“Fake news” has entered the national lexicon, and the mud-slinging from both sides is pretty sad to watch. What one side calls “fake news,” the other calls the “truth” and vice-versa. Politics is a dirty game, and we try to stay out of it. But “fake news” has also entered the tax lexicon, as people continually call us and say, “I heard such-and-such on the Internet,” or “so-and-so” said “such-and-such.” OK, let’s get some things straight. First and foremost, don’t believe everything you read on the Internet, everything you hear on YouTube, or what’s tweeted. Some of it is just good-natured fun, some is just plain crazy, and some is a scam. That very much goes for taxes and as everyone gears up for the TCJA (Tax Cut and Jobs Act) there are a lot of rumors going round the Internet. On this note, we read this article with keen interest – “Are You Using ‘Fake News’ for Your Tax Research?” (https://www.bna.com/using-fake-news-b73014470439/). The article doesn’t name any particular things, but it points out that pretty much anyone can write a blot article or post on YouTube, so you can’t necessarily know what you’re dealing with.
That’s the first part of this problem. Too much unsubstantiated noise on the Internet. But there’s a second problem: the IRS and the FTB. The tax agencies provide information to “help” the public but even that “helpful information” can be pretty obtuse. We should know – we’re tax professionals. For example, check out some of the articles on the IRS website on “Tax reform” (See: https://www.irs.gov/newsroom/tax-reform). Get out your no-doze and aspirin as you try, as a lay person, to make heads or tails of what this all means. Here are some of the headlines:
- New rules and limitations for depreciation and expensing under the Tax Cuts and Jobs Act
- Many corporations will pay a blended federal income tax this year under the new tax reform law
- Combat zone tax benefits now available to Armed Forces members who served in the Sinai Peninsula; IRS accepting retroactive tax refund claims back to 2015
- Inflation Adjustments Under Recently Enacted Tax Law
- Newly-revised estimated tax form and publication can help people pay the right amount
- IRS issues guidance on business interest expense limitations
- IRS Issues Guidance on Withholding on the Transfer of Partnership Interests by Foreign Persons
- IRS urges ‘Paycheck Checkup’ for key groups; tax withholding may need adjustment
- IRS Issues Additional Guidance on Transition Tax on Foreign Earnings
- IRS encourages ‘Paycheck Checkup’ for taxpayers to check their withholding; special week focuses on changes
- IRS provides additional details on section 965, transition tax; Deadlines approach for some 2017 filers
Fun reading? Not so much. Important reading? Not really for lay people, but for us as tax professionals, absolutely! So that brings us to our third point about “fake news” and taxes. Seek out a tax professional. Of course we’re partial to Safe Harbor LLP, which we hear is one of the top-rated and most beloved tax accounting firms in San Francisco. We hear that those guys and gals really know taxes, both California and Federal, and work very hard to help their high income, business, and even expat tax preparation clients in the good graces of all the relevant tax authorities while minimizing taxes to the fullest extent of the law. The point being – reach out to someone who does taxes for a living and avoid the whole “fake news” issue entirely.