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QuickBooks Lesson 1 – The Basics

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Sat, 12 May 2012 13:05:45 GMT

QuickBooks Lesson 1 – The Basics

QuickBooks Lesson 1 – The Basics

Accountant in Miami

Accountant in Miami Introducing QuickBooks

Accountants in Miami Getting around in QuickBooks

Finding information to help you get started, 13 Managing your open windows

Using the menu bar
Using the icon bar
Using the navigation bar
Making the Home page your starting point
Using the workflow diagram
Making the Home page work for you

All the Accounting in Miami you need to know

Your chart of accounts
About assets, liabilities, and equity
Assets
Liabilities
Equity

Accountants in Miami – Topics

Cash versus accrual bookkeeping
Cash basis
Accrual basis
How your bookkeeping method affects QuickBooks
Measuring business profitability
The balance sheet
The profit and loss statement
The statement of cash flows
Looking at the journal entries for transactions
Exiting QuickBooks
Moving between company files

Accounting in Miami Lesson objectives

To gain an overview of the course and the topics to be covered
To know how QuickBooks works and how you can get around in QuickBooks
To learn common business terms used by QuickBooks
To see how to exit QuickBooks

ACCOUNTING MIAMI COURSE INTRODUCTION

This course by Accounting Miami CPA is an introduction to QuickBooks. Its main objective is to introduce you to the basic features in QuickBooks and give you an opportunity for hands-on practice. You’ll learn about the types of information you need to track in your business, and you’ll see how to enter that information and track it in QuickBooks. By the time you complete the course, you’ll have a good idea of all that QuickBooks offers, you’ll be familiar with the most common tasks, and you’ll know where to find information about more advanced features.

Accountant in Miami Introduces QuickBooks

Although most small business owners are worried about revenue, running a business involves a lot of other tasks. Depending on the type of business, you need to invoice customers, record payments from customers, pay your own bills to outside vendors, manage inventory, and analyze your financial data to see where you need to focus your next efforts. QuickBooks is a tool you can use to automate the tasks you’re already performing as a business owner or to set up a new business.

When you’re working in QuickBooks, you’ll spend most of your time using a form, a list, or a register. Since these are so basic to QuickBooks, we’re going to spend a few minutes introducing them.

Using forms

You record most of your daily business transactions on a QuickBooks form, which looks just like a paper form. Here’s an example of the form you use when you want to record a bill from and write a check to one of your vendors.

The form is intuitive—you already know how to fill out a form. But after you provide the information on a QuickBooks form, QuickBooks does the accounting for you in the background. For example, when you record a bill and then write a check (using the Pay Bills window) to pay for the business expense, QuickBooks enters transactions in your accounts payable register to show the expense you incurred and the payment you made. (Accounts payable is the money owed by your business to vendors.) It also records the check in your checking account, keeping your records up to date, and providing a running balance of what you owe at any time.

Using lists

The list is another basic QuickBooks feature. You fill out most QuickBooks forms by selecting entries from a list.

QuickBooks has lists where you can store information about customers, vendors, employees, items or services you sell, and so on. Lists save you time and help you enter information consistently and correctly.

When you’re filling out an invoice form and you select a customer name from the Customer:Job list, QuickBooks not only fills in the name but also fills in the address, the payment terms, and the customer’s sales tax, based on the information previously entered about that customer.

Here’s an example of the Customers & Jobs list in the Customer Center.

QuickBooks lets you complete a variety of activities from lists, using the menu buttons located at the top of each list. For example, to fill out an invoice for a customer, first select the customer from the Customers & Jobs list, and then choose Invoices from the New Transactions menu buttons.

Using registers

In addition to forms and lists, you’ll also work with registers in QuickBooks. Just as you use your paper checkbook register to see a record of all the transactions in your checking account—checks you’ve written, other withdrawals you’ve made from your account, and deposits—a QuickBooks register contains a record of all the activity in one account. Almost every QuickBooks account has its own register.

Accountants in Miami example of the register for an accounts receivable account.

The register shows information about invoices written to customers—the date of the invoice, the date it’s due, the name of the customer, and the amount. It also shows payments you’ve received against your invoices. The right column of the register gives you a running balance of all your accounts receivable, so you always know how much you’re owed.

Accounting in Miami Getting around in QuickBooks

QuickBooks maximizes your work space and gives you quick access to the features and reports that you use most. In this section you’ll learn how to do the following:

Find information to help you get started using QuickBooks
Manage your open windows
Compare windows side by side
Customize navigation features

Download lesson….click link below

QuickBooks Lesson 1 – The Basics

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Bookkeeping Services Miami Top Overtime Traps

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Fri, 11 May 2012 18:49:17 GMT

Bookkeeping Services Miami Top Overtime Traps

Bookkeeping Services Miami

Bookkeeping Services in Miami remind business owners who often look for ways to bootstrap or ask employees to go above and beyond. But overlooking overtime could land you in a heap of trouble, according to Bookkeeper Miami VieraCPA.

Bookkeeping Services in Miami

Bookkeeper Miami VieraCPA notes this is the age of expensive equity and debt financing for startup entrepreneurs and small-business owners. The prudent way for business owners to weather this storm is to stretch their company’s cash flow and operating assets in clever, cost-effective ways according to their Bookkeeping Services in Miami. Employee compensation is no exception.

According Bookkeeping Services Miami VieraCPA the problem with bootstrapping compensation to employees is that it’s easy for business owners to fall out of compliance with federal and state payroll regulations. One of the most common areas of oversight is the failure to pay overtime wages to certain types of employees.

Bookkeeper Miami – Plan ahead to avoid payroll surprise

Bookkeeping Services in Miami class employees as either “exempt” or “nonexempt” when it comes to receiving overtime pay for working above 40 hours in a single workweek. Nonexempt employees are generally non-salaried employees who have no direct managerial oversight of other employees or the discretion to make decisions on matters of significance to the organization. The minimum pay rate for overtime is 1.5 times regular pay.

Here’s the gotcha that often catches business owners off guard. Even if an eager, extra-hardworking nonexempt employee wants to work longer hours without pay, a company is still liable for the cash obligation. Former employees who later leave a company on unfriendly terms can seek overtime back pay and cause a nightmare of audit activity from payroll tax authorities.

To minimize payroll surprises, Bookkeeping Services Miami advise business owners to take care to classify their workers according to definitions of exempt and nonexempt employees under the Fair Labor Standards Act. The definitions are not always clear-cut. Some types of administrative, customer service, engineering, marketing and website workers may be entitled to overtime pay while others may not.

Closing overtime loopholes

Under the Fair Labor Standards Act, Bookkeeper Miami VieraCPA advises business owners they can no longer simply give employees an impressive job title or put them “on salary” to avoid overtime pay obligations. Now, to qualify as an “exempt” employee, all of the Department of Labor’s qualifications for a specific type of job must be met. Key classification descriptions are available for software, administrative, professional and other jobs at the Department of Labor’s website.

Bookkeeping Services in Miami is frequently asked by cash-poor startup entrepreneurs or business owners seeking to turn around struggling operations if they can use common stock or stock options to sidestep minimum wage or overtime pay obligations. They argue that the stock is a form of compensation that may, over time, be worth far more than current cash payments.

That’s true, but if the Department of Labor or local payroll tax authorities find out about the non-cash payment, the business owner will still be held accountable for minimum wage and overtime payments to nonexempt employees. Further, officers and board members of companies can be personally liable for unpaid payroll tax obligations if a company is unable to meet its tax obligations.

Bookkeeping Services Miami notes one last payroll documentation management tip. The Fair Labor Standards Act requires employers to keep payroll and other records for nonexempt employees for three years. The IRS requires employers to keep employment-related tax records for four years.

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Miami Accounting Service Flat Fee Business Model

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Thu, 10 May 2012 12:57:44 GMT

Miami Accounting Service Flat Fee Business Model

Miami Accounting Service

Accounting Services in Miami VieraCPA want you to think about a recent purchase. It could be as simple as a pair of jeans or as exciting as a car. Did you care what effort went into making the item…

How much labor went into growing the cotton or making the steel? How elaborate were the distribution channels, or how much mental energy went into the marketing campaigns? No, of course not! What you cared about was how much value you placed on owning the item compared to the price it took to acquire it and Accounting Services Miami Flat Fee Business Model uses the same approach to it’s services. If the value (in your mind) equaled or exceeded the price, then you were happy to make the purchase!

Accounting Services in Miami

Miami Accounting Service VieraCPA points out that what you have just experienced is an illustration of the difference between effort based pricing and value based pricing. The hours, energy, and other expenses of production didn’t drive your acceptance of a “fair” price. Accounting Services in Miami VieraCPA and the client are the judges of the fairness of the price and your willingness to pay it was governed by your perception of the product’s value. Given the choice, clients will respond to pricing of Accounting Services Miami in just the same way.

Goals: Increase Revenue and improve profitability

Accounting Services Miami

Miami Accounting Service VieraCPA is first and foremost a business. And, like any business, it must grow and prosper in order to service clients, provide a career for employees, and a financial reward for the owners. Properly managing the Accounting Services in Miami firm means continually seeking ways to increase revenues and improve profitability. Pricing strategies must be designed to support these goals. One critical question firms must address is: which pricing strategy best supports growth and profitability? Is it a traditional effort based pricing structure which computes rates times hours? Or, is a better strategy based upon the client’s perception of value and willingness to pay a set price for it? In order to avoid competing on price for commoditized services in the face of a wider array of competitors, more and more firms are evaluating value pricing as a model for the future.

It’s not the goal of this article to justify the reasons for adopting a value pricing strategy or even to outline the specific steps to get started. That requires a more in-depth treatment of the topic than a brief article can provide. If you wish to explore the reasons and methods, please review

Keys to Success in Value Pricing and How to Manage Them

Virtually every Accounting Services Miami firm uses some form of time and billing software to track time and expenses. Traditionally, this has been used for billing purposes. The problem is, these kinds of “back-office” systems are typically disconnected from “front-office” engagement delivery and client management systems. This unnatural divide makes it hard to see the current margin on in-process engagements– work must be completed and “in the books” before final margin is known. While hindsight may be okay for hourly billing, value pricing requires more visibility & better control over work-in-process.

