explained

If you earned above $3500 in 2008 or $3650 in 2009, you are obligated by law to file a USA tax return to the IRS at the end of the tax year. The US tax authorities are very strict and so you should always file a tax return to avoid any unnecessary problems with US visas in the future.

If you do not file your tax return civil penalties may be imposed. These can be a deducted refund or in cases when you owe the IRS – taxes you need to pay will be forever assessed with interest and penalties.

If you are a US resident criminal charges may be brought against you. Not filing a tax return is a criminal offense punishable by one year in prison for each unfiled year and a fine of $25000 each year.

If you need to pay taxes and you filed your tax return but did not pay them, there is no criminal penalty.

Therefore, filing an IRS tax return will most likely to get you money back and will avoid legal problems in the future with visas and penalties.
Preparing and filing a US tax return involves tedious work. Dealing with piles of complicated forms and documents is both confusing and time-consuming. To save this hassle, many people chose to get a tax refund company such as on their behalf. Please note that if you are a non-resident you are not allowed to e-file your tax return. etsrefunds.org to file their US tax return

Employment agencies use workers' tax allowances to boost profit

Employment agencies are exploiting a loophole in the taxrules to take advantage of low-paid workers' tax-free allowances, allowing them to improve their own profits rather than pass on the full benefit to employees.
Tax experts say the agencies could be saving as much as 50p a worker per hour, with only 10-15% of the benefit passed on to the temporary workers.
In sectors such as food processing and manufacturing, margins for employment agencies are often as low as 80p to £1 a worker per hour, giving those agencies who exploit the loophole a distinct advantage. Competitors who question the legitimacy of the practice claim it is distorting the market.Industry figures are calling on HMRC to clarify the situation. Andrew Gilchrist, managing director of multi-sector recruiter Interaction, said: "Someone needs to come out and say whether they are legal or illegal. It's an abuse; the exchequer is losing out and UK workers are losing out."
The schemes reduce the level of temporary workers' wages that are subject to tax. They voluntarily sacrifice part of their pay: tax and national insurance are calculated on the remainder and they are reimbursed through non-taxable expenses.
Mike Cooper, director of Best Connection, a national supplier of temporary workers, said: "More and more companies are using the tax-free allowances of individual workers not to benefit them, but to fund their own business and enable them to offer reduced and unsustainable margins."
A spokesperson for Northern Foods, which makes Marks & Spencer ready meals, Fox's biscuits and Goodfellas pizzas, said the company is aware that one of the agencies it uses has adopted a salary sacrifice scheme, but that the company makes no financial gain.
The debate about the legitimacy of the schemes rests on whether the expenses paid by the employer have genuinely been incurred by the worker, and whether paying national insurance and tax on an amount that is less than the national minimum wage is legal.
In many cases receipts do not have to be produced by the worker to prove the expenses were incurred, because HMRC has granted dispensations allowing the payment of fixed-rate allowances for things such as travel and meals.
Lesley Fidler, tax director at accouar £93 worth of travel that week?"
Proponents of the schemes point out that the workers involved receive more take-home pay. Marie Samuels, employee and temp benefit manager for gap personnel, said: "We went into these schemes because the larger agencies [which are already using them] go into the market and set the margins. It's a win-win, we can compete for business, the temp has an increase in wage and obviously we get savings ourselves."
But reducing the size of an employee's national insurance contribution could also have an impact on their access to contributory tax benefits, such as pensions and jobseeker's allowance.
A spokesperson said HMRC has "commenced compliance activity to identify and take action against those employment businesses and umbrella companies which are operating in contravention of tax, national insurance or national minimum wage legislation".
The Department for Business, Enterprise and Regulatory Reform's guidelines state: "If you refund money to a worker, which the worker has spent on something to do with their job, the refund does not count as national minimum wage pay."

