May 21, 2013

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Get Free IRS Tax Information by Connecting with the IRS on Social Media

March 12, 2013 By

Are you connected with Uncle Sam on social media? Well, some taxpayers are uncomfortable with the idea of following or liking the IRS’s Facebook and Twitter pages or even watching their YouTube videos. Some compare this to granting a stalker an express pass to your bedroom and uncover some personal secrets within the walls of your house. Are these fears justified? The answer is no; you really don’t have to shy away from being “social” with the IRS on social networking sites.

The IRS uses a number of technological solutions to enable taxpayers find access to significant tax information like changes in the tax code, new initiatives, services, and products. It has gone ahead and even developed very effective tax apps that have made acquisition of tax information a breeze.

IRS2Go: Most Americans own smart phones, some have more than one. As a result, there has been swelling demand for solution-driven apps that can simplify the otherwise complicated things in life. In the same spirit, the IRS designed the IRS2Go, a smartphone app that lets you get tax updates on the go, check your refund status with just a click and follow the IRS on Twitter. You can find the app in the Apple App store for use on iPhone or iPod device and GooglePlay store for use on Android devices.

YouTube Videos: The IRS posts short but very enlightening videos on its YouTube channel on an array of tax-related topics. Other than English, these videos are also available in Spanish and American Sign Language.

Twitter: Get tax-related announcements, news for tax pros, and job seekers’ updates by following the IRS on Twitter. The Twitter username is @IRSnews.

Facebook: You can also access tax-related information for individuals, tax pros and other tax issues by liking their Facebook pages. Furthermore, get some general tax information on these pages, but ensure that you don’t post personal details on social media.

Audios and Podcasts: The audio recordings are typically short on specific tax-related topics. They can be found on iTunes or Multimedia Center on the IRS website.

Widgets: These tools can be placed on blogs, websites or social networking sites to direct people to the IRS website.

CAUTION: The IRS mainly uses the discussed tools to better their service delivery. Therefore, you must not at any point, divulge personal data, like your Social Security Number, on social media. Personal tax or account-related questions cannot be answered on these platforms. Instead, channel them directly to the IRS officers or visit their website.

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Crucial Facts about Capital Gains and Losses

June 22, 2012 By

A capital asset is what you posses and use; be it for commercial or private purposes. Homes, household furniture, bonds and stocks in personal accounts are all considered as capital assets. On opting to sell them, you either incur a capital gain or loss, depending on the purchasing and selling price differences.

Capital assets can have an effect on your income tax returns in various ways. Listed below are some specifics about capital losses and profits from the IRS’s perspective and how your returns are affected by them.

To begin with, anything you own and use for private reasons, investment or even pleasure is considered as a capital asset, which when sold can result in a loss or a gain. Please note that all profits realized have to be reported to the IRS. Capital losses are only deductable on venture assets and not any other assets held solely for private use.

Depending on the length of time capital investments are held before they are sold for cash, the capital gains and losses are either categorized as long or short-term. When you hold assets for over a year before selling, the profits are long-term profits or losses while short-term profits or losses being when the asset is held for 12 months or less or less. When long-term losses are exceeded by gains, a net capital gain is recorded to the amount which the net long-term capital profit exceeds your short-term capital loss, that is, if you have any.

The tax rates that apply to other incomes are lower than those on net capital gains. In 2010 for example, most people had a 15% maximum capital profits rate. Furthermore, some lower-income people can have a 0% rate or their total capital profits. Furthermore, there are some net capital gains taxed that are taxed at a 28% or 25% rate.

Individuals whose capital losses surpass gains can have the extra subtracted from their tax returns and used to reduce other expenses like wages. This is however limited to a $3,000 annually or $1,500 for married individuals who file their returns separately.

In case a taxpayer’s net capital loss is more than the limit for capital loss deductions, the value that is not consumed can be moved forward to the following year and handled as if it was incurred in that very year. The capital loss and gains are documented on Schedule D and line 13 of Form 1040.

For additional information on how to report capital gains and losses, read instructions on Schedule D. Alternatively, read Publication 17 titled “Your Federal Income Tax” or Investment Income and Expenses as described in Publication 550.

