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Tax Tip of the Week | No. 439 | Special Holiday Edition December 20, 2017

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

Tax Tip of the Week | Dec 20, 2017 | No. 439 | Special Holiday Edition…

Enjoy the Holidays!

We are going to take a break from our tax and business tips this week. Instead, the family of Bradstreet & Company would like to wish you and your family the most joyous holiday season and best wishes for 2018.

We hope you enjoy the Tax Tip of The Week. As always, your topic suggestions and questions are always appreciated.

Is the Tax Tip of the Week real?
While your kids are questioning if Santa is real, we continue to receive some interesting feedback that some of you don’t realize this is really Bradstreet CPAs reaching out each week (… some suspect this is a “packaged” communication to which we add our logo.) Well, rest assured it’s us and we love to hear from you.

Enjoy the week and, “Yes Virgina, there is a Santa Claus”.

Wishing you all great things,

The Staff at Bradstreet & Company

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

…until next week.

Tax Tip of the Week | No. 430 | FINALLY! Penalty Relief for Delinquent Partnership Returns October 25, 2017

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

Tax Tip of the Week | Oct 25, 2017 | No. 430 | FINALLY! Penalty Relief for Delinquent Partnership Returns

In case you are unaware, some Internal Revenue Service filing due dates have changed. These new deadlines which began with the 2016 tax year for returns filed in 2017 included the Form 1065, U.S. Return of Partnership Income. The original due date for calendar-year partnerships was April 15th, the same as your personal income tax return. The new due date for calendar-year partnerships is March 15th.

S corporations have always been due March 15th. Partnerships and S corporations are known as “pass-through entities” because all items of income and expense get “passed through” and are reported on the owners’ personal income tax returns. Partnerships and S corporations generate a K-1 for each partner, shareholder or member. The K-1 provides information necessary for preparation of the owner’s personal return.

By moving the due date of partnerships up to March 15th, the IRS hopes more returns can be filed by April 15th, rather than having to file extensions due to late K-1’s. Or, to say it another way, the Internal Revenue Service hopes to get your tax money faster by taxpayers filing earlier.

However, many partnerships did not meet the new, earlier filing deadline and either filed their returns and/or their extensions late. If you are an owner of a partnership that has received a penalty notice for late filing, we may have some good news. If certain conditions are met, the Internal Revenue Service may provide you relief from the penalties normally assessed when filing a delinquent return. These types of penalties for partnerships may be quite significant since they are assessed on a per partner, per month basis. So, if you have one of these types of notices, let us know. We can help.

Sometimes we have to be thankful for the small things in life.

This week’s author….Mark Bradstreet, CPA

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. 402 | Filing for an Extension April 12, 2017

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

Tax Tip of the Week | April 12, 2017 | No. 402 | Filing for an Extension

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. After submitting this form, you now have until October 16, 2017 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 some taxes, 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 17th.   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 16th —-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. 391 | 2017 Tax Filing Deadlines January 25, 2017

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Tax Tip of the Week | January 25, 2017 | No. 391 | 2017 Tax Filing Deadlines

Keep the following dates in mind while filing your 2016 tax returns in 2017:

March 15, 2017   Partnership/Form 1065 – This is a new due date for partnerships, changed from April 15.

March 15, 2017   S-Corps/Form 1120S – This deadline remains the same as prior years.

April 18, 2017*    Individual Tax/Form 1040, Estates, Trust/Form 1041 – *Not a typo! 4/15/17 is a Saturday and 4/17/17 is a holiday in Washington D.C.

April 18, 2017      Individual Extension/Form 4868 – Remember, if you owe taxes for 2016, a tax payment is due with the extension.

April 18, 2017      C-Corps/Form 1120 – C-Corps were previously due by March 15.

Sept 15, 2017       Extended Partnerships/Form 1065, S-Corps/Form 1120S, C-Corps(calendar year)/Form 1120,  – Any extended return that contains a K-1 is due prior to individual deadlines.

Oct 2, 2017           Extended Estates, Trust/Form 1041 – These were previously due October 15.

Oct 16, 2017         Individual Tax/Form 1040 – Last day to file individual returns that were placed on extension.

April 15, 2020      2016 Amended Return/Form1040X – You can file an Amended Return to pay taxes anytime, but you only have 3 years from the original due date to claim a refund.

Please Note:  This is not a comprehensive list of all due dates for all tax forms and does not include due date changes for fiscal year-end C-Corps.

Also Note:  Ohio generally follows all federal due dates as do most cities. Please contact us regarding your particular filing due dates.

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. 387 | Happy New Year! December 28, 2016

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

Tax Tip of the Week | December 28, 2016 | No. 387 | Happy New Year!

And get ready for the tax filing season.

Hopefully, you followed some of the suggestions we outlined a few years ago in TTW # 21 to organize your records.  If you did, great!  This will make filing your tax returns a lot easier this year. It also means that you and your tax advisor can spend more time on tax and financial planning issues for 2017 vs. looking back to 2016.

