Tis the season and in many areas of the business world, it is common to buy gifts for customers and business associates. This is just one way to maintain good working relationships, increase professional networking, open doors for opportunities as well as thanking someone for a job well done. There is also an another good reason to purchase such gifts. All or, at least part, of the costs associated with purchasing business gifts, may be deducted from your taxes. There are IRS rules that must be followed.
IRS Gift Definition
The IRS defines a gift as any transfer of an item to a person either directly or indirectly. This transfer does not have to have full consideration returned. Consideration is money or the value of an item in terms of money.
This is like many other types of tax deductions; the IRS places a limit on just how much can be deducted when money is spent to purchase gifts associated with doing business. The IRS limitation is $25 per recipient per year at this time. A business is able to spend as much as it feels necessary... read article
2015 has introduced new tax reforms on the state level, federal level and international level. These tax reforms will impact business conduct and procedures in various ways. As long as executives remain familiar with the basic changes, conducting business as usual for 2015 through 2016 should be no sweat.
Some of the key reasons why businesses may be affected in 2015 is the government’s pressure for transparency and political members’ progressive economic projections for the coming years. Such pressures make for strategic plans and firm projections difficult for some companies. In order to remain in compliance with these reforms, hiring a law firm for business tax related purposes is essential, especially with the increase demand for documentation and reportings. Below are tips and outlines of issues that may assist leaders in strategizing and preparing for a challenging road ahead.
Increased Demand for Transparency
In late 2014, an increased pressure for transparency was put on businesses, with a demand for documentation of all transactions, and reporting obligations. These changes were put in place for the sake of putting public speculations and suspicions at ease. Companies that are in... read article
Small business owners with their myriad of jobs they must do every day to keep their business running are often the most likely to get themselves into tax debt problems. Three of the biggest culprits leading to tax problems are a volatile income stream, disorganization and procrastination. All of these reasons are understandably present when often the busy pace of running a businesses where you have to wear many different hats to keep things running.
Volatile income is one of the biggest challenges that can face many types of small businesses, and really make taxes a difficult time. A few industries can really be feast or famine that not makes every day life more difficult, without a highly disciplined approach it can open the door to serious tax problems. For example real estate agents may have an exceptional year, closing on an unusually busy year with high-dollar home sales followed by a lengthy drought. Without proper planning this can leave the business owner a high tax bill at a time when the money to pay is not available. This can lead to a backlog of large tax debt or more problems if the business owner gets a little too “creative”... read article
Many people look for quick solutions when Uncle Sam is breathing down their neck. However, experts recommend that you do your due diligence before you seek the help of a company.
There are several reputable firms with tax attorneys, enrolled agents and certified public accountants that can help you settle your tax debt. However, there are some companies that say they can help you solve your tax problems for a couple of pennies. These companies are usually scams.
You have probably seen or heard the advertisements on radio and television that claim they can help you save 90 cents on the dollar if you allow them to resolve the tax liabilities. David Moise, who works for WeiserMazars, has stated that those claims are most likely too good to be true.
He also states that there are some companies that allow you to resolve your tax problems for a small amount of money. However, the advertisements that you have seen suggest that you will be able to negotiate a resolution with the Internal Revenue Service without taking into account your ability to pay. That is not true.
Advertisements are not the only things that are giving people misleading tax advice. Many companies are reaching out... read article
I cannot afford to pay my taxes and an extension will not help!
Ok so after preparing your return, and double checking you have been able to claim all legal deductions you find that the amount you owe is so large that even a payment extension will not allow you enough time to pay the amount. Not a pleasant situation to be in, but you certainly are not the only one to be there.
Many in this situation may put of actually filing the return because they feel there is no possible way they can deal with the tax burden they owe. As a consequence they make the situation worse by delaying any proactive action and accumulating additional interest and penalties. Or they chose the to file, and fail to pay anything because they cannot pay the full amount. In time the IRS begins collection activities including harassing phone calls, letters which can lead to a slew of problems including liens on your property, bank account levies and wage garnishment.
Fortunately again there is a way to resolve this situation without getting into further trouble with the IRS, and it has a name – the Installment Agreement.
