Author Archives: Pat Michael

About Pat Michael

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More Information on W-2 Reporting Requirements for Employers

Not sure what to report on W-2, optional or mandatory?

Our table is based on IRS Notice 2012-9, which, until further guidance, contains the requirements for tax-year 2012 and beyond. Items listed as “optional” are designated as such based on transition relief provided by Notice 2012-9, and their “optional” status may be changed by future guidance. However, any such change will not be applicable until the tax year beginning at least six months after the date of issuance of such guidance. Continue reading →

Employer-Provided Health Coverage Informational Reporting Requirements: Questions and Answers

IRS Q&A Affordable Care Act Reporting Requirements

The Affordable Care Act requires employers to report the cost of coverage under an employer-sponsored group health plan. To allow employers more time to update their payroll systems, Continue reading →

Informational Reporting of the Cost of Employer-Sponsored Group Health Care Plan Coverage

Not sure what to report on W-2, optional or mandatory?

This table is based on IRS Notice 2012-9, which, until further guidance, contains the requirements for tax-year 2012 and beyond. Items listed as “optional” are designated as such based on transition relief provided by Notice 2012-9, and their “optional” status may be changed by future guidance. However, any such change will not be applicable until the tax year beginning at least six months after the date of issuance of such guidance.

This table was created at the suggestion of and in collaboration with the IRS’ Information Reporting Program Advisory Committee (IRPAC). IRPAC’s members are representatives of industries responsible for providing information returns, such as Form W-2, to the IRS. IRPAC works with IRS to improve the information reporting process.

Form W-2 Changes

8 Facts to Know if You Receive an IRS Letter or Notice

What to do if you receive an IRS Notice or Letter

While it may be tempting to navigate the new tax laws and changes on your own, it is always better to consult a tax professional – specifically – Enrolled Agents (EA) who are recognized as the tax experts.  Your EA will know what to do, why you received the notice or letter, and the immediate steps to take.  However, if you want to do this on your own – here are some facts you need to know.     Continue reading →

Taxes, Death… and Marriage?

Marriage – tax advantage?  Maybe yes, maybe no.

Marriage can have a tax-rate advantage, but it depends on the incomes.  Did you know you can actually save tax money if one spouse is making a lot less than the other?  It’s true.  The tax bill of the high-income earner can almost (if not totally) be cancelled out.  Continue reading →

Family Child Care Guide to Visits, Inspections and Interviews

Family Child Care Guide to Visits, Inspections and InterviewsRedleaf Press has a new “how to” guide by Donna C. Hurley and Sharon Woodward.

“Case studies featuring more than twenty common challenges that can occur during visits and skill-based solutions and successful strategies you can use to prepare for those situations
Checklists and self-examination activities to help you welcome and connect with potential families, specialists, and inspectors in positive ways
Support, guidance, and techniques to enhance your program”
Softbound, 144 pgs.

 

Read the full post at http://childcaretaxspecialists.com/guide-to-visits-inspections-and-interviews/

Social Security Changes Based on Life Expectancy

Social-Security-AdministrationThere are changes in Social Security. This affects everyone who is approaching retirement age.

Update:  Want to learn more on the latest from the Social Security Administration, see https://ssa.gov/planners/lifeexpectancy.html

Back on July 29, 2013 the Ways & Means Committee released bipartisan proposals which it stated were necessary to strengthen and protect Social Security. In an effort to engage stakeholders in a dialogue on the potential legislative solutions, the Committee is soliciting feedback. Such changes would include the controversial “chained consumer price index (CPI)”option, see Article 2141 and Article 2140.

Without action addressing the fiscal and structural challenges facing the entitlement programs, the Committee notes that Medicare will be bankrupt by 2026 and seniors will experience a 23% cut to their Social Security benefits in 2033.

As part of a bipartisan hearing series on entitlement reforms announced in April, the Committee is reviewing a variety of proposals to protect and preserve Medicare and Social Security that have been identified by President Obama, either in his budget or in other recommendations to Congress, as well as bipartisan ideas for entitlement reform from the President’s National Commission on Fiscal Responsibility and Reform (the “Simpson-Bowles Commission”) and the Bipartisan Policy Center Debt Reduction Task Force (“Domenici-Rivlin Task Force”).

