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Tax Form 1040ez Instructions

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Tax Form 1040ez Instructions

Tax form 1040ez instructions 2. Tax form 1040ez instructions   Tax Shelters and Other Reportable Transactions Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Abusive Tax SheltersRules To Curb Abusive Tax Shelters Investor Reporting Penalties Whether To Invest Introduction Investments that yield tax benefits are sometimes called “tax shelters. Tax form 1040ez instructions ” In some cases, Congress has concluded that the loss of revenue is an acceptable side effect of special tax provisions designed to encourage taxpayers to make certain types of investments. Tax form 1040ez instructions In many cases, however, losses from tax shelters produce little or no benefit to society, or the tax benefits are exaggerated beyond those intended. Tax form 1040ez instructions Those cases are called “abusive tax shelters. Tax form 1040ez instructions ” An investment that is considered a tax shelter is subject to restrictions, including the requirement that it be disclosed, as discussed later. Tax form 1040ez instructions Topics - This chapter discusses: Abusive Tax Shelters , Rules To Curb Abusive Tax Shelters , Investor Reporting , Penalties , and Whether To Invest . Tax form 1040ez instructions Useful Items - You may want to see: Publication 538 Accounting Periods and Methods 556 Examination of Returns, Appeal Rights, and Claims for Refund 561 Determining the Value of Donated Property 925 Passive Activity and At-Risk Rules Form (and Instructions) 8275 Disclosure Statement 8275-R Regulation Disclosure Statement 8283 Noncash Charitable Contributions 8886 Reportable Transaction Disclosure Statement See chapter 5, How To Get Tax Help , for information about getting these publications and forms. Tax form 1040ez instructions Abusive Tax Shelters Abusive tax shelters are marketing schemes involving artificial transactions with little or no economic reality. Tax form 1040ez instructions They often make use of unrealistic allocations, inflated appraisals, losses in connection with nonrecourse loans, mismatching of income and deductions, financing techniques that do not conform to standard commercial business practices, or mischaracterization of the substance of the transaction. Tax form 1040ez instructions Despite appearances to the contrary, the taxpayer generally risks little. Tax form 1040ez instructions Abusive tax shelters commonly involve package deals designed from the start to generate losses, deductions, or credits that will be far more than present or future investment. Tax form 1040ez instructions Or, they may promise investors from the start that future inflated appraisals will enable them, for example, to reap charitable contribution deductions based on those appraisals. Tax form 1040ez instructions (But see the appraisal requirements discussed under Rules To Curb Abusive Tax Shelters , later. Tax form 1040ez instructions ) They are commonly marketed in terms of the ratio of tax deductions allegedly available to each dollar invested. Tax form 1040ez instructions This ratio (or “write-off”) is frequently said to be several times greater than one-to-one. Tax form 1040ez instructions Because there are many abusive tax shelters, it is not possible to list all the factors you should consider in determining whether an offering is an abusive tax shelter. Tax form 1040ez instructions However, you should ask the following questions, which might provide a clue to the abusive nature of the plan. Tax form 1040ez instructions Do the tax benefits far outweigh the economic benefits? Is this a transaction you would seriously consider, apart from the tax benefits, if you hoped to make a profit? Do shelter assets really exist and, if so, are they insured for less than their purchase price? Is there a nontax justification for the way profits and losses are allocated to partners? Do the facts and supporting documents make economic sense? In that connection, are there sales and resales of the tax shelter property at ever increasing prices? Does the investment plan involve a gimmick, device, or sham to hide the economic reality of the transaction? Does the promoter offer to backdate documents after the close of the year? Are you instructed to backdate checks covering your investment? Is your debt a real debt or are you assured by the promoter that you will never have to pay it? Does this transaction involve laundering United States source income through foreign corporations incorporated in a tax haven and owned by United States shareholders? Rules To Curb Abusive Tax Shelters Congress has enacted a series of income tax laws designed to halt the growth of abusive tax