The Installment Agreement allows a taxpayer to... read article
For the second installment in the series we will be addressing another common issue that can cause taxpayers to get themselves into trouble with the IRS.
Being Afraid Of An Audit.
Problems from fear of being audited usually result in two things; either the taxpayer is afraid of being audited so they over pay on taxes they do not actually owe or worse, they are paralysed and rather than risk being audited they put off filing until it becomes a real problem to deal with.
Both problems have costly consequences, but they also both have the same solution:
Make your returns audit-proof.
This may sound like perhaps not taking all of the tax exemptions you may qualify to better “fly under the radar” but that is not the case.
While you certainly should not be accepting tax deductions that are false, legal tax deductions will save you quite a bit of money and not accepting them is no guarantee that you will not be audited anyway.
The other reaction of fear of an audit is often freezing up and putting off even filing your returns, will create far worse problems. If you are concerned that your taxes may be too high, or that you do not... read article
A responsibility that is shared by all wage earners and businesses in this country is the requirement to pay income taxes at the state and federal level. While paying taxes and filling out tax forms is something that is done on an annual basis, the tax code has become very complex and has made filling out taxes correctly a challenge for many. For those that need help in preparing their taxes, hiring an accountant could be a great option. An accountant can provide a number of services.
Often individuals and business owners need help with a host of tax issues, but for some issues like substantial delinquent tax debts, only an experienced attorney would be recommended. Accountants and other tax professionals are more suited for day to day operations and none-distresses tax filing.
The first service that comes with hiring an accountant is that they will be able to prepare your taxes for your and will be able to reduce your tax liability as much as legally possible. Tax accountants are well aware in recent changes to the tax code, which could have an impact on your final tax bill. These changes could include new deductions and credits that could apply to... read article
If you have any offshore or international accounts or income with banks or other financial institutions and to date have not yet reported them to the IRS for fear of being prosecuted, then the voluntary disclosure program will give you the opportunity to be compliant without criminal tax evasion implications.
The current program is similar to the 2011 Offshore Voluntary Disclosure Initiative (OVDI) but does have some key differences. The penalty structure of the current program is nearly the same as the OVID program with the exception for those who fall into the highest penalty category.
The biggest difference is that unlike OVID there is not a set deadline. That's both good and bad – while there is no set deadline it also means the IRS can choose to cancel at any time.
The new program the penalty for the highest aggregate balance in foreign bank accounts/entities or value of foreign assets during the eight full tax years prior to the disclosure has risen a steep 25% higher from the previous penalty in the 2011 OVID program to 27.5%. Other penalties may be less though and some taxpayers may only be faced with a 12.5% or even a 5% penalty depending... read article
When it comes to facing the Internal Revenue Service, nobody should go at it alone. There are intricacies that can only be properly handled by someone well-versed in tax law to ensure the best outcome is reached. However, there are some things that should be avoided. You may have seen TV commercials advertising large tax resolution firms that portray their clients has all getting free from the IRS for only "pennies on the dollar". While this is possible in some circumstances, it is often not the norm, like the old adage - if it's too good to be true, it probably is.
Spend some time choosing who will become your advocate, but I can say look for an experienced Florida tax attorney who specializes in IRS resolution that will personally handle your case. Below are some tips to help anyone going through tax problems find the best IRS resolution.
Look for Complete Representation
Whether dealing with wage garnishments, bank levies, tax liens or audits, there will be a lot of paperwork to deal with. While a tax defense lawyer will file the appropriate paperwork to the corresponding ... read article
How to indicate if your identity was stolen and ways to safeguard your identity from theft.
Your identity may have been stolen if you have filed your tax return and have found that someone has already filed your tax return using your information. Also, if you have a tax balance due to the IRS and refund or collection actions have been taken against you for a year that you did not file your taxes.
If you receive a letter from the IRS and you feel that your identity may have been stolen, you should respond immediately to the name, address, phone number that is listed on the IRS letter please contact the IRS and your tax lawyer as soon as possible to resolve this matter.
There is also a unit of the IRS that responds to identity theft outside of the US and if you feel that you have been at risk due to a lost purse or wallet, questionable credit card activity, you should call the Identity Protection Specialized Unit so further steps can be taken to secure your account.