ILLMAS

I only have a handful of clients that call often and take a good amount of my time, I am going to put on my big boy pants and tell them you pay for my time or find someone else, I am also going to put in writing to disclose how I will be charging in 15 min increments. People will be willing to pay $12.50 for 15 min, instead of $50 per hour, learned this from a CPA friend. FYI: Call too much clients are accounting/payroll clients not tax clients.

Do you have a business page? I have thought about it, but questions like that, make me think twice.

Yes first time I every see this, but if a business is active in the state of IL and has not paid the annual fee, then the notice is appropriate. I have help countless clients reinstate their IL corporation because they forgot to file. Once an SOS agent told my client if he didn't want to reinstate his LLC, that it was okay just to create a new LLC with the same name, and he did. I sent you a PM

We are currently waiting for the FBAR penalties to be assessed for a client, I really hope you have a good reasonable cause in case they give you a chance to explain yourself. IDK or IDKS won't cut it.

Thanks Tom, gift tax return was prepared back in 2012 for 2011, we are crossing our finger that the TP had a valuation done back then in case it ever comes up. MAS

Perfect this was exactly what I was looking for, an FYI for the rest, I am not going to prepare a gift return, stay calmed

This is the type of example I am looking for, a parent gifts a property or a business to one of his kids, in short what steps were taken to make sure if the IRS comes knocking, both your client and kid covered their butts (reasonable transaction). I have heard stories of parents giving their kids a $100K property for $1.

I have never prepared a gift tax return, but I wanted to know what basis is used to determine the value of the gift (something the IRS would accept as reasonable), mind sharing an example. Thanks

I found your kitchen video

I share an office with a CPA firm, and they had an issue with Proseries not letting them efile because they had not renewed for 2015. I think other vendor should follow this tactic to hook clients to come back.

Try it and let us know

Let's say the TP was supposed to be paid $50K for work, TP reported the $50K on Sch C and paid the tax, this will fall under: Cash method. If you use the cash method of accounting, you generally report income when you receive payment. You cannot claim a bad debt deduction for amounts owed to you because you never included those amounts in income. For example, a cash basis architect cannot claim a bad debt deduction if a client fails to pay the bill because the architect's fee was never included in income. However, I would see it very tough convincing the IRS you accidentally reported income you have not received yet. Or lets say the company who paid him the deferred wages (W2), the company paid the payroll taxes, TP reports it however he never received the actual pay, then his employer would have to to correct his W-2 to reflect zero wages.

You can claim a business bad debt deduction only if the amount owed to you was previously included in gross income. This applies to amounts owed to you from all sources of taxable income, including sales, services, rents, and interest. Accrual method. If you use the accrual method of accounting, you generally report income as you earn it. You can only claim a bad debt deduction for an uncollectible receivable if you have previously included the uncollectible amount in income. If you qualify, you can use the nonaccrual-experience method of accounting discussed later. Under this method, you do not have to accrue income that, based on your experience, you do not expect to collect. Cash method. If you use the cash method of accounting, you generally report income when you receive payment. You cannot claim a bad debt deduction for amounts owed to you because you never included those amounts in income. For example, a cash basis architect cannot claim a bad debt deduction if a client fails to pay the bill because the architect's fee was never included in income. How To Claim a Business Bad Debt There are two methods to claim a business bad debt. The specific charge-off method. The nonaccrual-experience method. Generally, you must use the specific charge-off method. However, you may use the nonaccrual-experience method if you meet the requirements discussed later under Nonaccrual-Experience Method . Specific Charge-Off Method If you use the specific charge-off method, you can deduct specific business bad debts that become either partly or totally worthless during the tax year. However, with respect to partly worthless bad debts, your deduction is limited to the amount you charged off on your books during the year. Partly worthless debts. You can deduct specific bad debts that become partly uncollectible during the tax year. Your tax deduction is limited to the amount you charge off on your books during the year. You do not have to charge off and deduct your partly worthless debts annually. You can delay the charge off until a later year. However, you cannot deduct any part of a debt after the year it becomes totally worthless. Significantly modified debt. An exception to the charge-off rule exists for debt which has been significantly modified and on which the holder recognized gain. For more information, see Regulations section 1.166-3(a)(3). Deduction disallowed. Generally, you can claim a partial bad debt deduction only in the year you make the charge-off on your books. If, under audit, the IRS does not allow your deduction and the debt becomes partly worthless in a later tax year, you can deduct the amount you charged off in that year plus the disallowed amount charged off in the earlier year. The charge-off in the earlier year, unless reversed on your books, fulfills the charge-off requirement for the later year. Totally worthless debts. If a debt becomes totally worthless in the current tax year, you can deduct the entire amount, less any amount deducted in an earlier tax year when the debt was only partly worthless. You do not have to make an actual charge-off on your books to claim a bad debt deduction for a totally worthless debt. However, you may want to do so. If you do not and the IRS later rules the debt is only partly worthless, you will not be allowed a deduction for the debt in that tax year because a deduction of a partly worthless bad debt is limited to the amount actually charged off. See Partly worthless debts, earlier. Filing a claim for refund. If you did not deduct a bad debt on your original return for the year it became worthless, you can file a claim for a credit or refund. If the bad debt was totally worthless, you must file the claim by the later of the following dates. 7 years from the date your original return was due (not including extensions). 2 years from the date you paid the tax. If the claim is for a partly worthless bad debt, you must file the claim by the later of the following dates. 3 years from the date you filed your original return. 2 years from the date you paid the tax. You may have longer to file the claim if you were unable to manage your financial affairs due to a physical or mental impairment. Such an impairment requires proof of existence. For details and more information about filing a claim, see Publication 556. Use one of the following forms to file a claim. For more information, see the instructions for the applicable form.