shelters. Tax form 1040ez instructions These provisions include the following. Tax form 1040ez instructions Disclosure of reportable transactions. Tax form 1040ez instructions   You must disclose information for each reportable transaction in which you participate. Tax form 1040ez instructions See Reportable Transaction Disclosure Statement , later. Tax form 1040ez instructions   Material advisors with respect to any reportable transaction must disclose information about the transaction on Form 8918, Material Advisor Disclosure Statement. Tax form 1040ez instructions To determine whether you are a material advisor to a transaction, see the Instructions for Form 8918. Tax form 1040ez instructions   Material advisors will receive a reportable transaction number for the disclosed reportable transaction. Tax form 1040ez instructions They must provide this number to all persons to whom they acted as a material advisor. Tax form 1040ez instructions They must provide the number at the time the transaction is entered into. Tax form 1040ez instructions If they do not have the number at that time, they must provide it within 60 days from the date the number is mailed to them. Tax form 1040ez instructions For information on penalties for failure to disclose and failure to maintain lists, see Internal Revenue Code sections 6707, 6707A, and 6708. Tax form 1040ez instructions Requirement to maintain list. Tax form 1040ez instructions   Material advisors must maintain a list of persons to whom they provide material aid, assistance, or advice on any reportable transaction. Tax form 1040ez instructions The list must be available for inspection by the IRS, and the information required to be included on the list generally must be kept for 7 years. Tax form 1040ez instructions See Regulations section 301. Tax form 1040ez instructions 6112-1 for more information (including what information is required to be included on the list). Tax form 1040ez instructions Confidentiality privilege. Tax form 1040ez instructions   The confidentiality privilege between you and a federally authorized tax practitioner does not apply to written communications made after October 21, 2004, regarding the promotion of your direct or indirect participation in any tax shelter. Tax form 1040ez instructions Appraisal requirement for donated property. Tax form 1040ez instructions   If you claim a deduction of more than $5,000 for an item or group of similar items of donated property, you generally must get a qualified appraisal from a qualified appraiser and complete and attach section B of Form 8283 to your return. Tax form 1040ez instructions If you claim a deduction of more than $500,000 for the donated property, you generally must attach the qualified appraisal to your return. Tax form 1040ez instructions If you file electronically, see Form 8453, U. Tax form 1040ez instructions S. Tax form 1040ez instructions Individual Income Tax Transmittal for an IRS e-file Return, and its instructions. Tax form 1040ez instructions For more information about appraisals, including exceptions, see Publication 561. Tax form 1040ez instructions Passive activity loss and credit limits. Tax form 1040ez instructions   The passive activity loss and credit rules limit the amount of losses and credits that can be claimed from passive activities and limit the amount that can offset nonpassive income, such as certain portfolio income from investments. Tax form 1040ez instructions For more detailed information about determining and reporting income, losses, and credits from passive activities, see Publication 925. Tax form 1040ez instructions Interest on penalties. Tax form 1040ez instructions   If you are assessed an accuracy-related or civil fraud penalty (as discussed under Penalties , later), interest will be imposed on the amount of the penalty from the due date of the return (including any extensions) to the date you pay the penalty. Tax form 1040ez instructions Accounting method restriction. Tax form 1040ez instructions   Tax shelters generally cannot use the cash method of accounting. Tax form 1040ez instructions Uniform capitalization rules. Tax form 1040ez instructions   The uniform capitalization rules generally apply to producing property or acquiring it for resale. Tax form 1040ez instructions Under those rules, the direct cost and part of the indirect cost of the property must be capitalized or included in inventory. Tax form 1040ez instructions For more information, see Publication 538. Tax form 1040ez instructions Denial of deduction for interest on an underpayment due to a reportable transaction. Tax form 1040ez instructions   You cannot deduct any interest you paid or accrued on any part of an underpayment of tax due to an understatement arising from a