The caller put in a forfeiture and is waiting to see how long it will take to collect the money.

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Listen for important tax information from Dailey Law Firm attorney Richard Ambrow. Mr. Ambrow provides advice about the IRS offer and compromise process and how it effects people in Michigan.

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A business owner wants to know how to file personal income taxes.

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A caller wonders about the enforceability of an arbitration agreement, especially one that stipulates which state’s law will apply. Attorney Matt Catchick explains that this might be enforceable, but an attorney really should review the document to make sure.

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Brian Dailey, Host of the Law Show on WJR, speaks with enrolled agent with the IRS John Catoni with Michigan Tax Tips. Watch the video or read the transcript below!

Transcript:

Brian: John Catoni is an enrolled agent with the IRS and he is here again this week to explain to us a little bit about what we need to do for taxes coming up. Welcome to the Law Show, John.

John: Hello Mr. Dailey?

Brian: How are you doing?

John: Good, real good.

Brian: Good. Are you getting any sleep or are you still… are you starting to burn the midnight oil?

John: Hey, who needs sleep? I’ll sleep in May.

Brian: Ok. So you’re sort of like the bears, you are hibernating now right?

John: That’s right.

Brian: Alright. So listen John, let’s talk business first. What do employers and people in business need to be concerned about for taxes upcoming?

John: Again, like, you know, we’ve talked about this before, make sure you are including all the 1099’s that you may receive that you get through the mail and report that income, you know, because it will come back and haunt you. And you want to look at your entity structure this time of the year so maybe you can potentially elect [Indiscernible] [0:00:54] status.

Another thing I wanted to mention which a lot of American businesses do not take advantage of it’s, that I’ve noticed is the domestic activities production deduction. It’s…a lot of US companies can get this for goods and services they produce in the US. You can get a 6% deduction off your net income for 2009 that’s gone up to 9% in 2010.

Brian: So if Mr. Widget Makers is making – making widgets, he can get a 6% write down of his net income?

John: Exactly, exactly and, you know, a lot of cases that I review people are… they are not taking advantage of it and it’s for products that are built right here in the good old USA.

Brian: Excellent. John, Lets talk about people that are not in business, they are just working and they’ve got deductions coming up and they’ve got taxes coming up. What are the things that are most important for individuals?

John: Boy, I’ve had a lot of smiling faces this year leaving my office because there is a lot of little tax credits, you know, that maybe one at a time don’t add up to much, but when you put them all together it’s making some difference on people’s returns. There’s the energy credit for any energy efficient property you’ve done to your house such as windows, doors, insulation, maybe a new hot water tank, if you bought a new vehicle you can deduct the sales tax, the education credits have been expanded now. It can be a refundable credit which means even if you don’t have any tax liability, you could still get that credit.

One thing I want to mention about that – the first time home buyer’s credit which everybody has been talking about, I don’t know if everybody remembers initially it was the $7500 credit, but you had to pay it back. There is talk in the legislation that they might reverse that so you don’t have to pay that back. So if you have any questions on that you might want to get a hold of me. And there’s just…there are countless other little credits that you might not be aware of that you just got to stay on top of.

Brian talks to an enrolled agent with the IRS, a man who is really qualified to give tax advice. He gives some great tips on saving money on your taxes, especially now that the year has just ended.

A caller had a deal — with a $50 dollar deposit — to buy a dryer. Now the seller has canceled the deal for no reason. Brian explains that the buyer could go out and find a similar dryer and — if it cost more — sue the seller for the difference. Brian notes that litigation might make this option unpleasant so it might work to point out to the seller that this is an option one could take and perhaps that would persuade the seller to come around.

Brian explains that during this time of year, we all need to be more careful. Homeowners need to keep their sidewalks clear of ice, snow and things that might cause hazards . . . and business owners as well. Something everyone should review each year.

A caller has had numerous power outages which cause damage to his home. Instead of filing a claim with his homeowner’s insurance, could he file suit? Brian explains that he could, but the cost of hiring an attorney and filing suit would probably make it economically unfeasible. Sit down with an attorney and discuss all your options.

A caller’s co-op recently rewrote the rules so that you cannot have a pet without a doctor’s note. More troubling, they reserve the right to determine whether they think you are a good pet owner or not! Justin and Matt encourage the caller to sit down with a lawyer and review the new rules to see if they are enforceable at law.