Latest Taxes Articles

Tax Accountants : A Short Guide

Thu, 15 Jul 2010 12:19:23 +0100

Filing your taxes can be a difficult and stressful ordeal to handle, not to mention any mistake can cost you a lot of money. A tax accountant can relieve all the stress that emanates from an intricate tax filing system. Not only will a tax accountant find a myriad of ways to lower next years taxes for you, he or she can also make sure there are no issues when you submit your taxes to the IRS.

If you have a business, you can get help with your cash flow, IRS tax structures, and getting all of the data that you require in order to help determine your taxes with a tax accountant. Business and individuals can benefit from any of a number of IRS tax breaks, which your tax accountant can help you find, giving you an incredible amount of savings for your business and keeping you in good standing with the IRS.

It is highly important to hire a tax accountant who is not only a professional but who is also reputable. A tax accountant has to deal with two fronts, your company and the IRS. If you have a skilled tax accountant he can appease both sides. However, if your tax accountant is not reputable you may find that he will use unethical or even illegal means. Is saving a little bit of money through such means worth heavy fine or even jail time?

Think about these factors as you look for the right tax accountant:

Knowing What You Require - While no one has encyclopedic knowledge of all the tax laws that pertain to every single circumstance, you can find specialists that will have experience in your specific situation (like an individual or a business). Those who need business tax help will want to find tax accountants who have worked with companies like yours before.

Good Reputation And Testimonials - Ask the tax accountant in question for a list of the clients that they have had in the past; this will help you find out whether or not they have worked well with other customers they have had. If they check out, you can feel free to bring them on.

Staying Current - Look for a tax accountant who wants to stay current and up to date on the newest tax laws that have been put into effect, so that they do not help you accidentally break the law through ignorance. There may be loopholes they think they know that do not exist anymore.

Outsourcing Your Bookkeeping - Advice From An Expert

Thu, 15 Jul 2010 10:37:19 +0100

Outsourcing your bookkeeping has a number of advantages. The main advantage is simply the amount of money you will save. Although you will pay an outsourced bookkeeper three times the amount you would pay an in house bookkeeper for their time, you actually save money because you only hire them for a certain amount of time and you do not need to pay health insurance, vacation or other things a contract will usually involve.

Costs are also cut thanks to the money you save on the recruitment and training process you do not have to worry about. If for some reason your freelance bookkeeper does not work out you can find a new one in next to no time and do not have to worry about the costs for replacing them. It is simply a phone call and you will have a replacement in no time at all. Although it is important to point out that not being pleased with the work of a freelance bookkeeper is unlikely, if you go to the right company you will doubtless be pleased with their work.

The majority of outsourced bookkeeping will take place in the bookkeepers own offices. This means you will not have to worry about providing them with an office space or the infrastructure to work within your company building. They will be paid for the job and not on an hourly basis so their productivity away from the office will not be an issue. They will earn the same amount of money for the job and it will not be dependent on how long they take to complete it, unless they miss their deadline of course.

Another benefit to outsourcing your bookkeeping is that you could actually see your profit margin rise instead of decrease because you are not hiring a brand new employee. You can negotiate with them what you need them do, how often you need them to do it and how much they should charge you for their services. If you have a small operation with a few employees, then you will not need them as much. If you have a large operation, with multiple forms and filings every single month, then you may need them more. But rest assured, they will be able to do the job for you, no matter how big or small, quickly and competently.

Doesn't it just make sense to hire an outside accounting expert to take care of your business books for you? Payroll, taxes and other pertinent forms will no longer be your concern as long as you give them the information they need to get the job done. Remember the old saying though - "If it sounds to good to be true, then it probably is". Do not go with someone who says they know what they are doing but has no references to back them up. Ultimately, it is up to you to make sure that your business is successful, and a great outside accounting expert can help you get where you want to go.