I think you manually have to enter the information to get the credit, it just doesn't compute on it's own, for example you will need to fill-in the wages/income and taxes paid per state.

I tried efiling a tax return today and ATX gives me an error, error unknown, cannot connect...... Anyone?

Who here charges when a client calls for any question? I am in the process eliminating payroll services, the stress is not worth what I am currently charging and I would like notify clients that call too much I will be charging starting in 2015. I would hate to charge for my time, but I feel it will be the only way they won't call.

I wondering if the customer who called you was my wife.

Another component of the ACA to keep an eye out for, PPACA: Although employers can be forgiven for focusing on the more pressing elements of the Patient Protection and Affordable Care Act (PPACA) that take effect in January 2014, there is another provision of the law that is not yet getting much attention—and it should. The provision is a short one. Fully insured health plans that have not retained grandfathered status under the PPACA will be subject to the same nondiscrimination rules that have long applied to self-insured plans. The penalties warrant notice, as they are considerable and could cost employers up to $500,000 if they don’t comply with the provision. The new provision also has implications for benefits strategy. “Historically, if an employer wanted to offer [certain employees or owners] medical coverage that was different, richer or received a greater subsidy, the solution was always to offer insured plans because they weren't subject to the same nondiscrimination rules as self-insured plans,” said Andy Anderson, a partner at law firm Morgan, Lewis & Bockius in Chicago. “Now that historic calculus has been changed by the [PPACA].” Expanding Nondiscrimination Like the nondiscrimination rules for self-insured health plans, cafeteria benefit plans and various retirement plans, the PPACA provision is designed to penalize companies that discriminate in favor of highly compensated employees when it comes to offering certain benefits—in this case, fully insured health plans. This discrimination can take the form of favoring highly compensated employees when it comes to eligibility to participate in the plan or in terms of the benefits provided. In general, highly compensated employees meet any of the following criteria: A shareholder who owns more than 10 percent of the company. An individual who is among the five highest-paid employees in the organization. An individual who is among the top 25 percent of employees in terms of compensation. Once the federal government starts enforcing the provision, employers could face an excise tax of $100 for each day the plan is not in compliance for each non-highly compensated employee who is not eligible for the health plan, up to a maximum penalty of $500,000. Anderson noted that the biggest difference between these PPACA nondiscrimination rules and the nondiscrimination rules for other types of benefits lies in the penalty calculation. In short, the penalties for noncompliance under the PPACA are calculated based on the number of people who are discriminated against. For example, a business with 100 employees that offers a discriminatory fully insured health plan for 10 highly compensated employees would pay a penalty based on the 90 employees who are facing discrimination. “That is the exact opposite of how nondiscrimination rules have been historically considered,” Anderson explained. “In a self-insured arrangement the tax consequences are based on discriminatory coverage received by the highly paid individuals.” When to Comply? The key question is, when will the federal government release the guidance necessary for employers to comply with the provision? “Apparently, [issuing this guidance] is not a huge priority in Washington right now,” observed Bonita Hatchett, a partner at law firm Barnes & Thornburg in Chicago. The IRS postponed enforcement of the provision at the end of 2010, noting that employers need guidance on exactly how these rules should apply to fully insured plans. Since then, there has been little indication of when this guidance might arrive. Seeing as there are already nondiscrimination rules for self-insured and cafeteria plans, Anderson speculates that “regulators will attempt not only to make sense of rules in the PPACA, but perhaps they will attempt to synthesize all of those [nondiscrimination] rules so that they begin to operate in a more consistent way.” Whatever the final result, it is unlikely that guidance will be released in the near future, given the flurry of regulations being issued as we move closer to 2014. The IRS has said it will hold off on enforcement until that guidance has been released, which may be in 2014 or even 2015. Preparing for Guidance Although the timing of forthcoming guidance is a question mark, the nature of the issue is not. “Most employers have a pretty good idea whether they have any potential discrimination issues lurking in their health plan structures,” Anderson said. “They might only offer health coverage to a limited number of people. They may offer free health coverage only to executives or owners.” The point of the nondiscrimination provision is to ensure that everyone is eligible for the same benefits. To make sure their organizations are prepared when guidance comes out and enforcement begins, HR and benefit managers should do the following: Take a close look at current plans. The first step is to take an inventory of fully insured health plans that the organization currently offers. In addition, as employers develop and execute their 2014 compliance approach, they should make sure that any new health plan design is not discriminatory. Know who is highly compensated. “Employers should always know who is highly compensated and who is not,” said Hatchett. In fact, businesses may already keep that information for retirement plan testing purposes. Keep nondiscrimination rules in mind when hiring. If the organization is recruiting an executive or any other individual who could meet the highly compensated criteria, employers need to tread carefully when offering or designing any type of special health insurance arrangement for that individual. “If employers want to continue offering special benefits for executives, they should try to do so in a tax-neutral way,” Anderson advised. Be prepared to act when the time comes. Even if employers do not want to change potentially discriminatory plans right now, they should be aware of the issues. If they address these proactively, they can avoid a rush to comply once the guidance is released. More important, they will have time to communicate the issues and any resulting changes to the affected employees. Joanne Sammer is a New Jersey-based business and financial writer. Related External Articles: White House Delays Nondiscrimination Rules Under PPACA (or At Least Said It Would), Fox Rothchild LLP, January 2014 - See more at: http://www.shrm.org/hrdisciplines/benefits/articles/pages/nondiscrimination-rules-health-plans.aspx#sthash.5PUeQSfB.dpuf

