Tackling the tax story
By Alan Cleaver
The clock is ticking if you’re going to help your audience out with a year-end individual income-tax checklist.
And it’s a good time to start getting ready for a weekly – or more often – tax tip feature to debut in January. Despite the hype about the April 15th deadline – which is even softer in recent years since filers can get a six-month extension merely for the asking – a huge percentage of returns actually are filed in January as soon as W-2 wage information is available.
If you’ve been pressed into service as the tax guru for the 2009 tax year, begin now. And believe it or not, tax tips and features are a lot more fun than they’re usually given credit for.
For starters, the Internal Revenue Service Publication 17 is your friend. It’s kind of like the Form 1040 instruction booklet on steroids, and offers tons of ancillary information and anecdotes. You can download it online, but I love the bound hardcopy (available via mail order) for leafing through over lunch at my desk.
(Note that this is the publication the big for-profit tax guides are based on; they expand with more case studies, tips and advice but if you have Pub 17 in hand, you’re pretty well good to go for the season.)
The best story I ever got out of it was one about quirky tax laws, like the one that says that ill-gotten gains through embezzlement must be reported as ordinary income – but that if they are later paid back through restitution the filer can take a credit for the repayment. Casualty losses are another fun topic – if you lose your diamond ring because you slammed your hand in the door, bashing the gem out of its setting, you can take a deduction for the value of the stone. Never a dull moment in Publication 17.
Now is the time to line up some experts and advisers, too, before they get into their busy season. Check with your local Certified Public Accountant trade group, and find the volunteer society that does returns for seniors and low-income people. They’ll be holding events that you’ll want to cover and use for color in your tax packages.
Another helpful group: Enrolled agents. EAs are tax preparers with special credentials that let them represent tax filers in administrative courts. They’re very savvy about current tax issues and trends; a great source of story ideas.
Check with your state’s attorney general or consumer affairs division for the latest on tax prep fraud and consumer caveats. And don’t overlook these stories:
Charitable deductions and scams. See this previous post for more story ideas.
Displaced workers turning to tax prep schools as a career alternative.
Valuing year-end donations. The Salvation Army’s value guide is generally accepted by the IRS.
Last-minute contributions to tax-deferred savings accounts.
Last-minute uses for flexible spending account cash.
