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Check your taxes...
Old 04-04-2006, 08:14 PM   #1
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Check your taxes...

http://news.yahoo.com/s/nm/20060404/..._taxreturns_dc

GAO checks tax returns prepared by pro tax outfits (not CPA's) and finds most of them wrong, swinging between $2000 errors in refunds to $1500 errors in overpays.

"The results were shocking," said Montana Democrat Max Baucus, the top Democrat on the committee. "They made up their own facts. And they made up their own tax laws."

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Re: Check your taxes...
Old 04-04-2006, 08:55 PM   #2
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Re: Check your taxes...

Quote:
Originally Posted by Cute Fuzzy Bunny
"They made up their own facts. And they made up their own tax laws."
Well then Mr. Baucus should get to work making the tax code simple enough so you don't need a CPA to figure out what you owe.

Too bad that would limit Mr. Baucus' ability to direct tax breaks to favored constituents who coincidently send checks to his re-election campaign.
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Re: Check your taxes...
Old 04-04-2006, 09:06 PM   #3
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Re: Check your taxes...

3YTG,
Amen. Everyone who actually computes their own return understands that the final dollar amount is really just a best guess. The guidance is very difficult to interpret for the average Joe. I wonder what %age of legislators do their own tax calculations?




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Re: Check your taxes...
Old 04-04-2006, 09:13 PM   #4
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Re: Check your taxes...

Quote:
Originally Posted by 3 Yrs to Go
Well then Mr. Baucus should get to work making the tax code simple enough so you don't need a CPA to figure out what you owe.
Darn straight. Between the AMT and twenty-two copies of the foreign tax credit form (there's only room for 3 countries per form, I had 32 countries to report, and you have to fill out one set for the AMT and another for regular taxes), my return was over 80 pages long. It's extremely difficult to have any confidence that there aren't any mistakes in there.

I forget the details, but recall reading a study where a fictitious family's return was prepared by a few dozen different CPA's, and the results were all over the map.

But yeah, politicians love to muck with the tax code to reward donors and influence people's behavior, and there's a whole bunch of accountants and tax preparers that would scream if taxes got simple enough to make their jobs obsolete, so it's unlikely to get better anytime soon.

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Re: Check your taxes...
Old 04-04-2006, 09:32 PM   #5
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Re: Check your taxes...

Well don't rely on the IRS to get it right either. Isn't the over/under at the Help Line at 40%?
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Re: Check your taxes...
Old 04-04-2006, 09:41 PM   #6
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Re: Check your taxes...

GAO reports error rate of 34% on advice from the IRS in September of 2005: http://www.treas.gov/tigta/auditrepo...0540146fr.html
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Re: Check your taxes...
Old 04-05-2006, 02:58 AM   #7
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Re: Check your taxes...

Quote:
Darn straight. Between the AMT and twenty-two copies of the foreign tax credit form (there's only room for 3 countries per form, I had 32 countries to report, and you have to fill out one set for the AMT and another for regular taxes), my return was over 80 pages long. It's extremely difficult to have any confidence that there aren't any mistakes in there.
Hi sc,

I am assuming these are the foreign taxes paid on dividends on your US-based mutual funds that hold foreign stocks. Just use "Various" for the country and combine the results (meaning 2 forms, one for non-AMT and one for AMT). I was super frustrated about the same thing until I called my dad, who is a professional tax preparer, about what to do.

But there may be something special about your situation; I can't be sure. When I read the instructions literally last year (2005) for 2004 taxes, I came to the same conclusion that you did, until I talked to my dad -- that was the first year I was above the threshold to file Form 1116. This year, I didn't even read the instructions and just copied the same technique as last year (1 form). My dad had said that they were clarifying the instructions for form 1116 this year (2005) to clarify that you could use "Various" in this typical situation. And in any case, the final tax outcome for me was identical -- all the extra forms would have just been busy work.

Hope that helps.

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Re: Check your taxes...
Old 04-05-2006, 08:21 AM   #8
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Re: Check your taxes...

Quote:
Originally Posted by Martha
GAO reports error rate of 34% on advice from the IRS in September of 2005: http://www.treas.gov/tigta/auditrepo...0540146fr.html
Which begs the question: If the IRS tells you something, and you have the guys name, badge number, and the time and date of the call, and exactly what he said, and someone else listened to the call to support what he says, and you get audited later and the advice turns out to be incorrect...who's on the hook?

Yeah, I know the answer... :P
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Re: Check your taxes...
Old 04-05-2006, 09:10 AM   #9
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Re: Check your taxes...

Would it be too pedantic to point out the correct meaning of "to beg the question"?

Sorry, I shouldn't even go there
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Re: Check your taxes...
Old 04-05-2006, 09:20 AM   #10
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Re: Check your taxes...

Hi Kramer, thanks for the advice. I thought about using "VARIOUS" but the instructions for the form 1116 looked pretty clear to me: "If you paid taxes to more than three countries or possessions, attach additional sheets following the format of parts I and II." One of their examples has three copies of the form, and a search for "various" in that PDF got no matches.

