Accounting News and Notes

Duluth/Suwanee/Lawrenceville  CPA:  IRS Just Announced the 2013 Mileage Rate

The IRS Just Announced the 2013 Mileage Rate as 56.5 cents per mile. This is up from the prior year mileage rate of 55.5 cents per mile. Please keep in mind that tax law requires all taxpayers who use an auto for business use to keep a by day mileage log to support all business miles.

John Dillard is an Christian Speaker/Author and an Atlanta CPA. To See how he takes Christ along with him to work visit http://www.hiscpa.com/ and for his latest book Overcoming Life’s 9/11′s: Job’s Journey and a Voice of One: Nehemiah’s Prayer or call John Dillard CPA today at 770.814.9304 (All Rights Reserved) Dare to Attempt Something so Great for the Kingdom of God that it is doomed to failure, lest Christ be in it!

Contact HIS CPA PC (A Christian Atlanta CPA Firm) today.

We advise clients on: IRS representation, Offer in Compromise, Tax Problems, Incorporation in Georgia, Corporate and Personal Income Tax Returns, Part-time CFO, Virtual Controller, Business Planning, Offer in Compromise, Back Taxes, Bookkeeping

www.HisCPA.com A Christian CPA Firm in Duluth GA Proudly Serving Suwanee, Lawrenceville, Snellville, Lilburn, Duluth, Norcross, Peachtree Corners, Atlanta, Gwinnett, Johns Creek, Roswell, Forsyth, Flowery Branch, Buford, Dunwoody, Grayson, Alpharetta, Roswell, Sandy Springs & Tucker as a Faith Based CPA

Want a Free Initial Consultation About Your IRS Tax Representation/Audit Issues? Looking to obtain penalty abatement from the IRS, set up a payment plan for file old back tax returns with the IRS? We work closely with you to help resolve:

• Tax Garnishment

• Trust Fund Penalties

• Offer in Compromise

• 100% Penalty

• Statute of Limitations

• IRS Tax Issues/Tax Problems

• IRS Tax Penalties

• IRS Tax Levies

• Tax Liens

Call us today for a free initial consultation…all you have to do is show up and the initial consult is free. Call us today to be sure that all of your rights are protected and that you pay only your lowest legal possible tax allowing us to help with:

• Collection Appeal

• IRS Installment Plans

• Delinquent Returns

• Late Payment/Filing of Payroll Tax Returns

• Wage Levies

•Tax Advocacy

• Back Taxes/Returns for Personal & Business Income Taxes

• IRS Representation

• IRS Appeals

To Read more about our IRS Tax Representation Services see http://www.hiscpa.com/irs-representation.html We Help You to Ensure that only your lowest legal possible tax is reflected by:

• Determination of Filing Status

• Review of Past Filed Returns

• Amending Tax Returns

• Filing of Past Returns

• Evaluating & Determining Tax Elections

www.HisCPA.com A Christian CPA Firm in Duluth GA Proudly Serving Suwanee, Lawrenceville, Snellville, Lilburn, Duluth, Norcross, Peachtree Corners, Atlanta, Gwinnett, Johns Creek, Roswell, Forsyth, Flowery Branch, Buford, Dunwoody, Grayson, Alpharetta, Roswell, Dunwoody, Sandy Springs & Tucker as an Award Winning CPA

Duluth/Suwanee/Alpharetta CPA: Determining Tax Dependents on Your Personal Return

The number of dependents a taxpayer has is one of the key factors used in calculating the total number of exemptions. To this total taxpayers who are disabled, blind, or elderly are allowed to take an additional exemption when determining their taxable income. One’s total dependents and additional exemptions are then multiplied by that year’s amount to determine the total reduction in taxable income. Exemptions, like itemized deductions, are by law phased out/reduced based upon the taxpayer’s filing status and adjusted gross income.

Our son who is 19 and is a full time student at the University of Georgia earned about $3,000 last year working for money to contribute to their living expenses. If he files a return he gets back about $350. Does doing this impact our ability to claim him as a dependent on our personal returns?

