Tax Service Blog

 

 

As a small business owner, it's easy to get caught up in the excitement of an average day. Especially when work piles up in and around the office, entrepreneurs don't always take the time to consider the long term impact of what they're doing. Here are a few things to keep in mind that will help you promote the long term success of your business when the going gets tough:
 
Communication is Key
 
When you're busy with work and expect to be for the foreseeable future, you might notice that you have not been actively communicating with your employees and customers. Maintaining a steady stream of communication is essential to creating lasting business relationships. As a general rule, if you don't have time to communicate with the people you work with, make time. A small business owner might not be required to report to anyone, but that doesn't mean he or she should not actively engage others. The value of maintaining strong business relationships will pay dividends down the road when you reach a clearing in the work load.
 
Watch Your Deadlines

As your business evolves don't allow your sense of time to go with it. A busy schedule means that you have to be more conscious than ever about what day of the week it is, and when it comes to deadlines, your organization will be judged on its ability to back up the expectations it sets. If you've told your customers that they can expect a new product launch on September 2 then you can't wait until September 3 rolls around to inform them that you'll have it ready sometime next week. Start missing deadlines and you will quickly lose trust amongst your clients. If there's any doubt, remember that you would rather be ready to move up a date than be forced to delay it.
 
Treat Your Clients Like Family
 
With all the hours you put into your small business as an entrepreneur, it's quite possible that you spend more time at work than you do at home. While you may face difficulties trying to manage the ever so delicate work-life balance, try not to over-think the difference between the way you treat your clients and the way you treat your family. Your purpose for starting a business to begin with was guided by your desire to help people, and you can establish a lasting connection with people by developing a strong sense of trust. It might seem extreme, especially for an entrepreneur who comes from a tight-knit family, but treating your clients like family is the best way to earn their respect and, in turn, their repeat business.

 

FS-2013-3, January 2013

 

The Internal Revenue Service is taking additional steps during the 2013 tax season to protect taxpayers and help victims of identity theft and refund fraud.  

 

Stopping refund fraud related to identity theft is a top priority for the tax agency. The IRS is focused on preventing, detecting and resolving identity theft cases as soon as possible. The IRS has more than 3,000 employees working on identity theft cases – more than twice the level of a year ago. We have trained more than 35,000 employees who work with taxpayers to recognize and provide assistance when identity theft occurs.

 

Taxpayers can encounter identity theft involving their tax returns in several ways. One instance is where identity thieves try filing fraudulent refund claims using another person’s identifying information, which has been stolen. Innocent taxpayers are victimized because their refunds are delayed.

 

Here are some tips to protect you from becoming a victim, and steps to take if you think someone may have filed a tax return using your name:

 

 

 

If your tax records are not currently affected by identity theft, but you believe you may be at risk due to a lost or stolen purse or wallet, questionable credit card activity or credit report, contact the IRS Identity Protection Specialized Unit at 800-908-4490, extension 245 (Mon. - Fri., 7 a.m. - 7 p.m. local time; Alaska & Hawaii follow Pacific Time).

 

 

Be alert to possible identity theft if you receive a notice from the IRS or learn from your tax professional that:

 

If you receive a notice from IRS and you suspect your identity has been used fraudulently, respond immediately by calling the number on the notice.

 

If you did not receive a notice butbelieve you’ve been the victim of identity theft, contact the IRS Identity Protection Specialized Unit at 800-908-4490, extension 245 right away so we can take steps to secure your tax account and match your SSN or ITIN.

 

Also, fill out the IRS Identity Theft Affidavit, Form 14039. Please write legibly and follow the directions on the back of the form that relate to your specific circumstances.

 

In addition, we recommend you take additional steps with agencies outside the IRS:

 

 

 

 

 

The IRS is working to speed up and further streamline identity theft case resolution to help innocent taxpayers.

 

The IRS more than doubled the level of employees dedicated to working identity theft cases between 2011 and 2012.  As the IRS enters the 2013 filing season, we now have more than 3,000 employees working identity theft issues. Despite these efforts, the IRS continues to see a growing number of identity theft cases.

 

These are extremely complex cases to resolve, frequently touching on multiple issues and multiple tax years. Cases of resolving identity can be complicated by the thieves themselves calling in. Due to the complexity of the situation, this is a time-consuming process. Taxpayers are likely to see their refunds delayed for an extended period of time while we take the necessary actions to resolve the matter. A typical case can take about 180 days to resolve, and the IRS is working to reduce that time period. While the identity theft cases are being worked, the IRS also reminds victims that they need to continue to file their tax returns during this period.

 

For victims of identity theft who have previously been in contact with the IRS and have not achieved a resolution to their case, they can contact the IRS Identity Protection Specialized Unit, toll-free, at 800-908-4490. If victims can’t get their issue resolved and are experiencing financial difficulties, contact the Taxpayer Advocate Service toll-free at 877-777-4778.

 

 

It is a top priority for the IRS to help victims and reduce the time it takes to resolve their cases. In addition, the IRS continues to aggressively expand its efforts to protect and prevent refund fraud involving identity theft before it occurs as well as work with federal, state and local officials to pursue the perpetrators of this fraud.

