PhillyTalk: Ask the Writers and Experts

For your purposes you may wish to consult with w financial planner to guide you through the best patch to take, Regarding credit cards it is always advisable to contact the bank itself and close the account. You can then discard the cards by shredding. You may also wish to contact the 3 major credit bureaus and request that a fraud alert be placed on you account. This can be a very useful tool in protecting yourself against identity theft. You may also wish to contact the Federal Trade Commission as they have plenty of information about this growing problem. http://www.ftc.gov/bcp/edu/microsites/idtheft/.

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http://www.irs.gov/efile/article/0,,id=151880,00.html

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This response does not represent a legal opinion from the IRS. To address your specific circumstances consult with a tax professional.

You provide very little information in you query. Please check out Publication 505 http://www.irs.gov/publications/p505/ch02.html#d0e4429 on the IRS.gov Web site. It is a quite complete document and shod provide you with the guidance you are looking for.

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This response does not represent a legal opinion from the IRS. To address your specific circumstances consult with a tax professional.

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Telephone Excise Tax Refund. Don't lose out. You still have time to request this refund. http://www.irs.gov/newsroom/article/0,,id=164032,00.html

To figure how much you may deduct for property that you contribute, you must first determine its fair market value on the date of the contribution.

If you itemize, personal legal expenses are not deductible. Please review Publication 529 page 14 under the heading Nondeductible expenses List of nondeductible expenses (http://www.irs.gov/pub/irs-pdf/p529.pdf).

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Other Helpful Publications

Publication 17, Your Federal Income Tax

Publication 463, Travel, Entertainment, Gift, and Car Expenses

Publication 501, Exemptions, Standard Deduction, and Filing Information

Publication 502, Medical and Dental Expenses

Pub 526, Charitable Contributions

Pub 529, Miscellaneous Deductions

Publication 530, Tax Information for First-Time Homeowners

Pub 535, Business Expenses

Publication 544, Sales and Other Dispositions of Assets

Publication 547,Casualties, Disasters, and Thefts

Publication 561, Determining the Value of Donated Property

Pub 584, Casualty, Disaster, and Theft Loss Workbook

Pub 2194 Disaster Losses Kit for Individuals

Publication 936, Home Mortgage Interest Deduction

Publication 970, Tax Benefits for Education

Form 1040 (Schedule A&B), Itemized Deductions and Interest & Dividend Income

Form 2106, Employee Business Expenses

Form 2106-EZ, Unreimbursed Employee Business Expenses

Instructions for Form 2106

Form 8283, Noncash Charitable Contributions

Inst 8283, Instructions

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This response does not represent a legal opinion from the IRS. To address your specific circumstances consult with a tax professional.

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We cannot promote a particular tax preparer or attorney. You can use the information below as an outline to select a tax attorney. You may also wish obtain the services of an enrolled agent or tax attorney that can represent you in tax court. At a minimum please contact your local IRS office as soon as possible

Advice for Choosing a Tax Return Preparer

IRS TAX TIP 2007-06

Taxpayers who pay someone to do their taxes should choose a preparer wisely. If you choose to use a paid tax preparer, it is important that you find a qualified tax professional. Taxpayers are ultimately responsible for everything on their return even when it’s prepared by someone else.

The most reputable preparers will request to see your records and receipts and will ask you multiple questions to determine your total income and your qualifications for expenses, deductions, and other items.  By doing so, they have your best interest in mind and are trying to help you avoid penalties, interest, or additional taxes that could result from later IRS contacts.

While most tax return preparers are professional and honest, taxpayers can use the following tips to choose a preparer who will offer the best service for their tax preparation needs.

Ask about service fees.  Avoid preparers who claim they can obtain larger refunds than other preparers, or those who guarantee results or base fees on a percentage of the amount of the refund.

Plan Ahead. Choose a preparer you will be able to contact after the return is filed and one that will be responsive to your needs.

Get References. Ask questions and get references from clients who have used the tax professional before. Were they satisfied with the service received?

Research. Check to see if the preparer has any questionable history with the Better Business Bureau, the state’s board of accountancy for CPAs or the state’s bar association for attorneys. Find out if the preparer belongs to a professional organization that requires its members to pursue continuing education and also holds them accountable to a code of ethics.