Millions may have to repay part of stimulus tax credit

Some 15.4 million taxpayers could receive smaller refunds than they expected or owe taxes next year because they did not have enough money withheld from their paychecks as part of the Making Work Pay tax credit program, according to a report issued Monday.
The tax credit advocated by President Obama and enacted in February as part of the $787 billion economic stimulus plan lowered taxes for all but the nation's highest wage earners. It cut payments by as much as $400 for individuals and up to $800 for couples. Most workers started receiving the tax credit earlier this year as small reductions in the amount of taxes withheld from their paychecks.
But federal tax tables that guide those withholdings did not account for some wage earners whose personal situations complicated the tax credit calculation. That category included some workers with more than one job, some married couples in which both spouses work, and some Social Security recipients with jobs.
The Treasury Department's inspector general for tax administration estimated that more than 10 percent of all taxpayers who file individual tax returns for 2009 could owe additional taxes because of the complexities of the Making Work Pay credit. Of that group, the IRS estimated that 65,000 taxpayers could technically face penalties for underpaying their taxes in 2009, although the agency said it would waive such fees.
While the inspector general's report estimated that millions of taxpayers will be negatively affected by the tax credit, a Treasury official said the vast majority will only receive a slightly reduced refund and not an out-of-pocket tax liability on April 15.
"These taxpayers actually receive a portion of their refund throughout 2009 in the form of reduced withholding, which is exactly what the law intended," Richard Byrd Jr., commissioner of the IRS's Wage and Investment Division, wrote in response to the report.
Overall, more than three-quarters of all taxpayers receive returns, which last year averaged more than $2,800, according to the IRS.
In addition, an undetermined number of workers eligible for the Making Work Pay tax credit will also receive other tax credits passed as part of the stimulus plan, including credits for education, energy efficiency, sales tax paid for cars and a tax credit for first-time homeowners. Those credits should further reduce the number of taxpayers left with greater tax liability than they expected, IRS spokesman Eric Smith said.
"Making Work Pay was designed to deliver much needed boosts to the paychecks of 95 percent of all working Americans," Treasury spokeswoman Nayyera Haq said in statement. "Since enactment, more than 110 million families have benefited from as much as $60 in additional take home pay each month to put toward their family budgets, serving as a steady boost to spending and consumption."

The state of Minnesota is running short of cash.

It would mark the first time the state has had to borrow money for bills in 25 years, when it took out $1.6 billion short-term loans over a four-year stretch and had to pay almost $125 million more to service them.
Minnesota collects $15 billion a year from various taxes, but money goes in and out the door unevenly throughout the year.
Minnesota, like most states, has a cash-flow problem caused by the worst recession since the Great Depression, Hanson said. The state has collected $233 million less in taxes than was forecast in February.
Because of the cash shortage, the state this month delayed $128 million in corporate tax refunds to 451 businesses and $16 million in sales tax refunds to 294 taxpayers, state Revenue Commissioner Ward Einess said. He plans to pay those refunds in December to avoid having to pay interest on payments that are more than 90 days overdue.
State officials won't know if they will have to borrow money for day-to-day operations until state economist Tom Stinson issues his next revenue forecast Dec. 2, Hanson said. The state wouldn't have to borrow until March, April or May, its "low-cash months."
The state's top-level credit rating could be in jeopardy if it does borrow for operating expenses, Hanson said. That would force the state to pay higher interest rates on bonds it issues for construction projects.
The last time the state used short-term borrowing was during the 1981-84 recession. It borrowed $1.6 billion and paid $124 million in interest on those loans.

Warning over email tax-back scam

Government officials are warning the people of Bracknell of a scam involving a staggering number of emails offering people the chance to claim tax back.
HM Revenue & Customs (HMRC) has issued the warning this month of a record number of online attacks, known as “phishing”.
And officials say in just one day this month, they received more than 10,000 reports of the fraud and 83,000 in a month.
Last month, getbracknell received a number of phone calls from people concerned over being rung up out of the blue by companies offering the chance to win back bank charges if they give their account details out over the phone.
In this scam, the sender claims the recipient of the email is due a tax return and then asks for credit card or bank details.
Customs officials are warning anyone who hands over the information risks having their account emptied or their bank details being sold to criminal gangs.
They also warn the latest version of the online scam operates from websites which change their domain name every 20 minutes.
John Harrison, head of HMRC customer contact, said: “We only contact customers who are due a refund in writing by post.
“We never use emails, telephone calls or external companies in these circumstances.
” He also advised customers not to click on any website or links contained in suspicious emails or open attachments. “I would strongly encourage anyone receiving such an email not to open it.

