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Tax Tip of the Week | No. 248 | Businesses To Benefit From New BWC Changes April 30, 2014

Posted by bradstreetblogger in : tax changes, Tax Planning Tips, Tax Preparation, Tax Tip, Taxes, Taxes , add a comment

Tax Tip of the Week | April 30, 2014 | No. 248 | Businesses To Benefit From New BWC Changes

From the Ohio Society of CPA’s…

The Ohio Bureau of Workers’ Compensation (BWC) Board of Directors on April 23, 2014 approved $2.2 billion in employer credits to help with the proposed switch from retrospective to prospective billing.

That is in addition to the $1 billion in premium rebates announced by the governor in 2013.

Premium credits will help public and private employers make the jump to pay-as-you-go workers’ insurance in January 2015 without the double billing that would normally be required.

Outgoing BWC Fiscal Planning Chief Tracy Valentino said forward billing will allow for another projected rate cut of 2% for private employers and 4% for public employers.

“Additionally, Ohio would see the benefit of a higher level of employer satisfaction by cutting through the bureaucratic red tape that currently exists in the system and operating BWC in a manner consistent with private insurance practices,” Valentino said. “The decision to move to prospective payment, particularly with BWC’s reducing the financial impact on private and public taxing district employers, will help modernize Ohio’s workers’ compensation system and simplify the system greatly for the employers who rely on it for coverage.”

“The credit will facilitate a smooth transition for employers to a more user-friendly system that will provide them more flexibility while reducing their overall costs,” said BWC Administrator/CEO Stephen Buehrer.

After prospective credits are in place, he said ongoing savings from the switch will total $28 million for private employers and $16 million for public employers in 2015 alone. Policyholders will also have the option of making 12 installment payments per year and earlier opportunities to participate in various incentives, including group experience rating and group retrospective rating programs.

“Today was a formal step of the board to reserve that money as a liability of the fund,” Buehrer said outside the board meeting. “It shows that we’re trying to modernize the system, and we’re trying to do it in a way that is not harmful to our customers.”

You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.

Tax Tip of the Week | No. 247 | The Affordable Care Act’s Impact on Ohio April 23, 2014

Posted by bradstreetblogger in : General, tax changes, Tax Preparation, Tax Tip, Taxes, Taxes , add a comment

Tax Tip of the Week | April 23, 2014 | No. 247 | The Affordable Care Act’s Impact on Ohio

An update from the Ohio Society of CPAs….

Preliminary numbers are coming out about the impact of the Affordable Care Act and what it means for Ohio.

In a nutshell: costs have gone up. According to Ohio Lt. Gov. and Ohio Department of Insurance Director Mary Taylor, CPA, premiums went up by 41% on average in Ohio’s individual market and by 18% in the small group market. The increases don’t account for federal subsidies that might be available, but still underscores the impact of the law on Ohio’s insurance market.

The federal government reports 7.1 million Americans have signed up for health care insurance. However, most insurance companies are saying 10-20% of those sign-ups have not yet paid their premiums.

In addition, many were already insured, meaning the impact on the uninsured population isn’t as great as many had hoped.

“The numbers on this issue are all over the map right now,” said Ohio Department of Insurance Communication Director Chris Brock. “In February, McKinsey and Company put the number of previously uninsured people signed up for Obamacare at 27%. Most likely that number will change as new data comes out, but that’s a really low number considering there are 40 to 50 million Americans without insurance that the law was supposed to help.”

You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.

Tax Tip of the Week | No. 246 | Thank You! April 16, 2014

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Tax Tip of the Week | April 16, 2014 | No. 246 | Thank You!

The Week After Tax Season

Aaaah……The week after tax season (and the first full weekend home in two and a half months) is the best week in a tax accountant’s life!

We met a lot of new clients this year because of referrals from existing clients, and readers of our Tax Tip of the Week. Thank you!  A referral is the best compliment we can ever receive.

Even though tax season is over—we will continue our Tax Tip of the Week mailing for the rest of the year. We will keep you updated on the constant changes as well as spotlighting specific tax planning ideas.

If there are any special tax topics you would like us to cover, just send us an email or give us a call.

Again, thank you for making this one of our most rewarding tax seasons yet.

As always, give us a call if you have any questions.

You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.

Tax Tip of the Week | No. 245 | It Is Better to Extend vs. Not File on Time April 9, 2014

Posted by bradstreetblogger in : General, tax changes, Tax Planning Tips, Tax Preparation, Tax Tip, Taxes, Taxes , 2comments

Tax Tip of the Week | April 9, 2014 | No. 245 | It Is Better to Extend vs. Not File on Time

Filing for Extensions

If you haven’t filed your tax return by now, you should probably consider filing for an extension.  It is a lot easier to file for an extension than it is to amend a return later for a mistake you made trying to rush your return to completion. Even more costly is if the IRS finds a mistake you made and assesses underpayment penalties and interest.

To file for an extension, you simply need to submit Form 4868. ( http://www.irs.gov/pub/irs-pdf/f4868.pdf). After submitting this form, you now have until October 15, 2014 to timely file your return. Note, however, an extension of time to file is not an extension of time to pay.  If you suspect you will owe tax, you must send a payment along with the extension. This is true for your federal, state and city returns.

Ohio will automatically accept the federal extension. Some cities, however, require a special city extension form.  Also, some cities will not allow extensions if you only have W2 income.  Be sure to check with your work and/or resident cities before April 15th.

Another reason to file for extension is that some speculate your chances for an audit decreases for extended returns. How?  One of the methods the IRS uses to select a return for audit is to select a random sample of returns filed by April 15th.   If your return is not in that sample—then you don’t get picked!

Editor’s Note:  One of the pledges I make to all my clients is that my personal return will be the last one filed each year. When my most procrastinating client’s return is filed on October 15th —-mine is right behind it!  And has been that way for nearly 20 years!

You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.

Tax Tip of the Week | No. 244 | Be Careful With IRA Rollovers April 2, 2014

Posted by bradstreetblogger in : Tax Deadlines, Tax Planning Tips, Tax Preparation, Tax Tip, Taxes, Taxes, Uncategorized , add a comment

Tax Tip of the Week | April 2, 2014 | No. 244 | Be Careful With IRA Rollovers

A recent tax court ruling….

In Bobrow v. Commissioner (TC Memo 2014-21), the Tax Court ruled that the one-rollover-per-year rule applies to all of a taxpayer’s IRAs rather than to each IRA separately. This ruling conflicts with IRS Publication 590 which gives the following example:

“You have two traditional IRAs, IRA-1 and IRA-2. You make a tax-free rollover of a distribution from IRA-1 into a new traditional IRA (IRA-3). You cannot, within 1 year of the distribution from IRA-1, make a tax-free rollover of any distribution from either IRA-1 or IRA-3 into another traditional IRA.

However, the rollover from IRA-1 into IRA-3 does not prevent you from making a tax-free rollover from IRA-2 into any other traditional IRA. This is because you have not, within the last year, rolled over, tax free, any distribution from IRA-2 or made a tax-free rollover into IRA-2.”

The Tax Court, however, concluded that the section 408(d)(3)(B) limitation applies to all of a taxpayer’s retirement accounts and that regardless of how many IRAs he or she maintains, a taxpayer may make only one nontaxable rollover contribution within each one-year period.

You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.