Lee B

I've had several retail clients taken advantage of by less than truthful merchant service reps. The problem is that this industry has very little in the way of regulatory scrutiny, so that sometimes it looks like the "Wild Wild West". There are a number of reputable merchant service firms that don't charge sign up fees, cancellation fees on a month to month agreement (no long term contract). So it's buyer beware.

My fees are above average, but I won't process payroll for less than $60 a month. For a biweekly payroll with 6 or 7 employees, I charge $ 90 per month.

FROM PC MAGAZINE Keep Poodle At Bay With Basic Internet Safety Oct 15, 2014 2:47 PM EST By Fahmida Y. Rashid Researchers have uncovered another serious vulnerability in Secure Sockets Layer (SSL) which affects how our information and communications are secured online. The good news is you can take specific steps to block attacks exploiting this flaw. . . . . . Why Do We Still Have SSL 3.0? Most modern servers and applications use TLS 1.1 or 1.2, but SSL 3.0 is still widely used in order to support legacy applications and systems. Internet Explorer 6 is one good example. While IE 6 is not as visible as it used to be, it hung around for quite a long time, so quite a number of servers and applications were built to support SSL 3.0 along with the more secure TLS. Netcraft estimated nearly 97 percent of SSL Web servers are likely to be vulnerable. "You could pretty much kill it in most places today," security researcher Troy Hunt wrote, but that is only part of the problem as there are clients out there which may depend on the ability to fall back to SSL 3.0. We don't know which ones they are, making companies less willing to just pull the plug. For example, there were Twitter reports that MetroTwit, a popular Twitter client for Windows, relied on SSL 3.0 and stopped working after Twitter disabled SSL 3.0 support Tuesday evening (MetroTwit has released a hotfix, by the way, so you should update your client). "It's the uncertainty that keeps these early generation technologies alive," said Hunt. Fix the Browser Problem Use a modern, standards compliant Web browser. Mozilla will disable SSL 3.0 by default in the next version of Firefox, expected Nov. 25, and Google is scrubbing it from Chrome. Safari auto-enables SSL, but Apple has yet to weigh in on its plans for the browser. Microsoft posted an advisory with instructions on disabling SSL 3.0 from Windows desktops and servers. "No need to hate on Microsoft, as Internet Explorer 10 or 11 will do," said Garve Hays, a solutions architect with NetIQ. You can manually turn off SSL 3.0 in IE by un-checking the SSL 3.0 box under the Advanced tabs in the Internet Options menu. Firefox users should go to about.config on the browser, and change the value for security.tls.version.min to 1. They can also download a Mozilla add-on to disable SSL 3.0. Chrome users who want to disable SSL 3.0 can add the command line flag --ssl-version-min=tls1 to the browser. Safari users will have to wait for an update, whenever it comes. Staying off Safari temporarily will reduce the likelihood of a Poodle attack

I've gone to several of their presentations in the past and Drake is where I would go if ATX falls on its face this year. There is no need to buy both of them. If I had to switch in February, I think it would go fairly well. I just prefer to stay with ATX, as long as things don't get any worse, since I've used ATX for over 15 years.

In an article I read some months ago the official error rate on VITA prepared returns was close to 50 %.

I would prefer that it stays the way it is now. I don't want to have to check 4 or 5 different categories

First you need a supportable FMV that would hold up under audit. I don't see how you will get there without a business appraisal, might cost $ 6,000 to $ 10,000. One you have a supportable FMV, then you can strategize.

I haven't used any Intuit programs in a long time, it's a personal preference. I'm just curious why you feel so strongly ?

Three options 1. Endorse the check as the corporation and deposit it in the personal account as a third party check. 2. Cash the check at the bank the check is drawn on. 3. Contact the insurer, explain the situation and request a check be issued to the individual