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Could the IRS be trying to send you money?

The Internal Revenue Service is looking for Tennesseans who are due to receive a combined $1.77 million in the form of 1,849 refund checks that were returned to the IRS by the U.S. Postal Service due to mailing address errors.
“IRS wants to get these checks to their owners as quickly as possible,” said IRS spokesman Dan Boone. “All you have to do is update your address to get your refund check reissued.”
The Internal Revenue Service is looking for 397 Nebraskans and 555 Iowans — but not because they owe the taxman money.
In fact, it’s the other way around. These taxpayers had their tax refund checks returned to the agency as undeliverable, IRS officials said Thursday.
In Nebraska, the checks total $359,002 and average about $904 a check. Douglas County leads the state in the number of unclaimed refunds, 141, which average $1,040 a check and total $146,693.
In Iowa, the checks total $495,001, averaging $894 a check. Polk County leads that state with 103 unclaimed refunds, averaging $811 a check and totaling $82,753.
Nationwide, 107,831 taxpayers had about $124 million in refunds returned to the IRS, an average of about $1,148 per check.
Tax refund checks often are returned as undeliverable when taxpayers move without notifying the IRS or the U.S. Postal Service.
“We want to make sure taxpayers get the money that’s waiting for them,” said IRS spokesman Christopher Miller. “Maybe you got married or moved and just forgot to update your information with the IRS.
”Taxpayers can update their addresses and claim refunds in several ways."

Tax Policy

In 2007, the most recent year for which statistics are available for both individuals and corporations, total corporate income tax liability was $413.2 million and total individual income tax liability was $5.6 billion.
The huge disparity between individual and corporate taxes results from the different ways in which the two groups are taxed.
Individuals pay taxes on all of there income. They can make deductions for mortgage interest, medical expenses, and a few other types of expenses, but in general, they pay taxes on everything. Basic costs of living, such as housing, food, and transportation are non-deductible. Corporations pay tax on their net income, after they deduct all of the expenses of doing business.
If a corporation requires vehicles to conduct its business, all of that expense is deductible. If an individual requires a vehicle to go to work, they pay tax on all of the income used to fund that expense.
If a corporation operates from offices, factories, or warehouses, their costs to purchase and maintain those buildings are deductible.
If a corporate employee needs to stay in a motel or rent an apartment, those costs are deductible. If an individual lives in a house, they pay taxes on the income that they pay their rent or mortgage principal with. If a corporation buys food or liquor for a party or company event, those costs are deductible. If an individual buys food for their family, they pay tax on the income used to buy that food.
Aside from the extremely different tax rules that apply to corporate and individual income, corporations and individuals are also taxed at different rates.
Corporations pay 6.6% tax on their net income.
Individuals pay taxes on their entire income on the following progressive scale:
$2850 – 5%
$7150 – 7%
Over $7150 – 9%
The “effective tax rate” for taxable income, which is total income minus deductions, is 7.5% on average for all individuals. Individuals at roughly the $40,000 dollar income level pay a higher percentage of their income in taxes than corporations, and those rates continue to go up the more they make.
Individuals pay 13.5 times as much in income tax as corporations. To put this another way, the people who do the work pay 13.5 times as much to maintain government as the shareholders who produce nothing, but collect the profits. This is because the shareholder, who produces nothing, is taxed at a lower rate, and has a completely different set of tax rules, which shield most of their income from taxation.
Basic fairness would dictate that all individuals be taxed according to the same laws. A corporation is only a collection of individuals. A corporation is its shareholders. Shareholders, through the State established legal fiction of corporation, work and do business according to a completely different set of rules than individuals, and their activities are taxed in an entirely different manner.
There are endless arguments about this issue, but if you step back and look at it objectively, it is really just a bit of gimmickry that clever people have invented in order to cheat others out of what is rightfully theirs. No matter how many legal arguments, statistics, and economic theories someone sights, they can never overcome the basic fact that in the end the result is two different sets of rules for the same supposedly equal people who are constitutionally entitled to equal treatment under the law.
If you read my piece on the history and ethics of taxation, then you will understand that this situation is a result of the basic law of taxation: the powerful tax the weak, and the rich tax the poor.

