By Denise on Aug 16, 2010 in notes to clients, other | 0 Comments
Over the last couple of months, we’ve been working hard on getting settled at our new location. Here are a few photos from our new office:
For directions to our new location visit our Directions page. For more photos of the progress of our move, visit out Facebook photo album. (Don’t forget to “Like” us!)
By Denise on Jun 16, 2010 in other | 0 Comments
For the last several years, Schoppe’s Bookkeeping & Tax Service has sponsored a little league softball or baseball team. For the second year in a row, we sponsored our granddaughter’s softball team, KaBoom.
Below are a few photos from closing ceremonies on June 12, 2010
Michael & JoAnn with their granddaughter
JoAnn with the sponsor plaque
KaBoom
Sponsor plaque
Congratulations to the team, going into playoffs! Go get ‘em girls!
By Denise on May 31, 2010 in other | 0 Comments
Effective June 1st, we will be in a new location. We will now be found at 508 W. Tyson in Cameron. We are still in the process of setting up our new building, and we invite you to follow our progress on our Facebook page. Our goal is to be able to serve our clients more effectively and efficiently with this change.
Our phone number, fax number and email addresses, etc. will remain the same. As we make our move, it IS possible our phones could be down for as much as a day as the number transfers from our old location to our new location. Email will remain an excellent way to get in touch with us if that should happen, and we definitely want to hear from you!
We are still here for all your income tax and bookkeeping needs… we’re just going to be in an all new location. Stay tuned!!
By Denise on May 13, 2010 in income tax advice | 0 Comments
Business Week recently ran an article full of tax advice from a former IRS Auditor.
The biggest point made in the article: Small businesses are more likely to be audited that individuals, due to the ease of small businesses to understate their income and overstate their write-offs.
…the IRS devotes the greatest share of its enforcement budget—41 percent in 2006—toward small businesses. The agency in recent years has tried to increase compliance through education and enforcement. The Schedule C, which sole proprietors use to report income, is the single most audited business form, says Jeff Collins, a tax attorney and former IRS auditor in Schaumburg, Ill.
Small business owners should not worry about audits as long as they report everything accurately. The article lists out 25 common slip-ups that an audit will catch, and that if these are avoided… an audit should not be anything to stress over.
Among the items in the list: classify your employees properly (independent contractors versus employee), pay your payroll taxes on time and correctly, keep careful and detailed records of your expenses and income — proof of both of these are key in an audit, keep detailed mileage logs and don’t deduct more vehicle expenses than you’re entitled to take, and be careful about what you designate as “other expenses.”
The article is an excellent read, and taking the time to go through all the common tax-mistakes could end up saving you thousands of dollars down the road.
http://www.businessweek.com/smallbiz/content/mar2009/sb20090317_698989.htm
By Denise on Apr 28, 2010 in income tax news | 0 Comments
A recent article in the New York Times states that, “As many as 400,000 nonprofit organizations are weeks away from a doomsday.”
Turns out that a provision in a 2006 federal bill regarding pension reform, the Pension Protection Act, will revoke the tax exemptions of non-profit groups that fail to file tax forms for three consecutive years.
LOSS OF EXEMPT STATUS FOR FAILURE TO FILE RETURN OR NOTICE.—
‘‘(1) IN GENERAL.—If an organization described in subsection (a)(1) or (i) fails to file an annual return or notice required under either subsection for 3 consecutive years, such organization’s status as an organization exempt from tax under section 501(a) shall be considered revoked on and after the date set by the Secretary for the filing of the third annual return or notice. The Secretary shall publish and maintain a list of any organization the status of which is so revoked.
‘‘(2) APPLICATION NECESSARY FOR REINSTATEMENT.—Any organization the tax-exempt status of which is revoked under paragraph (1) must apply in order to obtain reinstatement of such status regardless of whether such organization was originally required to make such an application.