reportable transaction (discussed later) if the relevant facts affecting the tax treatment of the item are not adequately disclosed. Tax form 1040ez instructions This rule applies to reportable transactions entered into in tax years beginning after October 22, 2004. Tax form 1040ez instructions Authority for Disallowance of Tax Benefits The IRS has published guidance concluding that the claimed tax benefits of various abusive tax shelters should be disallowed. Tax form 1040ez instructions The guidance is the conclusion of the IRS on how the law is applied to a particular set of facts. Tax form 1040ez instructions Guidance is published in the Internal Revenue Bulletin for taxpayers' information and also for use by IRS officials. Tax form 1040ez instructions So, if your return is examined and an abusive tax shelter is identified and challenged, published guidance dealing with that type of shelter, which disallows certain claimed tax shelter benefits, could serve as the basis for the examining official's challenge of the tax benefits you claimed. Tax form 1040ez instructions In such a case, the examiner will not compromise even if you or your representative believes you have authority for the positions taken on your tax return. Tax form 1040ez instructions The courts have generally been unsympathetic to taxpayers involved in abusive tax shelter schemes and have ruled in favor of the IRS in the majority of the cases in which these shelters have been challenged. Tax form 1040ez instructions Investor Reporting You may be required to file a reportable transaction disclosure statement. Tax form 1040ez instructions Reportable Transaction Disclosure Statement Use Form 8886 to disclose information for each reportable transaction (discussed later) in which you participated. Tax form 1040ez instructions Generally, you must attach Form 8886 to your return for each tax year in which you participated in the transaction. Tax form 1040ez instructions Under certain circumstances, a transaction must be disclosed within 90 days of the transaction being identified as a listed transaction or a transaction of interest (discussed later). Tax form 1040ez instructions In addition, for the first year Form 8886 is attached to your return, you must send a copy of the form to: Internal Revenue Service OTSA Mail Stop 4915 1973 North Rulon White Blvd. Tax form 1040ez instructions  Ogden, UT 84404 If you file your return electronically, the copy sent to OTSA must show exactly the same information, word for word, provided with the electronically filed return and it must be provided on the official IRS Form 8886 or an exact copy of the form. Tax form 1040ez instructions If you use a computer-generated or substitute Form 8886, it must be an exact copy of the official IRS form. Tax form 1040ez instructions If you fail to file Form 8886 as required or fail to include any required information on the form, you may have to pay a penalty. Tax form 1040ez instructions See Penalty for failure to disclose a reportable transaction , later under Penalties. Tax form 1040ez instructions The following discussion briefly describes reportable transactions. Tax form 1040ez instructions For more details, see the Instructions for Form 8886. Tax form 1040ez instructions Reportable transaction. Tax form 1040ez instructions   A reportable transaction is any of the following. Tax form 1040ez instructions A listed transaction. Tax form 1040ez instructions A confidential transaction. Tax form 1040ez instructions A transaction with contractual protection. Tax form 1040ez instructions A loss transaction. Tax form 1040ez instructions A transaction of interest entered into after November 1, 2006. Tax form 1040ez instructions Note. Tax form 1040ez instructions Transactions with a brief asset holding period were removed from the definition of reportable transaction for transactions entered into after August 2, 2007. Tax form 1040ez instructions Listed transaction. Tax form 1040ez instructions   A listed transaction is the same as, or substantially similar to, one of the types of transactions the IRS has determined to be a tax-avoidance transaction. Tax form 1040ez instructions These transactions have been identified in notices, regulations, and other published guidance issued by the IRS. Tax form 1040ez instructions For a list of existing guidance, see Notice 2009-59 in Internal Revenue Bulletin 2009-31, available at www. Tax form 1040ez instructions irs. Tax form 1040ez instructions gov/irb/2009-31_IRB/ar07. Tax form 1040ez instructions html. Tax form 1040ez instructions Confidential transaction. Tax form 1040ez instructions   A confidential transaction is offered to you under conditions of confidentiality and for which you have paid an advisor a minimum fee. Tax form 