California Stealin'

Desperation grabs for revenue are nothing new in politics, but California is once again leading the way in creative financing.
To help close yet another gaping budget deficit, now estimated to be $7 billion this year and reach as high as $20 billion next, Sacramento lawmakers have authorized a 10% increase in the amount of taxes withheld from worker paychecks starting November 1 and through 2010.
The extra withholding tax will reduce Californians' take-home pay by about $1.7 billion for the year. But the lawmakers say this isn't a tax increase.
OK, how about calling it a compulsory interest-free loan from taxpayers to the state? According to the Franchise Tax Board, 10,004,000 Californians overpaid their state taxes last year and received an average refund of $903. The withholding penalty is expected to snatch between $20 and $90 a month from middle-class families.
For those feeling the pinch of recession and living paycheck to paycheck, that penalty will hurt. Of course, the government is obliged to return this money next spring when workers get their tax refunds, so this is the ultimate budget gimmick. It borrows from taxpayers now and deepens the budget hole next year.
And we almost hate to ask: What happens come April if the state doesn't have enough money to pay the tax refunds it owes its citizens? Will taxpayers get IOUs the way state contractors did last year when Sacramento ran out of money? Meanwhile, Governor Arnold Schwarzenegger and the legislature now face their sixth "extraordinary session" to balance the budget. Income tax rates went up last year by 0.25%, bringing the top rate to 10.55%, but receipts are already coming in $1 billion below projections, according to the state controller.
The politicians could use this continuing crisis as an opportunity to reform the state's tax code with lower rates and fewer deductions and loopholes, as recently proposed by the governor's tax reform commission. But that plan has been panned by the ruling classes in Sacramento. They claim to want to steal only from the rich, but their latest withholding ruse is showing that they'll steal from anyone with a paycheck.

35 million letters delayed in UK post strike

Some 35 million pieces of mail have been delayed by this week's British postal strikes, Royal Mail said Friday.
Thousands of postal staff have walked off the job in three days of strikes this week in a dispute over modernization plans, job security, and workloads. It follows two consecutive days of nationwide strikes last week that resulted in limited collection and delivery of mail.
Royal Mail said it had cleared "virtually all delays" caused by last week's strikes and was working to clear delays caused by the work stoppage this week.
More than 43,000 postal staff across the United Kingdom went on strike Thursday at mail centers and distribution units, according to Royal Mail and the Communication Workers Union, which represents the striking workers.
Some 400 people in three cities in England went on strike Friday, and 77,000 delivery and collection staff, including postmen, were due to strike Saturday, the union said.
The two sides came together for talks Thursday night and again on Friday to seek a resolution, according to a spokesman at the Trades Union Congress, which is mediating the dispute.
Union members have complained that Royal Mail has not consulted the union on its plans to bring in changes such as new machines that might replace certain positions and lead to layoffs. They are also unhappy that Royal Mail hired thousands of temporary workers ahead of the strikes.
The walkouts have caused concern among businesses and retailers, especially those who rely heavily on direct mail, that the effects could last through Christmas.

Scam tax refunds 'reach record'

A record 83,000 scam e-mails offering fake tax refunds were reported to the UK's tax authority in September.And on one day this month, 10,000 reports about "phishing" e-mails were made to HM Revenue and Customs (HMRC). The messages tended to start with a claim which read: "Following a review of your fiscal activity you are due a refund of tax of £x." But HMRC stressed that it would never inform people of a tax rebate by e-mail or on the telephone. Sucker listsJohn Harrison, head of HMRC customer contact online, said that the messages tried to extract people's credit card and bank account details. This left them at risk of their savings being stolen and the details sold on to professional criminal gangs, in so-called "sucker lists". The latest version of this scam originated from various different websites, which operated for 20 minutes before changing their domain name. "We only contact customers who are due a refund in writing by post. We never use e-mails, telephone calls or external companies in these circumstances," Mr Harrison said. He urged people not to click on linked websites on these scam e-mails, but to report these e-mails and delete them. This is the latest in a series of warnings about scam messages taking the HMRC name. Losses from all scams in the UK are estimated to total £3.5bn a year. The Office of Fair Trading has calculated that 3.2 million people are caught out by scams each year.