Why All Businesses Should Hire Accounting Services

Sat, 10 Jul 2010 11:29:38 +0100

Basic math knowledge is necessary when running a business as you need to compute for your losses and gains. But if your business employs individuals, basic accounting is not adequate, particularly if you are gearing towards growth. Aside from the numbers, you likewise need to know the law. You have to hire accounting services.

Balancing the books is not an easy feat if you are not trained for it. You need to pay your staff their due earnings and give them their benefits. You also need to file your taxes correctly and on time. Basic math knowledge won't be adequate in this case because this also requires the law. Hiring accounting services can do these things for you.

Your staff are considered highly important in the business. It is your obligation to pay them their due salary and treat them right. By hiring accounting services, you can pay your staff in a diligent manner.

One of the most challenging concerns in business is the filing of tax forms. You have to know taxation law in this. Basic math knowledge won't just cut it. Even falsely lodging your tax forms could equal to big problem for you. Trust accounting services to ensure this step is accomplished the right way. This will not only let you concentrate on other aspects of the business, it also keeps you from serious legal tax troubles.

Certified Public Accountants or CPAs from accounting services know what your numbers mean and can do for you. Because they monitor your financial books, they will be able to tell you if adding new equipment is a bad pick or a good investment at this time of the year, or how much bearing hiring new staff can affect your business financial wise.

Because CPAs help you set and supervise your finances, you will be able to better operate your company. Outsourcing accounting services will be advantageous in your business.

Accounting services help you make good financial decisions that have big impact on your company. While you know how to operate your business, they help you amplify your business' financial potentials.

Cost Segregation - Tax Deductions

Wed, 07 Jul 2010 11:41:04 +0100

By understanding business tax deductions, business owners may enjoy personal benefits from business expenditures - a nice car to drive, a combination business trip/vacation, retirement savings plan - if they follow the myriad tax rules.

The tax code allows deductions from gross income, which reduce income taxes. Increasing tax deductions reduces taxable income and income taxes. Therefore, knowing how to maximize your deductible business expenses enables you to lower taxes.

According to the IRS, trade or business expenses must be ordinary and necessary to be considered a tax deduction. Although the tax code does not specifically define “ordinary” and “necessary” tax deductions, these types of expenses are specified in various IRS publications and regulations. Some of the tax deductions business owners can claim fall under categories such as charitable contributions/donation deductions, medical and dental deductions, moving expense deductions, deducting job costs, travel and entertainment expense deductions, casualty and theft losses, depreciation and involuntary conversion deductions.

Even after the fiscal year ends, and business owners of improved commercial real estate are still seeking tax deduction opportunities, one popular option is to order a cost segregation study (CSS). A CSS will identify any item that can be depreciated over a shorter period of time. These studies can result in accelerated depreciation deductions for properties including new buildings, renovations of existing buildings, leasehold improvements, and real estate purchase after 1986. Cost segregation allows business owners to increase depreciation, generate more tax deductions, and reduce their tax rate.

Cost segregation involves separating up to 135 components of real estate that depreciates faster than the building itself. Taxpayers can depreciate many components of real estate using a five-, seven-, or 15-year recovery period. Within permissible bounds, there is a huge tax-savings opportunity for valuing this property accurately. This category includes items such as carpeting, certain fixtures, window treatments, site improvements and some wall coverings.

Cost segregation increases tax deductions by apportioning about 20% to 40% of the total cost basis to short-life property. Short-life property depreciates over a shorter life period and provides a higher level of tax deductions annually during the first 15 years of ownership. Most business owners increase depreciation by 50% to 75% by obtaining a CSS analysis.

O’Connor & Associates is a national provider of commercial real estate consulting services including cost segregation , due diligence, federal tax reduction, renovation upgrading cost analyses, tax return review and apartment inspections.