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Take Advantage of the New Estate Tax Law and get Tax Relief

September 20, 2011 By

Estate Tax Law

In December 2010, Congress passed a law that increased the limit of the tax-free wealth that can be transferred by an individual to heirs from $2 million to $5 million. This is an increase of 150% and is significant to any U.S. citizen who has that kind of wealth and is willing to transfer it to his or her children or other beneficiaries. However, this law does not only benefit wealthy individuals. Couples can now take advantage of the new law to plan on their wealth so as to save on taxes. Below are some considerations when making such plans:

Transfer within Spouses

According to the law, an individual can give or transfer wealth to their spouse without paying any taxes. There is no cap to the amount that can be transferred. In essence, this means that a married couple has a tax free limit of $10 million ($5 million for each spouse) to transfer to beneficiaries under the revised Estate Law.

Transfer of Lifetime Limit to Surviving Spouse

Another adjustment that was made to the Estate law was that a surviving spouse could inherit the tax free limit of the departed spouse. In other words, any non utilized limit of the spouse that dies is transferable to the surviving spouse. For example, if a married couple had not utilized any of their tax free limit for estate transfers and one of the spouses dies, the surviving spouse would inherit the unused limit of the deceased spouse and therefore have a limit of $10 million to transfer to children or other heirs. However, if the second spouse died, the only amount of wealth that would be transferred tax free to the heirs would be within the limit of the second spouse, and not both spouses. The law only allows a tax free transfer of the “basic exclusion” upon death, which means the limit of only the person who has died. Any transferred limit is therefore lost.

Using Trust Accounts to Bypass the Law

However, to avoid the surviving spouse losing the tax free limit of the dead spouse once he or she dies, estate lawyers are now setting up family trusts to bypass this law limitation. This is how the trust works: the surviving spouse transfers funds to a family trust to the limit of the tax free balance of the spouse who has passed on. The revenues from the trust are paid to the surviving family members. Once the second spouse dies, wealth within his or her tax free limit can then be transferred either directly to the heirs or to the trust. The wealth that was originally in the trust will not be considered again for the tax free limit as it was transferred to the trust under the limit of the first spouse to die.

Time-line for Estate Law

When setting up trusts and taking advantage of the new limits for the adjusted Estate law, you need to be aware that this law is temporary. The $5 million limit is set to expire in 2012, therefore, reverting back to the former $2 million limit. The rule of transferring the limit of a dead spouse to the surviving spouse will also expire in 2012. However, with the current mood of politicians, it can be projected that that the limit-transfer rule may remain effective post 2012. President Obama has personally vouched to keep this rule beyond its expiration time. Besides this, this rule has become very popular and has gotten a lot of support and experts foresee it becoming permanent in the tax books.

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IRS Help: What to do when contacted by the IRS Criminal Investigation Division

September 8, 2011 By

The IRS implements a meticulous system that seeks to identify all tax offenders. The IRS categorizes tax offenses in two categories. Negligence is when a taxpayer makes an error either by having erroneous figures or mathematical calculations in their tax returns or erroneously misses various entries while filing. Negligence is seen as not being willful in the discrepancies in figures and the IRS only seeks civil charges against those who are negligent. On the other hand, fraudulence involves outright cheating on your taxes. This is a willful act of defrauding the IRS to avoid paying due taxes. This includes crimes such as having two sets of accounting records for fraud purposes, forging receipts and other documentation, altering figures in various tax records, and not filing a tax return with no valid reason. For such crimes, the IRS pursues both civil and criminal charges.

According to an analysis by the IRS, 17% of taxpayers cheat on their tax returns. The main culprits are employment occupations, businesses that are cash intensive, and service industry workers. This includes bar waitresses, lawyers, doctors, construction workers, domestic workers, and way-side shops. However, the IRS prosecutes very few tax cheats. In a recent tax year, the IRS charged 2,472 taxpayers for criminal offenses, which accounted for only 0.002% of taxpayers. However, these statistics should never be an incentive to cheat on your taxes. The IRS is actively increasing its audits to track down and pursue both negligent and fraudulent taxpayers. 2010 statistics show that the IRS has increased audits in all taxpayer groups. Furthermore, when the ax falls your way, the consequences are really not worth the risks on lying on your returns.