Senate OKs reducing tax refunds for college loan delinquents

The Senate Finance Committee on Thursday voted to allow the state Division of Taxation to reduce a person’s state income-tax refund if the person is delinquent on certain college loans issued by the Rhode Island Student Loan Authority.

The committee approved the measure, 6 to 0. The House unanimously approved it on June 26.

Rhode Island already allows for offsets against state income tax refunds for delinquent federal taxes, state taxes, college loans involving the Rhode Island Higher Education Assistance Authority and some other items.

At a State House hearing on Thursday, Charles Kelley, executive director of the Rhode Island Student Loan Authority, said that the offset provision would make the agency’s borrowings more appealing to firms that rate bond issues.

As a result, the agency could borrow at lower interest rates, and issue loans to students and families at lower interest rates, he said.

State Sen. Daniel DaPonte, D-East Providence, chairman of the Senate Finance Committee, said that the provision would allow the agency to borrow for less and pass those savings on to students and their families. “That’s the big-picture goal,” DaPonte said in an interview after the hearing.

The agency oversees a portfolio of about $1.1 billion in education loans, including loans that are guaranteed by the federal government and about $450 million in private education loans which are not federally guaranteed, Kelley said.

The bill would allow the offset for the agency’s private education loans, he said.

Income Tax Return Clarification

What are income tax returns? Each spring is income tax return time. We all know about filing our taxes, paying them, and getting our tax refund, but somehow the term “tax return” is not always clearly understood.

The annual process begins in January through March of every year when wage earners receive their wage and tax withholding certificate from their employers. Students will receive statements of tuition, scholarship, and aid information covering the previous year. An income tax return form is then used to take the amount earned and figure out the correct dollar amount of taxes for which the individual is liable.

Although a person filing the papers detailing earnings, deductible expenses, and taxes may have some or all of their withheld taxes returned to them, that is not what is meant by the term “income tax return”. Actually, what “tax return” refers to is three parted. First, you are letting the government know, or are returning a report on, how much you made in the previous year. Next you are stating how much you have paid in taxes, up till the end of the year. Finally, your tax return form declares what is the amount you must pay.

So in going through this tax return process many people show that they have overpaid their income tax and therefore have a refund coming. The alternative is of course, that there was not enough money withheld, or that the quarterly payments were not enough and now you owe the government the difference.

To summarize, we offer you to care about everything instead of you and send your document to the IRS and to your state tax department.You don't have to carre about nothing.

Most income tax refunds have been paid

There has been a slowdown in paying individual income tax refunds because of the state’s precarious finances.

While revenue officials are not allowed to discuss individual tax cases, most refunds from uncomplicated individual state income tax returns for 2008 have been paid, or soon will be, Revenue Commissioner Tim Russell said last week.

Because of the recession, Alabama’s income tax collections this year have been anemic. In fact, they’re less than the previous year, requiring careful management of taxes that fund education first and then refunds.
Hundreds of thousands of refunds were slowly released because of cash flow problems this year. Because returns would be so slow in being released, the revenue department advised it would pay 4 percent interest on any refund not made by July 15.
Refunds from uncomplicated federal returns for 2008 were electronically deposited within a week or 10 days of returns being e-filed, but state refunds from uncomplicated returns that were filed early often took more than six weeks to receive.

Revenue spokeswoman Carla Snellgrove said the department has issued 1.3 million individual refunds totaling $659.3 million so far this calendar year.

Earlier this month, about 10,000 refunds were released to the comptroller for payment, she said. The refunds were through Sept. 30 and should be paid by the end of October. Refunds are released when funds become available out of income tax collections.

The revenue department batches refunds for payments. During two days in early October, 15,411 refunds worth $20.3 million were issued, and on one day, Oct. 15, another 16,365 refunds were issued totaling $16.8 million.

Snellgrove said any complicated tax return or a return with a filing extension would not be completed quickly but those were few in number.

“Most individuals will have been paid,” Snellgrove said.