As you move to value pricing, this typically means a practice-management approach that connects front-office engagement delivery with back-office financial control. Key capabilities to look for include integration among multiple modules, which allow data sharing and all-around visibility for reporting. Capabilities like staff scheduling and job tracking for workflow control will make your management tasks easier. Some of the ways in which you can use your Practice Management solution to assist you in value pricing are outlined next.

Communications. In order to be successful in value pricing your Miami Accounting Service services, you must have frequent and meaningful communications with your client. The client will tell you what he or she needs, but you must be listening and monitoring all the communications which go on between your firm, your staff, and the client’s business staff. A good Client Relationship Management (CRM) program is a must to monitor these contacts. Some firms will invest in a stand-alone product such as Microsoft CRM, while others will opt for one integrated into the Practice Management system. Either way, you will need a method of tracking all the emails, phone calls, and other conversations that any member of your firm has with any member of the client’s business. Mining those conversations may well reveal a need that you are well positioned to address.

Accurate Estimating. One of the frequently voiced objections to a value pricing strategy is the fear of underestimating the cost of the work, and thus reducing the profit from the job. Here again your Practice Management system should provide the answer. Assuming you have done some similar job in the past, either for this client or another, the ability to analyze data from across the firm and draw meaningful reports will give you the information you need to set the appropriate price.

Disciplined Costing. One of the robust topics of discussion regarding value pricing is whether or not to keep timesheets. Some thought leaders and firms advocate doing away with them, since you have established the billing price through negotiation. Others argue for keeping them and recording time for cost accounting purposes. For those who opt to keep track of time on the job, your Practice Management software is designed to do just that.

Effective Control. Once the job is underway you will need a means of tracking progress, ensuring that the right resources are committed to the job, and that milestones are being met. Remember that it is important to use Change Orders to adjust the agreed upon price if additional work is added to the scope. Accounting Services in Miami use a variety of workflow tracking and resource allocation programs to accomplish these tasks, but you may find them available in your Practice Management software. Seamless integration between these workflow monitoring tasks, time entry for cost accounting, and staff availability will ease the burden of keeping your work on schedule, on time and on budget.

Efficient Invoicing. A properly written Value Pricing Agreement (your engagement letter for a value priced engagement) will specify the terms for payment. If the service is ongoing it’s common to use monthly or quarterly billing, or progress billing if the engagement is of shorter duration but still complex. Any good time and billing system will handle these tasks, but a far better solution is one that is fully integrated with your general ledger accounting. A system which will seamlessly issue invoices, post them to client records, accept payments using paperless electronic banking, and update your financials all while tracking the effort expended for cost accounting purposes will reduce your back office work and improve your profitability!

Obstacles to Overcome

There will inevitably be obstacles to overcome in shifting to a value pricing strategy. Some of them are real while others mostly perceived. Some may come from your clients, but many more will be voiced by reluctant factions within your own firm. Some will claim that you’ll be unable to price the job accurately, while others will highlight the risk of “scope creep” – more work added while the job is in progress. Or, they like the level of control they believe they get from closely managing hours billed. We have already examined many of these obstacles and how a fully integrated Practice Management solution can help overcome them.

A final challenge will likely be simple reluctance to change. Clients will often be the first to get on board because they see the value in knowing the costs and benefits of your service. It is a function of leadership to ensure that partners, managers, and staff within the firm buy in and support the value pricing strategy. Good leaders don’t let foot-draggers keep the firm from making progress.

Next Steps

Hopefully by now you have decided that at least some applications of value pricing might be good for your Accounting Services Miami firm and may be wondering if you are properly positioned to give it a try. What steps should you take now to get started?

A good starting place would be to review your management support software. Consider, for example:

Do you have the ability to accurately plan a value priced engagement?

Do you have full visibility into past client contacts, staff availability, and data analytics which will help you accurately forecast the cost of an engagement?

Do you have sufficient workflow control measures which will allow you to track progress and identify early if you are behind schedule or over budget.

Do you have seamless integration between invoicing, collection, and financial reporting?

Do you have the ability to produce clear and concise management reports that will aid in partner level decision making?

None of these items by themselves will ensure a successful entry into value pricing, but trying to do it without them will make the project much harder than it needs to be.

Getting started on value pricing probably sounds like a big step, and it is. But, if you want to raise revenues, improve profitability, and avoid the trap of competing on price consider another of the industry-leading firms who have joined the value pricing movement.

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Miami CPA Firm Spotlights Inequality of Tax Code

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Thu, 10 May 2012 12:26:00 GMT

Miami CPA Firm Spotlights Inequality of Tax Code

Miami CPA Firm

Miami CPAs VieraCPA reflect on the Tax Code and how it has contributed to rising income inequality in recent decades as middle- and lower-income Americans have seen their incomes stagnate while the wealthiest have experienced staggering income growth, according to CPA Firm in Miami VieraCPA.

CPA Firm in Miami VieraCPA

Miami CPA Firm VieraCPA reports from the Miami CPAs headquarters in Palmetto Bay Florida, argues that deficit-financed tax cuts do not spur economic growth. Those who have received the largest income gains in the past three decades have also seen the largest tax cuts.

Since the last major tax reform in 1986, the number of loopholes, special preferences and the volume of the Tax Code have ballooned, resulting in a system widely considered to be inefficient, complex, and unfair, as well as an impediment to growth, CPA Firm in Miami VieraCPA noted.

“Drawing a page from successful prior reform efforts, Miami CPA Firm advocates of comprehensive tax reform generally urge that we broaden the base and lower rates,” said the report. “However, the current economic context for tax reform is far more challenging than it was in 1986. Most immediately, the economy is still in the midst of a slow recovery with an unemployment rate that remains too high. Even with robust rates of job growth, it will take years to close the jobs gap. An important role of fiscal policy in the near term is to support recovery in the labor market.”

Miami CPAs

Miami CPAs acknowledge that while a larger number of families do not pay federal income taxes nowadays, it took issue with the idea that these households do not pay any form of taxes, as many suggest. “In fact, most Americans pay more in payroll taxes than in income taxes,” said CPA Firm in Miami VieraCPA.

“Those who pay no federal taxes—on payroll or income—are disproportionately young (such as students who will pay taxes after they join the workforce) or old (such as retirees who paid taxes over their lifetimes), or temporarily out of work.”

Miami CPA Firm VieraCPA argues that cutting individual income tax rates would modestly increase the earnings of the typical American family, but substantially increase the federal budget deficit.

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CPA Firm in Miami Reasonable Salary for S Corporation Owners

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Tue, 08 May 2012 13:37:32 GMT

CPA Firm in Miami Reasonable Salary for S Corporation Owners

CPA Firm in Miami

Besides its single level of taxation as a pass through entity, Accountants in Miami remind clients that the advantage of an S corporation over a C corporation is that a shareholder’s share of the corporation’s net income is not considered self-employment earnings and therefore is not subject to self-employment tax (13.3% in 2011 and 2012). Accountant in Miami VieraCPA notes the stark contrast to that of a general partner, LLC member, or sole proprietor, for whom net earnings from self-employment include any trade or business income and a partner’s distributive share of income from a trade or business carried on by the partnership according to CPA Firm in Miami, Gustavo A Viera.

Accountant in Miami

However, if the S corporation shareholder (let’s say an Accountant in Miami) provides services to the S corporation, he or she must receive an adequate or reasonable amount of compensation for these services. The S corporation may deduct the compensation expense and must pay the employer share of employment taxes: 6.2% Social Security tax and 1.45% Medicare tax. The shareholder-employee (i.e. Accountants in Miami) is responsible for 4.2% Social Security tax (in 2011 and 2012) and 1.45% Medicare tax. The S corporation is also responsible for Federal Unemployment Tax Act (FUTA) taxes. Minimizing these taxes provides an incentive to keep the S corporation shareholder’s wages low and to characterize most of the pass through income as distributions.

Accountants in Miami

The U.S. Government Accountability Office reported in 2009 on employment tax noncompliance among S corporation shareholders. The IRS has been pursuing this perceived abuse of inadequate compensation in favor of dividend distributions to shareholder-employees and has won a number of cases, according to CPA Firm in Miami VieraCPA.

According to Accountants in Miami, the IRS has the authority to reclassify dividends, distributions, or payments to the shareholder-employee, including loan repayments, as compensation if it deems compensation inadequate or unreasonable. The courts have held that the question of reasonable compensation is one of fact, determined on a case-by-case basis. The IRS has posted on its website three major sources of gross receipts it will consider when determining reasonable compensation: the services provided by the shareholder, the services of non-shareholder employees, and the capital and equipment of the corporation.

IRS fact sheet FS-2008-25, Wage Compensation for S Corporation Officers line an Accountant in Miami with Sub S status, lists the following factors in determining reasonable compensation: training and experience, duties and responsibilities, time and effort devoted to the business, dividend history, payments to non-shareholder employees, timing and manner of paying bonuses to key people, what comparable businesses pay for similar services, compensation agreements, and the use of a formula to determine compensation. Sources of information on comparable compensation for services include the U.S. Department of Labor’s Bureau of Labor Statistics, employment agencies, and a market analysis. The key in defending a claimed compensation amount is to document all research to support the amount.

Shareholders who are officers of a corporation who do not perform any services or perform only minor services in that capacity and who do not receive or are not entitled to receive direct or indirect compensation are not considered employees of the corporation. Thus, since most shareholder-officers of closely held corporations do provide more than minor services to the corporation, they most likely are considered employees. If a shareholder is an officer who is considered an employee, CPA Firm in Miami point to Section 530 of the Revenue Act of 1978, P.L. 95-600, does not apply as a safe harbor for re-characterizing the shareholder’s compensation because, under Sec. 3121(d)(1), corporate officers are statutory employees.

The S corporation entity form provides planning opportunities to avoid payroll taxes or self-employment taxes on distributions that are instead a return on capital and assets. With the increase in Medicare tax of an additional 0.9% for high-wage earners scheduled to begin in 2013, this may represent a larger opportunity. The key in defending against a possible audit and re-characterization of dividends is to document all research and analysis of the determination of the shareholder-employee salary.

