Safeguard data from natural disasters

Tuesday, June 26th, 2012

If your local meteorologist says a Category 3 hurricane is coming tomorrow, are you prepared? You may have shutters on your windows and a stockpile of canned food and bottled water, but what about your financial records?  The IRS identified several steps that individuals and businesses should take to protect themselves against losses from natural disasters.

• Create an electronic set of backup records (e.g. bank statements, tax returns, insurance policies).
• Document valuables with photographs or videos of home contents and store with a friend or family member who lives outside the area.
• Update personal and company emergency plans.
• Check on fiduciary bonds if you are an employer who uses payroll service providers; a bond could offer protection if the provider defaults.

IRS specialists trained to handle disaster-related issues can be reached by calling 1-866-562-5227, and copies of previously filed tax returns can be requested by filing Form 4506 (Request for Copy of Tax Return).

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Scott F. Berger is a tax and accounting services principal at Kaufman, Rossin’s Boca Raton office.  Kaufman, Rossin & Co. is one of the top CPA firms in the country.  He can be reached at sberger@kaufmanrossin.com.

Another IRS email scam

Tuesday, June 5th, 2012

The IRS will never initiate contact via email. If you receive an email claiming to be from the IRS, it is a SCAM!

Below is a screenshot of one of the scam emails being sent.

If you have any concerns or questions, feel free to contact your Kaufman, Rossin professional.

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Scott F. Berger is a tax and accounting services principal at Kaufman, Rossin’s Boca Raton office.  Kaufman, Rossin & Co. is one of the top CPA firms in the country.  He can be reached at sberger@kaufmanrossin.com.

Is the IRS targeting you?

Wednesday, September 28th, 2011

If you make more than $1 million, watch out.  Seems like the IRS is targeting wealthy taxpayers.  8.4% of taxpayers making more than $1 million were audited last year, compared to 1.1% of the general population. For those with more than $10 million, the audit rate was %18.4.

Barron’s recently posted an article online called “How the IRS Is Probing the Rich.” “…Folks with fat bank accounts, pricey properties, big incomes, large investments and complex tax profiles” should be on the lookout. The federal government is trying to recoup some of the billions in taxes that is estimated due, but not collected.

The new “wealth unit” may have you in their sights. Red flags:

• property transfers
• certain investment losses
• home-loan interest deductions
• foreign income
• big spenders

The IRS is getting a nice return on their investment. The IRS estimates that for every dollar they spend on enforcement, they bring in as much as $10.

This article is definitely worth browsing, especially if you fall into the category of “rich.”

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Scott F. Berger is a tax principal at Kaufman, Rossin’s Boca Raton office.  Kaufman, Rossin & Co. is one of the top CPA firms in the country.  He can be reached at sberger@kaufmanrossin.com.

Taxpayers aren’t always receiving timely and quality responses from IRS

Thursday, August 11th, 2011

Most taxpayers aren’t getting timely responses to written inquiries to the IRS, and not all responses are completely accurate says a recent report by the Treasury Inspector General for Tax Administration (TIGTA). 

The IRS received about 20 million letters, forms and other written correspondence from taxpayers in 2010. The TIGTA found that most final responses from the IRS were accurate; however, the interim responses were not clear as to what taxpayers should do.

The report examined random correspondence cases and found that only 19 percent of the cases received timely and accurate responses. The report also showed that the IRS is not following its own policy guidelines and has not implemented any measures or processes to monitor and evaluate the correspondence to make sure taxpayers are receiving timely responses. The IRS’s goal is to respond within 30 days. The IRS disagreed with the outcome measures the TIGTA stated in the report.

 Click here to read the full report by the TIGTA. 

What does this mean for you? Taxpayers should exercise patience when dealing with the IRS.

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Scott F. Berger, CPA is a tax principal at Kaufman, Rossin’s Boca Raton office.  Kaufman, Rossin & Co. is one of the top CPA firms in the country.  He can be reached at sberger@kaufmanrossin.com.

Attorneys Audit Technique Guide

Monday, August 8th, 2011

The IRS published the Attorneys Audit Technique Guide to help examiners audit an attorney’s tax return. However, the document is not an official pronouncement of the law or the position of the IRS, and cannot be relied upon as such.

The Guide notes in part that:

1. the identity of a client and the nature of his or her fee arrangement generally is not protected by the attorney-client privilege.
2. attorneys who base their fees on hours worked plus case-related costs should be able to provide detailed records of their time and costs since that is how they bill their clients.
3. attorneys working on a contingency fee basis use either a gross fee contract (where court costs, expert fees, etc. are deductible business expenses) or a net fee contract (where expense advances are treated as loans until settlement).

To view the entire Guide, click here. If you have questions, please don’t hesitate to contact me at 561.394.5100 or sberger@kaufmanrossin.com or any Kaufman, Rossin professional.

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Scott F. Berger, CPA is a tax principal at Kaufman, Rossin’s Boca Raton office.  Kaufman, Rossin & Co. is one of the top CPA firms in the country.  He can be reached at sberger@kaufmanrossin.com.

Employers will pay less tax starting July 1

Friday, June 10th, 2011

Employers are currently required to pay federal unemployment taxes pursuant to the Federal Unemployment Tax Act (FUTA). FUTA provides the necessary funding to compensate those who have lost their jobs. As an employer, you are subject to pay FUTA tax on the first $7,000 of each employee’s annual paid wages.  Since 1988, the 6.2% FUTA has comprised of two rates: 6.0% permanent rate and 0.2% temporary surtax.

The 0.2% FUTA surtax is set to expire on July 1, 2011 decreasing the FUTA tax rate to 6.0% for the remainder of 2011.

The IRS provides three tests to determine which employers must pay FUTA tax. Click here to access these tests.

To learn more about the FUTA tax please visit the IRS website.

If you have any questions or concerns, please contact me or any Kaufman, Rossin professional.

Dennis Fitzpatrick is a tax principal at Kaufman, Rossin’s Miami office.  Kaufman, Rossin & Co. is one of the top CPA firms in the country. He can be reached at dfitzpatrick@kaufmanrossin.com.