10 Ways to Lower Your Taxes

1. Boost your 401(k) contributions.
2. Make the most of your flexible spending account.
3. Buy a house.
4. Buy a car.
5. Sell losing investments.
6. Maximize your tax credits and deductions.
7. Pay college bills.
8. Give to a charity.
9. Max out tax breaks for the self-employed.
10. Keep track of medical expenses.
1. I've been maxing out my 401k for years, so I get the full tax advantages here.
2. Does a HSA count? If so, I put in the maximum allowed each year.
3. I already have a house and it's been paid off for over a decade -- so I don't get the new homeowner credit or the mortgage interest deduction. And I'm ok with that.
4. I thought about buying a car this year and saving the state taxes, but I think my car will last another (hard) winter and it's probably a better deal to keep it longer. So I'll look for a new car in 2010.
5. I have enough investment losses to carry over for years. Ugh.
6. We're looking at buying a new heater/AC and the $1,500 tax credit is one reason why. That and the fact that the repairman said, "Your heater is making a funny noise. My suggestion is to never turn it on again."
7. Our 529 contributions save us on state taxes (a few hundred dollars a year) because we invest with an in-state 529 plan.
8. Our biggest deduction for the past several years.
9. If you have a business (or a side business), you can save a bundle on taxes by having the business cover many costs (such as a deduction for home office use, magazine subscription, books, computer equipment and support, etc.) I could make much better use of this option, but I seem to maximize revenue and minimize expenses (which is not a bad thing.)
10. I'd prefer to have no medical expenses at all than to have massive ones that save me on taxes (which is probably the same way everyone feels about this issue.) But if you do have big medical bills, it's at least some consolation that they can save you some on your taxes.

South Carolina lawmakers aiming to extend jobless benefits

South Carolina lawmakers said Monday they will return to the Capitol next week to ensure thousands of state residents receive extended unemployment benefits.
House Speaker Bobby Harrell and Senate President Pro Tem Glenn McConnell, both Charleston Republicans, agreed to the extraordinary move and criticized the state Employment Security Commission for failing to get the Legislature involved in heading off a problem that this week made 6,700 of the state’s unemployed ineligible for extended benefits.
“The General Assembly will take quick action to fix this oversight by the ESC to ensure that unemployed South Carolinians will not suffer further by being denied this federal benefit,” Harrell and McConnell said in a joint statement.
“It is unfortunate that the Legislature must return to fix this problem, this oversight was completely avoidable” and shows the need to overhaul how the commission operates.
Even before the new wave of workers lost benefits, the state had more than 113,000 people who had exhausted all state and federal regular and extended benefits in the midst of an 11.5 percent unemployment rate, which is the nation’s sixth highest.
The federal government made stimulus money available for 20 weeks of extended benefits.
To get the final seven weeks, states had to tie emergency jobless relief to the unemployment rate. But South Carolina’s emergency payments are instead tied to people receiving jobless checks. Because legislators didn’t temporarily change that law, the extra benefits weren’t available. South Carolina was the only state that needed to make the change that didn’t, according to the National Employment Law Project in New York.
And a quick, one-day return means legislators won’t be in town when the State Ethics Commission releases a report that would fuel more impeachment discussion.

How would you feel about getting a check for only 8 cents in the mail? That is just one reason why Georgia's lieutenant governor is slamming the state's department of revenue -- criticizing the way the department handled this year's tax refunds.
Mike Aiken said he isn't quite sure what to do with the check he just got from the state of Georgia -- a check that would boost his bank account by 8 cents.
He had to wait more than three months for his Georgia tax refund. The state owed him interest -- 8 cents. It cost the state 33 cents to mail it.
"They should have put a minimum somewhere," Aiken said. "Anything less than a dollar forget it. I don't know how the rest of the public may feel about it -- maybe they want their eight cents."
Facing a budget shortfall, the Department of Revenue had to reduce the staff that processes tax refunds -- the cuts to that staff saved the department $2.4 million. Because the checks slowed getting out refund checks, the state wound up paying approximately $2 million in interest to those who had to wait.
Add to that, about $100,000 in extra postage to send those interest checks.
Lt. Gov. Casey Cagle calls the situation unacceptable.
"The Department of Revenue was cut less than some other state agencies," Cagle said. "And more important, the core mission of the Department of Revenue is to collect taxes and process those -- and when you're not doing it in a timely manner, you're violating your core principle."
The revenue department had to cut a total of $12 million from its budget. Cagle says those cuts should have come in places other than the people who process tax refunds. As for that 8 cent check -- by law the state has to pay interest to anyone who gets their refund as late as Mike Aiken got his -- no matter the amount.
Aiken says he may keep the check as a souvenir.
Twice, Revenue Commissioner Bart Graham has declined requetsts from 11Alive News for an interview. Late Monday afternoon, his department e-mailed answers to several questions. The department says it made cuts to avoid closing offices or discontinuing any services - and says it was not a foregone conclusion that cuts would have caused refund checks to go out late.
As for the lieutenant governor''s statements - the revenue department had no comment.