1040ez instructions A transaction is offered under conditions of confidentiality if the advisor who is paid the fee places a limit on your disclosure of the tax treatment or tax structure of the transaction and the limit protects the confidentiality of the advisor's tax strategies. Tax form 1040ez instructions The transaction is treated as confidential even if the conditions of confidentiality are not legally binding on you. Tax form 1040ez instructions Transaction with contractual protection. Tax form 1040ez instructions   Generally, a transaction with contractual protection is one in which you or a related party has the right to a full or partial refund of fees if all or part of the intended tax consequences of the transaction are not sustained, or a transaction for which the fees are contingent on your realizing the tax benefits from the transaction. Tax form 1040ez instructions For information on exceptions, see Revenue Procedure 2007-20 in Internal Revenue Bulletin 2007-7, available at www. Tax form 1040ez instructions irs. Tax form 1040ez instructions gov/irb/2007-07_IRB/ar15. Tax form 1040ez instructions html. Tax form 1040ez instructions Loss transaction. Tax form 1040ez instructions   For individuals, a loss transaction is one that results in a deductible loss if the gross amount of the loss is at least $2 million in a single tax year or $4 million in any combination of tax years. Tax form 1040ez instructions A loss from a foreign currency transaction under Internal Revenue Code section 988 is a loss transaction if the gross amount of the loss is at least $50,000 in a single tax year, whether or not the loss flows through from an S corporation or partnership. Tax form 1040ez instructions   Certain losses (such as losses from casualties, thefts, and condemnations) are excepted from this category and do not have to be reported on Form 8886. Tax form 1040ez instructions For information on other exceptions, see Revenue Procedure 2004-66 in Internal Revenue Bulletin 2004-50, as modified and superseded by Revenue Procedure 2013-11, (or future published guidance) available at www. Tax form 1040ez instructions irs. Tax form 1040ez instructions gov/irb/2004-50_IRB/ar11. Tax form 1040ez instructions html. Tax form 1040ez instructions Transaction of interest. Tax form 1040ez instructions   A transaction of interest is a transaction entered into after November 1, 2006, that is the same as, or substantially similar to, one of the types of transactions that the IRS has identified by notice, regulation, or other form of published guidance as a transaction of interest. Tax form 1040ez instructions The IRS has identified the following transactions of interest. Tax form 1040ez instructions “Toggling” grantor trusts as described in Notice 2007-73, 2007-36 I. Tax form 1040ez instructions R. Tax form 1040ez instructions B. Tax form 1040ez instructions 545, available at www. Tax form 1040ez instructions irs. Tax form 1040ez instructions gov/irb/2007-36_IRB/ar20. Tax form 1040ez instructions html. Tax form 1040ez instructions Certain transactions involving contributions of a successor member interest in a limited liability company as described in Notice 2007-72, 2007-36 I. Tax form 1040ez instructions R. Tax form 1040ez instructions B. Tax form 1040ez instructions 544, available at www. Tax form 1040ez instructions irs. Tax form 1040ez instructions gov/irb/2007-36_IRB/ar19. Tax form 1040ez instructions html. Tax form 1040ez instructions Certain transactions involving the sale or other disposition of all interests in a charitable remainder trust and claiming little or no taxable gain as described in Notice 2008-99, 2008-47 I. Tax form 1040ez instructions R. Tax form 1040ez instructions B. Tax form 1040ez instructions 1194, available at www. Tax form 1040ez instructions irs. Tax form 1040ez instructions gov/irb/2008-47_IRB/ar11. Tax form 1040ez instructions html. Tax form 1040ez instructions Certain transactions involving a U. Tax form 1040ez instructions S. Tax form 1040ez instructions taxpayer owning controlled foreign corporations (CFCs) that hold stock of a lower-tier CFC through a domestic partnership to avoid reporting income as described in Notice 2009-7, 2009-3 I. Tax form 1040ez instructions R. Tax form 1040ez instructions B. Tax form 1040ez instructions 312, available at www. Tax form 1040ez instructions irs. Tax form 1040ez instructions gov/irb/2009-03_IRB/ar10. Tax form 1040ez instructions html. Tax form 1040ez instructions   For updates to this list, go to www. Tax form 1040ez instructions irs. Tax form 1040ez instructions gov/Businesses/Corporations/Abusive-Tax-Shelters-and-Transactions. Tax form 1040ez instructions Penalties Investing in an abusive tax shelter may lead to substantial expenses. Tax