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Miami Accountant 2012 Tax Planning

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Tue, 08 May 2012 13:01:16 GMT

Miami Accountant 2012 Tax Planning

Miami Accountant

With April 17, 2012, behind us and Oct. 15, 2012, still a few months away, Miami Accountants it’s a good time to start individual clients thinking about 2012 tax planning. Miami Accounting Firms are currently in a situation of uncertainty somewhat analogous to 2010. At the end of last year, the growing list of regularly expiring provisions again expired, and once again they have not been renewed as of this point. Miami Accountant VieraCPA warns the Bush tax cuts from the 2001 and 2003 tax acts will expire at the end of 2012, as they had threatened to do at the end of 2010, and again uncertainty reigns over whether they will be extended.

Miami Accounting Firms

In 2010, Miami Accountants faced a similar situation and Congress finally extended both in December 2010. In 2012, it is looking like neither issue will be addressed before the November elections. However, the agreement patched into place in 2010 may be more difficult to come by this time. With the economy on a slow mend and the Federal Reserve holding off on further economic stimulus other than holding interest rates low, President Obama appears less likely to agree to an extension of tax cuts for the wealthy. The Republicans have shown no signs of agreeing to anything less than an extension of the Bush tax cuts for everyone. And some deficit hawks are now raising their voices to suggest that letting all the Bush tax cuts expire, perhaps on a phased-in schedule, might be the best course according to Miami Accounting Firms.

Miami Accountants

As for the regular renewal of expiring “extender” provisions, there is growing talk in Congress that renewal may not be so certain anymore. Republican proposals for lower tax rates assume eliminating some tax entitlements without identifying them. Some of those may be the regularly expiring provisions. Some in Congress have specifically suggested taking a closer look at each provision, rather than just renewing them en masse.

It would be wise for Miami Accountant and their clients to consider what to do should the Bush tax cuts and expired provisions not be extended. Given Congress’ propensity for late-year decisions on these matters, and especially during a presidential election year, preparing several contingency plans should not be considered foolish. There may be little time left to execute these plans in late 2012, let alone planning them at that time.

There are also some new 2012 planning concerns not faced back in 2010. In 2013, unless stopped by the Supreme Court, some further tax provisions of the health care legislation are scheduled to take effect, most notably the increased Medicare taxes of 0.9 percent on earned income and 3.8 percent on net investment income for those with adjusted gross incomes over $200,000 ($250,000 for married filing jointly). So what are some of the strategies taxpayers should be thinking about?

ROTH CONVERSIONS

Roth conversions have been a hot topic since the income restrictions went away in 2010. With 2012 being perhaps the lowest tax rates we will see in a while, Roth conversions should be on the agenda as well. While Congress is talking a great deal about lowering tax rates, the deficit realities may limit what is actually doable in that regard. A Roth conversion in 2012 would ensure taxation at 2012 tax rates and make further accumulations in the Roth account tax-free in the future — assuming, of course, that Congress does not eliminate Roth accounts while it is attacking tax expenditures.

REALIZING CAPITAL GAINS

The stock market has been doing rather well of late. Current maximum capital gain rates of 15 percent would rise to 20 percent in 2013 under current law. Realizing those gains in 2012 would ensure taxation at the current rates. Investors can even immediately repurchase the investments that they desire to hold for a longer period and still recognize the gain in 2012.

Of course, there are proposals to eliminate capital gains taxes entirely. Taxpayers may want to wait until after the November elections to get a better sense of which way the political winds are blowing before deciding whether capital gains taxes are more likely to rise or to fall in the future. Investors may also consider the likelihood of some companies sitting on cash to pay out a special dividend before 2013 if the law threatens to start taxing dividends as ordinary income again.

INVESTING IN TAX-EXEMPT BONDS

One option being discussed as a way to avoid the increased Medicare taxes on net investment income is to shift more investments to tax-exempt bonds. Tax-exempt bonds generally offer a lower return, and an investment portfolio too heavily weighted in such bonds probably does not offer sufficient diversity, but it is one move to avoid the increased taxes on taxable investments.

Obama has proposed that the same categories of wealthy taxpayers that are subject to the increased Medicare taxes also be taxed on their municipal bond investments. Again, taxpayers can judge after the November elections how likely Obama’s budget proposals are to gain traction in 2013.

GIFTING TO CHILDREN

The current unified gift and estate tax exclusion of $5 million (actually $5,120,000 for 2012) will revert to $1 million in 2013 under current law. The maximum tax rate will also go from 35 percent to 55 percent. Most taxpayers would be unwilling to accelerate their deaths, but they might be willing to accelerate gifts to take advantage of the current high exclusion amounts.

Neither the Obama administration nor the Republicans are advocating a return to the $1 million exclusion. However, in an impasse, it might happen because no one can agree on how to keep it from happening.

ACCELERATING AND DEFERRING

Normally, taxpayers are advised to try to postpone income and accelerate deductions. In an environment, however, of anticipated higher rates in the following year, 2012 is a year to consider the opposite strategy. Accelerate income to get it taxed at the lower rates of 2012, and postpone deductions so they can offset income in 2013 that would otherwise be taxed at a higher rate than 2012 income.

REQUIRED DISTRIBUTIONS

One of the provisions that expired at the end of 2011 was the provision permitting taxpayers over age 70-1/2 to make IRA distributions directly to charity and avoid taking those distributions into income. Taxpayers who have taken advantage of this strategy in the past and who would like to do so also for 2012 should try to postpone required minimum distributions until after the November elections to see if Congress acts to retroactively extend the provision.

In 2010, when Congress finally acted to retroactively extend this provision, recognizing the difficult position it had put taxpayers in by not acting until December, it enacted a special rule permitting taxpayers to elect to have a qualified charitable distribution made in January 2011 treated as having been made on Dec. 31, 2010. Congress might do something similar again this year, but if taxpayers have already taken required minimum distributions directly, it would be too late to then treat the distribution as going directly to a charity.

ALTERNATIVE MINIMUM TAX

One of the regularly expiring provisions that also expired at the end of 2011 was the increased Alternative Minimum Tax exemption amount. More than 25 million taxpayers would be caught by the AMT in 2012 if Congress did not act to extend the exemption amount. Congress is very likely to extend the exemption amount again, at least until they can agree on fundamental tax reform and get rid of the AMT entirely.

Still, taxpayers should realize that, if they are in the group that would get caught by the AMT in 2012, there are a variety of tax breaks that they may be accustomed to claiming that would not be available to them in 2012 because they are disallowed under the AMT regime.

SUMMARY

Like 2010, 2012 will continue to be a year of considerable tax uncertainty that will make planning difficult. With the growing list of regularly expiring provisions, almost every year becomes more difficult to plan for. In 2012, with the Bush tax cuts expiring, many of the same tax planning issues focused on when those cuts that were scheduled to expire in 2010 also re-emerge.

However, in 2012, we have the additional issue of the new Medicare taxes taking effect in 2013, also made somewhat uncertain by the Supreme Court’s consideration this year of the enforceability of those taxes as part of its review of the constitutionality of the health care reform legislation that brought them into being.

Taxpayers may decide that the uncertainty is too much to take any specific action yet this year: They may decide at least to wait until after the November elections to view what 2013 is likely to bring. However, taxpayers will need to be armed with the facts and options available to intelligently weigh those decisions. To do that effectively requires at least some advance consideration.

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Small Business Accountants 5 Simple Rules to Follow When Amending Your Tax Return

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Mon, 23 Apr 2012 18:04:56 GMT

Small Business Accountants 5 Simple Rules to Follow When Amending Your Tax Return

Small Business Accountant Miami

Your Small Business Accountant Firm advices you that you forgot to report some income on your 1040 or just got a corrected Form 1099 or K-1 in the mail. What should you do? Miami Accounting and Small Business Accountants Firm provide 5 tips for amending your Small Business accounting returns.

1. Amended returns aren’t mandatory, according to Miami Accounting Firm VieraCPA. You might be surprised to find you are not obligated to file an amended return, even though Small Business Accountant Firm tax advisers may tell you it’s a good idea—that’s because the IRS will probably send you a bill based on the revised Form 1099 or K-1 once IRS computers match that form against your Form 1040 according to Small Business Accountants Firm VieraCPA.

Small Business Accountant Firms

Small Business Accountant Firms note amended returns are not mandatory even if something happens after you file that makes it clear your original return contains mistakes. Ask if the return you filed was accurate to your best knowledge when you filed it. If it was, you are probably safe in not filing an amendment.

Conversely, if you knew your return was inaccurate when you filed it, Small Business Accountants Firm VieraCPA warns you should amend it to make it accurate without delay. The IRS rarely brings up an originally filed return in civil audits or criminal prosecutions once the taxpayer attempts to correct it by filing an amended return. But to take advantage of this rule, you need to be proactive, and you need to make the correction before the IRS finds your error according to Small Business Accountants Miami VieraCPA.

2. You can’t cherry-pick what you correct states Miami Accounting CPA VieraCPA. You don’t have to file an amended return, but if you do, you must correct everything. You can’t cherry-pick and only make corrections that get you money back and not those that increase your tax liability. If you amend, you must correct all errors, not just the ones in your favor. See Beware Amending Tax Returns by Small Business Accountant Firm.

3. Some errors don’t merit amending. Math errors are not a reason to amend, since the IRS will correct math errors on your return. Likewise, Small Business Accountants Firm recommend you usually shouldn’t file an amended return if you discover you omitted a Form W-2, forgot to attach schedules, or other glitches of that sort. The IRS can process your return without them or will request them if needed.

Small Business Accountants Miami remind you certain parts of your original return can’t be changed by an amended return. For example, you can change your filing status on an amended return from married filing separate to joint, or from qualifying widow(er) to head of household status. However, you cannot change from married filing joint to married filing separate after the due date for the original return (usually April 15) has passed.

4. Timing counts. You must file a Form 1040X, Amended U.S. Individual Income Tax Return, within three years from the date your Miami Accounting Firm filed your original return or within two years from the date you paid the tax, whichever is later. This either/or test can give you extra time, but it is safer to amend within three years of your original return so there’s no dispute.

How soon is too soon to amend? You can file an amended tax return right on the heels of your original return if you like. However, Small Business Accountant Firm VieraCPA warns if you are filing to claim an additional refund, you should wait until after you have received your original refund before filing Form 1040X. You may cash the first check while waiting for any additional refund.