Determine if the preparer’s credentials meet your needs. Are they an Enrolled Agent, Certified Public Accountant or Tax Attorney? Only attorneys, CPAs and enrolled agents can represent taxpayers before the IRS in all matters including audits, collection actions and appeals. Other return preparers may represent taxpayers only in audits regarding a return they signed as a preparer.

Report suspected tax fraud and abusive tax preparers to the IRS on Form 3949-A, Information Referral, or by sending a letter to Internal Revenue Service, Fresno, CA 93888 .  Download Form 3949-A from IRS.gov or order by mail at 1-800-829-3676.

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Small Business and Self-Employed One-Stop Resource (http://www.irs.gov/businesses/index.html)
This section offers a broad range of resources across federal and state agencies, as well as industry/profession specific information for self-employed entrepreneurs, employers and businesses.

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This response does not represent a legal opinion from the IRS. To address your specific circumstances consult with a tax professional.

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There are an awful lot of unknowns in your question so I can't make the leap and tell you the tax liability would be X or Y. First check out Publication 590 (Introductory page is located on our Web site at http://www.irs.gov/publications/p590/ar01.html). Another good source of information would be the instructions for the 1040 forms and of course the IRS.gov Web site has a wealth of information. You may also elect to seek the help of a tax preparer. You can review Tips for Choosing a Tax Preparer at http://www.irs.gov/individuals/article/0,,id=133088,00.html.

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Need a Copy of Your Tax Return Information? You have two easy and convenient options for getting copies of your federal tax return information -- tax return transcripts and tax account transcripts -- by phone or by mail... http://www.irs.gov/individuals/article/0,,id=110571,00.html

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This response does not represent a legal opinion from the IRS. To address your specific circumstances consult with a tax professional.

The following table does not quite fit on this page but you should still be able to follow the columns. I am including tax information for 2006 as well as 2005 since I can't tell by your inquiry what years you may be referring to. If no return has been filed you should contact you local IRS office in order to get back on track.

                            Income Tax Rate Schedules - 2005      *

                            15%      25%       28%        33%        35%

(Taxable Income)    Over:    Over:     Over:      Over:      Over:

Married joint           $14,600 $59,400  $119,950 $182,800 $326,450

Married separate     $ 7,300  $29,700  $  59,975 $  91,400 $163,225

Single                    $ 7,300  $29,700  $  71,950 $150,150 $326,450

Head of household  $10,450 $39,800  $102,800 $166,450 $326,450

                            Income Tax Rate Schedules - 2006      *

                            15%      25%       28%        33%        35%

(Taxable Income)    Over:    Over:     Over:      Over:      Over:

Married joint           $15,100 $61,300  $123,700 $188,450 $336,550

Married separate     $ 7,550  $30,650  $  61,850 $  94,225 $163,275

Single                    $ 7,550  $30,650  $  74,200 $154,800 $336,550

Head of household  $10,750 $41,050  $105,000 $171,650 $336,560

Income Tax Rate Schedules - 2007      *

                            15%      25%       28%        33%        35%

(Taxable Income)    Over:    Over:     Over:      Over:      Over:

Married joint           $15,650 $63,700  $128,500 $195,850 $349,700

Married separate     $ 7,825  $31,850  $  64,250 $  97,925 $174,850

Single                    $ 7,825  $31,850  $  77,100 $160,850 $349,700

Head of household  $11,200 $42,650  $110,100 $178,350 $349,700

     * For 2005/2006/2007, a 10% tax rate applies to taxable income up to the point at which the 15% rate begins.                

Personal Exemptions

                                2005         2006         2007

                                $3,200       $3,300       $3,400

 *In 2006, AGI in excess of specified thresholds will reduce the personal exemption amount by 2% for every $2,500 ($1,250, if married filing separately) or part thereof that their income exceeds $225,750, if MFJ or qualifying widow(er); $112,875 if MFS; $150,500 if single; or $188,150 if HoH. Beginning in 2006 no more than 2/3 of the exemption amount is phased-out, so each exemption cannot be less than $1,100.