Worst of recession over, Conference Board says

The Canadian economy will grow 2.9 per cent next year, bolstered by government stimulus programs, the Conference Board of Canada said yesterday. "The darkest days now seem to be in the past," the Conference Board said in a report. "Over all, real GDP [gross domestic product] is now forecast to contract by 2.1 per cent in 2009, down 0.4 percentage points from what we forecast in our summer Canadian outlook. As private sector activity stabilizes and strengthens next year, planned capital spending by all levels of government will help boost real GDP growth to 2.9 per cent in 2010," the Conference Board said, adding that "stronger, post-recession-type growth of 3.6 per cent is in the cards for 2011." Private sector spending is expected to plunge by 13.7 per cent in 2009 and is forecast to grow by less than 1 per cent in 2010. "For now, government policy remains the economic stabilizer," the Conference Board said, with Canadian infrastructure spending levels forecast to surpass $50-billion in 2009 and peak at $60-billion in 2010.

State forced to pay $2 million in interest to taxpayers

More than 278,000 Georgia taxpayers are receiving a little extra dough this week from the state.
The Department of Revenue has mailed out more than $2 million in interest to taxpayers whose refunds were not issued within 90 days of the April 15 filing deadline.
Delays in processing individual income tax returns led to the backlog, which Revenue officials say was caused by $12 million in budget cuts at the agency in the past year. More than 300 Revenue employees were laid off, many of them in the tax return processing unit.
Georgia law requires the state to pay interest on any return not processed within 90 days of April 15, or 90 days from the date the return was filed if after April 15.
The taxpayers receiving interest payments will get an average of $7.42, although 90,000 are receiving $1 or less. Some were $20 or more.
Under state law, the interest accrues at 1 percent per month after the 90-day limit. But the 90-day clock doesn't begin ticking until April 15, no matter when the taxpayer files a return. Any taxpayer who filed a return on time but did not receive refund before July 14 should receive an interest payment.
All taxpayers getting interest payments filed paper returns, and they should have already received their refunds, said Graham, who reports to Gov. Sonny Perdue. The interest is being sent out separately because the agency had to reprogram its computer systems to calculate interest owed. It's the first time since at least 2003 that the state has had to pay interest for late refunds.
But on six occasions during the past legislative session Graham warned lawmakers that budget cuts would result in processing backlogs. Graham said that proposed cuts would lead to an average three-month delay.
Lawmakers cut Revenue's budget by $12 million, or 9 percent. Of that, $2.4 million came from the processing center. Graham cut two of the three shifts of part-time processors hired during tax season.
Cagle also said in the interview that the state gave the Department of Revenue an additional $26 million "to create efficiencies of scale to process these much faster."
But that $26 million did not go to the processing unit. Much of it was bond money to create a new data warehouse that eventually will make it easier and more efficient for Revenue agents to investigate fraud. Some was for an ongoing project aimed at making it easier for sales tax and employers' withholding taxes to be filed and paid electronically.Perdue defended the agency. Bert Brantley, the governor's communications director, said the Revenue Department has recovered more than $500 million in recent years through improved operations and new ways to collect back taxes.
"Our goal is always to meet those higher expectations," Brantley said. "We regret it any time we don't reach that goal, even when it is due to budget cuts."