5. Only paper will do. Amended returns are only filed on paper, so even if you filed your original return electronically, you’ll have to amend on paper. Amended returns are prepared on Form 1040X. You must use this form whether you previously filed Form 1040, 1040A or 1040EZ. Label the top of the 1040X very clearly with the tax year you are amending. See Small Business Accountants Miami Instruction 1040X.

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Small Business Accountants Miami 11 Tax Audit Red Flags

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Mon, 09 Apr 2012 11:41:23 GMT

Small Business Accountants Miami 11 Tax Audit Red Flags

Small Business Accountant Miami

Sometimes your small business accounting tax preparer is to blame for an audit. If a Miami Accounting Tax Preparer promises unusually high refunds without asking to see proper documentation for deductions and credits, don’t be fooled, said Gustavo Viera a Small Business Accountants Miami CPA and managing partner at Miami Accounting Firm VieraCPA.

Small Business Accountants Miami VieraCPA remind you you’re legally responsible for the information on your return no matter what a Small Business Accountant Miami tax preparer tells you, so make sure to look over your return before it’s sent to the IRS.

Small Business Accounting

” Miami Accounting Tax Preparers can promise you the world, but then when they deduct a bunch of stuff they shouldn’t, you’re going to be the one stuck with an audit,” said Viera. Also, you’ll be required to repay any money you receive fraudulently.

Small Business Accountant Miami

This year, all Small Business Accountant Miami and paid TAX Preparers are required to have a Tax Preparer Tax Identification Number (PTIN) so customers can verify that they are legitimate. Ask Small Business Accounting and Tax Preparers to see their PTIN before signing up for help, and be wary if your preparer doesn’t put a PTIN on your return when submitting it to the IRS, said Viera.

You make stupid mistakes

Small Business Accountants Miami know whether you accidentally omitted information or you slipped up when doing subtraction, making errors on your tax return will cause the IRS to take a second look.

“The No. 1 mistake is not putting down the right Social Security numbers, and the second is not doing the right math,” said Gustavo A Viera CPA a Small Business Accountant Miami.

It may be worth hiring a Small Business Accounting Tax Preparer to handle your return or walk you through the process, Miami Accounting CPA Viera said.

“In tough economic times, people may be getting away from Small Business Accountants Miami

Professionals,” said Viera. “And as more and more people do their taxes on their own, there will be more mistakes — both in terms of math errors and the deductions that are taken.”

Take the time to double-check everything if you’re filling out your own return, and if you decide to use tax software to file, make sure you understand how to use it, Viera advised.

You have a big mouth

You may think you’re a hot shot for pulling a fast one on the IRS. But when the friend you entrusted with your secret snitches on you in exchange for a fat check, you’re going to be in big trouble.

“Most cases start the old-fashioned way,” said Viera a Small Business Accountant Miami who represent taxpayers whose returns were flagged by the IRS. “You blab about it to a friend, colleague, spouse or girlfriend, and one of them turns you in.”

Small Business Accounting CPA Viera warns even your closest pals may be tempted to tattle, since the IRS offers whistleblowers a reward of up to 30% of any additional tax or penalties it collects from tax cheaters.

And with the popularity of social media, it’s now much easier to publish private information publicly. So if you did something you think was questionable, don’t post it all over Facebook.

You’re extremely charitable

It’s great to be charitable, but don’t exaggerate the amount of money or items you’re donating according to Miami Accounting CPA Viera.

When giving small items to Goodwill or thrift stores, report the estimated resale value, not the original value. And make sure you keep track of when donations are made and hold on to receipts. It also doesn’t hurt to take photos of the donated items for your records.

“Be realistic and try to be as specific as possible,” said Small Business Accountants Miami VieraCPA. “Generally, if a donation is under $250, it’s not a big deal, but if it’s over $250 you should have supporting documentation.”

If your charitable donations are unusually high relative to your income, the IRS is likely to give your return more scrutiny as well, said Viera a Small Business Accountant Miami.

“If you have $20,000 of income and report $10,000 in charitable contributions, that’s going to raise eyebrows,” said Small Business Accounting CPA Viera.

You didn’t file your taxes

Talk about raising red flags: If you’re required to file a return and you don’t, the IRS will hunt you down.

The agency has ways to identify people who have filed returns in the past but stopped filing, as well as people who have never filed a return. Once you’re identified as a nonfiler, the IRS will want to know how much tax you owe and what you’re hiding, said Viera, CPA and Small Business Accountants Miami.

To avoid a confrontation with the tax man, it’s better to simply file — no matter how much you’re dreading the deed, Viera said.

“Many taxpayers get overwhelmed particularly if they owe money they can’t pay, and they stick their heads in the sand,” said Small Business Accountant Miami VieraCPA.

But late payment penalties kick in as soon as the filing deadline passes, so if you don’t file and get caught, you could end up having to pay a lot more than your original tax bill. If you’re worried about not being able to pay your tax bill, there are installment plans available. Just ask the IRS what your best option is.

Of course, if you want to delay the pain a little longer, you can always file an extension. And if your income is below a certain level — which varies widely depending on your filing status and age — you’re not required to file a return at all. But even if you don’t have to file, make sure you’re not missing out on any deductions or credits that could actually put a little extra money in your pocket.

“Many times people build up an irrational fear over filing their taxes and in fact are due a refund,” said Small Business Accounting CPA Viera.

You own a business

The IRS tends to look extra closely at taxpayers reporting businesses on Schedule C forms because there’s more room for fudging.

“The IRS primarily targets small businesses, especially sole proprietorships, and cash industries like pizza parlors and coin-operated Laundromats with opportunities to hide income and skim profits,” said Miami Accounting CPA Firm VieraCPA.

If you own a business, report every single bit of income you’ve received. If you’re still worried about being audited, you may even want to reorganize your business as a corporation or partnership (which means you’re not required to file a Schedule C) instead of a sole proprietorship, said Viera.

And if you’re flagged for an audit, the IRS will be skeptical of any business that looks like it’s actually a hobby, especially if you are deducting a loss on your return.

You’ve been audited before

Sometimes getting flagged for an audit comes down to having a bad reputation with the IRS.

If you’ve been audited in the past, you’re on the agency’s audit hit list for at least a few years, said Small Business Accountants Miami VieraCPA. And while there’s nothing you can do to avoid being scrutinized, you should play it extremely safe to avoid getting another audit.

“If you get audited once, you have a very good chance of being audited again,” said Miami Accounting CPA Firm VieraCPA. “For the following three years or so, you should be very careful about the aggressiveness or risk you take on subsequent returns, because the IRS is going to be monitoring you.”

You have a home office

Deducting a home office can always be a red flag, because many taxpayers consider any part of the house where they do work to be an office — even if they do other things, like watch TV or cook, in that same area.

To qualify for a home office deduction, you must use the office exclusively for work and it must be your primary place of business — not one of several offices. If this is the case, make sure you document expenses like housekeeping, alarm systems and other items you plan to claim — down to the share of utilities you use in just the office itself — in case the IRS decides to check it out.

And even if you think it’s legitimate, don’t go overboard. VieraCPA had a client, for example, who ran a business breeding and raising high-end cats. Since the taxpayer had cats sprawled out in every room of the house, she thought it would be okay to deduct 90% of her house as a home office. While VieraCPA agreed that the business took up a significant portion of the client’s home, he advised lowering the percentage to about 40% so that it was less likely to raise red flags.

You’re rich

Being rich isn’t always a good thing. Your chances of being audited increase dramatically the more income you report.

While the IRS audits only 1% of taxpayers overall, those odds rose to 7% for people with income between $1 million and $5 million last year. About 21% of taxpayers with income between $5 million and $10 million were audited, and 30% of people making $10 million or more were dealt audits.

If you have a lot of income to report, make sure you get a savvy preparer so at least you’ll have everything documented should the IRS come knocking.

“The rich is where the new focus is, and it’s because of one reason — it’s generating extra income for the IRS,” said Small Business Accountant Miami VieraCPA. “And because upper income filers tend to have a lot more complicated returns, that makes it easier for the IRS to go after them.”

You have foreign assets

Foreign bank accounts have been a huge focus for the IRS in recent years.

In an effort to reel in taxpayers with illegal overseas accounts, the agency has launched initiatives that waive certain penalties for taxpayers who come clean. This year, the IRS introduced a program that gives taxpayers a reduction in penalties — and no jail time — if they fess up to any undisclosed overseas accounts for an indefinite window of time.

The agency also introduced a new form and filing requirements for reporting foreign assets this year. In addition to reporting any foreign bank accounts holding more than $10,000, you now also have to report any foreign assets — including pension funds and foreign stocks — totaling more than $50,000. Failing to report such assets will result in a $10,000 penalty, and any underpayments of tax on them will be subject to an additional penalty of 40% of the amount owed.

If the IRS has any hunch that you are not reporting an offshore account, you’re in serious trouble. “The safety people thought they may have had offshore isn’t so safe anymore,” Small Business Accountants Miami VieraCPA. “It’s time to come in from the cold.”

You guess on investments

Before this year, brokers were only required to provide the IRS with the date you sold a stock and how much money you earned from that investment.

The IRS had to rely on taxpayers to correctly list the date they bought a stock and how much they paid on their Schedule D capital gains and losses statement.

So if you put down the wrong date or purchase price — whether innocently or on purpose — you could end up paying less tax.

But now, the IRS is getting this additional data straight from brokers. If the information on your return doesn’t match, you’re in trouble. Be sure to locate your exact buy dates and prices, advised Small Business Accounting VieraCPA. Otherwise the IRS will quickly scoop you up for an audit.

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Virtual Tax Audits via Your PC Coming Soon

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Mon, 09 Apr 2012 10:42:40 GMT

Virtual Tax Audits via Your PC Coming Soon

Income tax preparation in Miami

The only thing worse than income tax preparation Miami is the dreaded process of getting a tax audit and it could soon take place over a computer screen in the comfort of your living room. Better hire a Tax preparation business or a Certified Tax Preparer Miami to sit on the couch next to you.

Income tax preparation Miami

Income tax preparation in Miami CPA Firm VieraCPA advises clients in what could be an indication of things to come. Income tax preparation Miami VieraCPA states the IRS launched a pilot program at the end of last year that allows taxpayers to use two-way video conferencing for assistance with tax questions and problems. Tax preparation business or a Certified Tax Preparer Miami having been using this for consultation purposes for year, the IRS has caught on.