form 1040ez instructions First, the promoter generally charges a substantial fee. Tax form 1040ez instructions If your return is examined by the IRS and a tax deficiency is determined, you will be faced with payment of more tax, interest on the underpayment, possibly a 20%, 30%, or even 40% accuracy-related penalty, or a 75% civil fraud penalty. Tax form 1040ez instructions You may also be subject to the penalty for failure to pay tax. Tax form 1040ez instructions These penalties are explained in the following paragraphs. Tax form 1040ez instructions Accuracy-related penalties. Tax form 1040ez instructions   An accuracy-related penalty of 20% can be imposed for underpayments of tax due to: Negligence or disregard of rules or regulations, Substantial understatement of tax, Substantial valuation misstatement (increased to 40% for gross valuation misstatement), Transaction lacking economic substance (increased to 40% for undisclosed transaction lacking economic substance), or Undisclosed foreign financial asset understatement (40% in all cases). Tax form 1040ez instructions Except for a transaction lacking economic substance, this penalty will not be imposed if you can show you had reasonable cause for any understatement of tax and that you acted in good faith. Tax form 1040ez instructions Your failure to disclose a reportable transaction is a strong indication that you failed to act in good faith. Tax form 1040ez instructions   If you are charged an accuracy-related penalty, interest will be imposed on the amount of the penalty from the due date of the return (including extensions) to the date you pay the penalty. Tax form 1040ez instructions   The 20% penalties do not apply to any underpayment attributable to a reportable transaction understatement subject to an accuracy-related penalty (discussed later). Tax form 1040ez instructions Negligence or disregard of rules or regulations. Tax form 1040ez instructions   The penalty for negligence or disregard of rules or regulations is imposed only on the part of the underpayment due to negligence or disregard of rules or regulations. Tax form 1040ez instructions The penalty will not be charged if you can show you had reasonable cause for understating your tax and that you acted in good faith. Tax form 1040ez instructions    Negligence includes any failure to make a reasonable attempt to comply with the provisions of the Internal Revenue Code. Tax form 1040ez instructions It also includes any failure to keep adequate books and records. Tax form 1040ez instructions A return position that has a reasonable basis is not negligence. Tax form 1040ez instructions   Disregard includes any careless, reckless, or intentional disregard of rules or regulations. Tax form 1040ez instructions   The penalty for disregard of rules and regulations can be avoided if all the following are true. Tax form 1040ez instructions You keep adequate books and records. Tax form 1040ez instructions You have a reasonable basis for your position on the tax issue. Tax form 1040ez instructions You make an adequate disclosure of your position. Tax form 1040ez instructions Use Form 8275 to make your disclosure and attach it to your return. Tax form 1040ez instructions To disclose a position contrary to a regulation, use Form 8275-R. Tax form 1040ez instructions Use Form 8886 to disclose a reportable transaction (discussed earlier). Tax form 1040ez instructions Substantial understatement of tax. Tax form 1040ez instructions   An understatement is considered to be substantial if it is more than the greater of: 10% of the tax required to be shown on the return, or $5,000. Tax form 1040ez instructions An “understatement” is the amount of tax required to be shown on your return for a tax year minus the amount of tax shown on the return, reduced by any rebates. Tax form 1040ez instructions The term “rebate” generally means a decrease in the tax shown on your original return as the result of your filing an amended return or claim for refund. Tax form 1040ez instructions   For items other than tax shelters, you can file Form 8275 or Form 8275-R to disclose items that could cause a substantial understatement of income tax. Tax form 1040ez instructions In that way, you can avoid the substantial understatement penalty if you have a reasonable basis for your position on the tax issue. Tax form 1040ez instructions Disclosure of the tax shelter item on a tax return does not reduce the amount of the understatement. Tax form 1040ez instructions   Also, the understatement penalty will not be imposed if you can show there was reasonable cause for the underpayment caused by the understatement and that you acted in good faith. Tax form 1040ez instructions An important factor in establishing reasonable cause and good