FROM ACCOUNTING TODAY The Internal Revenue Service is making changes in W-2 and 1099 forms and reporting requirements, starting next year. W-2 Form Changes Returned Wage Reports from the Social Security Administration Effective January 2015, the Social Security Administration will return Form W-2 electronic and paper wage reports under the following conditions : • Medicare wages and tips are less than the sum of social security wages and social security tips, • Social Security tax is greater than zero; Social Security wages and social security tips are equal to zero, and • Medicare tax is greater than zero; Medicare wages and tips are equal to zero. In addition, Forms W-2 and W-2c electronic and paper wage reports for household employers will be returned under the following conditions: • The sum of Social Security wages and Social Security tips is less than the minimum yearly earnings subject to Social Security and Medicare tax withholding for a household employee, and • The Medicare wages and tips are less than the minimum yearly earnings subject to Social Security and Medicare tax withholding for a household employee. If the above conditions occur in an electronic wage report, the SSA will notify the submitter by email or postal mail to correct the report and resubmit it to the SSA. If the above conditions occur in a paper wage report, the SSA will notify the employer by email or postal mail to correct the report and resubmit it to the SSA. Third-Party Sick Pay Recap Reporting The IRS expects to change the third-party sick pay recap reporting and filing requirements for wages paid in 2014. Information about this change will be included in the 2014 Publication 15-A. 1099 and Related Form Changes 1098: Mortgage Insurance Premiums Mortgage insurance premiums paid or accrued after Dec. 31, 2013, are no longer eligible to be treated as interest paid by the payer/borrower. Box 4 on Form 1098, formerly used for reporting these premiums paid or accrued, has been reconfigured for providing other information. 1098-C: Motor Vehicle Odometer Mileage Entry Donators of motor vehicles must enter the odometer reading of the motor vehicle in the new box 2a. 1099-B: New Reporting Requirements Brokers are required to report the adjusted basis of certain debt instruments upon a sale of the debt instrument. In addition, brokers are required to report the adjusted basis of certain securities futures contracts and options upon a sale or closing transaction as well as the gross proceeds from the sale or closing transaction. Brokers also must report whether any gain or loss from these transactions is short-term, long-term or ordinary. Furthermore, there are reporting requirements for a transfer of a debt instrument, an option or a securities futures contract to another broker and for an organizational action that affects the basis of a debt instrument, an option, or a securities futures contract. Additional changes to this form include: • The form has been redesigned to conform to the box numbers on Form 8949. A new box has been added at the top center of the form to enter a code that will assist the recipient in reporting the transaction on Form 8949 and/or Schedule D. • Additional State Copies: Copy 1 (For Payer State) and Copy 2 (For Recipient State) were added for 2014. • Boxes 14 through 16 (state boxes) allow for a second data entry. 1099-INT Boxes 10 and 11 were added to accommodate the new reporting requirements for a debt instrument that is a covered security and that is acquired by a taxpayer with market discount, bond premium or acquisition premium. 1099-K • Box 1b, Card Not Present transactions: Box 1b was added to the form to be used to enter the gross amount of total reportable payment card/third party network transactions for the calendar year where the card was not present at the time of the transaction or the card number was keyed into the terminal, such as in the case of online, phone, or catalogue sales. Reporting in box 1b is optional for 2014. • Second TIN notification box: The 2nd TIN notification box was added to Copies A and C. 1099-MISC Box 11, Foreign tax paid, and Box 12, Foreign country or U.S. possession, were deleted. This information is now reported on Form 8966, Foreign Asset Tax Compliance Act Report. 1099-OID Boxes 5 and 6 headings changed from Foreign tax paid and Foreign country or U.S. possession to Market discount and Acquisition premium respectively. Boxes 5 and 6 are now used for the new reporting requirements for a debt instrument that is a covered security and that is acquired by a taxpayer with market discount, bond premium, or acquisition premium. 1099-R: New Distribution Code Use Distribution Code K to report distributions of IRA assets not having a readily available fair market value (FMV). Important Dates – 2014 W-2 and 1099 Feb. 2, 2015 – due date to mail employee copies for W-2 & 1099 March 2, 2015 – due date to send paper format of 1099 Federal (IRS) filing March 2, 2015 – due date to send paper format of W-2 Federal (SSA) filing or March 31, 2015 – due date to send e-file format of W-2 and 1099 Federal (SSA/IRS) filing

Ask your new client to call the state CPA board.

At the end of this week,Microsoft will stop licensing Windows 7 to Computer makers. If you need or want another Windows 7 computer, now is the time to order one..

I copied this from an ATX email I received yesterday: RENEWAL REMINDER: Software is shipping next month-Renew before November 14th-and you won't experience a break in your product support. Call 800-495-4626 to renew I don't remember ATX saying in previous years ???

FROM TAX PRO TODAY inShare October 28, 2014 By Daniel Hood Intuit has enhanced its program for tax professionals, adding new benefits and opening it to enrolled agents. The online program, called Personal Pro, connects tax pros with potential individual clients and small-business owners who need a tax return prepared. Previously known as CPA Select, it has been refreshed and is now available for enrolled agents. The average tax pro can get as many as 40-50 new clients through the program, according to Intuit, and they can use any tax prep software. Once they’ve prepared a return, they create an invoice and upload the finished tax docs. Intuit handles the billing, and after the client has paid and approved the return, the tax pro files the return. Preparers receive 75 percent of the gross revenue, with Intuit issuing payments for completed clients on a monthly basis I don't think I could prepare returns for clients that I hadn't met face to face

Doesn't there have to be at least a down payment in 2014 ? Plus you don't say what kind of entity your client is, an accrual 1040 ???

