Introducing Our Tax Packages!

Tax season is underway as we speak. Sounds fun, right? But we love to serve you, so we are looking forward too that opportunity again.

We'll be doing some different things this year to deliver greater options to you and seriously increase the value we deliver in the preparation of your tax return.

Value and Transparency

You will have four options to chose from as we serve your tax return needs: Gold, Silver, Bronze and Basic. We want these to bring transparency in what we will do for you while allowing you to choose the value you perceive in each option. You get to choose your price according to what YOU need and value. Here are the details:

Under the Gold Tax Package, we will deliver your completed return to you within 4 days of you delivering all of your tax information to our office and your tax return price payment. We will also review your last 3 years tax returns looking for mistakes and missed opportunities. We will also include our IRS Letter Notice service, that is, we will respond to any IRS Notice for the tax returns we prepare at no additional charge. Our IRS Letter Notice does not include audits. Additionally you have unlimited access to us via telephone or email for any tax questions you may have throughout the year. If your tax questions require additional research, you will enjoy a 50% discount off our normal rate. Lastly, we will provide tax planning in the fall and you will enjoy a 25% discount on any services we provide to you. This package will be 80% higher than our normal tax preparation rate.

Under the Silver Tax Package, we will deliver your completed return to you within 8 days of you delivering all of your tax information to our office and your tax return payment. We will also include our IRS Letter Notice service for a 50% discount off our normal rate. That is, we will respond to any IRS Notice for the tax returns we prepare. Our IRS Letter Notice does not include audits. Additionally you have unlimited access to us via telephone or email for any tax questions you may have throughout the year. If your tax questions require additional research, you will enjoy a 25% discount off our normal rate. This package will be 40% higher than our normal tax preparation rate.

Under the Bronze Tax Package, we will deliver your completed return to you within 14 days of you delivering all of your tax information to our office and your tax return payment. We will also include our IRS Letter Notice service for a 15% discount off our normal rate. That is, we will respond to any IRS Notice for the tax returns we prepare. Our IRS Letter Notice does not include audits. This package will be 15% higher than our normal tax preparation rate.

Under the Basic Tax Package, we will extend your tax return to be completed during non-busy season hours, to be completed within one month after the tax deadline filing date. But you will receive a 10% LOWER price off our normal tax return rate.

Now you have total choice! For those that value a quick turn around time and premium added services, we've provided that option for you. And for those of you who value lower prices more than a quick turn around time, you get to have your way too! We know you will have questions about these options, so feel free to contact us and ask questions.

What to do next? Once you tell us which package you want to choose, all you have to do is provide your tax information to us after January 15th, make your deposit payment, and we'll do the rest!. All Tax Return Packages require a deposit of $150 before we begin. You can pay your deposit securely online by check or credit card HERE.

Please note, our normal tax return consists of one IRS Form 1040, Schedule A, one state return if required and e-filing. Additional forms and schedules incur additional costs. For the 2011 tax season our normal tax return preparation fee is $225, and our IRS Letter Notice service is $150. Please contact us for your custom price quote.

All tax returns must be paid-in-full before e-filing. 

Thanks for letting us serve you.

Why Didn't My Accountant Tell me That?

I find that most business owners don't enjoy spending hours reading the tax law. But I do!!

One of the ways I want my clients to leverage me as a resource is to share my knowledge with them so they don't have to do it themselves. This includes providing them with answers to questions they didn't even know to ask.

At least once a week I am asked the question, "What type of entity should I form for my business?"

With a few follow up questions, most tax advisors will answer this question and the client will be happy with the answer.

Then what usually happens is the client starts to learn more things as they progress in their business. These may be things they should have been doing or should not have been doing, but they are all things they wished they would have known sooner.

This is why I don't just answer the specific question at hand; I anticipate what the client doesn't know to ask. I have tremendous experience in the long-term implications of a tax strategy, which includes forming an entity, and I want to share my knowledge and experience with my clients so my clients can avoid common mistakes (that sometimes can set their business or investing back by years).

Even though the client has come to me with one specific question, I typically find myself asking the client many more questions that cover bookkeeping, tracking expenses, business or investing operations, additional goals they have, estate planning and exit strategy (to name a few).

Eventually most people learn these details, but usually it is not until they are at a point where they wish they had known about them sooner. This goes back to that question I hear when talking to prospects - "Why didn't my accountant tell me that?"