Standard Deductions*

                                 2005           2006 **    2007

Single                        $5,000        $5,150       $5,350   

Head of household      $$7,300      $7,550       $7,850

Married joint               $10,000      $10,300     $10,700

Married separate         $$5,000      $5,150       $5,350

Additional deduction for age 65 or over/blind:

Single                        $1,250        $1,250       $1,300

Married                      $1,000ea.   $1,000ea.  $1,050

 *The standard deduction for a taxpayer eligible to be claimed as a dependent on someone else’s return is the greater of $850 or the dependent’s earned income plus $300, up to the regular standard deduction amount for a single person.

 **In 2006, AGI greater than $150,500 ($75,250 for married taxpayers filing separately), will reduce the amount of certain itemized deductions claimed on Schedule A by the lesser of 3% of the amount that the AGI exceeds the $150,500 threshold, or 80% of allowable itemized deductions. Beginning in 2006, the phased-out amount is reduced by 1/3.

Filing Requirements 

                                                2005           2006          2007

Single                                       $ 8,200       $8,450          $8,750

  65 or >                                   $ 9,450       $9,700          $10,050

Head of household                     $10,500      $10,850        $11,250

  65 or >                                   $11,750      $12,100        $12,550

Married joint                              $16,400      $16,900        $17,500

  (1) 65 or over                          $17,400      $17,900        $18,550

  (2) 65 or over                          $18,400      $18,900        $20,650

Married separate                        $ 3,200       $3,300          $3,400

Qualifying widow(er)                   $13,200      $13,600        $14,100

  65 or >                                   $14,200      $14,600        $15,150

I can't speak to your situation as I am certain you have additional financial elements which can impact potential tax circumstances. There are also many varieties of annuities. You can enter "annuities" in the search box on the IRS.gov Web site and review the numerous results which should give you some excellent information. You should contact a tax professional who can guide you through this process.

Then short answer is yes. I am also including additional information regarding charitable contributions as well.

Tips for Deducting Charitable Contributions

IRS TAX TIP 2007-57

When preparing to file your federal tax return, don’t forget your contributions to charitable organizations. Your donations could add up to a sizeable tax deduction if you itemize on IRS Form 1040, Schedule A.

Here are a few tips to ensure your contributions pay off on your tax return:

You cannot deduct contributions made to specific individuals, political organizations and candidates. Nor can you deduct the value of your time or services and the cost of raffles, bingo or other games of chance.

To be deductible, contributions must be made to qualified organizations.

Only contributions actually made during the tax year are deductible.

If your contributions entitle you to merchandise, goods or services, including admission to a charity ball, banquet, theatrical performance or sporting event, you can deduct only the amount that exceeds the fair market value of the benefit received.

Donations of stock or other property are usually valued at the fair market value of the property.

To be deductible, clothing and household items donated after August 17, 2006, generally must be in good used condition or better.

Special rules apply to donations of vehicles.

For a charitable contribution of $250 or more, you can claim a deduction only if you obtain a written acknowledgment from the qualified organization.

If you claim a deduction on your return of more than $500 for all contributed property, you must attach IRS Form 8283, Noncash Charitable Contributions, to your return.

Taxpayers donating an item or a group of similar items valued at more than $5,000 must also complete Section B of Form 8283, which requires an appraisal by a qualified appraiser.

For more information, check out Publication 526, Charitable Contributions, which is available at IRS.gov.

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Sales Tax Deduction Calculator

If you file a Form 1040, and itemize deductions on Schedule A, you have the option of claiming either state and local income taxes or state and local sales taxes. (You can’t claim both.) If you saved your receipts throughout the year, you can add up the total amount of sales taxes you actually paid and claim that amount.

If you didn’t save all your receipts, you can still choose to claim state and local sales taxes. You could fill out the worksheet and use the optional general sales tax tables in Publication 600, State and Local General Sales Taxes (for 2006 tax returns) or 2005 Instructions for Schedules A & B (Form 1040) (for 2005 tax returns) – but why not take the easy route and use the Sales Tax Deduction Calculator!

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This response does not represent a legal opinion from the IRS. To address your specific circumstances consult with a tax professional.