Below is my response:

AS LONG AS HE IS IN SCHOOL OVER 5 MONTHS A YEAR AND IS UNDER THE AGE OF 25, YOU CAN CLAIM HIM AS A DEPENDENT AS LONG AS WHEN HE DOES HIS PERSONAL RETURN HE DOES NOT ALSO CLAIM HIMSELF (WHICH IS USUALLY NOT A PROBLEM AS THEIR INCOME IS SO LOW THEY STILL USALLY GET BACK MONIES REGARDLESS OF WHETHER OR NOT THEY CLAIM THEMSELVES). TYPICALLY PARENTS BY FAR ARE USUALLY IN A HIGHER TAX BRACKET THAN THEIR CHILDREN IT IS MOST ALWAYS BETTER FOR THE FAMILY FINANCIAL UNIT AS THERE IS MUCH MORE TO BE SAVED ON THE PARENTS RETURN THAN ON THE CHILDS.

Determining Filing Status and Dependents

The first step in filing your personal Federal tax return is to determine your correct filing status and the number of deductions you can claim. It sounds simple, but it can make a difference in the amount of tax you pay. As an Atlanta CPA I have learned over the decades that this is an essential component of keeping your tax bill as low as legally possible; to learn more about his and other important tax news visit http://www.hiscpa.com/personal-returns.html

Christian CPA Challenges Atlanta Believers: Are You Letting People Know You Love Christ?

Are You Letting People Know You Love Christ? If not, why not? Certainly there are opportunities in some parts of your life where you can be ALL that God made you to be. Pray that you become a light unto a lost world and that you seek to tell ALL you meet the Good News of Jesus Christ. The below is a sample note we might receive off of our web site. See what you can do today to let others see God in You!

I am currently studying for my CPA exam, after receiving my MBA in Accounting a year ago.  The reason I am contacting you is because I too, am a born again Christian.  I admire your ability to show your faith through your work.  I would love to talk to you about that, and Accounting.  If you have a few moments, I’d love to meet with you at your office, or a phone call if you are too busy. Thank you for reading.

John Dillard, CPA of His CPA, PC (An Atlanta Christian CPA firm) 1940 Woods River Lane, Duluth, GA 30097  Phone 770-814-9304   http://www.hiscpa.com/  To retain John Dillard CPA (An Atlanta Christian Speaker/Author) for your business group or church congregation, you can contact him today at 770.814.9304   Dare to Attempt Something so Great for the Kingdom of God that it is doomed to failure, lest Christ be in it!   We advise clients on: IRS representation, Offer in Compromise, Tax Problems, Incorporation in Georgia, Corporate and Personal Income Tax Returns, Part-time CFO, Virtual Controller, Business Planning, Back Taxes, Business Acquisitions/Sales, Forensic Accounting, Business Valuations and Bookkeeping.

www.HisCPA.com A Christian CPA Firm in Duluth GA Proudly Serving Alpharetta/Suwanee/Lawrenceville/Norcross/Atlanta/Gwinnett/North Fulton/Johns Creek/Roswell/Forsyth/Flowery Branch/Buford as an Award Winning CPA

Duluth, Norcross, Alpharetta CPA: Completing IRS Form W-4 and Worksheets & Georgia Form W-4

Determining Your Federal & State Withholding

Marital Status

People who qualify under the claim of married generally have a lower withholding rate. If you are not married then you must take your withholding at the increased single rate, head of household or the highest tax bracket, married filing jointly.

You should mark single in the box if any of the following apply to you:

• If you are single, divorced, or separated from your partner by order of court and law

• If you are married but your spouse is not an American citizen

You should mark married in the W-4 if any of the following apply to you:

• If you and your spouse are both legal U.S. Citizens. If your spouse dies during the current tax year you are still considered married for that tax year.

• Either you or your spouse is considered a resident alien. You can find the details on resident aliens on IRS Publication 519.

If you are married but still withholding at a single rate. If you and your spouse, both working, cannot meet the requirements of a married withholding tax then you can file a “married, but withhold at a single rate” to fulfill the necessary payments for married withholding.

Determining Withholding Allowances

Allowances run in relation to your amount withholding. The more allowances you claim the less income tax you have to withhold, or your employer has to withhold. Your allowances depend on these following things:

• How many exemptions you can take on your tax return

• Whether you have income from more than one job

• What deductions, adjustments to income, and credits you have exacted for the year

• Whether you will file as head of the household

Great care should be taken that you do not under withhold as both the IRS and Georgia will add penalties and interest for any late payment of taxes when you settle up and actually file your IRS Form 1040/personal income tax return.

