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October 31, 2024
For many businesses, one of the biggest year-end tasks is sending and filing 1099 forms by the January 31st deadline. Depending on how many contractors your business has used this year, and how organized you’ve been about keeping good records, 1099 requirements can become a big project that you don’t want to leave until the […]
September 18, 2024
The IRS is taking steps to bring more clarity and compliance to digital asset reporting by releasing the draft Form 1099-DA. Set to be used by brokers to report certain sale and exchange transactions starting in 2025, this form aims to simplify tax reporting for digital assets and enhance transparency in an often opaque market. […]
July 10, 2024
Converting a Limited Liability Company (LLC) to an S-Corporation (S-Corp) can offer several advantages for business owners, including tax savings. However, before you make any permanent changes, you’ll need a careful understanding of the legal and financial implications. In this article, we’ll explore the key aspects of converting an LLC to an S-Corp, including the […]
April 24, 2024
Were you self-employed in 2020 or 2021 and had to miss work due to COVID-19? Perhaps you were sick or had to take care of a child or family member. If so, you may be eligible to claim tax credits. If you’re self-employed or part of the gig economy, you’ve likely been bombarded with ads […]
April 17, 2024
Today’s interconnected world has opened the windows of the World Wide Web to allow businesses to collaborate with talent from across the globe. If you’re a U.S. employer engaging foreign contractors, you need to ensure the proper completion of Form W-8BEN: the Certificate of Foreign Status of Beneficial Owners for United States Tax Withholding and […]
January 27, 2024
Hiring independent contractors for your business can reduce paperwork and tax payments, but it does require using 1099 forms for reporting purposes. There are numerous 1099s to report different types of non-employment income to the IRS during the tax year. In this quick cheat sheet, we’ll break down the differences between Forms 1099-MISC and 1099-NEC […]
January 18, 2024
Don’t forget: some big changes are coming for anyone earning more than $600 through a third-party settlement organization (TPSO). Whether you’ve generated income from Etsy, Airbnb, eBay, VRBO, Uber, or Amazon, you can soon expect to receive a Form 1099-K, which is also filed with the IRS. So, is 1099-K income taxable? And how will […]
January 10, 2024
In a significant move aimed at alleviating the financial burden on taxpayers, the Internal Revenue Service (IRS) has announced a waiver of nearly $1 billion in late-payment penalties for millions of individuals, businesses, trusts, estates, and tax-exempt organizations that were not sent automated collection reminder notices during the pandemic. Understanding the tax relief measures The […]
July 5, 2023
Caring for an elderly parent or adult dependent can be emotionally and financially burdensome. According to a study by AARP, caregivers spend an average of $7,242 per year on caregiving expenses. Thankfully, there are tax breaks available to help offset the cost of elder care. The name of the Child and Dependent Care Credit is […]
February 1, 2023
If you’ve been going to town (literally) on business meals and entertainment expenses for the last two years, you may need to start second-guessing some of those starters as deduction percentages have decreased to pre-COVID levels for 2023. The Consolidated Appropriations Act of 2021, signed by the President on December 27, 2020, made changes to […]
January 31, 2023
Over the last few decades, the foreign affairs of U.S. citizens have come under increasing levels of government scrutiny. On November 4, 2022, the IRS issued a new draft set of instructions for an S-corporation’s 2022 Schedules K-2 and K-3; instructions for partnerships followed on December 23, 2022. The IRS finalized these instructions for 2022 […]
September 20, 2022
The Inflation Reduction Act of 2022 was signed into law by President Biden on August 16, 2022. In addition to new taxes and credits, the Act directs $80 billion to the Internal Revenue Service (IRS). In this blog post, we summarize the Act’s tax revenue provisions, tax credits and deductions, IRS provisions, and how your […]
June 7, 2022
All too often, we see people missing out on great tax-saving opportunities because they simply don’t know about them. And with tax laws changing every year, it’s not always easy to keep up with the latest tax deductions, credits, and exemptions. Our list of frequently missed tax breaks may help you uncover money-saving opportunities this […]
May 10, 2022
“Join me in inviting @elonmusk to move @Twitter to the freest state in the nation! Florida would benefit the company as a whole—we have no state income tax and the perfect business climate. It’s time to book a one-way ticket,” said Florida CFO Jimmy Patronis in a tweet after it was announced that Elon Musk […]
