| IRS estimate: 17 percent of taxes owed went unpaid and Tax gap: IRS comes up $385 billion short |
| News - Financial News |
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WASHINGTON (AP) -- People and businesses underpaid their taxes by an estimated 17 percent in the most recent year studied, failing to send the government a massive $450 billion that it was owed, according to an Internal Revenue Service report released Friday. The study covered 2006, the most recent data the IRS said was available. The amount of underpaid taxes far exceeded the size of the entire federal budget deficit at the time. After IRS audits and other enforcement efforts, non-compliance in 2006 shrank to 14 percent. [Read the full article] Taxes Tax Filing 7 Ways To Get Organized For The Tax YearLet's get organizedSlide 1 of 9Even if your tax situation isn't complicated, there's still documentation the Internal Revenue Service demands. But filing taxes doesn't have to be an ordeal. And it can be less frustrating and less time-consuming if you have all the material at your fingertips.By being prepared, you'll be ready to file your return at the earliest possible moment (the IRS usually starts accepting returns around mid-January). And the earlier you file, the sooner you'll get your refund.The key to a successful tax form is proper reporting. The IRS wants to know how much money you made so it can tax it. You need to know what you can put on your Form 1040 that will help you trim your tax bill.To help you organize your tax paperwork so that you and the IRS will be happy, let's look at seven ways to help you get organized. [Read the full article] Workplace benefits can not only provide you and your family with much-needed services, but some of them also can help cut your federal tax bill. One of the most popular benefits is a flexible spending account, often referred to as an FSA.Companies typically offer two types of spending accounts. With a dependent-care FSA, an employee sets aside money to help pay for costs typically associated with putting the kids in day care so mom and dad can work.But even more workers opt for a medical FSA, in which they can set aside money to pay for routine items such as health insurance copays, uninsured treatments such as vision care or even over-the-counter drug purchases.In both cases, the money is taken out through regular, equal payroll deductions. In both cases, the FSA deductions come out of a worker's paycheck on a pretax basis. That means less of your earnings are subject to tax. [Read the full article] 
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