If you are married, it depends on whether your spouse is going to work or claim allowances on their own Form W-4 to the IRS and the G-4 to the State of Georgia. As a Duluth CPA I have learned over the years that understanding your filing status is confusing, as is tax law, for many taxpayers, to read more on this visit http://www.hiscpa.com/personal-returns.html

Atlanta, John Creek, Alpharetta CPA: Where to Send Your Mail Requests When You Need Tax Information

If you are interested in sending in requests for forms, instructional documents, and IRS publications, you should send your request envelope to this address where you would have normally have filed your income tax return. For a complete list of these and where to file please see http://www.irs.gov/file/index.html

If you are in need of Receiving Information from the IRs through DVDs

With the mail order you can receive instructional DVDs from the IRS (Publication 1796). We have listed the names of the DVDs below: • Instructions for your current-year forms and publications • As well as the same for the prior year • They will send you Tax Map, which can be used to find and research information electronically • Included is a Frequently Asked Questions guide about Tax Laws and Codes • A List of topics from the IRS hot line information systems • The actual Internal Revenue code defined by the IRS in full. • Easy to complete, fill in the blank tax documents • A beneficial list of IRS tax bulletins and posts • A list of toll free and email support names and numbers

This release twice a calendar year, January and March. These DVDs can be bought from the NTIS from the website : www.irs.gov/cdorders for $30. These DVDs are helpful and informative. Though many smaller issues such as requesting a copy of a prior tax return or a copy of a prior tax form can be best handled by yourself. I suggest that all taxpayers who are facing any substantive issues such as the below retain a CPA who is well versed in tax representation issues, back taxes and tax advocacy.

Help Avoid an IRS Audit Discover simple steps that you can do to help prevent an IRS audit. Though the tax code is at times very difficult to understand and comply, these basic simple steps will help you avoid an IRS audit. See http://www.hiscpa.com/avoiding-audits.html

Atlanta Offer in Compromise When all else fails and if you qualify, the IRS and Georgia both have a program which will enable you to work to solve the severest tax problems. Visit http://www.hiscpa.com/offer-in-compromise.html

Atlanta IRS Installment Plans to Pay Your Past Due Taxes The IRS has long been in the business of helping taxpayers get back into the system to ensure that taxpayers are able to pay their taxes over time. For those who do not qualify for an Offer in Compromise or to pay the taxes and interest in full, while seeking penalty abatement, an Installment Plan is a prudent and wise choice and alternative to get your past taxes due paid and current. See http://www.hiscpa.com/installment-plans.html

We serve clients that are located in Atlanta GA, Gwinnett County, Duluth, Lawrenceville, Snellville, Dunwoody, Lilburn, Decatur, Tucker, Suwanee, Cobb County, Forsyth County, Berkeley Lake, Dacula, Alpharetta, Johns Creek, Lawrenceville, Marietta, Milton, Norcross & Beyond as a Faith Based CPA Firm.

Gwinnett, Johns Creek, Alpharetta CPA: How Can I Know If I Owe Estimated Taxes?

Tax law for both the IRS and the state of Georgia can require certain people and entities to pay these estimated taxes. Those include:
• A sole proprietor, partner, LLC or LLP member or partner, S corporation shareholder, or a self employed individual you are required to pay the tax if you are expecting to be taxed over $1,000 in the year.
• An S-Corporation and are expecting to be taxed more than $500 in the upcoming year you must complete these as well.
• A taxpayer retained a tax liability from the year before then you will most likely have to pay an estimated tax in the current year. However you might be able to avoid this by working closely with your CPA during tax planning. As an Atlanta CPA for decades, we seek that many clients fail in this as perhaps one of the largest areas where clients fail to properly financially plan. You can check on these rules in IRS Form 1040-ES and Georgia Form 600-ES.

