The IRS sends out millions of computer generated letters a year to taxpayers. These letters are rarely welcome, as a result they can pile up unopened and certified letters are not collected from the post office.
While stamp collecting can be a rewarding and stress relieving hobby, I don’t know anyone that has the same experience with collecting IRS Letters. Everyone has rights to IRS appeals and tax court that are time sensitive. Having those deadlines go by the wayside make resolving your tax issue more difficult.
Often the IRS thinks you owe more in taxes, when in fact that is not true when all the facts are know. Some issues can be simply and quickly resolved.
The best strategy for dealing with IRS correspondence is to carefully read the letters and response to the IRS. If you don’t feel comfortable doing, this contact a tax professional that can interpret the letter, protect your rights, and craft the proper response.
Don’t loose another nights sleep, give us a call.
With the new tax law now in place, you can still deduct your interest on home equity loans that are at or below $100,000, if the loan was used to buy, build or substantially improve your home.
So if you took out a $25,000 home ‘equity’ loan to remodel your kitchen, that interest could still be deductible as an itemized tax deduction.
There could also be other options to deduct that interest depending on the use of the loan monies.
IRS Revenue Officers are continuing to focus on the payroll taxes that employers are required to both file and remit to the IRS on a regular basis. The IRS has determined that getting employers to pay these taxes is relatively easy money and the longer that a business goes not paying these taxes the more likely they will default and the IRS will never get the money. However the government will have to still cover the Medicare, Social Security and income tax withholding for the employees.
For the business owner the risk is that the IRS will go after them personally for the “Trust Fund” taxes and assess an penalty of 100% on those funds. The Trust Fund is the employee’s income tax withholding and their half of the FICA tax. The owner(s) can’t escape this via bankruptcy or by closing down the business.
If you are in this situation or know someone who is give us a call, we can help.
HSA accounts (Health Saving Accounts) are one of the best tax avoidance strategies available.
The accounts are funded through payroll withholding. They are provided by your employer if you have a high deductible Health Insurance plan.
The tax advantages are that the withheld money is free from both income, social security and Medicare taxes. Then any investment growth is tax free. Finally, the money used to pay medical expenses is tax free when withdrawn.
You will need to look at your individual situation to determine if an HSA is right for you. For wealthier taxpayers that don’t need to access the HSA on a yearly basis and can self-fund the yearly health plan deductible, holding an HSA until retirement could part of your financial plan.
I’ll be at the Washington State Society of Enrolled Agents table at the Small Business Fair. The fair is at the Renton Technical College September 29 from 8:00 to 4:15. There will be great speakers and exhibitors that you can access for free. This is a great resource for both existing and potential small businesses, hope to see you there.
Calling all current and aspiring small business owners! Join us on September 29, 2018 for the 22nd annual Biz Fair at Renton Technical College to learn from the experts how to start or grow a successful business.
Biz Fair is the longest running all government and non-profit-run small business fair in Washington State.
Sharpen your skills by attending seminars taught by savvy business experts who share their knowledge and real-life experiences in a no-sales environment.
Gain access to valuable small business resources – visit the Exhibitor Resource Center, staffed by representatives from federal, state and local government agencies, and business and trade associations.
The fair is free, with plenty of free parking and no advance registration.
Visit www.bizfair.org for more information.
Find us on Facebook at www.facebook.com/bizfair.
Follow us on Twitter at https://twitter.com/bizfair.
Wondering if you need a tax pro or if you can DYI? Dave Ramsey has a quick quiz to help answer that question. Take the quiz yourself to find out!
This act has wide ranging impacts to the income tax system for both businesses and individuals. Most of the changes take effect in 2018, however there are a few that are retroactive to 2017.
When we prepare your taxes, we will give you insight into how the new tax law will impact your taxes in 2018. There are many moving pieces of the tax law that changed so it would impossible to make general statements on how it would affect everyone. For most people and businesses, the changes should be positive.
Wondering if you are missing a deduction on your 2016 tax return? Well worry no more, through the rest of December we are offering a free review of your 2016 tax return. Call for an appointment either in person or virtually.
A newer IRS scam is coming to a mailbox near year. Scammers are sending out CP2000 letters that are demanding payment for tax return errors. It is not uncommon to get these letters if something was missed on the tax return. Below is as short write-up on the issue. If you have gotten a letter you can speak with us about it to determine if it is legitimate.
IRS Alerts Practitioner Groups of Fraudulent CP 2000 and ACA Letters
In a November 16 IRS National Public Liaison (NPL) meeting, IRS alerted tax practitioner groups of another variation of the fraudulent CP 2000, Notice of Proposed Adjustment for underpayment/Overpayment, scam where fraudsters are sending these notices to taxpayers asking them if they agree with IRS’s findings and to send them a check. The letters also inform the taxpayers that if they disagree with the IRS’s findings, that they should still send the fraudsters a check. In addition, fraudsters are sending taxpayers fake notices relating to unpaid taxes in relation to the Affordable Care Act, while also giving these taxpayers an indication that they may report them to immigration services. Again, the fraudsters ask the taxpayers if they agree with the IRS’s findings and to send the fraudsters a check, and if they disagree, to also mail the fraudsters a check.