The Internal Revenue Service is authorized to enter into written agreements with a taxpayer relating to the taxpayer's total tax liability or to specific issues affecting that tax liability for a specified period. These closing agreements may be used when there is an advantage in having a case closed or when the taxpayer shows a good reason for the agreement and the IRS concludes that there is no disadvantage to the government. In addition, the IRS may ask a taxpayer to enter into a closing agreement as a condition to the issuance of a letter ruling.
In deciding whether or not an individual has the ability to pay his or her delinquent federal income tax liability for the purpose of either an offer in compromise or an installment payment plan, the Internal Revenue Service looks at certain collection financial standards. These standards include both national and local allowances for the necessities of life.
If you are looking for a job, you may be entitled to a deduction for the costs of your search. However, you will only be able to take advantage of this tax benefit if you chose to itemize instead of taking a standard deduction. The deduction allowed would be the amount by which your job search expenses plus other miscellaneous deductions exceeds two percent of your adjusted gross income.
Generally, officers of a corporation are employees for employment tax purposes, and their compensation is wages. Thus, their wages are subject to Social Security, Medicare, and federal unemployment taxes along with withholding for federal income tax purposes. Only a corporate officer who does not perform any services or who performs only minor services and who neither receives nor is entitled to receive, either directly or indirectly, any compensation is not considered an employee.
If you work for yourself, you are usually required to pay a self-employment tax, which is a combination of Social Security and Medicare taxes. It is very much like the Social Security and Medicare taxes withheld from the wages of most employees.