Also, there are several similar competitors including one from amazon, whose fees are a bit cheaper. I have a concession stand client who uses Square and it seems to work fine,

Nineteen years ago, my clients sold a deli and a small meat processing plant, business plus real property. The buyer's attorney set up a S Corporation and put the real property into the S Corporation. Afterwords, the buyers decided to keep me as their accountant. The real property is still in the S Corporation. No audits yet, however the owners are now trying to sell the business. So the sale will finally bring this to an end.

Oregon also starts with Federal AGI

Yeah , I forgot about CFS Tax Tools. I am going to download the demo software and try it out. They are California based and have a good reputation on the West Coast.

I interpreted this as asking whether Officer's compensation still needed to be paid ?

Yes, the ATX Payroll Compliance program does the Efiling, but it doesn't generate payroll reports, keep track of overtime, vacation, hours worked etc etc.

There are a number of programs out there, but i am not aware of one that will efile the 94x forms for a reasonable price. If someone else knows of one, I would also like to know.

i wasn't aware that you could use check the box on a S Corp that was already in existence ?

K C, This reinforces what you have been saying ! Thanks for bringing this to my attention Lee Barckert FROM THE NEW YORK TIMES ARNOLDS PARK, Iowa — For almost 40 years, Carole Hinders has dished out Mexican specialties at her modest cash-only restaurant. For just as long, she deposited the earnings at a small bank branch a block away — until last year, when two tax agents knocked on her door and informed her that they had seized her checking account, almost $33,000. The Internal Revenue Service agents did not accuse Ms. Hinders of money laundering or cheating on her taxes — in fact, she has not been charged with any crime. Instead, the money was seized solely because she had deposited less than $10,000 at a time, which they viewed as an attempt to avoid triggering a required government report. “How can this happen?” Ms. Hinders said in a recent interview. “Who takes your money before they prove that you’ve done anything wrong with it?” The federal government does. Using a law designed to catch drug traffickers, racketeers and terrorists by tracking their cash, the government has gone after run-of-the-mill business owners and wage earners without so much as an allegation that they have committed serious crimes. The government can take the money without ever filing a criminal complaint, and the owners are left to prove they are innocent. Many give up. Photo The I.R.S. seized almost $33,000 from Ms. Hinders. Credit Angela Jimenez for The New York Times “They’re going after people who are really not criminals,” said David Smith, a former federal prosecutor who is now a forfeiture expert and lawyer in Virginia. “They’re middle-class citizens who have never had any trouble with the law.” On Thursday, in response to questions from The New York Times, the I.R.S. announced that it would curtail the practice, focusing instead on cases where the money is believed to have been acquired illegally or seizure is deemed justified by “exceptional circumstances.” Richard Weber, the chief of Criminal Investigation at the I.R.S., said in a written statement, “This policy update will ensure that C.I. continues to focus our limited investigative resources on identifying and investigating violations within our jurisdiction that closely align with C.I.’s mission and key priorities.” He added that making deposits under $10,000 to evade reporting requirements, called structuring, is still a crime whether the money is from legal or illegal sources. The new policy will not apply to past seizures. The I.R.S. is one of several federal agencies that pursue such cases and then refer them to the Justice Department. The Justice Department does not track the total number of cases pursued, the amount of money seized or how many of the cases were related to other crimes, said Peter Carr, a spokesman. But the Institute for Justice, a Washington-based public interest law firm that is seeking to reform civil forfeiture practices, analyzed structuring data from the I.R.S., which made 639 seizures in 2012, up from 114 in 2005. Only one in five was prosecuted as a criminal structuring case. The practice has swept up dairy farmers in Maryland, an Army sergeant in Virginia saving for his children’s college education and Ms. Hinders, 67, who has borrowed money, strained her credit cards and taken out a second mortgage to keep her restaurant going. Their money was seized under an increasingly controversial area of law known as civil asset forfeiture, which allows law enforcement agents to take property they suspect of being tied to crime even if no criminal charges are filed. Law enforcement agencies get to keep a share of whatever is forfeited. Critics say this incentive has led to the creation of a law enforcement dragnet, with more than 100 multiagency task forces combing through bank reports, looking for accounts to seize. Under the Bank Secrecy Act, banks and other financial institutions must report cash deposits greater than $10,000. But since many criminals are aware of that requirement, banks also are supposed