Source:  https://cs.thomsonreuters.com/

ATTN: California Taxpayers – Head of Household

Newest update on the ‘Head of Household’ Audit Letters

Sacramento – The Franchise Tax Board (FTB) announced mailing more than 100,000 audit letters to taxpayers to verify their “Head of Household”(HOH) filing status on their 2012 state tax return. We are encouraging all of our clients – once the questionnaire is received – to call for an appointment to come in at (619) 589-8680.

Taxpayers who do not qualify will have their tax reassessed at either the single or married-filing-separate filing status. FTB assessed $26 million in additional tax to the nearly 38,000 taxpayers who used this status last year and did not meet its requirements.  Continue reading →

Want to cut your spouse’s tax cost of inherited IRA’s?

Use Estate Planning to protect your IRAs!

This post speaks to the IRA owner in planning the future, and how essential it is to plan your estate today.  Put bluntly, “To get your estate situation the way you want it at death, you need to do your estate planning at the same time you build your asset portfolio.  If you wait until you have built them, estate planning is much more difficult¹.”    Continue reading →

Retirement planning using IRAs

Using IRAs in tax planning during retirement

TAX: Because of the flexibility of IRA distributions, it’s easy to move income among years

By Richard Malamud, CPA, J.D., LL.M., and Tim Hilger, CPA

Those of us who are age 59½ and older and still working face some interesting decisions. After decades of hearing the mantra, “Defer, Defer, and then Defer” maybe it is time to change that to “Accelerate” — at least sometimes. It is the thing to do if you assume tax rates will not be going down and the future may bring us large capital gains or other income that could cause us to owe the new Medicare tax. Continue reading →

Tax Benefits for Military

Special Tax Benefits for Armed Forces Personnel

IRS Summertime Tax Tip 2013-06, July 15, 2013

If you’re a member of the U.S. Armed Forces, the IRS wants you to know about the many tax benefits that may apply to you. Special tax rules apply to military members on active duty, including those serving in combat zones. These rules can help lower your federal taxes and make it easier to file your tax return. Continue reading →

Personal Home? Tax Home? What’s the Difference?

Did you know that your personal home is not your tax home? 

“Your tax deductions, tax strategies, and tax records hinge on the following federal income tax defined terms: Personal Home, Tax Home, Business Travel, Business Transportation.”¹

Do you know the definition and differences?   Continue reading →

Child Care Tax Specialists on Off-site Business Activity Hours

What Hours Can You Count When You Are Away From Home?

We’ve written about keeping track of your hours (http://childcaretaxspecialists.com/track-your-hours-even-when-children-arent-present/) but what about the hours you spend on business activities away from your home such as shopping for toys, picking up and dropping off children (if you offer that) or even attending seminars and workshops?

To read the whole post and download our (2) easy-to-use record keeping checklists click here.

Thinking of Selling Your Home? What About Taxes?

Will You Owe Taxes When You Sell Your Home?

Visit our Child Care Tax Specialists site and read more about what a family child care provider faces in the decision to sell their home by way of taxes. One tax you can probably avoid and another you cannot.  This will give you the high points, but it is always best to speak with your tax preparer to get the latest on potential tax impacts.

Click here to read about the tax that you probably can avoid.

Attention California Business and Schedule C Taxpayers

Do you know about California’s City Business Tax Program?You may be getting a notice from your city.  The FTB and cities are looking for revenue and the newest participants are Downey, Escondido, Fresno, Salinas, Santa Maria, and Tustin.

According to Spidell’s “…in June, cities were reminded to transmit 2012 business license information to the FTB on or before June 30.”  For more information on the City Business Tax Program, click here.

“From this information, the FTB will send filing enforcement notices to self-employed individuals and other businesses that have failed to file a return.

Cities happily send this information in exchange for a list of businesses that have filed tax returns. The cities use this information to contact the business and assess fees, penalties, and interest for failing to file and pay for a city business license. The FTB sends the data to the cities in December of each year.”

Each city has different requirements as to who must have a license.

For a pdf of participating cities, click here

 

Source:  Spidell’s July 2013 California Taxletter