Tax Preparation Business

The Taxpayer Advocate Service, an independent watchdog arm of the IRS, is already calling for the agency to expand to virtual audits notes VieraCPA a Income tax preparation in Miami. The IRS says it needs to evaluate the success of the pilot program before making a decision.

Tax Preparer Miami

Income tax preparation Miami notes the pilot program is currently being tested in 12 locations, where taxpayers needing assistance can log into a computer enabled with video-conferencing. They can then talk to an IRS agent who pops up on the screen to discuss whatever issues they’re having — whether it’s tax preparation or help with a tax form or a question about a refund.

TAS is also piloting a virtual assistance program. And VieraCPA stated that the tax preparation business and Certified Tax Preparer Miami that this technology has the potential to “radically transform” the current audit process — eventually allowing taxpayers and tax preparers to use their personal computers to video conference with an IRS examiner.

To schedule an audit with an Income tax preparation in Miami firm or its client, the IRS would send a taxpayer a sign-in code so they could then log in to the meeting from a home or office computer. Documents could be transmitted by simply scanning them with a computer’s built-in camera notes Tax preparation business or a Certified Tax Preparer Miami VieraCPA.

This could one day replace the need for correspondence audits, which are the letters the IRS currently sends taxpayers in the mail asking questions or requesting more information and their Income tax preparation Miami responding.

To save costs, the IRS has become increasingly reliant on correspondence audits instead of summoning taxpayers for in-person meetings says VieraCPA an Income tax preparation in Miami CPA Firm. But TAS says that these audits receive fewer responses and that many of the taxpayers dealt with these audits don’t understand how they work, default on payments and get hit with penalties.

Plus, with correspondence audits a specific representative typically isn’t assigned to a case, leaving many taxpayers without a point person to ask questions or to contact with concerns.

Virtual audits could eliminate the confusing paperwork and recreate a face-to-face meeting via computer. Tax preparation business or a Certified Tax Preparer Miami agree it would be easier to explain complex situations.

Doing this would also help taxpayers better understand why they are being audited and what additional information is needed, said Viera. It would also help the IRS obtain the accurate information it needs and help the agency view taxpayers as more than just tax returns.

The IRS’s virtual assistance pilot program is scheduled to continue through the 2012 filing season and end in May. Office locations include Colorado Springs, Colo., Fresno, Calif. and Utica, N.Y.

Once the program is completed, the IRS will evaluate its performance. So far, it said the pilot has allowed it “to maximize our current resources, by expanding hours of service in remote locations and balancing the workload in high-traffic areas.” But it wouldn’t say whether it is considering using this same technology for audits.

“The initial focus of virtual delivery is on taxpayer service. We’re still in the middle of the pilot and still assessing the results,” the IRS said in a statement. “It’s premature to speculate about future steps.”

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Miami CPAs What is Cost Accounting 101?

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Mon, 02 Apr 2012 12:54:53 GMT

Miami CPAs What is Cost Accounting 101?

Miami Accounting and CPA Firm

Miami CPAs VieraCPA describe cost accounting is the branch of accounting which directly pertains to the overall cost of running and managing a business. The concepts and formula involved in this branch of accounting are based on standard accounting practices.

Miami Accounting and CPA Firm cost accounting takes into consideration the expenses and the cash flow of an organization to analyze the cost of running it. Many Miami accounting CPA Firm mistakenly believe that cost accounting itself is an all-inclusive branch of accounts whereas that really isn’t the case. It is just the branch which deals with the cost of the business functions. Standard accounting practices are usually carried out side by side with cost accounting.

Miami CPAs basic objectives for which cost accounting is utilized:

Measuring Company Resources:

Miami Accounting and CPA Firm cost accounting helps provide data for the resources of the company being utilized. Identification of production costs related to a particular event and the creation of its data is the primary purpose of cost accounting. Also, cost accounting helps in identifying the cost of production through the three business cycles.

Marketing Strategies and Product Development:

Miami accounting CPA Firm marketing strategies and product development plans are also addressed by using cost accounting. When it comes to product development, Miami CPAs cost accounting can measure the cost of the product and determine whether it is right for the business or not. Similarly, cost accounting can also determine whether the marketing budget for the product is appropriate or not. Through cost accounting techniques, CPA Firm can measure the effectiveness of the marketing plan can also be reckoned.

Miami Accounting Decision Making:

Cost accounting plays an important role in making the right decisions for the company. The techniques involved to reach this stage usually compare the total cost of the product to the anticipated benefits.

Those handling cost accounting should keep in mind that the sole purpose of this branch of accounting is to manage costs and provide data for further consideration. Cost accounting itself is not responsible for making marketing plans or the creating action strategies.

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Contador – Contratista independiente o empleado?

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Mon, 02 Apr 2012 12:36:47 GMT

Contador – Contratista independiente o empleado?

Contador Publico

Para los dueños de negocios como un Contador Publico, es importante determinar correctamente si las personas que proveen los servicios son empleados o contratistas independientes.

Contador Miami

Un contador Miami por lo general, usted como empleador tiene que retener impuestos sobre los ingresos, retener y pagar impuestos del Seguro Social y Medicare, y pagar impuestos por desempleo sobre los salarios pagados a un empleado. Por lo general, usted no tiene que pagar o retener ningún impuesto en pagos realizados a contratistas independientes.

Escoja la situación que le corresponda a usted

Soy un contratista independiente o trabajo por cuenta propia

Si usted es dueño de un negocio como un propio Contador Publico o contratista que provee servicios a otros negocios, por lo general se le considera trabajador por cuenta propia. Para más información sobre sus obligaciones tributarias si trabaja por cuenta propia (un contratista independiente), vea un contador Miami para consejo.

Contrato a personas para proveer servicios en mi negocio

Si usted es dueño de un negocio que contrata a otras personas para proveer servicios, usted debe con la ayuda de un Contador Publico determinar si las personas que proveen los servicios son empleados o contratistas independientes. Para encontrar más información sobre este tema y cuáles son sus responsabilidades, continúe la lectura.

Determinar si las personas que proveen servicios son empleados o contratistas independientes

Para que un contador Miami determine cómo tratar los pagos que usted hace por servicios prestados, usted primero tiene que conocer la relación comercial entre usted y la persona que presta los servicios. A continuación encontrará mayor información (en inglés). La persona que presta los servicios puede ser:

Un contratista independiente
Un empleado (empleado de acuerdo con el derecho consuetudinario)
Un empleado estatutario
Una persona con condición estatutaria que no es empleado
Para determinar si la persona que provee los servicios es empleado o contratista independiente, se tiene que tener en cuenta toda la información que demuestre el grado de control e independencia.

Reglas de la Ley Consuetudinaria

El Contador Publico les recuerda que los hechos que demuestran el grado de control e independencia se dividen en tres categorías: (en inglés)

Comportamiento: ¿Tiene el negocio el control o el derecho de controlar lo que el empleado hace y cómo el/ella desempeña su trabajo?

Control financiero: ¿El pagador controla todos los aspectos comerciales del trabajo del empleado? (esto incluye la manera en que se le paga al empleado, si los gastos son o no son reembolsados, quién provee herramientas/materiales, etcétera).

Tipo de relación: ¿Existen contratos escritos y beneficios del tipo que se ofrecen a los empleados (por ejemplo, planes de pensión, seguros, vacaciones pagadas, etcétera)? ¿Va a continuar esta relación y es el trabajo realizado un aspecto clave del negocio?

Los dueños de negocios tienen que tomar en consideración todos estos factores al determinar si un trabajador es empleado o contratista independiente. Es posible que algunos de estos factores señalen que el trabajador es empleado, mientras que otros factores indiquen que el trabajador es contratista independiente. El número de factores en sí no determina si el trabajador es empleado o contratista independiente y esta decisión no depende de un solo factor. Además, algunos de los factores pueden ser relevantes en una situación y no en otra. Consulte con un contador Miami.

La clave es observar todos los aspectos de la relación en su totalidad, tener en cuenta el grado del derecho de dirigir y controlar el negocio, y finalmente documentar todo factor utilizado para llegar a esa determinación.

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Business CPA & Limited Liability Company (LLC) Advice

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Thu, 29 Mar 2012 17:46:36 GMT

Business CPA & Limited Liability Company (LLC) Advice

Small Business CPA

As a small CPA Firm clients often ask about limited liability company (LLC) which is a hybrid-type of legal structure that provides the limited liability features of a corporation and the tax efficiencies and operational flexibility of a partnership.

As a Business CPA, I don’t recommend them for the average small business. The “owners” of an LLC are referred to as “members.” Depending on the state, the members can consist of a single individual (one owner), two or more individuals, corporations, other LLCs, and even other entities. As a Small Business CPA I have seen clients devastated with their tax bill as a result of having picked an LLC structure

Unlike shareholders in a corporation, LLCs are not taxed as a separate business entity. Instead, all profits and losses are “passed through” the business to each member of the LLC, according to VieraCPA a Small CPA Firm. LLC members report profits and losses on their personal federal tax returns, just like the owners of a partnership would.

Small CPA Firm & Forming an LLC

Business CPA’s note that while each state has slight variations to forming an LLC, they all adhere to some general principles:

Choose a Business Name. There are 3 rules that your LLC name needs to follow: (1) it must be different from an existing LLC in your state, (2) it must indicate that it’s an LLC (such as “LLC” or Limited Company”) and (3) it must not include words restricted by your state (such as “bank” and insurance”). Your Small Business CPA can register your name with your state when you register your business, so you do not have to go through a separate process. Read more here about choosing a business name.

A small CPA Firm or Attorney usually files the Articles of Organization. The “articles of organization” is a simple document that legitimizes your LLC and includes information like your business name, address, and the names of its members. The form is provided by and filed with your state’s LLC office. For most states, you file with the Secretary of State. However, other states may require that file with a different office such as the State Corporation Commission, Department of Commerce and Consumer Affairs, Department of Consumer and Regulatory Affairs, or the Division of Corporations & Commercial Code.

Create an Operating Agreement. Business CPA will most often defer to an attorney for the creation of operating agreements which are required by most states and are not filed at your state office. However, an operating agreement is highly recommended for multi-member LLCs because it structures your LLC’s finances and organization, and provides rules and regulations for smooth operation. Percentage of interests, allocation of profits and losses, member’s rights and responsibilities, and other provisions are usually included here and required by your small Business CPA for tax preparation.