Criminal investigations conducted by the IRS are handled by the IRS Investigations Department. The department has special agents who investigate various potential tax cheats and prosecute taxpayers once they have enough evidence to build a case. If you are ever contacted by one of these special agents, you should be aware that you are being investigated for criminal charges. Here is what to do if you find yourself in such a situation:

  • Ask for Identification – If you are approached by an individual or team of people claiming to be special agents from the IRS Investigations Department, you should ask them for a business card or identification. If the contact is on email or telephone, do not divulge any information whatsoever to them. There are many identity theft scams that are circulating and their aim is to steal your information for malicious use. Besides this, receiving a business card is good for future reference when contacting or referring to the IRS agent assigned to your case.
  • Do Not Answer Questions – After they identify themselves and give you a business card, ensure that you do not give any information about your taxes. The Fifth Amendment in the U.S. Constitution gives you a right to not bear witness against yourself in a criminal case. This means that the agents have no right to get you to talk in any way, concerning your taxes or any other matter that may incriminate you.
  • Beware of the Witness Trap – You should also be careful about the witness trap. The IRS Investigations Department special agents will usually tell you that they are not investigating you but rather, they want you to be a witness in a case. Once they gather enough evidence, they then seek criminal charges against you. Therefore, even if they tell you that they are not investigating you, do not give them any information.
  • Seek Legal Counsel – Next, you should consider seeking legal counsel to get help on how to handle the situation. Your attorney will advise you on what to do and he or she will represent you in criminal claims for your IRS problems.

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IRS Payment Options if you are Unable to Pay Taxes Due

September 2, 2011 By

If you find yourself in a situation where you are unable to meet your due taxes before the tax deadline, do not despair. There are available options that you can take advantage of to ensure that you do not agitate Uncle Sam. Here is what to do if you find yourself in such a situation:

File a Tax Return

Ensure that you file a tax return, even if you are unable to pay off the due taxes immediately. There are worse consequences if you do not file the return. Not filing amounts to more tax troubles and may even surmount to criminal implications.

Consider Various Options for Paying your Due Taxes

Once you have filed your tax returns, you need to plan on how you will pay the taxes due. Depending on the amount of taxes that are owed, you may consider the following options for delayed payments:

  • Request for Short Delay – If you will have the funds to pay the taxes within 120 days, then you may call the toll-free IRS number and request for a short delay. The IRS customer service representatives handling such issues are permitted to make an interest and penalty free extension of up to 120 days if you provide a good reason for the delay.
  • Installment Agreement – If the amount you owe is below $25,000.00 and you are not able to pay it all in one lump-sum, you can apply for an installment agreement under the Online Payment Agreement service available on the IRS website. You can also call the toll-free IRS number to set up this installment agreement. The installment agreement is automatic for any taxpayer who owes below $25,000.00 and you can determine the installments to pay as long as you will repay within the required period. This installment agreement also has an extra advantage – you will not be requested to provide financial statements or any further paperwork. However, you will need to pay interest on the taxes due and late payment penalties. The interest rate for tax debt to the IRS is currently at 4% and is subject to change every three months. The late fee is currently 0.25% for Installment Agreements and 0.5% for tax debts outside IRS payment agreements.
  • Consider Borrowing – You can also consider taking a loan to clear your due taxes. However, you will need to compare the amount to pay if you took up a loan against making late payments through installments. Depending on your loan terms, you can check if the loan interest will amount to more than what the IRS will charge in interest and lateness fees. If the loan interest rate is less than that of the IRS’s deal, then it would be advisable to take the loan and pay off your taxes. However, if it is cheaper to take the IRS Installment Agreement, you should not be hesitant as there is no recourse to taking the agreement.
  • Prioritize Between State and Federal Taxes – If you owe both Federal taxes and State taxes, you should also do a comparison of the charges to be levied if you are late on either of the taxes. You can then pay off the taxes that bear more charges in interest and late fees and place an installment agreement with the tax authority with lower charges.
  • Seek Professional Help – If you owe over $25,000.00 or are still unsure about how to handle your tax dilemma, you may consider seeking help from a tax professional on what to do regarding which option to select.

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Top 10 IRS Tax Deductions and Tax Credits in 2011

September 1, 2011 By

The 2012 April tax season that accounts for the 2011 tax year may seem far and most taxpayers may not be overly concerned with their taxes at the moment. However, being conscious of tax matters as the year goes by ensures that you not only have a smooth tax time as you draw close to the next tax season, but also capitalize on the available tax opportunities. The major way in which taxpayers get tax savings from their returns is through tax credits and tax deductions. Below are 10 of the most common tax deductions and credits that you may qualify for in the 2011 tax year.