This means that May 16, 2010 is the date in which non-profits that failed to file the last three years consecutively will lose tax breaks. However, according to the New York Times article, the IRS did take measures to help non-profits avoid losing their status:
The I.R.S. would rather not revoke exemptions, either, and it has made a Herculean effort to let organizations at risk know it. For example, in 2007, it sent 665,000 letters to nonprofit groups that fell below the $25,000 threshold and those above that level that had not filed.
Lois G. Lerner, director of the exempt organizations division of the I.R.S, said that while groups would lose their exemptions effective May 16, the I.R.S. would probably not send out notices until January to give nonprofits a chance to bring themselves into compliance with the law.
New York Times Article
Text of HR 4 Pension Protection Act (PDF)
By Denise on Apr 9, 2010 in income tax advice, income tax news | 0 Comments
By this time next week, it will be all over. April 15th will have passed, and with it the deadline to file your 2009 Income Tax Return. If you find yourself unable to get your return completed by that deadline, you can file for a Extension.
However, an extension of time to file is not an extension of time to pay. You will owe interest on any past–due tax and you may be subject to a late–payment penalty if payment is not made timely.
To receive an automatic 6-month extension of time to file your return, you can file Form 4868 (PDF), Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, by the due date of your return. There are three choices for filing Form 4868 ; 1) electronically (such as by computer), 2) by paying part of your tax due with a credit card through an outside service provider listed on the form, or 3) by mail.
If you file your Form 4868 electronically you will receive an acknowledgement or confirmation number for your records and you do not need to mail in Form 4868.
If you need to pay additional taxes, you may do so through the outside service provider or through e-file. You can refer to your tax software or tax professional for ways to file electronically using e-file services. If you wish to make a payment using the electronic funds withdrawal option, be sure to have a copy of last year’s tax return. You will be asked to provide the Adjusted Gross Income from the return for taxpayer verification.
Besides filing electronically, you can generally get an extension of time to file if you pay part or all of your estimate of income tax due by credit card. You may pay by phone or Internet through one of the service providers listed on Form 4868. Each service provider will charge a convenience fee based on the amount of the tax payment. At the completion of the transaction, you will receive a confirmation number for your records.
In addition to filing Form 4868 electronically, or by paying part of your tax by credit card, you can file Form 4868 by filling out the form and mailing it to the place where you will file your return.
Please be aware that an extension of time to file is NOT an extension of time to pay.
If you are a United States citizen or resident alien, who is either: (1) living outside of the United States and Puerto Rico and your main place of business or post of duty is outside of the United States and Puerto Rico; or (2) in military or naval services on duty outside of the United States and Puerto Rico on the due date of your return, you are allowed an automatic 2–month extension until June 15 to file your return and pay any tax due.
For additional information refer to Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad. If you use this automatic 2–month extension, you must attach a statement to your return explaining which of the two situations qualify you for the extension.
If you are serving in a combat zone or in a contingency operation (or are hospitalized as a result of an injury received while serving in such an area or operation), you have at least 180 days after you leave the designated combat zone/contingency operation to file and pay taxes. See Publication 3, Armed Forces’ Tax Guide.
If you are determined by the Service to be affected by a Presidentially declared disaster or a terroristic or military action, then you may have up to one year after the due date of your return to file and pay taxes, depending on the deadline specified by the Service.
For more information:
By Denise on Apr 6, 2010 in income tax advice, income tax news | 0 Comments
The IRS has stated in an internal advice memo that Energy Star appliance rebates are reductions in the purchase price of the energy-saving products and are not to be included in taxable income. Thus, consumers must reduce the adjusted basis of property by the rebate amount and can’t treat the rebate as an expenditure when determining any tax deductions or credits.
Source: NATP TaxPro Weekly
By Denise on Apr 6, 2010 in income tax news | 0 Comments
IR-2010-38, April 1, 2010
WASHINGTON ― Many small businesses and tax-exempt organizations that provide health insurance coverage to their employees now qualify for a special tax credit, according to the Internal Revenue Service.