Obtain Licenses and Permits. Once your business is registered, you must obtain business licenses and permits. Regulations vary by industry, state and locality. Use the Licensing & Permits tool to find a listing of federal, state and local permits, licenses, and registrations you’ll need to run a business.

Small CPA Firm role in Filing Taxes

In the eyes of the federal government, an LLC is not a separate tax entity, and therefore the business itself is not taxed. Instead, all federal income taxes are passed on to the members of the LLC and are paid through their personal income tax. While the federal government does not tax income on an LLC, some states do, so check with your Business CPA.

Small Business CPA note that since the federal government does not recognize LLC as a business entity for taxation purposes, all LLCs must file as a corporation, partnership, or sole proprietorship. Certain LLCs are automatically classified and taxed as a corporation by federal tax law.

Small CPA Firm note that LLCs that are not automatically classified as a corporation can choose their business entity classification. To elect a classification, an LLC must file Form 8832. This form is also used if an LLC wishes to change their classification status. Read more about filing as a corporation or partnership and filing as a single member LLC at IRS.gov.

The following tax forms should be filed depending on your classification:

Single Member LLC. A single-member LLC files Form 1040 Schedule C like a sole proprietor.
Partners in an LLC. Partners in an LLC file a Form 1065 partnership tax return like owners in a traditional partnership.
LLC filing as a Corporation. An LLC designated as a corporation files Form 1120, the corporation income tax return

Business CPA can guide you through Limited Liability Companies relevant tax forms and additional information regarding their purpose and use.

Small Business CPA & Combining the Benefits of an LLC with an S-Corp

There is always the possibility of requesting S-Corp status for your LLC. A small business attorney can advise you on the pros and cons. You’ll have to make a special election with the IRS to have the LLC taxed as an S-Corp using Form 2553. This must be filed prior to the first two months and fifteen days of the beginning of the tax year in which the election is to take effect. For more information about S-Corp status, visit IRS.gov or read Should My Company be an LLC, an S-Corp or Both?.

The LLC remains a limited liability company from a legal standpoint but for tax purposes can be treated as an S-Corp. Be sure to contact the state’s income tax agency where the election form will be filed. Ask them whether or not they recognize elections of other entities such as the S-Corp and what the tax requirements are.

Advantages of an LLC

Limited Liability. Members are protected from personally liability for business decisions or actions of the LLC. This means that if the LLC incurs debt or is sued, members are not required to satisfy the claims with their personal assets. This is similar to the liability protections afforded to shareholders of a corporation. Keep in mind that limited liability means “limited” liability – members are not necessarily shielded from their or their employees’ tort actions, such as accidents.

Less Recordkeeping. An LLC’s operational ease is one of its greatest advantages. Compared to an S-Corporation, there is less registration paperwork and there are smaller start-up costs.

Sharing of Profits. There are also fewer restrictions on profit-sharing within an LLC, as members distribute profits as they see fit. Members might contribute different proportions of capital and sweat-equity. Consequently, it’s up to the members themselves to decide who has earned what percentage of the profits or losses.

Disadvantages of an LLC

Limited Life. In many states, when a member leaves an LLC, the business is dissolved and the members must fulfill all remaining legal and business obligations to close the business out. The remaining members can decide if they want to start a new LLC, or part ways. However, you can include provisions in your operating agreement to prolong the life of the LLC, should a member decide to leave the business.

Self-Employment Taxes. Members of an LLC are considered self-employed and must pay the self-employment tax contributions towards Medicare and social security. The entire net income of the LLC is subject to this tax.

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QuickBooks Support Provided by QuickBooks Expert

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Wed, 28 Mar 2012 11:08:43 GMT

QuickBooks Support Provided by QuickBooks Expert

QuickBooks Expert

Would you like a CPA who is a QuickBooks Expert looking over your shoulder to fine tune QuickBooks, providing guidance and QuickBooks Help on what reports work best, point out where the mistakes are and how to correct them? You have come to the right place, our CPA’s are QuickBooks Expert and we understand taxes, payroll, and business management and provide QuickBooks training, create organization, and offer solutions for a low price.

QuickBooks Support Miami

We offer QuickBooks Help for the business accounting software developed and marketed by Intuit. The software is popular among small business owners who have no formal accounting training. As such, the software soon claimed up to 85 percent of the small business accounting software market, but it requires QuickBooks Expert setup. It continues to command the vast majority of this market. CPA who often provide QuickBooks Support, however, were not satisfied with early versions of the system, citing poor security controls such as no audit trail, as well as non-conformity with traditional accounting standards.

QuickBooks Help

If you’re the business owner,CEO,bookkeeper,secretary etc all-in-one, your probably could use QuickBooks Support Provided by QuickBooks Expert which is a powerful tool which can be used to both improve business decision-making and enhance your job performance. For companies seeking fast solutions to pressing problems we offer on-site QuickBooks Help, QuickBooks Training & QuickBooks Support with QuickBooks accounting software. We listen to your wish list, discuss your options, and then modify QuickBooks Support to meet your expectations. There are times when QuickBooks will require a power boost. We keep you informed of third-party Add-in software that will help do the job. Knowledge helps keep money in the bank and we make sure you are well supplied.

QuickBooks Support Provided by QuickBooks Expert

CPA with 25 years experience in accounting, tax, & accounting technology.

Each trainer is a certified QuickBooks Expert
We take pride in our QuickBooks Support response time when you have a problem or question.
We take the extra effort to make sure you understand the how’s and why’s of QuickBooks Help
QuickBooks Expert are experienced CPA’s with expert knowledge of business issues.
We know our QuickBooks Support we will keep you abreast of any deficiencies, or a procedures that can be improved, and if interested, we suggest improvements.
Our QuickBooks Expert have a commitment to accuracy.
We offer QuickBooks Help when it’s convenient for you days, evenings or weekends
QuickBooks Support is customized to your specific needs
We tailor the software to fit your needs, your CPA’s needs, your banker’s needs, and your customer/vendor. This is not an impossible task!
QuickBooks Help It’s not just a training session, we continue to educate through regular E-Mail newsletters and links to informative websites that will help you grow your business.
We stay current with QuickBooks Support technology through ongoing continuing professional education courses, trade associations, periodicals & web searches. And, we share the best of the best!

QuickBooks Support Miami also extends to third part Add-on programs. Through the Solutions Marketplace, Intuit encouraged third-party software developers to create programs that fill niche areas for specific industries and integrate with QuickBooks. The Intuit Developer Network provides marketing and technical resources, including SDKs.

As a CPA’s and QuickBooks Experts we are uniquely qualified to provide the QuickBooks Help and solutions you seek. Call or e-mail us with your questions.

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Contadores consejos sobre Impuesto del trabajo por cuenta propia

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Mon, 26 Mar 2012 13:06:43 GMT

Contadores consejos sobre Impuesto del trabajo por cuenta propia

Contador Publico

Los contadores les avisan, usted trabaja por cuenta propia si es empresario por cuenta propia, (incluyendo un contratista independiente como un contador), socio en una sociedad colectiva (incluyendo un miembro de una compañía de responsabilidad limitada de varios miembros) o si trabaja por su cuenta como un contador publico. (Los contadores les recuerdan un empresario por cuenta propia también incluye el miembro de una compañía de responsabilidad limitada de un solo miembro que no se considera como separada de su dueño para propósitos de los impuestos federales sobre los ingresos y los miembros de una empresa conjunta que reúne los requisitos). De acuerdo con Gustavo Viera CPA, un contador en Miami, una LLC es un buen ejemplo de esto.

Contador

Por lo general el contador public les recuerda que tiene que pagar el impuesto sobre el trabajo por cuenta propia si recibió ingresos netos de $400 o más del trabajo por cuenta propia. Los contadores les avisan que normalmente, la cantidad sujeta al impuesto sobre el trabajo por cuenta propia es el 92.35% de sus ganancias netas del trabajo por cuenta propia. El contador calcula ganancias netas restando los gastos ordinarios y necesarios (incurridos durante el transcurso de su ocupación o negocio) del ingreso bruto que recibió de dicha ocupación o negocio. El contador public avisan que puedes ser responsable de pagar el impuesto sobre el trabajo de cuenta propia aún si recibe beneficios de seguro social.

Contadores

Los contadores les avisan si tuvo una pequeña ganancia o una pérdida neta en su negocio, pero desea que se aplique a la cobertura de seguro social, quizá reúna los requisitos para utilizar uno de los dos métodos opcionales para calcular sus ganancias netas del trabajo por cuenta propia. Consulte las instrucciones para el Anexo SE (del Formulario 1040), con un contador, y verifique si reúne las condiciones para usar un método opcional. Un método opcional podría aumentar su crédito por ingreso del trabajo o el crédito por el cuidado de hijos menores o dependientes.

La tasa del impuesto sobre el trabajo por cuenta propia es un porcentaje, establecido por ley y calculado por un contador publico, de sus ganancias netas del trabajo por cuenta propia. Esta tasa representa un 12.4% para el seguro social y un 2.9% para el Medicare. La cantidad máxima de ganancias netas que están sujetas al impuesto del seguro social está establecida por ley y cambia anualmente les recuerda VieraCPA unos contadores en Miami. Todas sus ganancias netas están sujetas al impuesto de Medicare.

El impuesto sobre el trabajo por cuenta propia se calcula en el Anexo SE del Formulario 1040, Self- Employment Tax (Impuesto sobre el trabajo por cuenta propia), en inglés. Al calcular su ingreso bruto ajustado en el Formulario 1040, puede deducir la mitad del impuesto sobre el trabajo por cuenta propia. Esta deducción se calcula en el Anexo SE. La Administración del Seguro Social utiliza la información del Anexo SE para calcular sus beneficios conforme al programa de seguro social.

Si es empleado de una iglesia o de una organización calificada controlada por una iglesia que optó por una exención de los impuestos de seguro social y Medicare y usted mismo no está exento del impuesto sobre el trabajo por cuenta propia, tiene que pagar el impuesto sobre el trabajo por cuenta propia si la iglesia u organización calificada controlada por la iglesia le pagó más de $108.28 en un año.

