Small businesses and audits

It’s a well-known truth that running a small business is considered an audit risk for taxpayers. Auditors have found that self-employed people often claim too many deductions and write off expenses that aren’t strictly related to business purposes. Even if you’re keeping everything on the up and up, you’re lumped in with all the other …


Audit risks for individual taxpayers

The IRS’ audit rate on individual income tax returns was 0.59% last year, which represents the lowest rate in the past 17 years. Households in all tax brackets saw a decline in audit rates, except the $50,000-$75,000 bracket, which experienced a 0.06% increase. Overall, the low audit risk sounds like good news for taxpayers, but …


Do you know who’s preparing your taxes?

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? The IRS has warned taxpayers to be on the watch for what they’re calling ghost preparers—a catch-all term for …


Irma’s Impact on Employer Retirement Plans

In our last post, we told you how the Hurricane Irma may have affected your tax deadline. But has the storm’s devastation impacted the deadline for retirement plan funding? The IRS does not specifically address the deadline for accrued retirement plan funding for those allowed an extension of time to file certain tax returns through …


Has Hurricane Irma Impacted your Tax Deadline?

Filing Deadline Relief for Parts of Florida Affected by Hurricane IRMA. The IRS just announced relief for victims of Hurricane Irma in parts of Florida and elsewhere will have until January 31, 2018 to file certain business and individual tax returns. The IRS also announced certain tax payments will be extended as well for quarterly …


Common IRS Audit Triggers

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 …


Standalone Health Reimbursement Arrangements Fail to Comply with Obamacare for Employee Coverage

A Health Reimbursement Arrangement is an account funded by an employer to reimburse employees for medical care expenses.  In the past, these arrangements have also been available to reimburse employees for purchasing their own private health insurance in lieu of having a company plan.  In light of Obamacare, an important question arises: Does an Employer Funded Health Reimbursement …


Cancellation of Debt: What it Means to You

Cancellation of debt is an issue that we see increasingly often while preparing tax returns and is something that every taxpayer should understand.  Any time there is a short sale, or a foreclosure, or any other such transaction, there is cancellation of debt.  These are not the only circumstances in which cancellation of debt occurs, …


Social Security Taxes Increase in Fiscal Cliff Deal

The new tax deal to avert the Fiscal Cliff may affect taxpayers who are struggling the most.  Social Security taxes increase as part of the agreement to avert the Fiscal Cliff to pre-2011 withholding rates of 6.2% of gross wages up to $113.700. The rate had previously been lowered starting in 2011 from 6.2% down to 4.2% …


Health Insurance Rebate Checks

We are all used to sending checks to the health insurance company.  So what do you do when you start getting health insurance rebate checks back from them?  This is happening in some cases because of a provision in the Affordable Care Act that says insurance companies can’t have too much profit. Employers who receive …

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