Here is what I found: In the past, employers were able to reimburse employees the cost of their individual coverage, on a tax-free basis per Internal Revenue Code §106. Since federal subsidies are now available for individual coverage purchased through the Health Insurance Marketplace, federal agencies do not want employers to incentivize employees to purchase individual coverage. Therefore, substantially identical guidance was issued by the IRS, Notice 2013-54, and the DOL, Technical Release 2013-03. Under this guidance, as of January 1, 2014, employers will violate the ACA and be subject to excise taxes ($100 per day per employee) if they provide tax-free reimbursement to employees or allow pre-tax salary reductions through a cafeteria plan to pay for individual coverage. The reasoning within the guidance is that “employer payment plans” are considered group health plans under ERISA when the reimbursement is tied to the employee’s other health insurance coverage. Group health plans are now subject to ACA reforms and cannot have annual dollar limits for essential health benefits. Therefore, since premium reimbursement plans cover essential health benefits and include an annual dollar limit, they may violate the ACA. Note that taxable reimbursements conditioned on the purchase of individual coverage also create a group health plan with dollar limits in violation of the ACA. However, taxable payments forwarded to insurers for individual coverage may be permissible if (1) the employee is given the choice to receive the cash or have the payment applied to individual coverage and (2) the arrangement meets ERISA’s definition of a voluntary plan. To meet this definition, the employer cannot endorse or contribute towards the cost of coverage. Group health plans that provide retiree-only coverage or “excepted benefits” are not subject to ACA reforms. Excepted benefits include plans that are limited to dental/vision coverage if offered separately from the group medical coverage. These plans can have dollar limits and can continue to be reimbursed on a tax-preferred basis. In summary, in order for an employer payment or reimbursement plan to be in compliance with the ACA: Employers cannot: Reimburse or pay for a current employee’s individual coverage on a tax-free basis. Allow employee pre-tax salary reductions for the cost of individual coverage. Pay for or reimburse an employee’s individual coverage on a taxable basis. Employers can: Provide a Health Reimbursement Arrangement (HRA) to reimburse former employees (retirees) on a tax-free basis for their group or individual coverage. Due to IRS double-dipping rules, the HRA cannot reimburse for coverage that is paid for with pre-tax dollars. Provide an HRA to reimburse current employees on a tax-free basis for other group coverage (retiree, COBRA), as long as the HRA is integrated with a group health plan. Due to IRS double-dipping rules, the HRA cannot reimburse for coverage that is paid for with pre-tax dollars. Provide a stand-alone HRA to reimburse on a tax-free basis for dental/vision coverage or expenses. Provide cash-back for waiving group health coverage offered through a cafeteria plan. Allow employees to elect to reduce their pay and have post-tax payroll deductions sent to the insurer.The employer must not endorse or contribute to the plan. Please note that HRAs create a group health plan with other compliance implications, including COBRA, ERISA, and ACA reforms.

Let's say it was cheaper for the employer to reimburse employees for their share of ACA, instead of the company getting a group insurance. Employee A does his tax return and because his income was low he qualifies for a subsidy and gets of a refund (ACA refund), this would be considered double dipping in my eyes and the employee should return the refund to the employer or not claim the subsidy, correct??? But is there a way of informing the IRS an employee is getting a reimbursement to prevent him/her of milking the system? Thanks Edit: I believe I found the answer, but I will wait to see what other say before I post it.

Today I found out there are merchant service brokers, just like insurance brokers that help you find a good deal. My client signed a deal with a broker to find credit card merchants that had lower fees and every time he found one he would move the account to a new merchant. But what the merchant broker failed to inform my client was that he would be paying a hefty cancellation fee each time the account was moved. Does this sound like a scam or is this practice common?

Banks now a days are teaming up with companies like ADP & Paychex, and are able to provide payroll for a fraction of the cost or even for free sometimes.

Lol this will only affect computer builders, if you already have it don't sweat it.

I would like to see some sample of other members tax organizer, I like ATX's but I would be interested in something more simple for my clients (KISS) to follow.

The IRS loves cash-only business by the way.