Phoenix CPA - Value Of Hiring A Local CPA To Keep Businesses On Track With Payroll, Taxes And Financial Needs

Fri, 21 May 2010 20:50:16 +0100

Financial concerns often worry a small business owner as well as the larger, mid-size businesses from tax matters, payroll expenses and insurance needs, a company could turn to a Phoenix CPA - Value of hiring a local CPA firm for all their monetary matters. By leaving the financial issues to a professional, certified accountant, a business owner could spend more time growing their business and helping people, which is no doubt why they got into business in the first place.

A certified public accountant is what CPA stands for and they help local and nationwide businesses with all their financial projects so that their company will run on a regular schedule without delays.

Typically, if a business can not afford to use the full services of a local CPA firm, they could begin by having them perform something like payroll which is a time consuming task for many business owners; depending on the amount of employees they have, the rate of taxes, those who have a portion of their paychecks going into a retirement fund or those who might have a garnishment against their wages for various debits. Each individual employee's paycheck takes time to set up and then maintain from week to week or bi-weekly.

As time goes on, a small to medium size business may want to increase the work that a CPA does for them. This may include turning over accounts payable and accounts receivable that could also eat away at a business owner's time which could be better spent organizing the business and growing their business through marketing and sales.

Accounts receivable are the payments for the services rendered that a business will receive and many times they must be matched up to an invoice or statement in order to make sure the right account is credited for payment.

Accounts payable are the bills that a business must pay just like an individual or family has bills. A local CPA would look over the bills to make sure they are correct before sending out the payments. This would include vendors and suppliers of goods and products or items that a business needs in order to operate their store or services properly and without interruption.

A local CPA will audit the bookkeeping and tax records and receipts for businesses to make sure there are no mistakes. At the end of a year, either fiscal or calendar, a certified public accountant will prepare a companies taxes, making sure that all the previous years taxes have been paid. This might include federal, state, local, business, social security and other taxes that various companies might have to cover in order to keep doing business.

In order for a small or medium volume business to handle their income and funds better, a certified public accountant would also be able to offer some advice on financial matters such as renting, leasing or purchasing equipment or vehicles.

The same local CPA that helps a business could also perform tax services for the company owner and his or her family as long as they are keeping the business and their personal affairs separate. Most business owners draw a salary from their business, however they also have stocks or shares from their company and this would require some tax filing at the end of the calendar year, by April 15.

A Phoenix CPA-value of hiring a local CPA company would be accommodating for all size businesses, large or small. They will help the business prepare and file taxes, plan and implement a payroll system or help with other financial needs a company might need. This will free up time for the business owner to do what they know best and that is run their business.

Donate Car To Charity Even With Parking Violations For Car Donation Tax Deduction

Wed, 19 May 2010 01:17:49 +0100

Since many people are considering to donate a car to charity, many are also on the search for the best assistance that they can get to do the procedure correctly. Many times, people who are thinking to give their cars to charity are the ones who may have too many vehicles at home and would like to keep them from becoming junk sitting around in their garage or elsewhere.

But aside from donating the car, these people are also interested in getting the car donation tax deduction that goes with the procedure. This is a good thing to file together with their taxes as long as they filed it properly. And the benefit can mean a much bigger return.

One of the concerns raised by potential donors is whether parking tickets can be a hindrance in donating the car to charity. The answer is that it is still possible to donate your vehicle by doing the several steps listed below.

What the car owners need to do is to follow the same procedure as donating cars with a clean parking record. Above all, you have to look first for a charity where you can donate the car, but make sure you find one that will put the car to good use.

After finding the charity, it's very important to fill out the documents that will be helpful for the whole transfer so that the new title holder or owner will be the receiving charity. Aside from this, proper documents should also be provided so they can document the transfer properly.

Next, you should also keep a number of documents for you like the bill of sale. This document will be useful in the future when it comes to filing your tax benefits and documenting your donation.

Once the car has been properly transferred, it's now time for you to take away the license plate from the vehicle. This act will be beneficial not only for the receiver but also to the donor. This is because both the receiver and the donor will be protected from violations that both of them may obtain by accident.

