Senate looks to aid unemployed, extend certain tax cuts

Democratic Senators Monday unveiled a $150 billion bill that pushes back the deadline to file for unemployment insurance until year-end and extends dozens of expiring corporate and personal tax credits.
The wide-ranging legislation, which could be voted on as soon as this week, would allow the jobless to apply for extended federal unemployment benefits and the COBRA health insurance subsidy through Dec. 31. It would also make the prevision retroactive to March 1, so the unemployed would not miss any payments.

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Federal unemployment benefits kick in after the basic state-funded 26 weeks of coverage expire. These federal benefits, worth up to 73 weeks, are divided into tiers, and the jobless must apply each time they move into a new tier.

But last week the Senate failed to pass a 30-day extension of the filing deadline, which expired on Feb. 28, because one Republican Senator objected. [Read the full article]

Dear Tax Talk, I purchased a franchise for $150,000 in 2005. I am trying to sell it for as low as $10,000. If I am successful, can I write off the $140,000 loss? — Bill

Dear Bill, The franchise might not have been successful, but at least you’re hoping the sale will be. The purchase of a franchise right is subject to the allowance for amortization under Section 197.

Section 197 allows the acquirer of certain intangible property to recover the acquisition cost on a straight line basis over 15 years. The concept of amortization is similar to depreciation, except amortization is the term used for intangible assets where depreciation applies to tangible property.

Under the tax law, the amount of depreciation or amortization allowed is considered an adjustment to the basis of the property subject to depreciation or amortization. [Read the full article]

The earned income tax credit, or EITC, can be a great benefit for workers who don’t make much money. This tax break returns to qualified individuals a portion of the taxes they paid.Bankrate’s 2010 Tax GuideTax tips and toolsHow do I … ?Filing and refundsReal estate and capital gainsFamily and educationOn the jobInvestments and retirementCharitable givingYour state taxes<< All guide contentIt even can produce a tax refund for eligible filers who had no tax liability. Most tax credits are nonrefundable, meaning they simply zero out a tax bill. For example, you owe $800 and have a $1,000 credit. That credit will erase your $800 bill, but you lose the extra $200.

But a refundable credit, which the EITC is, will allow you to get that extra $200 back as a refund from the IRS.

There is, however, a drawback to the credit. [Read the full article]

Authorities revoked a taxi driver’s license after an investigation found he was ripping off unsuspecting passengers by charging twice the rate they should have paid in one of the city’s largest cab scams.

The Taxi and Limousine Commission said it has pulled Wasim Khalid Cheema’s license following the administrative judge’s Jan. 21 ruling, which was made public Monday.

“Members of the riding public must be able to trust that taxicab drivers will not only transport them safely, but that they will be honest in their dealings with them,” administrative law judge Alessandra Zorgniotti wrote.

Cheema was accused of scamming passengers by repeatedly setting his meter at the rate drivers are allowed to use for trips to the suburbs, which is double the rate taxis use within city limits.

The city determined the driver was overcharging by reviewing his records, including automatic trip sheets that are generated using global positioning technology. [Read the full article]

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