If you are new to our Tax Tip of the Week series, or didn’t follow our suggestions from a few years ago, now would be a good time to review TTW #21.   You might want to make getting organized your 2017 New Year’s Resolution!

This week we will look at some of the more common forms that you should be watching for in the coming weeks and months:

W-2:    Employers should mail these by 1/31/17.  If you have moved during the year, make sure former employers are aware of your new address.

W-2G:    Casinos, Lottery Commissions and other gambling entities should mail these by 1/31/17 if you have gambling winnings above a certain threshold. Note:  Some casinos will issue you a W-2G at the time you win a jackpot.  Make sure you have saved those throughout the year.

1096:    Compilation sheet that shows the totals of the information returns that you are physically mailing to the IRS. The check box for Form 1099-H was removed from line 6, while a check box for Form 1098-Q was added to line 6. The spacing for all check boxes on line 6 was expanded. The amounts reported in Box 13 of Form 1099-INT should now be included in box 5 of Form 1096 when filing Form 1099-INT to the IRS.

1098-C:    This form is for contributions of motor vehicles, boats, and airplanes. A donee organization must file a separate Form 1098-C with the IRS for each contribution of a qualified vehicle that has a claimed value of more than $500. All filers of this form may truncate a donor’s identification number (social security number, individual taxpayer identification number, adoption taxpayer identification number, or employer identification number), on written acknowledgements. Truncation is not allowed, however, on any documents the filer files with the IRS.

1099-MISC :    This form reports the total paid during the year to a single person or entity for services provided. Certain Medicaid waiver payments may be excludable from the income as difficulty of care payments.  A new check box was added to this form to identify a foreign financial institution filing this form to satisfy its chapter 4 reporting requirement.

1099-INT:    This form is used to report interest income from banks and other financial institutions. Box 13 was added to report bond premium on tax-exempt bonds. All later boxes were renumbered.  A new check box was added to this form to identify a foreign financial institution filing this form to satisfy its chapter 4 reporting requirement.

1099-DIV:    This form is issued to those who have received dividends from stocks. A new check box was added to this form to identify a foreign financial institution filing this form to satisfy its chapter 4 reporting requirement.

1099-B:    This form is issued by a broker or barter exchange that summarizes the proceeds of transactions. For a sale of debt instrument that is a wash sale and has accrued market discount, enter code “W” in box 1f and the amount of the wash sale loss disallowed in box 1g.

1099-K:    This form is given to those merchants accepting payment card transactions.  Completion of box 1b (Card Not Present transactions) is now mandatory.

K-1s:    If you are a partner in a business or a limited partner in some investments, your income and expenses will be reported to you on a K-1. The tax returns for these entities are not due until 3/15/17 (if they have a calendar-year accounting). Sometimes, you may not receive a K-1 until shortly after the entity’s tax return is filed in March.

If you are a beneficiary of an estate or trust, your share of the income and expenses for the year will also be reported on a K-1. The timing of when you may receive your K-1 is the same as outlined above.

NOTE:  Many times partnerships, estates and trusts will put their tax returns on extension.  If they do, the due date of the return is not until 9/15/17.  We often see client’s receiving K-1s in the third week of September.

If you receive, or expect to receive, a K-1 it may be best if you place your personal return on extension.  It is a lot easier to extend your return then it is to amend your return after receiving a K-1 late in the year.

So start watching your mailbox and put all of these statements you receive in that new file you created!

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. 381 | New W-2 Reporting Requirements November 16, 2016

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

Tax Tip of the Week | November 16, 2016 | No. 381 | New W-2 Reporting Requirements

New W-2 and 1099-MISC Filing Deadlines to Have a Significant Impact on Businesses

This change adds an extensive amount of work for filers in January.

Every tax year brings a variety of changes, whether forms are updated or regulations have changed. This year marks a particularly important year for filers, as the deadline for submitting Form W-2 to the SSA and Form 1099-MISC to the IRS has changed significantly.

Beginning in 2017, for the 2016 reporting year, filers must send W-2 and 1099-MISC recipient copies and submit to the SSA/IRSIRS/SSA by January 31, regardless of method (paper or e-file). In many cases, this is months earlier, increasing workload and stress for filers.

To further complicate matters, the new filing deadline, as it relates to Form 1099-MISC, only impacts filers reporting nonemployee compensation payments in box 7. Although the overwhelming majority of 1099-MISC filers will report information in box 7, there is bound to be some confusion.

Historically, filers were required to provide W-2 and 1099-MISC forms to recipients by January 31; however, they were not required to submit the forms to the SSA/IRS until February 28 (paper) or March 31 (e-file).

With three months of work being condensed into 30 days, this change adds an extensive amount of work for filers in January. In addition, Forms 1095-B and 1095-C filing deadlines also fall at the end of January for recipient delivery. This schedule means businesses will face a huge time crunch when planning for wage, income, and ACA reporting for the 2016 year.

