With the election just weeks away, everyone is trying to analyze exactly what each candidate proposes to do about taxes and how they plan on executing those ideas.  While taxes are a complicated topic, most voters know that no matter who is elected, taxes will inevitably go up to help cover the national debt.  Even so, here are just a few ways that the candidates want to ammend the tax plan.

Obama:

• Increase capital gains tax rate to 20 percent on high-earners.
• Exempt estates worth up to $3.5 million and increase estate tax rate to 45%.
• Institute a minimum tax on overseas profits and other international proposals.

Romney:

• Eliminate taxes on investment income for taxpayers with adjusted gross income of less than $200,000.
• Repeal estate tax permanently. This would enable estates worth any amount to pass from one party to the next with no tax.
• Institute a territorial system that would tax U.S.-source profits of multinational corporations but would exempt profits earned abroad.

As a  student in online tax preparer school, who's tax plan do you think will benefit our economy most?

Winning a gold medal in the Olympics should be a moment of joy and jubilation - not a moment to be thinking about taxes.  Along with the fame and noteriety that comes with being a gold medalist comes a $9,000 tax bill. What happens is, the athletes that end up on the podium must fill out an entire other line on this year's tax forms.  In fact, there is a line where you have to claim your prize money.

According to Yahoo, "The United States Olympic Committee rewards Olympic medalists with honorariums. A gold medal brings $25,000. Silver medals get you $15,000. And a bronze is worth $10,000. The Weekly Standard, a conservative news magazine, ran the numbers and tabulated that the tax bill on a gold is $8,986, silver is $5,385 and bronze is $3,500."

This also comes before the athletes recieve money for the interviews and endorsement deals that are sure to follow a medaling win.

As a student enrolled in online tax school, what do you think of this?

Cigarettes have been around for such a long time that it's hard to imagine no one smoking them anymore.  Lawmakers in California are hoping that by raising the price of a carton of cigarettes by $1, we will be closer to that goal.  Although $1 may not seem like much, it will add up for those who smoke a pack a day.  Despite what lawmakers wanted, Proposition 29 as it's known was sent to a vote.  CNN says that although it was predominately voted "no", the final verdict could still be weeks away.

According to CNN, "initial results showed Prop 29 being rejected by a margin of roughly 65,000 votes, out of nearly 4 million cast -- a margin of 50.8% to 49.2%. However, the results don't yet include a vast number of mail-in ballots and provisional ballots."

Would you approve a tax like this?  As a student in online tax preparer school, do you think a tax like this is ethical?

After President Obama's announcement supporting gay marriage this week, it seems that's all everyone is talking about.  Besides the moral, ethical, religious, and legal arguments for either side, those involved in tax careers are looking at this from a basic taxation issue.  What does gay marriage mean for tax payers and what would the marriage mean for gay couples in respect for their taxes?  Here are some of their thoughts.

The truth is, marriage offers many types of tax breaks and benefits for the couple regardless of gender.  If you are married, there is no limit to the amount of money that can change hands, there is no gift tax, and there is no limit.  If you are not married, you are only allotted $13,000 per year that is tax free.  If you spend more than that, it starts to charge you a gift tax or starts impeding on your lifetime gift-tax exemption.

It also comes down to the splitting up of assets should the couple decide to end their relationship.  Married couples qualify for a tax free divorce which allows them to evenly split their assets (provided there is no prenup) and the amount taken away due to taxes is limited.  For unwed couples that bought property together or had other major investments, splitting can get messy and costly.  If two unmarried people split and try to divide the cost of their house in half, the other person's half qualifies as a "gift". 

What do you think of all of this?

Tax day is approaching but there is still time to file if you haven't already.  For people lagging behind this year you happen to get an extension.  Taxes, as a general rule, are always due on April 15, however, because that is a Sunday this year no mail can go out.  Monday is Emancipation Day which is a recognized holiday in Washington DC to commemmorate the freeing of slaves in that area.  So due to the weekend and the holiday, taxes won't be due until Tuesday, April 17. 

This isn't to say you need to leave your taxes until the very last possible minute.  People in tax preparing careers are still busy at work helping others to finish and file their taxes in time as to avoid any repercussion.  There are also websites where you can print off your tax forms or file them electronically.  If you do find yourself running late this year, be prepared to pay a fine?

Are your taxes done?  When did you file?

Taxes may be annoying and challenging to fill out, but no one can deny the satisfaction of getting money back from the government.  A new report from CNN says approximately 44% of Americans plan to put at least some of their refund in their savings.  That's up from 42% last year.  The website says that nearly 40% said they will use some of the money to pay down debt and 28.7% will spend it on everyday expenses. Just 12% said their refund would go toward a major splurge like a new television, down from 13% last year. Only 11% plan to spend the money on a vacation, which was also down from a year earlier.