 If your current accountant or tax advisor has not brought you any tax saving ideas, contact us TODAY! I will review your last three years tax returns looking for mistakes and missed opportunities that may be costing you thousands of dollars in taxes.

 If you have any questions about this topic, tax law changes, business tips, or how to become a client, please call us at 954-591-8290 or use our Contact form.

I find that most business owners don't enjoy spending hours reading the tax law. But I do!! 

One of the ways I want my clients to leverage me as a resource is to share my knowledge with them so they don't have to do it themselves. This includes providing them with answers to questions they didn't even know to ask. 

At least once a week I am asked the question, "What type of entity should I form for my business?" 

With a few follow up questions, most tax advisors will answer this question and the client will be happy with the answer. 

Then what usually happens is the client starts to learn more things as they progress in their business. These may be things they should have been doing or should not have been doing, but they are all things they wished they would have known sooner. 

This is why I don't just answer the specific question at hand; I anticipate what the client doesn't know to ask. I have tremendous experience in the long-term implications of a tax strategy, which includes forming an entity, and I want to share my knowledge and experience with my clients so my clients can avoid common mistakes (that sometimes can set their business or investing back by years). 

Even though the client has come to me with one specific question, I typically find myself asking the client many more questions that cover bookkeeping, tracking expenses, business or investing operations, additional goals they have, estate planning and exit strategy (to name a few). 

Eventually most people learn these details, but usually it is not until they are at a point where they wish they had known about them sooner. This goes back to that question I hear when talking to prospects - "Why didn't my accountant tell me that?"

If your current accountant or tax advisor has not brought you any tax saving ideas, contact us TODAY!  I will review your last three years tax returns looking for mistakes and missed oppertunitiys that may be costing you thousands of dollars in taxes.

If you have any questions about this topic, tax law changes, business tips, or how to become a client, please call us at 954-591-8290 or use our Contact form.

Your Expert!

Entrepreneurs need to use experts so they can focus on what they do best! We are that expert!

If you have any questions on how to become a client, please call us at 954-591-8290 or use our Contact form. 

The Super Bowl and Tax Planning

A decade or more ago, the Super Bowl had become a bit of a joke. Fans looked forward to watching the commercials, sure. But the actual game itself had become a dreary series of lopsided blowouts. Super Bowl XXIV was perhaps the worst offender, with the San Francisco 49ers pounding the Denver Broncos, 55-10, in a game that wasn't nearly as close as that score suggested!

More recently, the game has been more competitive and more entertaining. The NFC champion New York Giants reached this year's "big dance" by defeating the 49ers, 20-17, in a game that came down to the final play -- in a Cinderella playoff run that followed a middling regular season. The AFC champion New England Patriots made it by beating the Baltimore Ravens, 23-20, in a game that came down to the final play. That set up Sunday's contest, when the Giants defeated the Patriots, 21-17, in yet another game that came down to the final play.

Sunday's game proved the truth of the old cliche that "offense sells tickets, but defense wins games." Patriots coach Bill Belichick gambled by actually letting Giants running back Ahmad Bradshaw score in the final minute in hopes of keeping precious time on the clock. That gamble succeeded in giving quarterback Tom Brady 57 seconds to engineer a last-minute drive -- but ultimately failed when Brady's desperate final heave to tight end Rob Gronkowski fell harmlessly to the ground.

That same cliche about defense winning games applies to your finances as well -- especially when it comes to tax planning. If you want to put real money in your pocket, you've got two choices:

• Financial offense means making more money. (As Charlie Sheen would say, "duh.") But that's not always easy, especially in a tough economy like today's. You can invest all sorts of time efforts into growing your business or your income, only to see them sail wide right like a missed field goal.
• Financial defense means spending less money. That's often easier than making more. And when it comes to spending less, it makes sense to focus on the big expenses. For most affluent Americans, that means taxes, rushing you like the Giants' backfield. Maybe you can save 15% or more on car insurance by switching to GEICO. But in the long run, how much can that really do for you?

Financial defense is important enough that some financial moves which look like offense are actually defense in disguise. Wall Street is buzzing about Facebook's upcoming initial public offering, wondering if the company can really be worth $100 billion. But the company is raising "only" $10 billion in cash. And Facebook doesn't need the money. They're "engineering a liquidity event," in large part so founder Mark Zuckerberg can pay his own taxes! (We'll talk more about this as we get closer to the actual offering.)