Included in the health care reform legislation, the Patient Protection and Affordable Care Act, approved by Congress and signed by President Obama on March 23, the credit is designed to encourage small employers to offer health insurance coverage for the first time or maintain coverage they already have. In general, the credit is available to small employers that pay at least half the cost of single coverage for their employees.
“This credit provides a real boost to eligible small businesses by helping them afford health coverage for their employees,” said IRS Commissioner Doug Shulman. “We urge small businesses and tax-exempt employers to look closely at this important tax break — which is already effective — to see if they qualify.”
The maximum credit is 35 percent of premiums paid in 2010 by eligible small business employers and 25 percent of premiums paid by eligible employers that are tax-exempt organizations. In 2014, this maximum credit increases to 50 percent of premiums paid by eligible small business employers and 35 percent of premiums paid by eligible employers that are tax-exempt organizations.
The credit is specifically targeted to help small businesses and tax-exempt organizations that primarily employ low and moderate income workers. It is generally available to employers that have fewer than 25 full-time equivalent (FTE) employees paying wages averaging less than $50,000 per employee per year. Because the eligibility formula is based in part on the number of FTEs, not the number of employees, many businesses will qualify even if they employ more than 25 individual workers.
The maximum credit goes to smaller employers — those with 10 or fewer FTEs — paying annual average wages of $25,000 or less.
Eligible small businesses can claim the credit as part of the general business credit starting with the 2010 income tax return they file in 2011. For tax-exempt employers, the IRS will provide further information on how to claim the credit.
The IRS will use postcards to reach out to millions of small businesses that may qualify for the credit. The postcards will encourage small business owners to take advantage of the credit if they qualify.
More information about the credit, including tax tips, guides and answers to frequently asked questions, is now available on the IRS Web site, IRS.gov.
http://www.irs.gov/newsroom/article/0,,id=220848,00.html
By Denise on Mar 31, 2010 in income tax deadline | 0 Comments
By Denise on Mar 24, 2010 in income tax news | 0 Comments
IR-2010-33, March 18, 2010
WASHINGTON — Two new tax benefits are now available to employers hiring workers who were previously unemployed or only working part time. These provisions are part of the Hiring Incentives to Restore Employment (HIRE) Act enacted into law [March 18].
Employers who hire unemployed workers this year (after Feb. 3, 2010 and before Jan. 1, 2011) may qualify for a 6.2-percent payroll tax incentive, in effect exempting them from their share of Social Security taxes on wages paid to these workers after March 18, 2010. This reduced tax withholding will have no effect on the employee’s future Social Security benefits, and employers would still need to withhold the employee’s 6.2-percent share of Social Security taxes, as well as income taxes. The employer and employee’s shares of Medicare taxes would also still apply to these wages.
In addition, for each worker retained for at least a year, businesses may claim an additional general business tax credit, up to $1,000 per worker, when they file their 2011 income tax returns.
“These tax breaks offer a much-needed boost to employers willing to expand their payrolls, and businesses and nonprofits should keep these benefits in mind as they plan for the year ahead,” said IRS Commissioner Doug Shulman.
The two tax benefits are especially helpful to employers who are adding positions to their payrolls. New hires filling existing positions also qualify but only if the workers they are replacing left voluntarily or for cause. Family members and other relatives do not qualify.
In addition, the new law requires that the employer get a statement from each eligible new hire certifying that he or she was unemployed during the 60 days before beginning work or, alternatively, worked fewer than a total of 40 hours for someone else during the 60-day period. The IRS is currently developing a form employees can use to make the required statement.
Businesses, agricultural employers, tax-exempt organizations and public colleges and universities all qualify to claim the payroll tax benefit for eligible newly-hired employees. Household employers cannot claim this new tax benefit.
Employers claim the payroll tax benefit on the federal employment tax return they file, usually quarterly, with the IRS. Eligible employers will be able to claim the new tax incentive on their revised employment tax form for the second quarter of 2010. Revised forms and further details on these two new tax provisions will be posted on IRS.gov during the next few weeks.
http://www.irs.gov/newsroom/article/0,,id=220326,00.html