faith will be the extent of your effort to determine your proper tax liability under the law. Tax form 1040ez instructions Substantial valuation misstatement. Tax form 1040ez instructions   In general, you are liable for a 20% penalty for a substantial valuation misstatement if all the following are true. Tax form 1040ez instructions The value or adjusted basis of any property claimed on the return is 150% or more of the correct amount. Tax form 1040ez instructions You underpaid your tax by more than $5,000 because of the misstatement. Tax form 1040ez instructions You cannot establish that you had reasonable cause for the underpayment and that you acted in good faith. Tax form 1040ez instructions   You may be assessed a penalty of 40% for a gross valuation misstatement. Tax form 1040ez instructions If you misstate the value or the adjusted basis of property by 200% or more of the amount determined to be correct, you will be assessed a penalty of 40%, instead of 20%, of the amount you underpaid because of the gross valuation misstatement. Tax form 1040ez instructions The penalty rate is also 40% if the property's correct value or adjusted basis is zero. Tax form 1040ez instructions Transaction lacking economic substance. Tax form 1040ez instructions   The economic substance doctrine only applies to an individual that entered into a transaction in connection with a trade or business or an activity engaged in for the production of income. Tax form 1040ez instructions For transactions entered into after March 30, 2010, a transaction has economic substance for you as an individual taxpayer only if: The transaction changes your economic position in a meaningful way (apart from federal income tax effects), or You have a substantial purpose (apart from federal income tax effects) for entering into the transaction. Tax form 1040ez instructions   For purposes of determining whether economic substance exists, a transaction's profit potential will only be taken into account if the present value of the reasonably expected pre-tax profit from the transaction is substantial compared to the present value of the expected net tax benefits that would be allowed if the transaction were respected. Tax form 1040ez instructions   If any part of your underpayment is due to any disallowance of claimed tax benefits by reason of a transaction lacking economic substance or failing to meet the requirements of any similar rule of law, that part of your underpayment will be subject to the 20% accuracy-related penalty even if you had a reasonable cause and acted in good faith concerning that part. Tax form 1040ez instructions   Additionally, the penalty increases to 40% if you do not adequately disclose on your return or in a statement attached to your return the relevant facts affecting the tax treatment of a transaction that lacks economic substance. Tax form 1040ez instructions Relevant facts include any facts affecting the tax treatment of the transaction. Tax form 1040ez instructions    Any excessive amount of an erroneous claim for an income tax refund or credit (other than a refund or credit related to the earned income credit) that results from a transaction found to be lacking economic substance will not be treated as having a reasonable basis and could be subject to a 20% penalty. Tax form 1040ez instructions Undisclosed foreign financial asset understatement. Tax form 1040ez instructions   For tax years beginning after March 18, 2010, you may be liable for a 40% penalty for an understatement of your tax liability due to an undisclosed foreign financial asset. Tax form 1040ez instructions An undisclosed foreign financial asset is any asset for which an information return, required to be provided under Internal Revenue Code section 6038, 6038B, 6038D, 6046A, or 6048 for any taxable year, is not provided. Tax form 1040ez instructions The penalty applies to any part of an underpayment related to the following undisclosed foreign financial assets. Tax form 1040ez instructions Any foreign business you control, reportable on Form 5471, Information Return of U. Tax form 1040ez instructions S. Tax form 1040ez instructions Persons With Respect To Certain Foreign Corporations, or Form 8865, Return of U. Tax form 1040ez instructions S. Tax form 1040ez instructions Persons With Respect to Certain Foreign Partnerships. Tax form 1040ez instructions Certain transfers of property to a foreign corporation or partnership, reportable on Form 926, Return by a U. Tax form 1040ez instructions S. Tax form 1040ez instructions Transferor of Property to a Foreign Corporation, or certain distributions to a foreign person, reportable on Form 8865. Tax form 1040ez instructions Your ownership interest in certain foreign financial assets, temporarily