 

For more information, see the special identity theft section on IRS.gov and IRS Fact Sheet 2013-2, IRS Combats Identity Theft and Refund Fraud on Many Fronts.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Do I need to File a Return: This application will help you determine if you have to file a federal income tax return.

 

If you do not have to file a tax return, it will help you determine if you should file a tax return to claim any credit or refund that you are due.

 

Information You Will Need:

 

 

 

Estimated Completion Time: 12 minutes. However: 5 minutes of inactivity will end the interview and you will be forced to start over.

 

The following interview covers the same questions you would answer if you called the IRS toll-free tax assistance telephone number or if you came into a Taxpayer Assistance Center.

 

Please click the link below to begin the application process.

 

On the surface, that might sound like a silly question—how many of us walk around knowing the exact figure for the ratio of our debts to our assets? But calculating your net worth isn’t the dry, academic exercise it might sound like. Calculating your net worth means taking a long, hard look in the mirror and accurately assessing your financial situation. It’s the first step on the process towards more advanced financial planning, like saving for retirement or paying off your debts.

Resources, such as worksheets or calculators, exist to help you calculate your net worth. The worksheets ask you to add assets on one side of the page—things like cash on hand, cash in checking, market value of your home, market value of your property and the value of your retirement account, among other assets. Then once you have that total, you subtract the total of your liabilities to get to your net worth. Liabilities are the balance owed on your loans—from student loans to credit card to mortgages—as well as unpaid utilities and back taxes, among other money you know you’re going to have to pay in the future.

 

For instance, your net worth calculation might look like this:

Assets VS LiabilitiesCash in checking: $2,000, Student loans balance: $11,000, Cash in savings: $5,000, Balance owed on credit cards: $1,150, Value of car: $10,000, Balance owed on car loan: $8,000, Value of 401(k): $16,000, Balance owed on other loans: $2,000. Total Assets: $33,000Total Liabilities: $22,150

Subtract total liabilities ($22,150) from total assets ($33,000) = $10,850

 

You may find that the number is negative, meaning you have more liabilities than assets. Don’t be discouraged! While it’s not a rosy picture of financial health, you can’t fix the problem until you know the extent of the damage. Remember that net worth is unique to your situation, and a negative number doesn’t always mean your affairs are out of order. For instance, a doctor just graduating med school is likely buried in student debt, but due to the steady future income stream and employability conferred by the new degree, a negative net worth isn’t as bad as it appears. That’s what we found when we saw that NerdWallet recently challenged five contestants in the personal finance reality show ‘So You Think You Can Finance’ to create a net worth statement. Many of the contestants are young and just making the jump to financial independence—so the majority of them came up with a negative net worth number. Of course, it’s better to have a positive number—your net worth is an accurate way to measure how much money you truly have, so the larger your net worth number, the more well-off you are right now.

Once you have assessed your net worth, the next level is to figure out how to get from your current state to where you want to go. Again, it’s a highly individual process, but for many it will include creating a time line for becoming debt-free, as well as creating or optimizing a retirement savings plan. Let’s take the example of Jia, one of the contestants on ‘So You Think You Can Finance’. She did a great job on the net worth challenge – but the judges questioned whether she was ready to build on her net worth foundation to achieve her long-term financial goals. Had she begun incorporating her retirement savings into what she described as a balanced and healthy net worth picture? Also, she talked a lot about how her plans for marriage to her boyfriend figured into the future—but how would he fit into the financial picture? Deciding on joint accounts, prioritizing joint expenditures and aligning future savings is a key part in building on a basic net worth statement. Below are additional examples.

Subtracting your liabilities from your assets may seem like a simple math problem, but a well-thought out net worth statement is an important foundation you can build all your future financial planning on top of. So go ahead and calculate your financial worth, and let us know in the comments how you’re going to use it to plan your financial future!

Good news!! The 2011 Standard deduction are higher this year!

$5,800 for Single individuals, which is up $100 from 2010.

$8,500 for heads of household, also up $100 from 2010.

$11,600 for Married couples, up $200 from 2010. 

You heard it from the experts at Professional Freedom Tax Service, Inc.

 
Individual tax filers, did you know that when you itemize by saving all your receipts and medical bills and if those expenses do not exceed your 2011 standard IRS tax deduction (Single $5,800, Head of Household $8,500 or Married $11,600) then it will be in your best interest to actually take the standard deduction as opposed to taking the itemized deduction? Let Professional Freedom Tax Service tell you more about it, call us today!

Tax Service Blog

When it comes to filing taxes, some people cannot wait to get it over with. Whether it is because you don't want to worry until April, or because you have a huge refund coming, earlier is certainly better when filing taxes. The earliest you can file your taxes depends on when you get the proper documents. The IRS will allow filing sometime around the 8th of January, but W-2 and other forms are not required to arrive until the 31st of January. If you have any other questions, please contact a professional tax accountant that can help you with filing.

Tax Service Blog