to report any suspicious transactions, including deposit patterns below $10,000. Last year, banks filed more than 700,000 suspicious activity reports. Owners who are caught up in structuring cases often cannot afford to fight. The median amount seized by the I.R.S. was $34,000, according to the Institute for Justice analysis, while legal costs can easily mount to $20,000 or more. There is nothing illegal about depositing less than $10,000cash unless it is done specifically to evade the reporting requirement. But often a mere bank statement is enough for investigators to obtain a seizure warrant. In one Long Island case, the police submitted almost a year’s worth of daily deposits by a business, ranging from $5,550 to $9,910. The officer wrote in his warrant affidavit that based on his training and experience, the pattern “is consistent with structuring.” The government seized $447,000 from the business, a cash-intensive candy and cigarette distributor that has been run by one family for 27 years. There are often legitimate business reasons for keeping deposits below $10,000, said Larry Salzman, a lawyer with the Institute for Justice who is representing Ms. Hinders and the Long Island family pro bono. For example, he said, a grocery store owner in Fraser, Mich., had an insurance policy that covered only up to $10,000 cash. When he neared the limit, he would make a deposit. Ms. Hinders said that she did not know about the reporting requirement and that for decades, she thought she had been doing everyone a favor. Photo Jeff Hirsch, an owner of Bi-County Distributors on Long Island. The government seized $447,000 from the business, a candy and cigarette distributor run by one family for 27 years. Credit Bryan Thomas for The New York Times “My mom had told me if you keep your deposits under $10,000, the bank avoids paperwork,” she said. “I didn’t actually think it had anything to do with the I.R.S.” In May 2012, the bank branch Ms. Hinders used was acquired by Northwest Banker. JoLynn Van Steenwyk, the fraud and security manager for Northwest, said she could not discuss individual clients, but explained that the bank did not have access to past account histories after it acquired Ms. Hinders’s branch. Banks are not permitted to advise customers that their deposit habits may be illegal or educate them about structuring unless they ask, in which case they are given a federal pamphlet, Ms. Van Steenwyk said. “We’re not allowed to tell them anything,” she said. Still lawyers say it is not unusual for depositors to be advised by financial professionals, or even bank tellers, to keep their deposits below the reporting threshold. In the Long Island case, the company, Bi-County Distributors, had three bank accounts closed because of the paperwork burden of its frequent cash deposits, said Jeff Hirsch, the eldest of three brothers who own the company. Their accountant then recommended staying below the limit, so for more than a decade the company had been using its excess cash to pay vendors. More than two years ago, the government seized $447,000, and the brothers have been unable to retrieve it. Mr. Salzman, who has taken over legal representation of the brothers, has argued that prosecutors violated a strict timeline laid out in the Civil Asset Forfeiture Reform Act, passed in 2000 to curb abuses. The office of the federal attorney for the Eastern District of New York said the law’s timeline did not apply in this case. Still, prosecutors asked the Hirsch’s first lawyer, Joseph Potashnik, to waive the CARFA timeline. The waiver he signed expired almost two years ago. The federal attorney’s office said that parties often voluntarily negotiated to avoid going to court, and that Mr. Potashnik had been engaged in talks until just a few months ago. But Mr. Potashnik said he had spent that time trying, to no avail, to show that the brothers were innocent. They even paid a forensic accounting firm $25,000 to check the books. “I don’t think they’re really interested in anything,” Mr. Potashnik said of the prosecutors. “They just want the money.” Bi-County has survived only because longtime vendors have extended credit — one is owed almost $300,000, Mr. Hirsch said. Twice, the government has made settlement offers that would require the brothers to give up an “excessive” portion of the money, according to a new court filing. “We’re just hanging on as a family here,” Mr. Hirsch said. “We weren’t going to take a settlement, because I was not guilty.” Army Sgt. Jeff Cortazzo of Arlington, Va., began saving for his daughters’ college costs during the financial crisis, when many banks were failing. He stored cash first in his basement and then in a safe-deposit box. All of the money came from paychecks, he said, but he worried that when he deposited it in a bank, he would be forced to pay taxes on the money again. So he asked the bank teller what to do. “She said: ‘Oh, that’s easy. You just have to deposit less than $10,000.’” The government seized $66,000; settling cost Sergeant Cortazzo $21,000. As a result, the eldest of his three daughters had to delay college by a year. “Why didn’t the teller tell me that was illegal?” he said. “I would have just plopped the whole thing in the account and been done with it.”

Since the corporation is generating passive income, my educated guess would be, "no."