reportable on Form 8275 or 8275-R. Tax form 1040ez instructions    Instead of, or in addition to, Form 8275 or 8275-R, you may have to file Form 8938, Statement of Specified Foreign Financial Assets, with your tax return. Tax form 1040ez instructions See the Instructions for Form 8938 for details. Tax form 1040ez instructions    Your acquisition, disposition, or substantial change in ownership interest in a foreign partnership, reportable on Form 8865. Tax form 1040ez instructions Creation or transfer of money or property to certain foreign trusts, reportable on Form 3520, Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts. Tax form 1040ez instructions Penalty for incorrect appraisals. Tax form 1040ez instructions   The person who prepares an appraisal of the value of property may have to pay a penalty if: He or she knows, or reasonably should have known, that the appraisal would be used in connection with a return or claim for refund; and The claimed value of the property on a return or claim for refund based on that appraisal results in a substantial valuation misstatement or a gross valuation misstatement as discussed earlier. Tax form 1040ez instructions For details on the penalty amount and exceptions, see Publication 561. Tax form 1040ez instructions Penalty for failure to disclose a reportable transaction. Tax form 1040ez instructions   If you fail to include any required information regarding a reportable transaction (discussed earlier) on a return or statement, you may have to pay a penalty of 75% of the decrease in tax shown on your return as a result of such transaction (or that would have resulted if the transaction were respected for federal tax purposes). Tax form 1040ez instructions For an individual, the minimum penalty is $5,000 and the maximum is $10,000 (or $100,000 for a listed transaction). Tax form 1040ez instructions This penalty is in addition to any other penalty that may be imposed. Tax form 1040ez instructions   The IRS may rescind or abate the penalty for failing to disclose a reportable transaction under certain limited circumstances but cannot rescind the penalty for failing to disclose a listed transaction. Tax form 1040ez instructions For information on rescission, see Revenue Procedure 2007-21 in Internal Revenue Bulletin 2007-9 available at www. Tax form 1040ez instructions irs. Tax form 1040ez instructions gov/irb/2007-09_IRB/ar12. Tax form 1040ez instructions html. Tax form 1040ez instructions Accuracy-related penalty for a reportable transaction understatement. Tax form 1040ez instructions   If you have a reportable transaction understatement, you may have to pay a penalty equal to 20% of the amount of that understatement. Tax form 1040ez instructions This applies to any item due to a listed transaction or other reportable transaction with a significant purpose of avoiding or evading federal income tax. Tax form 1040ez instructions The penalty is 30% rather than 20% for the part of any reportable transaction understatement if the transaction was not properly disclosed. Tax form 1040ez instructions You may not have to pay the 20% penalty if you meet the strengthened reasonable cause and good faith exception. Tax form 1040ez instructions The reasonable cause and good faith exception does not apply to any part of a reportable transaction understatement attributable to one or more transactions that lack economic substance. Tax form 1040ez instructions   This penalty does not apply to the part of an understatement on which the fraud penalty, gross valuation misstatement penalty, or penalty for nondisclosure of noneconomic substance transactions is imposed. Tax form 1040ez instructions Civil fraud penalty. Tax form 1040ez instructions   If any underpayment of tax on your return is due to fraud, a penalty of 75% of the underpayment will be added to your tax. Tax form 1040ez instructions Joint return. Tax form 1040ez instructions   The fraud penalty on a joint return applies to a spouse only if some part of the underpayment is due to the fraud of that spouse. Tax form 1040ez instructions Failure to pay tax. Tax form 1040ez instructions   If a deficiency is assessed and is not paid within 10 days of the demand for payment, an investor can be penalized with up to a 25% addition to tax if the failure to pay continues. Tax form 1040ez instructions Whether To Invest In light of the adverse tax consequences and the substantial amount of penalties and interest that will result if the claimed tax benefits are disallowed, you should consider tax shelter investments carefully and seek competent legal and financial advice. Tax form 1040ez instructions Prev  Up  Next   Home   More Online Publications
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Consumer Protection Offices