Workers who are employees that automatically or ask to have the taxes withheld by their employee are exempt from paying estimated taxes. This is because when the money that would be paid through estimated tax is paid in full through the withheld amount from that specific employee’s income yearly. This information is correctly filed through a W-4 to the IRS and a G-4 with the state of Georgia, where a special blank is left for you to record how much you want your employer to withhold to meet standards of income taxes. You must anticipate your earnings from other sources to cause your taxable income and to adjust your federal and state withholding to be higher accordingly.

If you meet all three of the below requirements are also exempt from paying the estimated income tax:
• You retained absolutely no tax liabilities from the prior year
• You have been a U.S. Citizen/resident for that whole prior year
• You have paid all of your taxes owed for the year from other sources, such as the application of taxes from a prior year or sufficient federal and state withholdings from other sources such as your paycheck.

(Those that had a total of zero tax or were not required to file an income tax return are considered to have no tax liability in the prior year.)

Determing Your Estimated Tax Liability

To correctly come to the sum of your estimated tax you need to know your expected adjusted gross income, taxable incomes, taxes, deductions, and also credits for the year in consideration. We have included a few points to help you calculate the estimated tax:
• To make your process easier utilize your income, deductions, and credits in the past year as a basis for this year’s planning.
• Utilize your past year’s tax information as a guide to doing these steps correctly, while considering substantive changes to this year’s tax situation.
• You must first summarize the amount of income that you expect to income for the calendar year.
• You should be concerned with recording the right amount of income because if it is not done correctly the IRS may charge penalties.

These documents should be subject to change as regulations, codes, and IRS tax laws. Atlanta taxpayers by working closely with their CPA can do much to plan to avoid any unnecessary year-end surprises.

Atlanta CPA: Preparing Corporate Income Taxes for Decades
http://www.youtube.com/watch?v=LCTWMcvho_M

Atlanta CPA on IRS Installment Plans
http://www.youtube.com/watch?v=nvz4y1Ld4vE

www.HisCPA.com   A Faith Based CPA Firm Serving Duluth, Gwinnett, Atlanta, Alpharetta, Johns Creek, Dunwoody, Roswell, Snellville, Lawrenceville & Beyond.

Snellville/Roswell/Alpharetta CPA… Be Sure Your Tax Returns are Right Before They are Filed

Be Sure Your Tax Return are Right Before They are Filed. At His CPA We Work Hard to Be Sure your tax return is correct so that you don’t have to. The below is a sample letter we might send to a client after the initial data has been critiqued getting it ready to file your return. Is it time to upgrade your CPA firms tax services today?

Open Items Your Corporate Data Ready to Income Tax Returns/IRS Form 1120S

As there was no salary paid for the owners please move the Medical Insurance Premiums for active employee owners to Due From Shareholders on the Balance Sheet.

Please let me know what the face value of the Life Insurance is for the policy as listed on the P/L as tax law only allows us to deduct the value/premiums up to a $50K value policy.

Regarding your question about the loans. Loans are not taxable when you get/receive them nor deductible when pay them back. The amount as listed on the Balance Sheet would be the open amount due and payable. This would be true regardless of who the lender is (bank, credit cards, etc.).

To make sure to the extent that you can, when you need to borrow items that you borrow them in your own name and then personally loan the monies to the business. In this way you create tax basis which will allow you to deduct business losses of your S Corporation to the extent you have personally loaned monies to the business up to this amount.

I sent the below several times and have not yet heard back from you. Please review/advise:

-If you business has an average salary of less than $50,000 (not counting owners, their family members and those not on your medical insurance plan), have less than 25 Full Time Equivalents (FTE’s) and provide over 50% of the insurance for all employees you may qualify for the Small Business Health Care Tax Credit. If you think you might qualify please forward the amount of net medical insurance premiums paid by employee (after deducting the amounts an employee paid) along with whether their medical coverage is Single or Family. To read more about the credit visit http://www.hiscpa.com/blog/2011/08/23/atlanta-cpa-does-your-business-qualify-for-the-health-care-credit/ It would be advantageous to record the medical insurance premiums for employees versus owners in a separate P/L account. Please let me know.