New Zealand hit with record number of tax refund scams.

The New Zealand Government released new figures highlighting the constant problem of phishing techniques tailored to collect information about individuals for financial gain.

A record 83,000 scam emails offering fake tax refunds were reported to HM Revenue & Customs (HMRC) in September. The online attacks, known as ‘phishing’, have continued this month, with an unprecedented 10,000 reports of the fraud made to HMRC on one day alone.

The press release goes on to show how the scam continues unabated:

The scam email tells the recipient they are due a tax refund and then asks for bank account or credit card details. Anyone who gives these details to the fraudsters risks their bank accounts being emptied and credit cards maxed to their limit. The victim also risks having their personal details sold on to other criminal gangs. The latest version of this scam originates from various different websites, which operate for 20 minutes before changing their domain name.

It’s pretty wild that a con artist would use the tax department to get your money. I had to grin and believe that, the citizens rarely get refunds, because they are reporting the scam to the government. I don’t think even Al Capone would try to use the government’s tax department as a source of information to start a fraud! How times have changed!

Taxes paying through the nose

The problem with taxes isn't just that we have to pay them, but taxes in general create thousands of pages of laws, amendments and decrees that determine how much we have to pay.

We also like to tax our sins, so to speak. The state of California has decreed that the sin of smoking should cost the sinner 87 cents a pack. That's on top of a federal tax of $1.01. Legislators would like, mightily, to raise that another buck-fifty a pack in hopes of saving sinners from themselves and raising more money. They also cite savings in health care, not to mention longer lives.

We think that the evidence that smoking is harmful to health is very strong, and if Congress members were serious about it, they would just ban smoking altogether. That won't happen soon. Not to mention that the black market in cigarettes would flourish, and the feds and states wouldn't get a dime in taxes. Talk about conflicting goals.

Government likes to tax just about every sin under the sun. For the sin of reading this newspaper, you will be assessed a sales tax. If you drink sugary soft drinks, you pay sales tax, and now some folks at Princeton and Harvard are proposing a one-cent-per-ounce tax on that sin.

The soda tax advocates claim that a 10 percent increase in the cost of sugary drinks would result in a 10 percent decline in usage and a health care savings in the billions.

Why not just cut the subsidy to farmers for producing the corn fructose syrup used to sweeten drinks, instead of giving them tax money to grow the stuff and then taxing its consumption?

Then there are the discrepancies in what is taxed. Ice and soda are subject to California sales tax, but chips aren't. Our favorite, however, is this one, from the Board of Equalization: If you hop down to your favorite convenience story and buy a cold cheese dog, and take it with you, it's considered a grocery item, and you pay no sales tax. However, if you buy one from the rotisserie, it's considered takeout, and you pay sales tax. So what happens if you buy a cold burrito and heat it in the store's microwave? Depends on where the microwave is located. In some cases, the state gets a bite of the burrito; in others, it doesn't.

It's just one more reason why you have to love a full-time Legislature, which has never met a tax it didn't like, even when the laws that govern taxes don't make a lick of sense.

Student Tax Refund in the UK

Working casual jobs as a student gets you that much needed cash; but it also gets you paying taxes. The UK tax system is pretty straightforward, but can be complicated if you work part-time and for more than one employer.

Most students are taxed on the PAYE (Pay as you earn) scheme, which is designed to deduct the taxes you owe with each pay. This way you won’t end up owing a huge amount of tax at the end of the tax year. But the PAYE system does not take into account periods of unemployment. Income tax is calculated at a rate that’s only right if you work the full tax year on the same pay rate.

If you only work casually to supplement your studies, your annual income may drop to a lower tax bracket and you can end up having paid more taxes than you actually had to. You are then entitled to receive a tax rebate for the amount that was overcharged.

US tax return deadline.

The April 15 deadline for US tax returns is coming faster than you may think, so if you’ve worked in the USA it’s about time you started to organize your tax return.

First off, your employer will mail you your W2 form, which has all of your earnings and deductions for 2008. By law, employers are obliged to send W2 summaries by the end of January. If you live outside the USA, make sure you update your US employers with your current address.

If you have any trouble getting your W2, you can still file your tax return using your final payslip.