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IR-2024-201, Aug. 6, 2024 WASHINGTON — The Internal Revenue Service and the Security Summit partners remind tax professionals that using multi-factor authentication is now more than an important protection for their businesses and their clients – it’s now a federal requirement. https://www.irs.gov/newsroom/multi-factor-authentication-key-protection-to-tax-professionals-security-arsenal-now-required

He can’t be treated as an ordinarily employee - he has a hybrid status, which means he must pay self-employment tax on his earnings and H&U allowance. but he can have his estimates of those taxes withheld and reported on a W-2. His gross wages can be reported on Form 941 and omitted from the Medicare & SosSec wages lines. His withholding tax is reported on the 941 on the appropriate line. For most clergy this figure is very high relative to the wages figure because it includes both withholding tax and self-employment tax on both the wages and also the H&U allowance. (This withholding is typically not a calculated figure - the church withholds whatever amount the minister requests based on his estimated tax calculations). At year-end the minister receives a W-2 showing only entries for wages and withholding, Thus, the W2 will agree with the sum of the 941’s and all is well. It’s also a good idea to enter the H&U allowance as a memo entry in Box 14. Some bookkeepers feel wierd preparing the 941s and w2 forms in this manner, but it’s really the only way to do it properly and get the withholding reported & paid.

No, Darlene, that is not my tax practice. What in the world would I do with $500,000? (Ha Ha). I have not idea who that might be; nor do I care. I am just so glad to be alive. Thank you for reaching out.

I was just now reading about this through Tax Talk News and am scratching my head on how to manage. So as a sole practitioner I have to use 2FA to access a pdf file on my computer? I have to text to myself or call myself or email myself every time I want to look at a client file? My computer is password protected as is the ATX software but I don't have each client pw protected as I am the only user. If so, how do I confirm to myself that I am me, the authorized user? I realize that I will have to do something more now with Verifyle but my clients are not going to like it. At least I know it is an option so will have to read up on how to implement for myself and for each client. Retirement is REALLY looking better all the time! I'm getting too tired of soooo many hoops....

How are we going to use MFA to access PDFs of client data on our drives? Totally unrealistic.

No, the FAQs have a definite answer about sole proprietors filing Schedule C with a "dba"

Did the attorney say no Form 706 is needed? Or, Form 941? Get it in writing from your client. If your client returns later for you to prepare a return, then charge the same or more per hour than their attorney!

If your client is a clergyperson of a mainstream religion, his church employer most likely has the benefit of a regional &/or national organization with printed materials, workshops, etc., to help both clergy and church treasurers with the unique issues of clergy pay. Also, read publications by William F. Geisler, Beverly J. Worth, and IRS Publication 517.

I also learned this evening that most Homeowners Associations must file the BOI report. That’s going to be a real pain because their boards typically rotate some members annually. So that means the BOI report becomes an annual report with huge potential penalties, because all board members probably meet the “substantial control” criteria.

He can request enough FIT withheld to cover both his FIT as well as his SE tax on his return.

I used to password protect my PDFs but it was a PITA to open them, and I mostly did that just to email them. Even if Windows had password protected folders, there's still no way to add MFA to that process, unless Windows creates it.

I have been on a little adventure, believe it or not. I hadn't been feeling well for a while and one morning I told my husband that I thought I needed help. Well, ER led to 7 days in the hospital (so they tell me). I had viral bronchitis and then developed bacterial pneumonia and had myself a vacation of sorts. If anyone has noticed that I have not been nosing around, that is why, but I am now home and on the way to a full recovery. Turns out that I was sick for a very long time and I guess I knew it but I just thought that was the way life was. Well, let me tell you , I have not breathed so well in years and I am back. This was my first fullish day on the computer and I am pretty tired so will keep you posted. I am so Happy to be back and Life is Wonderful. Love to each and every one of you. I had my doubts there for a while, but I don't do well with meds and they sort of messed me up while they were curing me.

What was the FMV of the home as determined by appraisal? It may be that parents sold at below FMV, and if so, that will affect the answer here.

For anyone who is covered under Hiscox insurance and wondering if you are covered to assist any clients with the BOI requirements, Hiscox is not providing any coverage. I spoke with an agent yesterday who really didn't seem to understand what the BOI was. After explaining it a few times, they finally said we are not covered whether a CPA or EA.

I was told the same thing as Lee B.

I just called Hiscox directly and gave them my Policy #. I was told that I am definitely not covered and that the CTA BOI Reporting is specifically listed in my policy exclusions.

I was told different, the agent I spoke said this was the number one question they been getting and yes I was covered. I called back in May. I’m only preparing mine.

If the other accountant wants something in writing , they should provide the release document

Can't she just give it to the client?

Thanks Terry, I have used Hiscox for years. Even if they did offer coverage, I still wouldn't assist my clients with BOI. I am informing them of the CTA and BOI reporting.

I did have the pneumonia vaccine twice and reacted badly to both. I have had breathing issues for four years, since I was ill for 12 days, four years ago; just before Covid was a word. My hospital Doc said that I have been ill for a long time and fighting it on my own . Breathing issues for four years and it finally tried to take me out.I fought so hard to get rid of the oxygen and breathe on my own. I am pretty stubborn. To tell you the truth, I wasn't sure I could do it, but I had already purchased my tax program and had a lot of unfinished work to do. They fixed me up just fine.