April 26, 2022
Last week’s blog covered some of the 2022 tax changes that may cause your tax situation to be quite different than it was in 2021. Here are some additional changes that may impact your return for the next filing season. Standard Mileage Rates Mileage Type 2021 2022 Standard mileage rate for business driving/mile 56¢ 58.5¢ […]
April 21, 2022
Although filing your 2021 tax return may still be top of mind, there’s no better time to start planning for the tax changes coming in 2022. Every year brings with it a long list of tax law changes that can affect your bottom line, so it’s important to familiarize yourself with what’s new and what’s […]
January 13, 2022
The advance monthly payments of the Child Tax Credit ended in 2021, and the IRS has begun sending out letters to taxpayers who received monthly payments that indicate how much each individual received, as well as the number of children on which the credit amount was based. The expanded child tax credit will not continue […]
October 11, 2021
Why is it so important to get Form 8879 back to your tax preparer? If you have used a CPA firm or other tax preparer to file your taxes in the past decade, you’ve been required to complete a form authorizing the preparer to electronically submit your return on your behalf. Failing to submit that […]
June 17, 2021
The $1.9 trillion American Rescue Plan that passed earlier this year expanded the Child Tax Credit, an initiative aimed at putting money in the pockets of families. If you have children, expect to see a letter in your mailbox from the IRS soon regarding the schedule for advance payments of the Child Tax Credit. Here […]
December 9, 2020
Whether you file your taxes yourself or work with a preparer, it’s absolutely critical to protect your personal information. Before you enter your Social Security number, review these 6 tips to help you protect your identity online. 1. Get an Identity Protection PIN from the IRS Starting January 2021, the IRS is expanding its Identity […]
October 21, 2020
The vast majority of businesses have depreciable assets: company property, buildings, equipment, vehicles, etc. Because they are used for business purposes, claiming depreciation of these assets helps to reduce the taxable income of the business. As is the case any time you wade into the murky waters of tax, the IRS is always on the […]
August 20, 2020
Scammers never let an opportunity go to waste, and the COVID-19 pandemic has introduced new ways for bad actors to prey on the vulnerable and scared in the form of IRS scams. Criminals are already attempting to steal money and personal information under the guise of coronavirus tax relief. The IRS recently released their “Dirty […]
August 30, 2019
As the summer winds down, the IRS is gearing up for fall tax deadlines, year-end matters, and continued tax reform courtesy of the Tax Cuts and Jobs Act. But before all of that, the agency released some significant updates in August. Here are 3 recent IRS news items that impact a broad swath of taxpayers. […]
February 12, 2019
When it comes to selecting someone to prepare your tax return, there are a lot of criteria to consider. Have you thought about whether the person offering to do your taxes is a legitimate tax preparer? Protect yourself from tax prep scams by knowing how the IRS evaluates tax preparers. The IRS has warned taxpayers […]
February 4, 2019
Prior to the Tax Cuts and Jobs Act (TCJA), taxpayers could exchange like-kind business property (such as trading in a business vehicle) and defer any gain until the property was ultimately sold. Property that was eligible for this tax-free exchange included both real and personal property. If you traded in a business vehicle in 2017 […]
March 1, 2018
The IRS warns taxpayers of a new twist on an old scam. Criminals are depositing fraudulent tax refunds into individuals’ actual bank accounts, then attempting to reclaim the refund from the taxpayers. Here are the basic steps criminals follow to carry out this scam. The thief: Hacks tax preparers’ computers to steal taxpayer data. Uses […]
February 20, 2018
The Internal Revenue Service failed to tell nearly half a million victims of identity theft last year their information was being used by others for employment purposes, according to a new report, which attributed the failure to a computer programming error. The report, from the Treasury Inspector General for Tax Administration, found the programming […]
September 7, 2017
After the devastation of Hurricane Harvey and with Hurricane Irma threatening parts of the U.S. and Caribbean, the IRS reminds taxpayers that the agency is here to help. Individuals, businesses and organizations are encouraged to prepare for a variety of disaster and emergency situations in the following ways: Create Electronic Copies of Key Documents Taxpayers […]
