A few years ago, a company came in that was continuously being audited by the IRS. They had paid over $15,000 in penalties and interest for taxes owed on disallowed deductions. The previous advisor told them that this was a cost of doing business. We looked at what the Service was disallowing, analyzed their business and helped establish the documentation...
Tags: Client Service
Category: Taxes
Now that the pain of tax season is over, people usually think about how much they paid in taxes last year. Answer this if you can: Do you or your contacts feel –- As if you have to apologize to your advisor because you want to understand some basic aspects of your return. or Like you’re in an endless cycle...
Tags: second opinion
Category: Taxes
Did you know that as a US citizen, you are required to report your worldwide income from all sources on your US tax return? Any taxes paid to a foreign country on that income is then subject to a foreign tax credit. The omission of such income is considered to be tax evasion. This is a high audit target area...
Tags: worldwide income
Category: Taxes
Here are a few things to consider when making gifts of appreciated stock. If you are gifting to a qualified charity, you get a deduction for the fair market value of the stock even though your basis (cost) is less than the current value. When the charity sells the stock, there are no taxes due since qualified charities pay no...
Tags: appreciated stock gifting
Category: Taxes
It’s important to impart life’s lessons to your children. Prime example: Will your children be able to handle their finances when they become adults? Don’t assume they will. “Financial illiteracy” appears to be rampant in the younger generation. The same kid who is adept at using a smart phone or iPad may have trouble with basic math skills, balancing a...
Tags: financial literacy
Category: Taxes
Are you looking for a way to give your employees a tax-free benefit that is also tax-deductible for your business? Why not consider an accountable plan? An accountable plan is an arrangement that lets you reimburse your employees for expenses incurred on behalf of your company, such as driving to the post office or supply store. With a properly administered...
Tags: accountable plans
Category: Taxes
Crooks wanting to steal your identity are using bogus e-mails and websites designed to look like genuine IRS communications. You might expect the April 15 filing deadline to mark the end of these scams, but they, in fact, are expected to continue for months. An example of these bogus e-mails: You receive a message confirming IRS receipt of your tax...
Tags: Identity TheftTax scam
Category: Taxes
If you have a sizable refund of your 2012 taxes, it may be time for you to check your withholding. After all, when you overpay your taxes, you’re making an interest-free loan to the government. Reducing your withholding is as simple as filing a new Form W-4 with your employer. The form comes with a worksheet to figure out how...
Tags: 2013 withholding
Category: Taxes
Are you looking for a way to help your child with buying a home? Some strategies you might consider include lending your child money, gifting under the annual gift tax exclusion, pledging securities, and equity sharing. Assuming you have enough liquid assets, you can effectively act as the mortgage lender to your child by lending money to pay for the...
Tags: child home ownership
Category: Taxes
The IRS and the Treasury Department are getting increasingly interested in U.S. citizens who maintain foreign bank, savings, and investment accounts. If you have any foreign investments, there’s an approaching reporting requirement that you should be aware of. You are required to file “Treasury Department Form 90-22.1,” the “Report of Foreign Bank and Financial Accounts,” if you have a financial...
Tags: Foreign AccountsForm 90-22.1
Category: Taxes