-Please review the detail in the Payroll Taxes account as they represent 31% of Gross Wages and they should only be approximately 8%. Please review/advise as at present these are approximately $20,000 higher than they should be. You had mentioned that you are behind on your taxes. Please review to see if the amounts listed here are correct and to be sure that any Late Payment Penalties are segregated out into a separate Profit and Loss Account.
-After you have made these changes please resend the Balance Sheet and Profit and Loss.

www.HisCPA.com A Faith Based CPA Firm in Duluth GA Proudly Serving Alpharetta/Suwanee/Lawrenceville/Norcross/Atlanta/Gwinnett/North Fulton/Johns Creek/Roswell/Forsyth/Flowery Branch/Buford as an Award Winning CPA

Gwinnett Bookkeeping

Snellville/Roswell/Alpharetta CPA…Strategic Tax Advice/IRS Representation

Tax Representation is not for the meek of heart or someone who is not a CPA or is very well versed in IRS Representation issues. At His CPA PC we work hard to be sure that you pay only your lowest legal possible tax. The below is a sample letter we  might send to a client to give them an overview of the issues being addressed and to strategize accordingly. Is it time you upgraded your CPA firms tax services today?

Just got 5 IRS notices regarding your open taxes and I anticipate that to double based upon the open and due returns that you have. I have enclosed the attached IRS letter that is regarding your open and due monies owed by your S Corporation that I will send today.

Though the IRS letter To Seize Your Property or Rights to Property is for your S Corporation, you should expect one for your personal assets as well very soon. It appears on one of the notices that you might have requested an Installment Agreement. This is not the best option to address your taxes as both penalties and interest will continue to accrue.

I suggest you pay all of the taxes and interest in full along with estimated interest while asking that the IRS abate the penalties. To pursue this option, I need from you ASAP a detailed affidavit detailing the reasons for the late filing and payment. Please call me so that we can discuss.

If you decide to do an Installment Agreement I will need for you to complete ASAP IRS Form 433-D & 433-F for both you personally and your S Corporation. I have updated your open and due taxes for both you personally and your S Corporation.

www.HisCPA.com A Christian CPA Firm in Duluth GA Proudly Serving Alpharetta/Suwanee/Lawrenceville/Norcross/Atlanta/Gwinnettt/North Fulton/Johns Creek/Roswell/Forsyth/Flowery Branch/Buford as an Award Winning CPA

Snellville/Roswell/Alpharetta CPA…Amending Personal Income Tax Returns

Amending Personal Income Tax Returns is most something that we have to do after an individual taxpayer does their own personal income tax return. Though tax software has made the actual preparation of tax returns easier, it does not make their user a CPA. Just as giving a surgeons tools will not enable me to be well prepared to do surgery. The below is a sample letter that we might send to the IRS explaining the changes that are required to correct an original return prepared by a taxpayer rather than a CPA. Is it time to upgrade your CPA firms tax services today?

Internal Revenue Service
Atlanta, GA

Dear Sir or Madam,

I am writing you in a good faith attempt to come to terms over the above taxpayers’ present predicament with the IRS, get their returns filed, and to address their tax issues.

The taxpayers had no financial adviser in the past and they have retained me to assist them in this endeavor. At your earliest opportunity please call and confirm that the collection efforts have been stopped.

Please note I have enclosed a copy of the taxpayers 2011 amended return/IRS Form 1040X. Please accept it as filed. Please note the changes include:

-Adjusting property taxes on their vehicles and charitable contributions that were inadvertently not listed on the original return.
-Income from a K-1 that was recently received.
-Reflecting the capital gains/losses inadvertently not listed on the original return.

Enclosed please find a $1000 check to pay the taxes in full of $900 and estimated interest of $100.  I appreciate your attention to this matter and look forward to working with you to close their file.

Sincerely,  John C. Dillard, CPA, PC,  Partner in Charge

Submitting an Offer in Compromise
http://www.youtube.com/watch?v=-0pJ-Yy1kVE

Atlanta Tax Needs for Business Owners
http://www.youtube.com/watch?v=a23HFKe63dU

www.HisCPA.com A Christian CPA Firm in Duluth GA Proudly Serving Alpharetta/Suwanee/Lawrenceville/Norcross/Atlanta/Gwinnettt/North Fulton/Johns Creek/Roswell/Forsyth/Flowery Branch/Buford as an Award Winning CPA