1. Charity Donations

Donations are the easiest and one of the most common tax deductions. The tax code allows for a tax deduction of donations made to any qualifying tax-exempt organization. In 2011, the IRS released a list of the organizations that had lost their tax exempt status due to non compliance with various regulations. A taxpayer therefore, needs to verify that an organization is qualified as tax exempt to be able to qualify for the tax deduction. For donations above $250.00, you will need an acknowledgment from the organization that you have donated to as support documentation for the tax deduction. For non-cash contributions above $500.00, you will need to file Form 8283, “Non-cash Charitable Contributions Form”. Non-cash items that are above a given threshold will also require a valuation from a qualified appraiser.

2. Child Care Tax Credit

The Child Care Credit is given to parents or guardians who spend money to have their children or qualifying dependents taken care of while they are out working. The credit can be claimed for regular child care or even for a summer day-camp. The amount to claim depends on one’s income and the number of children. The allowed credit ranges from 20% to 35% of one’s income. The credit also has an annual cap of $3,000.00 for a single child and $6,000.00 for more than one child.

3. Mortgage Interest

The mortgage interest tax deduction allows homeowners who are paying for a mortgage to claim a deduction on the mortgage interest paid on their primary residence and qualifying second home. Various rules govern the qualification of primary residence and second home and you will need to ensure that your homes qualify before deducting these expenses. Besides mortgage interest, you can also deduct the real estate taxes paid on non-business property.

4. Medical Expenses

Various medical expenses can be tax deductible for taxpayers who choose to itemize their tax deductions. The qualifying deductions are subject to a threshold of the excess of 7.5% of one’s Adjusted Gross Income. The expenses include travel related to medical care, out-of-pocket medical expenses, and health insurance premiums. For out-of-pocket expenses, there are various items that qualify and you can get a comprehensive list of qualifying medical expenses from the IRS website.

5. Health Savings Account

Contributions to a Health Savings Account (HSA) are also tax deductible. However, the HSA must be a qualify one for the tax deduction. Interests earned from the account are also not taxable. However, for a HSA to qualify, it must be a high-deductible health plan.

6. Work Related Expenses

There are various work related expenses that are IRS tax deductible. Various training expenses, business travel (excluding travel from home to the office), qualifying work uniforms and work clothing, and qualifying entertainment expenses for potential clients are tax deductible, subject to various IRS rules. These expenses only qualify for deductions if they were not reimbursed by the employer.

7. Home Offices

For people who work from their homes, they can deduct various home expenses that are related to their home office. You will need to determine and apportion the home expenses that are attributed to the home office to deduct the costs. The expenses include rent, insurance, mortgage, repairs and maintenance, other related utilities, and depreciation.

8. Qualifying Retirement Savings

Contributions to various qualifying retirement accounts such as 401(k) accounts and IRAs are also tax deductible. For the 2011 tax year, the cap on the contributions to these retirement accounts is $16,500.00. For senior citizens above the age of 50, the tax exempt limit goes up to $37,500.00.

9. Education Expenses

The tax code also allows for tax deduction of various education-related expenses. For the 2011 tax year, there is a cap of $4,000.00 for tax deductions of tuition-related expenses. You can also claim the American Opportunity Tax Credit if you qualify for it.

10. Student Loans

Interest paid on student loans is also tax deductible subject to an annual cap of $2,500.00. This applies only to the interest and not the principal. However, to qualify for this tax deduction, you must be earning an income of less than $70,000.00 for single taxpayers or $145,000.00 for married taxpayers who file their taxes jointly.

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Filing Federal Income Tax is Getting Easier – and it’s Free

August 24, 2011 By

The IRS is making it easier for taxpayers to file their federal income tax returns. This year, you may be able to file your 2010 taxes using free tax software directly through the IRS website.

If you made $58,000 or less in 2010 in taxable income, you will definitely be able to find tax software that you can use on the IRS website. The software is available to certain taxpayers, depending on income, state of residency, and age. You will find the software at http://www.irs.gov/freefile. Some filing options are also available in Spanish.

Once you select which third party company you want to use, you will be directed away from the IRS website and to that company’s website. There, each software program has step-by-step processes to follow to complete your tax return. The software will ask you questions to qualify you for the appropriate tax form, which it retrieves for you to fill out. It will also help you find some tax breaks, such as the popular Earned Income Tax Credit.