Si se le requiere pagar el impuesto sobre el trabajo por cuenta propia, tiene que presentar el Formulario 1040 y adjuntar el Anexo SE. Para obtener más información acerca de los ingresos relacionados con la iglesia y los impuestos sobre el trabajo por cuenta propia, consulte la Publicación 517, Social Security and Other Information for Members of the Clergy and Religious Workers (Información sobre el seguro social y otra información para miembros del clero y trabajadores religiosos), en inglés.

Más información relacionada con el impuesto sobre el trabajo por cuenta propia se encuentra en la Publicación 334, Tax Guide for Small Business (Guía tributaria para pequeños negocios), en inglés.

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Contadores Consejo de Uso del automóvil para fines de negocio

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Sat, 24 Mar 2012 14:04:08 GMT

Contadores Consejo de Uso del automóvil para fines de negocio

Despachos Contables

Contadores te aconsejan si utilizas su automóvil para el trabajo o negocio y sólo lo utiliza para ese fin, puede deducir el costo total de su operación (sujeto a límites explicados más adelante o consulta con un Despachos Contables). Sin embargo, si utiliza el automóvil para ambos fines, negocio y personal, puede deducir sólo el costo de su uso de negocio, algo que muchos Contadores Hialeah no explican bien.

Contadores Hialeah

Los contadores avisan que normalmente, puede calcular la cantidad de los gastos deducibles de su automóvil utilizando uno de los siguientes dos métodos: el método de la tasa estándar por milla o el método de gastos reales. Si reúne los requisitos para utilizar ambos métodos; antes de escoger uno, le sería beneficioso calcular la deducción usando ambos métodos para determinar cuál de los dos le provee una deducción mayor de acuerdo con el Despachos Contables de Gustavo Viera CPA.

Contadores Hialeah les avisan que consulte la Publicación 463, Travel, Entertainment, Gift, and Car Expenses (Gastos de viaje, entretenimiento, regalos y automóviles), en inglés, para obtener la tasa estándar por milla actual. Si utiliza la tasa estándar por milla, puede añadir a su deducción todo gasto por estacionamiento y peajes incurridos para propósitos de negocio, de acuerdo con el Despachos Contables de Gustavo Viera CPA.

Contadores

Los Contadores les recurdan que para utilizar la tasa estándar por milla, tiene que ser el dueño del automóvil o arrendarlo.

No puede operar cinco o más automóviles a la misma vez, como sería el caso de operar una flota de automóviles, de acuerdo con el Despachos Contables de Gustavo Viera CPA. Muchos Contadores Hialeah an tenido problemas con el IRS por no consejar a los clientes bien.

No puede haber reclamado una deducción en un año anterior por depreciación del automóvil utilizando el Sistema Modificado de Recuperación Acelerada de Costos (MACRS, por sus siglas en inglés), incluyendo toda depreciación adicional por el primer año de uso o “depreciación de bonificación” u otro método aparte del método de depreciación uniforme para calcular la vida útil del automóvil, un temo complicado que debes consultarlo con unos contadores.

No puede haber reclamado una deducción según la sección 179 por el automóvil y no pudo haber reclamado gastos reales después de 1997 para un automóvil arrendado, y

No puede utilizar la tasa estándar por milla si es cartero rural y recibió un “reembolso calificado” (conocido en inglés como qualified reimbursement).

Además, para utilizar la tasa estándar por milla para un automóvil de su propiedad, tiene que optar por utilizar dicho método en el primer año en que el automóvil está disponible para utilización en su negocio. Para años posteriores, puede optar por utilizar la tasa estándar por milla o los gastos reales.

Sin embargo, si tiene un automóvil arrendado, tiene que utilizar el método de la tasa estándar por milla durante todo el período del contrato de arrendamiento (incluyendo renovaciones del contrato).

Para utilizar el método de gastos reales, tiene que determinar el costo real de operar el automóvil, y aquella parte de la operación general del mismo que sea para fines del negocio. Incluya gasolina, aceite, reparaciones, llantas, seguro, derechos de matrícula, licencias y depreciación (o pagos de arrendamiento) atribuibles a la porción de las millas conducidas para fines del negocio.

Otros gastos de automóvil por estacionamiento y peajes atribuibles al uso comercial se deducen por separado, independientemente de si usa la tasa estándar por milla o los gastos reales.

Por lo general, el Sistema Modificado de Recuperación Acelerada de Costos (MACRS, por sus siglas en inglés) es el único método de depreciación que pueden utilizar los dueños de automóviles para depreciar todo automóvil puesto en servicio después de 1986. Sin embargo, si usó la tasa estándar por milla en el año en el que puso el automóvil en servicio y cambia al método de gastos reales un año posterior y antes de que su automóvil esté completamente depreciado, tiene que usar la depreciación uniforme por el tiempo estimado de vida útil que le quede al automóvil.

Hay límites sobre qué cantidad de depreciación puede deducir. Para más información sobre los límites de depreciación, consulte el Tema 704. La Publicación 463, Travel, Entertainment, Gift, and Car Expenses, (Gastos de viaje, entretenimiento, regalos y automóviles), en inglés, explica los límites de depreciación y las reglas especiales que le corresponden a los automóviles arrendados.

La ley requiere que demuestre sus gastos mediante registros adecuados o pruebas suficientes para verificar su propia declaración. Para más información sobre el mantenimiento de registros, consulte el Tema 305.

Si es empleado cuyos gastos deducibles de negocio son totalmente reembolsados mediante un plan de rendición de cuentas, los reembolsos no se deben incluir como salario en su Formulario W-2 y usted no debe deducir los gastos.

Si su empleador utiliza un plan sin rendición de cuentas para reembolsarle los gastos, los reembolsos se incluyen en su salario. Su empleador sumará a su salario, sueldos u otra remuneración los reembolsos y otras asignaciones de gastos pagados a usted bajo un plan sin rendición de cuentas y declarará el total en su Formulario W-2. Sus gastos de negocio como empleado pueden ser deducibles como una deducción detallada. Para la definición de los planes de rendición de cuentas y sin rendición de cuentas, consulte la Publicación 463, en inglés, y el Tema 514.

Por lo general, si es empleado, para deducir sus gastos de automóvil, incluyendo los gastos que exceden del reembolso bajo un plan de rendición de cuentas, tiene que completar el Formulario 2106 o el Formulario 2106-EZ y detallar sus deducciones en el Anexo A del Formulario 1040. Sus gastos estarán sujetos al límite del 2% del ingreso bruto ajustado. Consulte el Tema 508 para información acerca del límite del 2%. Si trabaja por cuenta propia, los gastos de automóvil se deducen en el Anexo C o el Anexo C-EZ del Formulario 1040 o, si es agricultor, en el Anexo F del Formulario 1040.

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Miami CPA’S Point Out Small Employers Can Benefit from Health Care Tax Credit

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Sat, 24 Mar 2012 13:01:15 GMT

Miami CPA’S Point Out Small Employers Can Benefit from Health Care Tax Credit

Miami Accounting & CPA Firms

With tax-filing deadlines fast approaching for many small businesses, the CPA Firm VieraCPA today encouraged small employers that provide health insurance coverage to their employees to check out the small business health care tax credit and then claim it if they qualify. (You can also check out our CPA Firms website for an overview of the tax credit at.

The new Small Business Health Care Tax Credit page on the Miami Accounting VieraCPA website has information and resources to help small employers see if they qualify for the credit and then calculate it correctly (recommended consulting a Miami CPA’s. The Miami CPAS website includes a step-by-step guide for determining eligibility, examples of typical tax savings under various scenarios, answers to frequently-asked questions.

The small business health care tax credit was included in the Affordable Care Act enacted two years ago. CPA Firm VieraCPA advise Small employers that pay at least half of the premiums for employee health insurance coverage under a qualifying arrangement may be eligible for this credit. The credit is specifically targeted to help small businesses and tax-exempt organizations provide health insurance for their employees, stated CPA Firms VieraCPA.

Depending upon how they are structured, eligible small employers are likely subject to one of the following three tax-filing deadlines, which fall in coming weeks according to Miami Accounting and Miami CPA’s VieraCPA :

March 15: Corporations that file on a calendar year basis can have their Miami CPAS figure the credit on Form 8941 and claim it as part of the general business credit on Form 3800, both of which are attached to their corporate income tax return.
April 17: Individuals have until April 17 to complete and file their returns on Form 1040. This includes Sole proprietors, as well as people who have business income reported to them on Schedules K-1—partners in partnerships, S corporation shareholders and beneficiaries of estates and trusts according to CPA Firm VieraCPA . They also attach Forms 8941 and 3800 to their return. The resulting credit is entered on Form 1040 Line 53.
May 15: Tax-exempt organizations that file on a calendar year basis can use Form 8941 and then claim the credit on Form 990-T, Line 44f.

Taxpayers and CPA Firms needing more time to determine eligibility should consider obtaining an automatic tax-filing extension, usually for six months. See Form 4868 for individuals, Form 7004 and its instructions for businesses and Form 8868 for tax-exempt organizations.

Miami Accounting and CPA Firms that have already filed and later find that they qualified in 2010 or 2011 can still claim the credit by filing an amended return for one or both years. Corporations use Form 1120X, individual’s use Form 1040X and tax-exempt organizations use Form 990-T.

Some businesses and tax-exempt organizations that already locked into health insurance plan structures and contributions may not have had the opportunity to make any needed adjustments to qualify for the credit for 2010 or 2011. These employers can still make the necessary changes to their health insurance plans so they qualify to claim the credit on 2012 returns or in years beyond. Eligible small employers can claim the credit for 2010 through 2013 and for two additional years beginning in 2014.

Additional information about eligibility requirements and figuring the credit can be found at Miami CPA’s.

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Small Business CPA Warns of IRS SWAT Teams for Tax Dodgers

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Thu, 22 Mar 2012 15:43:40 GMT

Small Business CPA Warns of IRS SWAT Teams for Tax Dodgers

Small Business CPA

Small CPA Firm VieraCPA warns Tax Dodgers that the Internal Revenue Service is staffing up with high-powered talent to crack down on companies shifting profits from country to country to lower their tax bills, a hot strategy the agency has targeted before with only limited success.

Tax Preparation CPA

Tax Preparation CPA Viera points out the IRS showed its elevated concern on the issue, known as “transfer pricing,” last May by hiring Samuel Maruca to fill the newly created post of transfer pricing director.