City, county, regional, and state consumer offices offer a variety of important services. They might mediate complaints, conduct investigations, prosecute offenders of consumer laws, license and regulate professional service providers, provide educational materials and advocate for consumer rights. To save time, call before sending a written complaint. Ask if the office handles the type of complaint you have and if complaint forms are provided.

State Consumer Protection Offices

Oregon Department of Justice

Website: Oregon Department of Justice

Address: Oregon Department of Justice
Financial Fraud/Consumer Protection Section
1162 Court St., NE
Salem, OR 97301-4096

Phone Number: 503-378-4320 (Salem) 503-229-5576 (Portland)

Toll-free: 1-877-877-9392 (OR)

TTY: 1-800-735-2900

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Banking Authorities

The officials listed in this section regulate and supervise state-chartered banks. Many of them handle or refer problems and complaints about other types of financial institutions as well. Some also answer general questions about banking and consumer credit. If you are dealing with a federally chartered bank, check Federal Agencies.

Department of Consumer and Business Services

Website: Department of Consumer and Business Services

Address: Department of Consumer and Business Services
Division of Finance and Corporate Securities
PO Box 14480
Salem, OR 97309-0405

Phone Number: 503-378-4140

Toll-free: 1-866-814-9710 (OR)

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Insurance Regulators

Each state has its own laws and regulations for each type of insurance. The officials listed in this section enforce these laws. Many of these offices can also provide you with information to help you make informed insurance buying decisions.

Insurance Division

Website: Insurance Division

Address: Insurance Division
PO Box 14480
Salem, OR 97309-0405

Phone Number: 503-947-7984

Toll-free: 1-888-877-4894 (OR)

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Securities Administrators

Each state has its own laws and regulations for securities brokers and securities - including stocks, mutual funds, commodities, real estate, etc. The officials and agencies listed in this section enforce these laws and regulations. Many of these offices can also provide information to help you make informed investment decisions.

Department of Consumer and Business Services

Website: Department of Consumer and Business Services

Address: Department of Consumer and Business Services
Division of Finance and Corporate Securities
PO Box 14480
Salem, OR 97309-0405

Phone Number: 503-378-4140

Toll-free: 1-866-814-9710

TTY: 503-378-4100

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Utility Commissions

State Utility Commissions regulate services and rates for gas, electricity and telephones within your state. In some states, the utility commissions regulate other services such as water, transportation, and the moving of household goods. Many utility commissions handle consumer complaints. Sometimes, if a number of complaints are received about the same utility matter, they will conduct investigations.

Public Utility Commission

Website: Public Utility Commission

Address: Public Utility Commission
Consumer Services Division
550 Capitol St., NE, Suite 215
PO Box 2148
Salem, OR 97308-2148

Toll-free: 1-800-522-2404

TTY: 1-800-648-3458 (OR)

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The Tax Form 1040ez Instructions

Tax form 1040ez instructions Index Prev  Up     Home   More Online Publications