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In this issue:
Forms are being shipped
Don't forget to check your order! When you receive a shipment of tax forms or supplies, please open it immediately and check your order. Verify that we sent you the correct items and that there is nothing you forgot to order. Keep in mind that items are sometimes damaged in transit.
Forms and envelopes must be returned sealed and unused within 30 days, but no later than December 15th. Refunds do not include shipping charges.
Cancellation of Debt and TaxTools
Generally, cancellation of debt is considered income. This is true if the debt is either partially or completely forgiven through a mortgage workout, or if the loan ends up in foreclosure.
However, under the Mortgage Forgiveness Debt Relief Act of 2007, you may be able to exclude from tax up to $2 million of debt forgiven on your principal residence. The debt must have been home acquisition debt in order to qualify. In some cases other kinds of tax relief – based on insolvency, for example – may be available.
Two worksheets are included in CFS TaxTools that calculate the amount of COD income that may be excluded: Cancellation of Debt - Insolvency, which determines whether a taxpayer was insolvent prior to COD and how much of that COD that may be excluded, and Cancellation of Debt - Qualified Principal Residence Indebtedness, which determines how much COD can be excluded using the provisions in the Mortgage Relief Act. These two worksheets will assist the tax practitioner in determining if cancellation of debt income from either a foreclosure or a mortgage renegotiation can be excluded from income. TaxTools also includes Form 982, Reduction of Tax Attributes Due to a Discharge of Indebtedness. This form is used to report the cancellation of debt exclusion.
If you don't have TaxTools, click here to take advantage of our after-tax-season special and get TaxTools 2009 and TaxTools 2010 for the price of one year!
Coming soon: W2/1099 and Payroll Corrector 2009
Note: If you have already purchased and installed 941/940 2009, you do not need a CD or a full program download to install either W2/1099 or Payroll Corrector. Simply select "Update from the Web" from the "Internet Options" menu of Payroll System 2009, or download and install the update from our web site, here.
However, you must be sure to update your license code. We receive many calls from customers who receive an error message upon installing W2/1099 simply because they have not updated their license code. You can obtain your license code by logging in to your MyCFS account.
CFS Customer Service
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