Tax preparers cite this trend as people trying to rebuild their finances after the economy downturn.  Many are working on paying off debt or getting themselves to a position where they are more financially secure.

What are you doing with your tax refund?

It's the nightmare you see played out on tv or maybe even have experienced it yourself.  The threat of being audited by the IRS is a frightening thought for anyone, even the most seasoned tax preparer.  Having to explain your finances and have someone else comb through them is a daunting thought.  You may think those who are audited are chosen at random, but there are some red flags that will make the IRS take notice.  Some of those are:

1. Math mistakes - The biggest reason people receive letters from the IRS is addition or subtraction goofs. Fortunately, math errors rarely lead to a full audit. Still, double-check your math before you send in your return. And if you receive a letter from the IRS saying you owe money, check your numbers first. Sometimes, an IRS employee misreads one of your numbers, or the number is keyed into the IRS computer system incorrectly. If the agency is wrong, send a letter with a printout of your calculations.
2. Mismatched interest and dividend reporting - If the amounts reported in supporting documents don't match the amounts on your return, you will get a letter.  There are lots of possible errors here. Sometimes, the IRS will enter Form 1099 information (investment, interest and other nonwage income) into its computers and erroneously key in the income amount or the Social Security number of the recipient. If the income isn't yours, get a letter from the bank or other payer and forward that letter to the IRS. If the amount is incorrect, send a copy of the Form 1099 mailed to you by the payer.
3. You're on the IRS hit list - Those who receive much of their income in cash are traditionally on the radar screen of IRS agents looking for unreported income. Be prepared to defend any non-income deposits into your accounts. Recently, the agency has also pinpointed small-business owners and the self-employed. Too many "business" cars were going to campus each September. Be prepared to substantiate your deductions.
4. You have a big mouth - Never brag about how you put one over on the IRS, especially on Facebook. The IRS has been successfully trolling such sites to find unreported income and tax cheats.  Internal Revenue Service whistle-blowers can earn rewards of 15% to 30% of the additional tax collected, including fines, penalties and interest.
5. You're exceptional - An IRS computer program compares your deductions with others in your income bracket and weighs the differences. This secret IRS formula, called the DIF Score, is used to select returns with the highest probability of generating additional revenue through audits.
6. You have the wrong preparer - Let's face it: Some tax preparers are less than professional. Some, unfortunately, are crooks. If your preparer promises you a refund before checking all of your paperwork, run as fast as you can. That preparer is going to be taking illegal or inflated deductions, and, when the IRS finds out, you're going to be the one who pays the bill, plus interest and penalties.

Have you ever been audited?

Kim Kardashian's divorce drama is all over the news right now.  Everyone from CNN to the New York Times is covering this 72 day union.  Millions of people get divorced each year and millions of people get married.  The one thing regular couples who get married have in common with the Kardashian wedding, both have to pay taxes.  When you get married, lots of things change including how to file your taxes.  Thankfully the IRS has a list of the seven things you need to do tax wise when you get hitched.

1. Notify the Social Security Administration Report any name change to the Social Security Administration so your name and Social Security number will match when you file your next tax return. File a Form SS-5, Application for a Social Security Card, at your local SSA office. The form is available on SSA’s website at www.ssa.gov, by calling 800-772-1213 or at local offices.
2. Notify the IRS if you move If you have a new address you should notify the IRS by sending Form 8822, Change of Address. You may download Form 8822 from www.IRS.gov or order it by calling 800–TAX–FORM (800–829–3676).
   
3. Notify the U.S. Postal Service You should also notify the U.S. Postal Service when you move so it can forward any IRS correspondence or refunds.
   
4. Notify your employer Report any name and address changes to your employer(s) to make sure you receive your Form W-2, Wage and Tax Statement, after the end of the year.
   
5. Check your withholding If both you and your spouse work, your combined income may place you in a higher tax bracket. You can use the IRS Withholding Calculator available on www.irs.gov to assist you in determining the correct amount of withholding needed for your new filing status. The IRS Withholding Calculator will give you the information you need to complete a new Form W-4, Employee's Withholding Allowance Certificate. You can fill it out and print it online and then give the form to your employer(s) so they withhold the correct amount from your pay.
   
6. Select the right tax form Choosing the right individual income tax form can help save money. Newly married taxpayers may find that they now have enough deductions to itemize on their tax returns. Itemized deductions must be claimed on a Form 1040, not a 1040A or 1040EZ.
   
7. Choose the best filing status A person’s marital status on Dec. 31 determines whether the person is considered married for that year. Generally, the tax law allows married couples to choose to file their federal income tax return either jointly or separately in any given year. Figuring the tax both ways can determine which filing status will result in the lowest tax, but usually filing jointly is more beneficial.

What other tax changes are there when you get married?