He has since brought aboard specialists from Big Four audit firms KPMG and Ernst & Young, as well as law firm Mayer Brown and boutique consultancy Horst Frisch, Small Business CPA Viera adds.

Maruca, who came from law firm Covington & Burling, is still recruiting. He told Reuters the agency previously had “had a difficult time attracting and retaining economists.”

Now, he said, the IRS’s international group “has significant external hiring authority.”

Small Business CPA

Small CPA Firm VieraCPA points out that transfer pricing is a booming field of global tax law. It involves multinational corporations that are constantly moving goods, services and assets from one subsidiary to another in different countries, and how they account for these “transfers.”

Tax Preparation CPA Viera points out that by carefully manipulating the pricing of such moves, companies can effectively shift profits to low-tax countries from high-tax ones, lowering their overall tax costs.

Many governments in the developing and developed world, faced with crushing deficits, are working to curb transfer pricing because it reduces their corporate tax revenues.

IRS Commissioner Doug Shulman made changes at the agency in mid-2010 that set the stage for bringing in Maruca, who has filled 40 positions so far and plans to bring on up to 60 more staffers.

The IRS, which employs 90,000 people, saw its budget cut by 2.5 percent by Congress for fiscal 2012 to $11.8 billion.

Underpaid and Out-gunned

Federal agencies often struggle to keep up with higher-paid private-sector professional Small Business CPA. The IRS is no exception, and there is some skepticism about Maruca’s chances.

“The economic crisis allowed the IRS to attract talented, experienced industry professionals who might not have been available previously,” said ex-deputy IRS commissioner Michael Dolan, now director of KPMG’s Washington national tax practice.

“The $64,000 question is, what will Maruca be able to do … and will he really have enough resources to change the game?” Dolan said.

Small CPA Firm VieraCPA notes that in order to curtail tax avoidance through transfer pricing, governments seek to limit corporations’ ability to manipulate the transfer prices. National laws, though variable from country to country, generally call for “arms-length” pricing.

Tax Preparation CPA Viera says in theory, that means corporations must set transfer prices that are at or near market level, not artificially raised or lowered. But enforcement is complex, especially for intangible assets, such as search-engine algorithms or trademarks.

“There are billion-dollar disputes on just the arms-length transfer pricing of intangibles” said Small Business CPA Viera.

IRS Lags

By one measure of transfer pricing enforcement, the IRS lags behind tax treaty partners. In fiscal 2011, 85 percent of transfer pricing audit adjustments were initiated by a foreign country, rather than by the IRS, according to IRS statistics. That was up from 77 percent in fiscal 2010.

Two major transfer pricing court decisions went against the IRS in 2009 and 2010.

“Clearly, the IRS is trying to figure out what to do next on its litigation strategy in these important transfer pricing cases,” said Viera, a managing partner of a Small CPA Firm in Miami who called Maruca’s group a “SWAT team.”

As the IRS raises its game, the pharmaceutical and high-tech sectors can expect close scrutiny, Tax Preparation CPA professionals said.

Businesses are sure to fight back. The IRS has ruffled feathers on transfer pricing before with limited results.

“Anybody who thinks the IRS can ultimately enforce transfer pricing is either an eternal optimist or delusional,” said Richard Harvey, a tax professor at Villanova University and former senior adviser to the IRS’s Shulman.

The staff changes and hiring at IRS “will help them on the margins,” Harvey said. “But they’re still fighting a very difficult battle where the deck is stacked against them.”

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Public Accountants Advise Clients on New 1099-K Requirements

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Thu, 22 Mar 2012 15:13:42 GMT

Public Accountants Advise Clients on New 1099-K Requirements

Business CPA

Business Tax Accountant are advising clients that this is the first year that the IRS requires payments made with a credit or debit card to be reported by merchants who processed more than $20,000 and 200 transactions.

Public Accountant

Public Accountant Gustavo A. Viera CPA states the program, initiated by the Housing and Economic Recovery Act of 2008, aims to generate $10 billion in revenue over 10 years, although estimates have varied widely according to Public Accountants. The goal is to assist the IRS in matching income from sales to income reported on tax returns by Business CPA and their clients. Business Tax Accountant Viera warns the law requires backup withholding, in the case of merchants who do not provide a valid Taxpayer Identification Number and name that match IRS records.

Business Tax Accountant

There was initial consternation in the potential taxpayer burden caused by the fact that gross transactions are being reported while most small businesses just report net sales on their tax returns prepared by their Business CPA. To partly address the problem, the IRS instructs taxpayers to “enter -0- on line 1(a)” of Schedule C.

Some Business Tax Accountants have interpreted this as a “kick the can down the road” measure, but that’s not the case, according to Gustavo Viera CPA, Public Accountant in Miami.

“There’s been a lot of chatter on message boards and Public Accountants blogs saying, ‘The IRS gave us another year not to have to report our online sales or merchant payment sales,’” he said. “But that’s not the case.”

“Form 1099-K is still being sent to both the taxpayers and the IRS,” he noted. “The instructions are pretty clear: anyone who has a merchant account will get a 1099-K. For 2011, the IRS has deferred the requirement to report these amounts, so they tell you to enter zero on line 1a. But they also say to report all gross receipts on line 1b, including any income reported on Form 1099-K.”

“Don’t ignore the requirement,” advised Business CPA Viera. “The rumor that you don’t need to report the income this year is simply not true. It still needs to be reported as part of your gross income by your Business Tax Accountant . Rebates, refunds, cash backs, and other adjustments can be entered on line 2.”

The IRS was making a nod toward people trying to figure out how much time they should spend only on getting the Form 1099-K number perfect, Public Accountant Viera suggested. “It lessens the stress levels because there’s an implicit understanding that the Public Accountants would have to reconcile their internal records with the tax form. By not making it explicit, the IRS tried to lessen those burdens on small business owners, but since it is income it still needs to show up on the Schedule C in the way you think it should best be represented.”

The challenge for Business CPA clients comes when they take electronic payments as revenue in, but give cash or non-electronic value back to the consumer; for example, cash-back payments on a credit or debit card or refunds.

“This needs to be tracked locally, with the adjustments made on line 2,” Business Tax Accountant Viera said. “The result is that even though you’re not required to report anything on line 1a, the IRS expects you to report all receipts. There’s now a level of visibility available to the IRS that wasn’t there before.”

Public Accountants recommend that Form 1099-K be tailored to resemble Form W-2 in the way it organizes and presents information. “Gross
sales as reported on the Form 1099-K doesn’t have transparency on the form itself,” he said. “The small business owner doesn’t know how the figure was generated, and can’t verify that the number matches what was received during the year. Going forward, it would simplify matters for the small business if the form shows all the components of gross receipts.”

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Small Business CPA and Accounting for Small Business

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Wed, 21 Mar 2012 15:12:19 GMT

Small Business CPA and Accounting for Small Business

Accounting Services for Small Business

Small Business CPA know there is always the need for business people to understand and apply the principles of Small Business Accounting Services to requirements for best practices. There is never enough guidance when it comes to Accounting for Small Business, billing and taxes. There are certain sensitive guidelines which are recommended by Accounting Services for Small Business in order to ensure best practices.

Small Business CPA

Small Business Accounting Services remind you that in order to have efficient revenue negotiation there is the need to produce reliable and accurate financial reports. This is because users of these reports must be satisfied to be able to trust the financial institution

Accounting for Small Business

Accounting Services for Small Business must have set out accounting principles based on which financial reports must be prepared, according to their Small Business CPA. These principles and format standards are very crucial because they increase comparability within the various departments in the firm and other business firms as well. Sometimes there is software which is designed to ensure that the reports are produced automatically, or by a Small Business Accounting Services. These software applications have been produced based on standard accounting principles. Therefore there is increased accuracy and dependability on the reports generated and are widely used by Accounting for Small Business.

Small Business Accounting Services

Accounting for Small Business will create useful and accurate financial statement must comprise the following characteristics:

Understandable and Clear: It must not be complicated and must have a clear presentation. The users of the financial statement must be able to spot the necessary information at a glance. There must be transparency because when reports are difficult to understand banks may raise a red flag.
Significant Information: The information must be valuable and relevant to the financial or business institution. It is a best practice to make sure the report is prepared within a time period. This increases the accuracy of the report.
Trustworthy Information: The management of a firm is responsible for the information in the financial report to be reliable. The transactions must be consistent with what the financial report displays. Being faithful is the key! It must be neutral and free of bias.
Comparable: The financial report must be comparable to enable performance review over a specified period of time. The comparison is usually between companies and competitors.

Accounting Services for Small Business prepare financial statements have information about assets, liabilities and taxes over the financial year. This is why there are a set of documents which play an important role in providing information for a financial statements. These documents include the following:

Balance Sheet
Income Statement
Statement of retained earnings
Statement of change in cash balance
Notes to the financial statement

Your Small Business CPA prepares these documents and must be up to date at all times as they can be used for references at any time of the financial year. This is why they must be accurate and authentic. The information available in these accounting documents is very helpful in best practices for risk management and compliance in banks and business institutions as well. There are other reasons why a good financial report is important, for example when it comes to revenue negotiation and recognition.

Therefore, all Small Business Accounting Services must have a standard for financial reporting as a best practice to ensure success.

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Small Business CPA and Accounting for Small Business

gustavo@vieracpa.com (Gustavo A Viera CPA 1) — Wed, 21 Mar 2012 15:11:55 GMT

Small Business CPA and Accounting for Small Business

Accounting Services for Small Business

Understandable and Clear: It must not be complicated and must have a clear presentation. The users of the financial statement must be able to spot the necessary information at a glance. There must be transparency because when reports are difficult to understand banks may raise a red flag.
Significant Information: The information must be valuable and relevant to the financial or business institution. It is a best practice to make sure the report is prepared within a time period. This increases the accuracy of the report.
Trustworthy Information: The management of a firm is responsible for the information in the financial report to be reliable. The transactions must be consistent with what the financial report displays. Being faithful is the key! It must be neutral and free of bias.
Comparable: The financial report must be comparable to enable performance review over a specified period of time. The comparison is usually between companies and competitors.

Balance Sheet
Income Statement
Statement of retained earnings
Statement of change in cash balance
Notes to the financial statement

Therefore, all Small Business Accounting Services must have a standard for financial reporting as a best practice to ensure success.

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