98% of Free File users have been satisfied with the product and recommend its use to others. 30 million tax payers have used Free File since 2003. If you combine Free File with direct deposit, you may receive your return in as few as 10 days!

Free File uses secure technology to protect taxpayer information. If you make more than $58,000 or are comfortable filling out the forms on your own without the assistance of tax software, the IRS offers Free Fillable Forms. These forms, also available at http://www.irs.gov/freefile, do not come with software assistance, but do basic math calculations. While some Free File software companies offer state tax return assistance, Free Fillable Forms do not. However, e-filing with this method is free and suits the do-it-yourself taxpayer who prefers paper tax filing.

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IRS Removes Controversial Two Year Limitation on Innocent Spouse Relief

August 23, 2011 By

The IRS has made a historic removal of a two year limitation rule the Innocent Spouse Relief starting July 2011. This removal of the 2-year rule applies for most qualifying taxpayers seeking to get protection under the relief. Prior to this tax code change, those seeking to be relieved from tax obligations through the Innocent Spouse Relief had to do so within two years from when the IRS contacted the spouses for collection. In practice, many spouses who were innocent to the tax liability because they were either unaware of the due taxes or were in abusive marriages (and could not refuse signing because of duress or pressured influence) could not qualify for relief because of the time limitation. One reason for this is that if the IRS contacted the “guilty” spouse for collection, he or she may conceal this from the other “innocent” spouse and thus, the innocent spouse would remain unaware of the collection process. When the “innocent spouse” finally becomes notified of the back taxes being collected, often times, it would be past the two year time limit and therefore, too late to claim the relief. However, with the removal of the 2-year time limit, many innocent spouse will now get their relief with no time constraints.

Time Limit Still Applies for Some

The IRS however, maintained that the two year rule will still apply for spouses who became aware of the IRS collection within the two year time frame and did not take any action. This rule however, will not apply for any spouse who is or was in an abusive marriage.

About Innocent Spouse Relief

The Innocent Spouse Relief is a tax relief provided to spouses who file taxes jointly with their partner. The current rules for the relief were introduced into the tax code in 2002. According to the tax code, when a couple files taxes jointly, they are both held responsible for the information in the tax return and should an issue arise from the tax return, they are both held liable individually (and the IRS can collect the back taxes from either or both of the spouses). However, under the Innocent Spouse Relief, if a spouse is unaware of false information claimed on the tax return (and the IRS discovers the false information in the returns), the spouse can be absolved from the consequential tax liability that may arise. The innocent spouse will need to file IRS Form 8857- “Request for Innocent Spouse Relief Form” and provide an explanation of their innocence in the tax liability. If there is enough evidence to show that the spouse could have been unaware of the due taxes or forced to sign the tax returns against his or her will, the IRS will relieve the spouse of the taxes due.

The Scope of the Relief

The IRS receives on average about 50,000 Innocent Spouse Relief applications every year. They however, reject close to 2,000 applications for the lapsing of the two year limitation. However, with this new inclusion to the tax code, many of these victims will now receive justice and get the relief. The IRS has stated that this new rule will take effect immediately and any cases that are still under review will now be considered under this new rule. Any spouse who had been denied the relief because of the time limitation prior to the announcement can now reapply for the relief.

Action towards Removal of the Time Limitation

The removal of the time limitation on the Innocent Spouse Relief came after a spirited campaign by politicians and activist groups. The opponents of the former two year rule argued that the limitation cut off many innocent spouses from getting justice. Earlier in 2011, a group of House Democrats wrote a letter to the IRS commissioner, seeking the IRS remove the two year time limit. This followed many debates and discussions on Capitol Hill and the media that sort to have the IRS remove this rule. After all of these tremendous efforts, the changes have come as a welcome relief to many.

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IRS Taxes that Affect Land Ownership

August 22, 2011 By

Various land related expenses are treated differently depending on the use of the land and whether the land is improved or unimproved. These expenses include land rates, association fees, and other land maintenance expenses.

