new phishing scheme that seems to exclusively target Hotmail users

December, 2017

 

Consumer Alert: IRS Warns Taxpayers, Tax Pros of New Email Scam Targeting Hotmail Users

 

IR-2017-203, Dec. 13, 2017

WASHINGTON — The Internal Revenue Service today warned taxpayers and tax professionals of a new email scam targeting Hotmail users that is being used to steal personal and financial information.

The phishing email subject line reads: “Internal Revenue Service Email No. XXXX | We’re processing your request soon | TXXXXXX-XXXXXXXX”. The email leads taxpayers to sign in to a fake Microsoft page and then asks for personal and financial information.

The IRS has received over 900 complaints about this new phishing scheme that seems to exclusively target Hotmail users. The suspect websites associated with this scam have been shut down, but taxpayers should be on the lookout for similar schemes.

Individuals who receive unsolicited emails claiming to be from the IRS should forward it to phishing@irs.gov and then delete it. It is important to keep in mind the IRS generally does not initiate contact with taxpayers by email to request personal or financial information. For more information, visit the “Tax Scams and Consumer Alerts” page on IRS.gov.

How the new tax bill will effect businesses and corporation in the 2018 tax year

BUSINESSES AND CORPORATIONS

This bill lowers tax burden on pass-through businesses: The tax burden on owners, partners and shareholders of S-corporations, LLCs and partnerships — who pay their share of the business’ taxes through their individual tax returns — would be lowered by a 20% deduction, somewhat less than the 23% called for in the Senate-passed bill.

The 20% deduction would be prohibited for anyone in a service business — unless their taxable income is less than $315,000 if married ($157,500 if single).

Includes rule to prevent abuse of pass-through tax break: If the owner or partner in a pass-through also draws a salary from the business, that money would be subject to ordinary income tax rates.

But to prevent people from re-characterizing their wage income as business profits to get the benefit of the pass-through deduction, the bill would place limits on how much income would qualify for the deduction.

Nevertheless, tax preparers have warned that this favors passive owners of a business over active owners who actually run things.

This bill slashes the corporate rate: The bill cuts the corporate rate to 21% from 35%, starting in 2018. The bill would also repeal the alternative minimum tax on corporations.

How are individuals effected by the 2018 new tax bill

FOR INDIVIDUAL FILERS

This sham of a tax bill a taxed individual filers people who file individually and couples have to watch closely the changes that will happen for 2018 if you look closely the married couples with children may have no effect in their taxes may even go up because of the removal of the personal exemption take a look at the attached the tax schedules rates for individuals as they were and as they will be after the tax changes

  1. Some rates are lower for individuals: The bill preserves seven tax brackets, but changes the rates that apply to: 10%, 12%, 22%, 24%, 32%, 35% and 37%.

Today’s rates are 10%, 15%, 25%, 28%, 33%, 35% and 39.6%.

Here’s how much income would apply to the new rates:
— 10% (income up to $9,525 for individuals; up to $19,050 for married couples filing jointly)
— 12% (over $9,525 to $38,700; over $19,050 to $77,400 for couples)
— 22% (over $38,700 to $82,500; over $77,400 to $165,000 for couples)
— 24% (over $82,500 to $157,500; over $165,000 to $315,000 for couples)
— 32% (over $157,500 to $200,000; over $315,000 to $400,000 for couples)
— 35% (over $200,000 to $500,000; over $400,000 to $600,000 for couples)
— 37% (over $500,000; over $600,000 for couples)

This tax bill nearly doubles the standard deduction: For single filers, the bill increases the standard deduction to $12,000 from $6,350 currently; for married couples filing jointly the standard deduction increases to $24,000 from $12,700.

This is a super change, positive for all who are single and married, everyone if the standard deduction was used last year!  This is because the tax bill has increased the standard deduction, everyone will enter the schedule above at a lower rate if they used the standard deduction (and their potential itemized deductions are the same as the previous year).

With the increase in the standard deduction, itemized filers will not experience the same effect. The net effect is the percentage of filers who choose to itemize their deductions would drop sharply, since the only reason to do so is if your deductions exceed your standard deduction.

The real trouble with the tax bill is and the elimination of the personal exemption. The personal exemption is $4,050 for each person on the return this year,  but will be eliminated with the 2018 tax law.  That’s where the trouble starts.  Imagine you have 4 Kids and your married – that elimination of the personal exemption could mean more than a $24,000 increase in your taxable income given the same facts  as 2017.  Whether itemizing or using the standard deduction, the same effect.   This increases the amount of tax that you may owe because when you enter the above schedule,

Due to the late passage of the bill and its secrecy no one can tell you exactly whether you will have a decrease or increase until you look at your individual taxes filing for 2017 and get an estimate for 2018. Please file your taxes soon for 2017;  please be concerned about your 2018 tax bill while you can still do something about it in the next 12 months.

Yes the elimination of your personal exemptions may be a serious concern of this tax bill. Doing so lowers your taxable income and thus your tax burden. The GOP tax plan eliminates that benefit.  The families with three or more kids, this could reduce, if not eliminate any tax relief they might get as a result of other provisions in the bill.