Finally, it's also vital for people to reach the Division of Motor Vehicles, or DMV, and inform them about the change of ownership. Aside from the general office, they should also reach the local office about this process. This way the donor can donate cars to charity and be able to get car donation tax deduction because of the act.

Using An Umbrella Company To Take Care Of Your Tax Liabilities

Sat, 15 May 2010 11:05:40 +0100

If you are about to leave your employer to become a freelancer or contractor, then you need to decide how you will handle your future tax liabilities. You need to get something arranged as soon as possible, to avoid being hit with a big, unexpected, tax bill later on. The solution should be one that allows you pay the least amount in taxes, but which also makes it easy for your customers to deal with you.

One option available to you is to set-up a limited company. You will be the director and only shareholder, so it is not as complicated as it may sound. Taking this approach minimizes the amount of taxes that you have to pay, and allows you to claim back the widest possible range of expenses. If you have the time and money available to do this, then it is certainly something to consider doing.

Setting up a limited company is expensive and time consuming though. You will have to hire a lawyer and accountant to start with, and there are various on-going fees to pay, and paperwork to deal with. The easier option is to let a tax umbrella company take care of all the technicalities for you, and then you can focus on what you do best - making money.

The way a tax umbrella company works is that, basically, you become their employee for payment and tax purposes. Now, the term employee is used in the loosest possible sense here, as they have no control over you whatsoever. In reality, they are actually working for you, as they will take care of all of your invoices, payments and tax contributions.

You can be up and running with a tax umbrella company in just a few days. You just need to submit your personal and banking details to them and they will take care of all of the paperwork and legal technicalities for you. They will pay you fortnightly or monthly (depending on what you agree with them) directly into your bank account. The amount that you receive will be the total amount that your clients paid to the umbrella company, minus your tax contributions and the umbrella company's fee.

Some of the less reputable tax umbrella companies will try to entice you with offers of 'special dispensations' and 'exclusive tax breaks'. You need to ignore such claims as the company is either been untruthful or they are operating in a way that is not in accordance with taxation law. No umbrella company has any special agreements in place with the tax office, and so they all have to adhere to the same rules and regulations. Therefore, when deciding which one to use, you should only take into account their experience, how much they charge, and how often they will pay you.

A Brief History of the US Income Tax

Sun, 02 May 2010 20:55:20 +0100

US Citizens are required to pay federal income tax. The collection of this tax allows for the government to provide important services including those services that protect the country from outside threats. But have you ever wondered how the income tax came about? Here's a brief look at the history of the income tax.

Article 1, Section 8, Clause 1 of the US Constitutions allows the United States Congress to impose an income tax on its citizens. But this wasn't used until the American Civil War in 1861. The Revenue Act in that year allowed for the collection of about a three percent tax on any income over $800. The tax act was repealed a year later in 1862.

Federalist Alexander Hamilton explored the constitutionality of the income tax in Article 33 of his Federalist Papers. He advocated that the Necessary and Proper Clause of the Constitution established the grounds necessary to allow the federal government to collect tax on its citizens.

Since then, the court system has held that taxes directly to the people and property are acceptable under the law. Since the inception of federal taxes in the 1800s, we have come to know many types of taxes. For example, we pay Social Security, Medicare and employers pay payroll taxes. However, most of our taxation comes from federal income tax.

In 2008 alone, more than 150 million income tax returns were sent to the Internal Revenue Service (IRS). Lately, the IRS has gotten stricter about attempting to collect back taxes. It is easy to make mistakes and find yourself in a financial pinch with the IRS. If you find yourself up against a tax audit, collections or outrageous penalties, contact a trusted tax resolution specialist.

Tax Benefits for Energy Efficient "Designers"

Tue, 20 Apr 2010 01:58:07 +0100

There is help available for businesses that are trying to prosper during this turbulent economic period. The Energy Efficient Commercial Building Deduction that offers energy efficiency tax deductions for assets/materials in buildings was extended through 2013.