It's easy to think of us as just "tax people" and focus on the forms we file for that April 15 deadline (April 17 this year, for you procrastinators). But focusing on just compliance misses the value you get from proactive taxplanning, and misses the total value we offer as your financial "defensive coordinator." So call us when you're ready to "call an audible" and play real financial defense. We promise not to let the IRS just walk the ball across the goal line!

If you have any questions about this topic, tax law changes, business tips, or how to become a client, please call us at 954-591-8290 or use our Contact form. 

What to Do If You Are Missing a W-2 or an Inaccurate W-2

Make sure you have all the needed documents, including all your Forms W-2, before you file your 2011 tax return. You should receive an IRS Form W-2, Wage and Tax Statement, from each of your employers. Employers have until Jan. 31, 2012 to issue your 2011 Form W-2 earnings statement.

If you haven’t received your W-2, follow these four steps:

1. Contact your employer  If you have not received your W-2, contact your employer to inquire if and when the W-2 was mailed.  If it was mailed, it may have been returned to the employer because of an incorrect or incomplete address.  After contacting the employer, allow a reasonable amount of time for them to resend or issue the W-2.

2. Contact the IRS  If you do not receive your W-2 by Feb. 14, contact the IRS for assistance at 800-829-1040. When you call, you must provide your name, address, Social Security number, phone number and have the following information:

•  Employer’s name, address and phone number

•  Dates of employment

•  An estimate of the wages you earned, the federal income tax withheld, and when you worked for that employer during 2011. The estimate should be based on year-to-date information from your final pay stub or leave-and-earnings statement, if possible.

3. File your return  You still must file your tax return or request an extension to file by April 17, 2012, even if you do not receive your Form W-2. If you have not received your Form W-2 in time to file your return by the due date, and have completed steps 1 and 2, you may use Form 4852, Substitute for Form W-2, Wage and Tax Statement. Attach Form 4852 to the return, estimating income and withholding taxes as accurately as possible.  There may be a delay in any refund due while the information is verified.

4. File a Form 1040X  On occasion, you may receive your missing W-2 after you file your return using Form 4852, and the information may be different from what you reported on your return. If this happens, you must amend your return by filing a Form 1040X, Amended U.S. Individual Income Tax Return.

If you have any questions about this topic, tax law changes, business tips, or how to become a client, please call us at 954-591-8290 or use our Contact form. 

Deducting Business Losses

Even if you own 100% of a business, be it a sole proprietorship, LLC, partnership, or S corporation, you can't deduct losses from the entity unless you can show you materially participate in the business.

That is, you're involved in the activity in managing or working in the business. Showing up once a week to review the books for two hours won't qualify as material participation; participation must be substantial.

There are several ways to show material participation, but most business owners will pass the test using the more than 500 hour rule. In Alfred A. Iversen et ux. (T.C. Memo. 2012-19) the taxpayer was the founder of a large manufacturer of surgical and medical equipment in Minnesota. He also owned a working cattle ranch with 14,000 owned and 28,000 leased acres operated as an LLC. The ranch generated losses and the taxpayer claimed he materially participated in the operation. The IRS claimed the taxpayer did not, and disallowed the losses. The taxpayers lived in Minnesota and flew to the ranch either alone or with guests.

The Court noted participation in an activity may be shown by any reasonable means, including calendars, appointment books, or narrative summaries identifying work performed and the approximate number of hours spent performing the work. Contemporaneous daily time reports, logs, or similar documents are not required if other reasonable means exist of establishing a taxpayer's participation.

Neither of the taxpayers maintained a log, diary, notes or other record of the work performed. The taxpayers claimed they spent 2 to 3 hours a day on telephone calls, emails, and fax communications with the ranch manager. Telephone records introduced did not support that claim. Airplane logs indicated few trips during one of the years at issue and the trips were only for a day. Moreover, a family member went along.

The Court also noted that the fact that the airplane flights were paid for by the taxpayer's corporation, not the ranch, indicated the time spent at the ranch often and primarily related to the affairs of the corporation. In addition, the presence at the ranch of a full-time paid ranch manager for most of 2005 and 2006 disqualifies much of the taxpayer's time working on ranch activities from counting under the facts and circumstances test (an alternate test for material participation). The Court concluded the taxpayer failed to show he materially participated in the activity. 

If you have any questions about this topic, tax law changes, business tips, or how to become a client, please call us at 954-591-8290 or use our Contact form. 

