In the current anti-tax climate, some towns are finding it hard to produce enough money to keep even basic city services afloat.
Recently there has been a rash of phone scams concerning taxes. Many people have paid money over the phone, believing that they would be in trouble with the US government if they did not. As a certified public accountant, I wanted to make sure you understand that the IRS will always send you a letter first. They do not make cold calls demanding money. Please read this article to better inform yourself about the scams currently in play, and remember that the IRS will not call you, they will send a bill.
Were you shocked by the amount listed when you got your property appraisal in the mail recently? Did you know that protesting the appraisal is an option? Although not a simple process, it can be done by an individual. If you feel you need help with the paperwork and supporting documents, there are companies available who specialize in this type of tax appeal. You may be surprised by how much you will save on property taxes when your appraisal is lowered successfully.
The sales tax collected in Texas is in fact a sales and use tax. When consumers purchase items online and no sales tax is paid, the purchaser is supposed to remit the tax to the state. Form 01-156 Texas Use Tax Return should be filed with a payment on or before the 20th day following the period (month or year) during which items subject to use tax are brought into Texas. For example, if you purchase a Kindle from Amazon.com, no sales tax is collected. Your responsibility is to remit the tax.
Why do some online vendors collect sales tax and other’s don’t?
A fancy word for the reason is nexus. Nexus is a connection and in the sales tax world, that means if a company has a connection to Texas, usually a physical connection, that company is required to collect sales tax. Amazon.com closed a Dallas distribution center to avoid collecting sales tax on sales delivered in Texas.
This ability to disregard sales tax on sales creates an advantage for online stores over Main Street stores. The legislation introduced, referenced above, by a bipartisan group of 10 senators attempts to level that field. Amazon does support the legislation.
The Texas Society of CPA’s reports:
There are enough leaks in the Republican dike against using the funds to burst the dam. While Gov. Perry has not changed is opposition to using the fund, this week added to the number of Republican leaders who say the funds must be used. Last week we reported that Appropriations Chair Pitts (R-Waxahachie) said he had the votes to use the fund on his committee and this week Sen. Finance Chair Ogden (R-Bryan) said “We’re going to have to use a substantial amount of the rainy-day fund if we’re going to pass a budget.” While neither of these chairmen have the final say (it takes a three-fifths vote of the legislature to use the Rainy Day fund), there is growing Republican support as budget hearings continue to spell out the results of proposed budget cuts.
I wrote the above paragraph Thursday afternoon. This morning the Tea Party Caucus Advisory committee came out with strong language opposing the use of the Rainy Day fund in a letter to legislators saying, in part, “We strongly support a budget that is balanced without the use of any portion of the State’s Rainy Day Fund and without the imposition of new taxes, new fees that are effectively increased taxes (such as increased vehicle registration fees) or other new sources of revenue (such as gambling).” According to Jason Embry writing in his First Reading blog, “This is a very significant development. The Tea Party Caucus Advisory Committee consists of 13 tea-party organizers from around the state. They serve as a liaison back to the tea parties for the Tea Party Caucus, which consists of about a third of the membership of the House and two senators. “
On June 30 of each year, business owners in Texas need to determine whether they are holding abandoned property: property for which they have had no contact with the owner for the applicable abandonment period and their whereabouts are unknown.
For most business owners the most common financial assets will be outstanding payroll, accounts payable, or refund checks. For payroll checks, the abandonment period is one year. For other checks the period is three years.
The reports are due November 1 and no extension of time to file is available. Effective for the 2010 reporting cycle, which just ended, holders reporting to Texas are required to mail a notice in July to all owners of property over $250 that are due to be included in their November report. Here is a sample letter: Due Diligence Letter.
The Texas Comptroller is able to go back ten years to look for unreported unclaimed property. Although the Comptroller is holding the property for the rightful owner, the state wants to be the one holding the property rather than the business owner. Although there is no legal limit to make a claim, the state can invest this money much as lenders use escrow funds to make money on your money.
Investigate outstanding checks and contact vendors or employees on a regular basis so that you will limit your exposure to the unclaimed property regulations.
From the Texas Comptroller’s email:
A new slide show on the Texas Comptroller’s Web site can help homeowners who are protesting their property tax appraisals. County appraisal districts establish the taxable value for residences, but in most counties, homeowners have until June 1 to file a protest.
How to Present Your Case at an Appraisal Review Board Hearing: A Guide for Homeowners makes the property tax process more transparent by providing easy-to-understand information about what to expect at a property appraisal protest hearing.
“Homeowners are empowered by understanding the protest process, knowing what information to present to the local Appraisal Review Board and how to present it,” Texas Comptroller Susan Combs said. “It helps homeowners make convincing appeals and helps the review boards make better decisions.”
Appraisal review boards generally hear property appraisal protests between May 15 and July 25, except in major urban areas with extended protest periods.
Harris County Appraisal District Chief Deputy Sands Stiefer said the slide presentation is a welcome new resource for property taxpayers.
“We plan to link our Web site to the Comptroller’s video, and we are considering running the video in the waiting room at our ARB hearings,” Stiefer said.
To view the narrated slide show and read much more information about the property tax appraisal and appeal process, visit the Comptroller’s Web site at www.window.state.tx.us/taxinfo/proptax/index.html.