Maybe I'll try your tip next year - my guess is that the IRS would be pretty lenient about that, and might actually prefer a return that doesn't weigh so much...

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Re: Check your taxes...
Old 04-05-2006, 11:03 PM   #11
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Re: Check your taxes...

sc,

I agree with you about the literal reading of the instructions, as I came to the exact same conclusion for my 2004 taxes, which is why I called my dad about it. But he said that, in practice, 'various' is how it is done. He uses advanced software (way past Turbo Tax) and apparently it does 'various', too. And the important thing is that for all intents and purposes, the tax result is the same. So even an audit would not penalize you (assuming lack of said forms did not trigger the audit -- pretty doubtful).

Maybe if you did an internet search you might get a better feel for it.

Kramer (who was almost a form 1116 victim & agrees with your interpretation of the documentation)
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Re: Check your taxes...
Old 04-06-2006, 12:04 AM   #12
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Re: Check your taxes...

Quote:
Originally Posted by Cool Dood
Would it be too pedantic to point out the correct meaning of "to beg the question"?
Yes, too pedantic. *Nobody* uses that one correctly.
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Re: Check your taxes...
Old 04-06-2006, 09:19 AM   #13
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Re: Check your taxes...

I'm afraid the meaning of "begs the question" has changed all but officially to raise the question, but I'll never stop cringing at what still seems to be misuse. Losing the origianl meaning--claiming as true of that which you're trying to prove--means losing some of the power and flexibility of language and logic. Here's more info on begs the question: http://www.worldwidewords.org/qa/qa-beg1.htm

=astro, who thinks the world would be a better place, or at least Americans wouldn't be so dumb and easily persuaded, if logic and rhetoric and even Latin were taught in school
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Re: Check your taxes...
Old 04-06-2006, 09:26 AM   #14
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Re: Check your taxes...

OK, being the pedantic sort, what is the correct meaning/usage/application. It's raining here and I can't go out, so tell me, please.


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Re: Check your taxes...
Old 04-06-2006, 10:44 AM   #15
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Re: Check your taxes...

Quote:
Originally Posted by astromeria
Losing the origianl meaning--claiming as true of that which you're trying to prove--means losing some of the power and flexibility of language and logic.
Its original meaning hasn't been totally lost, only submerged in a tsunami of more popular uses.

Dude, even classical Greek & Latin evolved-- and so should you!
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Re: Check your taxes...
Old 04-06-2006, 12:29 PM   #16
 
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Old 04-06-2006, 12:38 PM   #17
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Re: Check your taxes...

Quote:
Originally Posted by Nords
Dude, even classical Greek & Latin evolved-- and so should you!
Nords--Heehee...that was MY line, back in my editing days!

Setab--Begs the question (used to *: ) mean claiming as true that which you're trying to prove, that the statement is based on circular reasoning. For example, "Flowers are pretty because they look so beautiful" begs the question.

Here's some good stuff from the link I provided earlier (well, it's good stuff if you're a former editor...YMMV):

The original sense is of a logical fallacy, of taking for granted or assuming the thing that you are setting out to prove. To take an example, you might say that lying is wrong because we ought always to tell the truth. That’s a circular argument and makes no sense. Another instance is to argue that democracy must be the best form of government because the majority is always right. The fallacy was described by Aristotle in his book on logic in about 350BC. His Greek name for it was turned into Latin as petitio principii and then into English in 1581 as beg the question. Most of our problems arise because the person who translated it made a hash of it. The Latin might better be translated as “laying claim to the principle”.

Very often, the fact that you are using the matter to be proved as part of your argument is a good deal more subtle than in these examples. It comes across rather as an attempt to evade the issue or avoid giving a straightforward answer, making the phrase mean “avoid the question”. This meaning of the phrase is common and most authorities agree it is now part of standard English.

The meaning you give is the newest. It is gaining ground, and one or two recent dictionaries claim that it is now acceptable—the New Oxford Dictionary of English, for example, says it is “widely accepted in modern standard English”. I wouldn’t go so far myself. Because of possible confusion over what you actually mean, and inevitable condemnation from people who have taken the trouble to find out what it once did mean, it’s better avoided altogether.
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Old 04-06-2006, 12:51 PM   #18
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Re: Check your taxes...

I see examples of begging the question (old sense-) practically every day, particularly in political and religious arguments (eg, Creationism is true because the world is God's creation). That Aristotle was one incredible genius and observer of people! In addition to wishing for Whirled Peas, I wish for another such thinker to come on the public scene in my lifetime. Maybe it would be easier to just take a class in rhetoric---hmmm, have you noticed that since they stopped teaching rhetoric in high school, advertising has become more effective...coincidence? I think not!
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Re: Check your taxes...
Old 04-06-2006, 12:53 PM   #19
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Re: Check your taxes...

Sometimes something just begs to be asked.

The Mr. and Ms. Language Persons should begger off
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Re: Check your taxes...
Old 04-06-2006, 12:56 PM   #20
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Re: Check your taxes...

uh, beggers can't be choosers...
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