What to do if you receive a notice from the IRS or State of Michigan?
It’s a moment many taxpayers dread. A letter arrives from the IRS or the State of Michigan and it is not a refund check. Do not panic; many of these letters can be dealt with simply and painlessly.

Each year, the millions of letters and notices are sent to taxpayers to request payment of taxes, notify them of a change to their account or request additional information. The notice you receive normally covers a very specific issue about your account or tax return. Each letter and notice offers specific instructions on what you are asked to do to satisfy the inquiry. You should review the correspondence and compare it with the information on your return.

Please contact us if you have any questions regarding the notice. We can explain the notice and draft a response stating if we agree or disagree with the specific issue.

What to do if you notice an error on your income tax return?
Oops! You’ve discovered an error after your tax return has been filed. What should you do? You may need to amend your return.

The IRS usually corrects math errors or requests missing forms -- such as W-2s or schedules. In these instances, do not amend your return. However, do file an amended return if any of the following were reported incorrectly:

         • Your filing status
         • Your total income
         • Your deductions or credits 


How long should it take to receive your tax refund?
Are you expecting a tax refund from the Internal Revenue Service or State of Michigan this year? If you file a complete and accurate paper tax return, your refund should be issued in about six to eight weeks from the date the IRS receives your return. The State of Michigan is usually will issue a refund in about four to six weeks. If you file your return electronically, your refund should be issued in about half that time — even faster when you choose direct deposit (approximately 10 days).

How can you check on your tax refund?
You can check on the status of your refund seven days after you e-filed your return or four to six weeks after mailing your return.
There are several ways to check the status of your federal refund. To use these applications, you will need your Social Security
number, filing status and the amount of the refund.

      • Where's My Refund: The fastest, easiest way to find out about your current year refund is access www.irs.gov and
         click on the “Where’s My Refund” link available from the home page.

      • Refund Hotline: Call the IRS Refund Hotline at 1-800-829–1954.

      • TeleTax: Call IRS TeleTax System at 1-800-829-4477. TeleTax’s refund information is updated each weekend -- if you do
         not get a date for your refund, wait until the next week before calling back.
 
In some circumstances, you may not receive your refund as quickly as you expected. Refund delays can be caused by a variety of reasons. For example, a name and Social Security number listed on the tax return may not match the IRS records. You may have failed to sign the return or to include a necessary attachment, such as Form W-2, Wage and Tax Statement. Or you may have made math errors that require extra time for the IRS to correct.

To check the status of your Michigan refund, the easiest way to find out is to assess www.michigan.gov/treasury and click on the
“Check Your Income Tax Info” link, then login using your Social Security number and last name. To use this application you will need the tax year, your adjusted gross income, your filing status and the amount of the refund.

What are the standard mileage rates for 2009?
For tax years beginning in 2009, the allowable deductions for the standard mileage rate are as follows:

         • Business miles: The standard mileage rate for the cost of operating your car changes to 55 cents a mile
           for all business miles driven.
         • Charitable services: The standard mileage rate allowed for use of your car when you use your car to provide charitable
           services to a charitable organization is 14 cents a mile.
         • Medical reasons: The standard mileage rate allowed for use of your car for medical reasons is 24 cents a mile.
         • Moving: The standard mileage rate for determining moving expenses is 24 cents a mile.

What are the standard deduction amounts for 2009?
The standard deduction for taxpayers who do not itemize deductions on Schedule A of Form 1040 is, in most cases, higher for 2009 than it was for 2008. The amount depends on your filing status, whether you are 65 or older or blind, and whether an exemption can be claimed for you by another taxpayer. In addition to the annual increase due to inflation adjustments and the increase allowed for the deduction for certain real estate taxes and a net disaster loss, your 2009 standard deduction is increased by any state orlocal sales tax imposed on the purchase of a qualified motor vehicle in 2009 after February 16.  For details, see Deduction for Sales and Excise Taxes Imposed on Purchase of New Motor Vehicles.

The basic standard deduction amounts for 2009 are:
         • Head of household — $8,500
         • Married taxpayers filing jointly and qualifying widow(er)s — $11,400
         • Married taxpayers filing separately — $5,700
         • Single — $5,700

The standard deduction amount for an individual who may be claimed as a dependent by another taxpayer may not exceed the greater of $850 or the sum of $300 and the individual's earned income. 

      

Miles V. Schmidt, CPA, PLC
750 Front Ave., NW, Suite 315, Grand Rapids, MI  49504-4400
Phone: 616.742.0400 - Fax: 616.458.9848