Tax insights for readers of The Sturbridge Times Magazine


By Thomas A. Dubrey, CPA, MST


With tax filing season upon us, I wanted to share some hot issues that may impact you this year. In the tax preparer community, we have noticed a continuing focus by the IRS to enforce and discourage fraud while keeping people’s identities safe and allowing a smooth process for filing tax returns. These efforts have led to a number of procedural changes that may impact you in 2017 and beyond.

Credits for children and families
The child tax credit and earned income tax credit are intended to put money back in the pockets of working families with low to moderate income. These credits are refundable, meaning that they can reduce tax below zero, resulting in a refund greater than the actual tax that was paid in. As a result, these credits are prone to abuse. Tax preparers are now being required to retain proof of eligibility to claim the children that are being used to take the credits. To claim a child, the child must live with you, be under age 19 (or 24 if a full-time student) and you must provide over half of the child’s support. Children of divorced or unmarried parents can be claimed by the non-custodial parent if a written release or divorce decree grants permission. Once the money is released by the IRS, it is hard to get back. Returns are being delayed to allow the IRS more time to verify eligibility. Claiming a child who is not eligible will lead to penalties.

Education credits are being tested
The American Opportunity Tax Credit is a tax credit for qualified education expenses paid on behalf of a taxpayer or dependent. This credit can offset tax below zero resulting in a refundable credit similar to the child tax and earned income tax credits. Unfortunately, the form issued by the colleges usually displays the amount of qualified tuition and fees billed, not paid. This has led to taxpayers claiming credits for costs that were not actually paid during the tax year. Efforts are being made to require the colleges to change this practice, but ultimately the burden of proof of payment is on the taxpayer. Allowable payment methods include credit cards, cash, student loans or loans from relatives. Scholarships and grants are not considered payments. If this credit is reduced by the IRS, it may impact your ability to claim it again in a subsequent year.

Identity Theft is a new reality
Each year, we are seeing more clients impacted by identity theft and attempts to defraud. In some cases, the client files a tax return only to have it rejected because one was already filed by someone else. In other cases, people are being notified by financial institutions of service providers that there personally identifiable information may have been compromised. I have also had several clients report that they received a call from “The IRS” demanding money.

Accounting firms and tax software companies are being targeted daily by these attempts to steal information. Some ways to protect you include not providing information to anyone claiming to represent the IRS over the phone (the IRS will always send correspondence via US mail, not by phone), never open an email attachment from an unexpected e-mail and periodically check your credit report for suspicious activity. If you feel your tax information may have been compromised, contact a reputable tax return preparer to help you navigate the process of filing and claiming your refund.

A changing administration means tax laws are on the move
With the new administration in office, tax law changes are likely in the near future. Most tax law originates in the House of Representatives and must be approved by both the Senate and House. The law is ultimately signed by the President.

This process is a good illustration of our system of checks and balances that has served our country well for generations. Although it is too soon to tell what the changes will be, we will continue to watch legislation closely. For now, don’t forget that April 15th is right around the corner.

Thomas A. Dubrey, CPA, MST is a Certified Public Accountant and Managing Member of Dubrey, Culliton & Fanning, LLC serving families, small businesses and not-for-profit organizations in our community.

The Sturbridge Times


The Sturbridge Times Magazine has been publishing 11 issues a year, with no January issue, since July, 2007. Our parent company, Strategen Advertising, Inc., is a healthcare marketing firm specializing in medical practice development and marketing medical equipment. Our publication is unique in that it offers agency-quality advertising creative services to our local advertisers.

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Sturbridge, Massachusetts


Sturbridge, first settled in 1729, by settlers from Medfield, was officially incorporated in 1738. The town is situated with Route 20 ribboning through, and Interstate 90 (Mass Turnpike) and Interstate 84 (heading to Connecticut and beyond) meeting in town. In the 2000 census Sturbridge counted 7,837 residents in 3,066 households (34.2% of which had children under 18), with an average density of 89.1 per square mile. The median income for Sturbridge families was $64,455.


Places of Interest:

Sturbridge, located on Rt. 20, is a “living museum" that re-creates life in rural New England from 1790s to the 1830s

Old Sturbridge Village, located on Rt. 20, is a “living museum" that re-creates life in rural New England from 1790s to the 1830s.

Tantiusques is an open-space reservation and historic site here in town.

Wells State Park is a 1,400-acre (570 ha) woodland park and campground located on Rt. 49. The park includes 10 miles (16 km) of trails and Walker Pond, which offers a setting for fishing, canoeing, and swimming.


Sturbridge has become a dining destination for people who travel from Worcester and Hartford, with many popular dining establishments such as the famous Publick House, Cedar Street Grille and Avellino.