Taxes and Thomas Taibe A Club Hit

Many members came up to me after the February 2007 meeting to tell me Thomas Taibe and Taxes was one of the best topics yet.

Thomas Taibe provided a framework for discussing income taxes that resulted in a barrage of questions starting less than half way into the presentation.

For example if you get income but no document such as a 1099, what should you do? Answer always include the income. Income Thomas claimed is the one item you do not want to understate. The IRS rules and system is geared to finding missing income and penalizing you for omitting. On the other hand, claiming a deduction that is not allowed is less painful if denied.

Thomas pointed out how to determine if you qualify for free eFiling with IRS. As his assistant we went to the IRS site. There is a prominent link entitled 2007 Free Filing. From there you can search for a free eFiling vendor or use the very quick wizard that will tell you if you qualify.

Otherwise to eFile you need to pay. This is often included with versions of tax software such as TaxCut and TurboTax.

Thomas provided us with some background into the issue of Fraud versus mistakes on tax returns. Generally Fraud means there is intent and it opens the IRS to look back to your finances as far as they want to go.

Currently the IRS does not keep your tax return in a paper or electronic image after fixed number of years – I believe 7 – but I do not remember exactly. But that does not include the data the IRS enters into their computers. Thomas was not certain, but suggested the IRS may now keep the summary level data indefinitely.

The meeting helped members who have filed taxes on their own for decades to our youngest member of the club that successfully started an online business and before his mother knew it had to learn about business taxes.

I think this could be a candidate for a annually repeated topic.