Unimproved land

In taxation terms, improved land is land that has a structure on it, such as a building. A piece of land is considered unimproved if it has no buildings on it, even if you bring in utilities such as water, electricity, fencing, and/or a sewage system. As long as there is no structures that can be used for economic purposes or personal housing, it is considered unimproved. For unimproved investment property land, one cannot deduct ongoing expenses. However, you may add the cost of the various one-off capital expenses that you apply to the land to the value of the land and depreciate it if it is an investment property (as opposed to a personal property). If it is personal property, you can add the amount of such expenses used to improve the land to the cost of the land, which will increase your cost price of the property if you were to ever sell it. This way, the capital gain on the property will be lowered and you will consequently pay less in capital gain IRS taxes.

Improved Land

Improved land is land that gives you some utility in one form or another. You may have a personal home on the land or some rental or investment property. If it is an investment property, then the land rates and land expenses are an allowable business expenses and are therefore, deductible for tax purposes every year that the expenses are incurred. Most of the land-servicing-expenses are not deductible for personal-use land.

Investment Property Land

For investment property, any association and property maintenance expenses are tax deductible. The details of qualifications of these deductible expenses are contained in the Internal Revenue Code Section 212. These expenses are a miscellaneous itemized deduction and therefore, follow the rules of itemized deductions. This means that you must add all itemized expenses and subtract 7.5% of your Adjusted Gross Income before deduction. You also cannot deduct this through itemized deductions if you are under the Alternative Minimum Tax (AMT). However, for those under the AMT and for those who do not itemize deductions, you can still add these expenses to the cost of the land so as to reduce on the capital gains (in case you ever sell the land). This option is called, capitalizing carrying charges, and is a choice available for those with an investment property. However, if the investment property is unimproved, you can only capitalize the carrying charges for only one year. If you opt to capitalize the charges, you will need to attach a statement to your tax return form explaining the expenses that you are capitalizing in the year you choose to do so.

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Claiming Qualified Long Term Care Expenses as Medical Tax Relief and Deduction

August 19, 2011 By

Under the Federal tax code, long-term care services provided for medical reasons are an allowable expense to deduct. However, according to Sec. 7702B(c)(1) of the Federal law, a licensed physician must prescribe such care as being fundamental for the well-being of the patient. Long-term care deductions allows for people who have chronic diseases and conditions of incapacitation to receive long-term care, including an attending nurse or caretaker, without paying taxes for such services. There are various rules and qualification guidelines that govern the application of this IRS tax deduction.

Qualification Requirements

The long-term medical care can only be claimed by taxpayers who itemize their tax deductions as opposed to using standard deductions. You therefore, need to use the right Form 1040 to benefit from these long-term care expenses and have them deducted. The expenses also need to have support documentation. The person claiming the deduction must maintain the doctor’s statement that prescribed the long-term care, including the diagnosis of the medical condition. Besides the doctor’s statement, one also needs to keep the receipts or payment vouchers for such medical care. All other tax requirements, including withholding of taxes for any employees involved in the long-term care, need to be adhered to.

Itemized Deduction

Itemizing of tax deductions is more complex than taking the standard deductions route. A taxpayer itemizing deductions needs to schedule all the tax-deductible medical expenses that need to be itemized and determine if the expenses exceed 7.5% of his or her Adjusted Gross Income (AGI). Therefore, for itemized expenses to qualify for deduction, a taxpayer must have above this 7.5% threshold in total medical expenses. There is however, no cap or maximum for these itemized deductions.

Case in Point – IRS vs. Estate of Baral

In some instances, the IRS has differed views with taxpayers on what qualifies as long-term care as prescribed by a physician. This was the case for Lillian Baral, who had been diagnosed with dementia. The doctor recommended long-term care and Baral’s brother, who was her financial trustee, employed two caretakers to attend to her. The condition of her illness deteriorated her mental and physical capacity and she finally succumbed to her infirmity in 2008. Due to her condition, she did not manage to file a return in 2008 for the 2007 tax year. Since no tax return was filed, the IRS decided to use their estimate and determined that she had earned incomes of $94,229.00 and had underpaid taxes by $17,681.00. However, in their calculations, the IRS did not allow for the inclusion of her long-term care expense – Baral’s brother had paid $49,580.00 to the caretakers and had also reimbursed expenses of $5,566.00.

The issue was referred to a tax court to determine if the IRS was just in their actions. In the ruling, the court held that the wage payments to the caretakers qualified as long-term care for tax purposes and that the IRS was out of order to have these expenses excluded for tax deductions. The court however, held that the reimbursed expenses could not pass for the deductible of long-term care expenses as there were no receipts (support documentation) to support these expenses.

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