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Georgia Tax Information

If you received an assessment notice from the Georgia Department of Revenue don’t panic. The DOR has announced that assessment notices, some of which dated back numerous years, were issued to taxpayers during transition to a new integrated tax system (ITS). When historical data was entered into the new system, notices were automatically generated for accounts showing historical liabilities. Generally, the notices are for period in which the DOR did not receive a tax return, even though there may be no tax owed. The Department will use "appropriate discretion" in working with the taxpayer to resolve this issue.

GEORGIA EDUCATION CREDIT – Your generosity may pay off
For tax years beginning on or after January 1, 2008, a credit is available against personal income tax for "qualified education expenses". "Qualified education expenses" are an expenditure of funds donated by the taxpayer to student scholarship organizations, which are 501(c)(3) nonprofits that distribute at least 90% of their revenues for scholarships or tuition grants to allow students to attend qualified nonpublic schools. The amount of credit is up to $1,000 (for a single taxpayer or head of household) or up to $2,500 (for a married couple filing a joint return). A corporation can claim a credit for qualified education expenses up to 75% of its income tax liability. From a strictly economic standpoint, it is cheaper to pay your State income tax and take a deduction for the tax paid – if you can. There can be AMT limitations. However, if you are planning to make a donation to a student scholarship organization anyway, you are much better off using the donation as a credit against state taxes.

SALES TAX – You may be paying more
Pending completion of technology requirements, Georgia will become an associate member of the Streamlined Sales Tax Agreement (SSTA) on January 1, 2011. The SSTAs purpose is to encourage all vendors, whether internet or “brick and mortar”, to collect and remit sales tax on customers living in the Streamlined States (there are 44 participating states). The purpose is to level the playing field between internet stores and traditional stores. Currently, internet stores do not typically collect sales tax on out-of-state sales giving them a price advantage. 15 of the participating states are full members, meaning they have met all requirements through laws, regulations, rules, and policies. Associate members are either in majority compliance or are scheduled to be in compliance with SST rules.

Related Tax Information




About the Author - Rusty Hopkins
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