April 7, 2017
IRS to Use Private Debt Collectors Okay, here’s the scoop: The IRS will begin turning over taxpayer accounts to four private debt collection companies. These firms will be able to keep up to 25% of what they collect. Now before you start to curse the IRS under your breath, know this: the IRS utilized private […]
November 20, 2014
There is no shortage of ways a taxpayer can run afoul of federal tax reporting requirements and find themselves in an audit. After all, the Internal Revenue Code (Federal Tax Law) comprised almost 74,000 pages as of 2013 and is growing each year. Despite the overwhelming quantity of information in the Code, you, the taxpayer, are required […]
August 15, 2014
In a recent tax court case, the IRS has successfully denied a “pizza deduction” for wages paid out in, well, pizza (Ross, TC Summ. Op. 2014-68). In this case, a small business owner who prepared taxes and did business consulting had “hired” her kids to do small jobs around the office and paid them in pizza. Rather than […]
September 9, 2013
The IRS has recently released an updated tax rule that differentiates between tips, which are voluntary payments to service personnel such as waiters, waitresses, bartenders, valet staff, etc. and service charges, such as those automatically applied to bills by restaurants for groups of certain sizes. Beginning January 2014, the IRS will treat any automatic gratuity as […]
September 11, 2012
It seems that every year we field about a dozen phonecalls regarding phony notices, business solicitations and phishing emails sent to business owners. These range from emails with fake Quickbooks update links to official looking letters in the mail with requests for banking and personal information. We have plenty of experience helping clients sort through […]
July 13, 2012
Have you received a notice from the IRS telling you that your tax return has been selected for examination? Selection for examination means that you are being audited by the IRS. Here’s what to do if you are audited. If your tax return is selected for examination by the IRS, you may receive the audit […]
June 14, 2012
When Krystle Reyes of Salem, OR filed her state tax return via Turbo-Tax, she decided to add a couple zeros to some key figures. Reyes overstated her income by $3 million and requested a $2.1 million refund. She got it. In the age of computers, you may be surprised to see that this scam was […]
March 17, 2012
In the age of computers, there’s not much that gets by the IRS. In fact, the IRS is seeking to automate as much as possible to bring relief to its agents. While this is great for them, it can be a nightmare for filers. The result has been a staggering number of computer generated IRS […]
February 13, 2012
Every year the Taxpayer Advocate’s office releases the most pressing concerns involving the IRS from a taxpayer perspective. This year, with IRS efficiency at an all time low, the TAS (Taxpayer Advocate Service) has picked up on the pain many of us are feeling when dealing with the IRS. It all boils down to this: the […]
August 17, 2011
In December of 2002, Norma Coronel gave birth to one child; but that’s not what her tax return says.. Coronel was indicted on 35 counts and arrested after claiming 19 children, 18 fake dependents on her tax return. Unbelievable we know, but this type of activity happens everyday due to the earned income credit. She was caught […]
August 11, 2011
About 20,000 individuals and 24,000 businesses have been randomly chosen and will soon get letters from the IRS. Don’t panic, these are not collection letters. These IRS surveys will help them update their estimates of what sort of burden they place on you. They are looking to see how much time you spend on filling out IRS […]
August 4, 2011
The IRS is increasing audit examinations of tax exempt organizations, specifically with regard to related party lending. They are looking for disqualified transactions to disqualified people who are personally involved with the not for profit or tax-exempt organization. This includes lending between the non-profit and any of its directors or staff, related party lending, especially […]
July 22, 2011
What’s the difference between a delinquent taxpayer and the IRS? Delinquent taxes are due right away, but the IRS now has a 16 week waiting period to even process most amended returns or other claims for refund. In addition to amended returns, paper filed returns are also subject to these extended wait times. Certain credits, […]
April 13, 2011
E-filing can speed up the tax filing process, and that is really nice…sometimes. When they process your return before they process your extension, that can cause some headaches in the form of IRS Notices. Already we are starting to see late filing notices go out for corporate returns that we filed in the last half […]