WBIR:

Taxpayers and tax preparers are discovering that anyone who elected to have tax preparation fees deducted from their tax refund will not receive rebate checks via direct deposit.

The problem relates to funds being routed to the tax preparer's third-party bank.

UPDATE: Based on the additional information in comments and thinking about this a little further, the IRS is handling this exactly right.

What it boils down to is that some taxpayers, either by getting a refund loan or having preparation fees deducted from their refund, had the third-party preparer's bank account listed as their direct deposit bank, and the third party is then responsible for disbursing the funds to the taxpayer.

In the case of the "rebate," the third party preparer may not be setup to accept it or disburse it, so the IRS is doing the only other thing they can do which is to mail those taxpayers a check directly instead of depositing it in some tax preparer's bank account.

So this sounds like one of those "that's a feature, not a bug" situations, and the right thing to do.

UPDATE: This and other questions answered in a recently updated IRS Economic Stimulus Payments FAQ.

Isn't it surreal we have a two page form to file for income taxes that requires 88 pages of instructions and the possibilty of 39 or more additional forms?

Have you ever heard of the Life Cycle Series of publications? It is a list of 14 forms and publications your child may need from birth to childhood. How about Innocent Spouse Relief? Apparently, if your tax refund was kept by the IRS to pay off past due Federal tax, child support, or Federal non-tax debt, such as a student loan, and it was your spouse, not you, that incurred the debt, you too may file for part of the refund. Then there is the Tax Guide for Seniors. An additional 34 page publication with topics that are "of interest to older taxpayers".

No wonder all of those H&R BLock and Jackson Hewitt offices pop-up this time of year. One of my favorites is the Liberty Tax Service. Their walking billboards dressed as the Statue of Liberty certainly make me want to use their service.

I found this thread on the Seymour Herald site.

It seems to raise some questions about possible illegal or certainly unethical behavior of the County Mayor and those that he employs.

Some people sure know a lot. I wonder what else others might be able to turn up.

It seems that Knox County may not have the monopoly on questionable behavior by those charged with "working for the people."

An investigative reporter should jump on this. Could be a Pulitzer prize in the making!

Complete text of the Seymour Herald thread follows:

Well, this ain't right.....

Link...

When are we going to get it? The rest of the world is outpacing us on way too many fronts. America's decline has gone pretty much unoticed by the "entertained" masses, and lack of exposure to other cultures has made us almost as ignorant as last generation's poor family living alone on a mountaintop in rural America.

Read more...

This is pretty good. (By way of ACK.)

Today, being Tax Day, I thought I would get the thoughts here on the Fair Tax. I have read the book and studied it some. I think it would be a very good idea. Especially due to the fact that everyone would get the tax back on the "essentials" through a "prebate" check. I would likely cross party lines to vote for somebody who supported the Fair Tax (assuming they weren't completely opposite me on every other issue). Since this is a more liberal forum, what are the thoughts here on the Fair Tax?

Not that it has ever mattered much to us, we usually file a few days early, Income Taxes are due April 17th this year. Normally, income taxes would be due on April 16th, the 15th is on a Sunday. This year taxes are due one day later because there is a holiday in Washington, D.D., Emancipation Day.

According to my accountant, the Emancipation Day holiday in DC is when Lincoln declared slaves free in DC as a predecessor to freeing all slaves in the United States. Since this is a holiday in DC and the IRS offices are located in DC, IRS employees honor this holiday. Thus, you have one more day to file this year before deciding on an extension.

Also, according to the AP article, "Some 54 percent of tax filers say their returns are sent electronically, and that number is rapidly growing." We don't file electronically. Don't want to. Don't know if we could even if we wanted to. Who here files their Income Taxes electronically? Use the poll to register your response.

A national tax preparation service has been targeted by the IRS and the Justice Department for filing fraudulent returns:

The government said Tuesday it is trying to shut down more than 125 Jackson Hewitt tax preparation stores in four states for systematic "tax-fraud schemes."

The Justice Department accuses the franchises of bilking the government out of more than $70 million through fraudulent practices such as using phony W-2 forms, bogus deductions and fuel tax credits and false claims regarding the earned income tax credit.

Jackson Hewitt Tax Services Inc. is the nation's second largest tax preparer. The franchises were either totally or partially owned by Farrukh Sohail, the Justice Department said, and involved "a pervasive and massive series of tax-fraud schemes," according to court filings.

Based on where the suits were filed, it appears the franchisee operates in Illinois, Michigan, Georgia, and North Carolina.

(The company has offices in Knoxville, Maryville, and Alcoa, but they do not appear to be affected and it is not clear if they are franchises or company owned stores.)

Jackson Hewitt responds in this press release:

The complaints announced today by the Department of Justice are limited to one franchisee, whose entities noted in the complaints operate more than 125 locations out of more than 6,500 Jackson Hewitt locations nationwide. The Company estimates that these entities represent about two percent of its total revenue. We do not believe that this matter is likely to have a material adverse effect on our financial position.

While we cannot comment on franchisee litigation, Jackson Hewitt takes such matters seriously. The Company expects its franchisees, which independently own and operate their businesses, to comply with the terms of their franchise agreements. Accordingly, they are responsible for conducting their operations with integrity, in compliance with all applicable laws and regulations.

Jackson Hewitt remains committed to providing accurate, quality tax preparation and the highest levels of customer service. Comprised of a network of thousands of tax preparers, and franchisees nationwide, the Jackson Hewitt system values its relationship with its customers and continues to assist them with their upcoming income tax filing requirements.

What a mess. The company's stock was down over 18% yesterday.

It's interesting (and somewhat disturbing) how the ripple effect of bad PR related to one franchisee can affect the company, their shareholders, other franchisees who could likely be small business people with everything they own tied up in their franchise, not to mention consumer confidence in the company and its services.

An open letter to Mayor Larry Waters and the Sevier County Commission.

Several articles have been written in the past couple of years regarding the lack of funding for infrastructure needs in Sevier County. A TACIR report states that Sevier County is short by approximately $300 million. A bond issuance was recently passed. Schools lack needed funds. A new hospital needs to be built.

I have attended commission meetings, planning commission meetings and have hosted Mayor Waters at a Friends of Wears Valley meeting. Citizens have repeatedly been told by county leaders that development / developers projects do not create additional burdens on infrastructure because 1. Rental cabins are not used full time. 2. Renters do not send their children to our schools. 3. Additional tax moneys collected on sales to tourists more than offset the burden they place on our system.

More after the jump...