While some of this assistance may come from bailouts and banks, there are other avenues also well worth researching. For example, a lesser-known corporate tax incentives for energy-efficient building materials and environmental controls for commercial buildings could offer property managers valuable financial breaks.

This is largely a result of the Emergency Economic Stabilization Act (EESA), that former President Bush enacted in October 2008. As part of the package, the Energy Efficient Commercial Building Deduction (EPACT2005, Title 13) was extended for another five years - through December 31, 2013.

This extension of the deduction gives property managers planning new buildings or retrofits plenty to consider since they cover improvements ranging from equipment such as interior lighting to HVAC/duct/air sealing and insulation, roofs, siding and other building materials. Everything used must meet specific certification requirements in order to qualify for the deductions.

According to the Commercial Building Tax Deduction Coalition, a tax deduction per square foot is permitted for owners who install equipment that reduces the building's total energy and power cost by 50 percent or more in comparison to a building meeting minimum requirements set by ASHRAE Standard 90.1-2001 - or by 16 2/3 percent for one of three subsystems: lighting, HVAC and water heaters and the building envelope. "Everyone is more mindful of energy consumption these days," says Mike Kluber director of engineering firm Kluber Skahan + Associates, Inc. in Batavia, IL and a Certified Energy Manager who is also LEED-certified. "When looking at maintenance plans for your new or replacement equipment, don't just look at maintaining it but seek better performance."

Plus, designers and builders that are participating in other energy efficiency programs, such as LEED by the U.S. Green Building Council or the U.S. EPA's Energy Star, may already qualify for certain deductions for energy-saving materials and equipment.

To claim the tax deduction, Kluber says qualified individuals are required to complete statements involving energy efficiency and typically, requests are made by the building owner or property manager and passed on to the tax professional in order to prepare the tax return documentation. A few components include:

 The engineer's qualifying statement, which demonstrates how the building complies with required standards
 Required field inspection to prove the use of energy-saving materials or equipment
 Statement of how calculations are performed for each type of equipment or material used. For most items, except lighting, specific software is required.

"Programs like the EESA tax deduction give plenty of reasons, opportunity and education to achieve energy savings. Plus, it's good stewardship," Kluber concludes.

Things You Should Know About Tax Free Shopping

Tue, 30 Mar 2010 09:59:36 +0100

A lot of people are suffering financially right now and they are looking for ways to save money. One way to save money that you may not have considered is taking advantage of tax free shopping sales and offers.

Many countries give refunds of sales taxes paid to their international visitors. There are a variety of online websites that list those countries and information on how to get your refund. If you are using a travel agent, they may be able to give you information about tax free purchases.

Some states within the United States, such as Louisianna and parts of Texas, will refund sales tax paid to international visitors. There are some restrictions so you will need to find out from the state what they are and how you can get your refund.

Some states within the United States, such as Delaware and New Hampshire, do not have a sales tax at all. You can shop there anytime you want and not have to pay a sales tax.

Within the past few years, a lot of states have started to hold annual tax free holidays. Although the timing can vary, they typically are held about the same time that the school year begins. You can usually buy items such as back to school supplies, computers, and clothing tax free during these holidays but qualifying items can vary from state to state. Local newspapers or even stores will have a list of the items that qualify. If you live close to another state, check their list also to see what items qualify. Not every state has the same items so you may be able to save some money by going to another state.

Before you leave on your shopping expedition, make a list of the eligible items that you need to buy. Also be sure to browse through store sale ads as many will run items on sale that are eligible as a tax free purchase. If you are looking for a more expensive item such as a computer, it is a good idea to shop for that first. The more expensive items sometimes have drastic price cuts in order to make the item eligible for the tax free holiday. A lot of times, stores only have a few quantities on hand and they can sell out quickly.

You may have to spend some time doing some planning and researching before you head off on your vacation or shopping trip. However, the time spent could very well be worth it when it helps you save a lot of money. And saving money these days is a good thing!