How to Prepare W-2s for Church Employees and Ministers

Richard Hammer at Managing Your Church posted an excellent article on how to prepare W-2's.

Churches need to report each employee’s taxable income and withheld income taxes as well as Social Security and Medicare taxes on Form W-2, and furnish copies B, C, and two of the 2011 Form W-2 to each employee by January 31, 2012. Copy A should be submitted to the Social Security Administration by February 29, 2012, along with Form W-3, Transmittal of Wage and Tax Statements. If your employees give their consent, you may be able to furnish Forms W-2 to your employees electronically. Electronic forms are due April 2, 2012. See IRS Publication 15-A for additional information.

Although W-2s are not difficult to prepare, there are some tips you should know. First, be sure to add cents to all amounts. Make all dollar entries without a dollar sign and comma, but with a decimal point and cents. For example, $1,000 should read “1000.00.” Government scanning equipment assumes that the last two figures of any amount are cents. If you report $40,000 of income as “40000,” the scanning equipment would interpret this as 400.00 ($400)!

Continue reading at How To Prepare W-2s.

If you have any questions about this topic, tax law changes, business tips, or how to become a client, please call us at 954-591-8290 or use our Contact form. 

Tax Tips for the Self-employed

There are many benefits that come from being your own boss. If you work for yourself, as an independent contractor, or you carry on a trade or business as a sole proprietor, you are generally considered to be self-employed.

Here are six key points the IRS would like you to know about self-employment and self- employment taxes:

1. Self-employment can include work in addition to your regular full-time business activities, such as part-time work you do at home or in addition to your regular job.

2. If you are self-employed you generally have to pay self-employment tax as well as income tax. Self-employment tax is a Social Security and Medicare tax primarily for individuals who work for themselves. It is similar to the Social Security and Medicare taxes withheld from the pay of most wage earners. You figure self-employment tax using a Form 1040 Schedule SE. Also, you can deduct half of your self-employment tax in figuring your adjusted gross income.

3. You file an IRS Schedule C, Profit or Loss from Business, or C-EZ, Net Profit from Business, with your Form 1040.

4. If you are self-employed you may have to make estimated tax payments. This applies even if you also have a full-time or part-time job and your employer withholds taxes from your wages. Estimated tax is the method used to pay tax on income that is not subject to withholding. If you fail to make quarterly payments you may be penalized for underpayment at the end of the tax year.

5. You can deduct the costs of running your business. These costs are known as business expenses. These are costs you do not have to capitalize or include in the cost of goods sold but can deduct in the current year.

6. To be deductible, a business expense must be both ordinary and necessary. An ordinary expense is one that is common and accepted in your field of business. A necessary expense is one that is helpful and appropriate for your business. An expense does not have to be indispensable to be considered necessary.

If you have any questions about this topic, tax law changes, business tips, or how to become a client, please call us at 954-591-8290 or use our Contact form. 

February Tax Dates

February 10, 2012

 Form 4070, tip reporting to employer.

Taxpayers who were able to extend the due date of the following 2011 forms because they deposited the tax and forms on time must file: 

• Form 941 due for 4th Quarter 2011. 
• Form 940 or 940EZ (Federal Unemployment Tax) for 2011. 
• Form 943 (social security and withheld tax for farm workers). 
• Form 945 (Nonpayroll items).

February 15, 2012 

• Employment tax deposits for January wages due for monthly depositors. 
• Form W-4. Last day for employees to file to continue exemption from withholdings in 2012 by filing new W-4. If new W-4 not filed, employers must begin withholding on prior exempt employees on February 15.

February 28, 2012 

• Forms 1099 series due to IRS. 
• Forms 1098 due to IRS. 
• Forms W-2 due to IRS. 
• Last day for farmers and fishermen who did not pay estimated tax on January 15 to file Form 1040 and pay tax to avoid underpayment penalty. 

Various

Form 8300 (statement to payer of cash of more than $10,000) must be filed with the IRS by the 15th day following the transaction. 

Semi-Weekly Employment Tax Deposit Schedule for February:

1, 3, 8, 10, 15, 17, 23, 24, 29

Special Rule: Employers must deposit taxes on next banking day after date employment tax liability exceeds $100,000.

If you have any questions about this topic, tax law changes, business tips, or how to become a client, please call us at 954-591-8290 or use our Contact form.