In the past, some businesses would file W-2 and 1099-MISC recipient copies first and wait to find out if any changes were needed prior to filing to the SSA/IRS, which lessened the risk for possible corrections. Due to the earlier deadline in 2017, businesses may need to abandon this strategy and consider filing to recipients and the SSA/IRS concurrently.

To further complicate January’s filing deadlines, the IRS recently eliminated the automatic 30-day extension of time to file W-2 forms. Previously, filers could obtain an automatic 30-day extension by submitting Form 8809 to the IRS on or before January 31. Filers could also request an additional 30-day extension, pushing their e-file deadline to the end of May. These automatic extensions will no longer be available when filing W-2 forms for tax year 2016.

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. 362 | One Million Fewer Taxpayers Asked to Take ID Quiz July 6, 2016

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

Tax Tip of the Week | July 6, 2016 | No. 362 | One Million Fewer Taxpayers Asked to Take ID Quiz

Here is a recent press release from the Ohio Society of CPAs……..

The Ohio Department of Taxation said about 1 million fewer taxpayers had to take its ID Confirmation Quiz to get their refunds this past tax season.

This was the result of more experience in fighting tax fraud and better targeting of suspicious income tax returns, Tax Commissioner Joe Testa said.

“The analysis we’ve done and modifications we’ve made have allowed us to dramatically reduce the number of taxpayers being asked to take the quiz and still remain among national leaders in aggressively combating these fraud schemes,” he said. “We will continue to refine our defenses to keep the state treasury safe and work to make the process more user-friendly.”

Last year, nearly 1.7 million taxpayers were asked to take the ID Quiz; this season that number was reduced by nearly two-thirds, to about 665,000.

Last year, taxpayers complained about the questions and Gov. Kasich vetoed a budget provision that would have limited the questions to information obtained from the previous five years. Testa told OSCPA such a limit would have hamstrung his department’s ability to examine tax returns.

Testa said taxpayers this year told the department the quiz was quick and easy to take, a view supported by its 98.8% passage rate. In addition, as identity theft and attempted tax fraud have become more prevalent issues, taxpayers said they understood and appreciated the extra steps ODT has taken to protect their identity and tax dollars. Security measures were also expanded this year to protect the identity of minors as well as adults.

Since 2014 more than $526 million in fraudulent income tax refund claims have been blocked, the department said, and that number is expected to increase. Final data for the recent filing season is not yet available.

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. 361 | Don’t Ignore That IRS Notice June 29, 2016

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

Tax Tip of the Week | June 29, 2016 | No. 361 | Don’t Ignore That IRS Notice

According to a 2016 report from the Treasury Inspector General for Tax Administration, the IRS mailed more than 188 million notices and letters to taxpayers during 2014. There’s no reason to believe the number of notices will be any less this year. If you’re one of those taxpayers on the IRS mailing list, here’s what to do.

Scan the heading. The first line, generally printed in bold type and centered beneath your name and address, will tell you why the IRS is contacting you. Questions about missing information, additional taxes owed, or payments due mean you’ll want to take prompt action to avoid more notices or assessments of interest and penalties.

Review the discrepancy. You’ll find the tax form and the year to which the notice applies printed in the upper right corner. Pull out your copy of the corresponding tax return, along with the supporting documents, and compare what you filed with what the IRS is questioning.

Prepare your explanation. Are the proposed changes correct? Did the IRS misapply a payment? Whatever the issue, there’s usually no need to file an amended return. However, the IRS typically wants a response, by either phone or mail, in order to clear the notice from your account.

Do not delay. Ignoring IRS correspondence will not make it go away. Reply to the IRS in a timely manner even if you don’t have all the information being requested.

Please contact us as soon as you receive a notice from the IRS or state or local taxing authority. We’re here to set your mind at ease by helping you resolve the matter as quickly as possible.  Many times, we can make the problem “go away” with a properly written response.

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. 350 | It is Better to Extend vs. Not Filing on Time April 13, 2016

Posted by bradstreetblogger in : Electronic Tax Filing, General, Tax Deadlines, Tax Planning Tips, Tax Tip, Taxes, Taxes , add a comment

Tax Tip of the Week | April 13, 2016 | No. 350 | It is Better to Extend vs. Not Filing 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. After submitting this form, you now have until October 17, 2016 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 some taxes, 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 (April 18th this year).   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 17th —-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. 349 | IRS Holds $950 Million for 2012 Non-Filers April 6, 2016

Posted by bradstreetblogger in : General, Tax Deadlines, Tax Tip, Taxes , add a comment

Tax Tip of the Week | April 9, 2016 | No. 349 | IRS Holds $950 Million for 2012 Non-Filers

Federal income tax refunds totaling $950,349,000 are waiting for an estimated 1 million taxpayers who did not file a federal income tax return for 2012.

To collect, these taxpayers must file a 2012 federal return no later than this year’s April deadline.

“We especially encourage students and others who didn’t earn much money to look into this situation because they may still be entitled to a refund,” said IRS Commissioner John Koskinen.

The IRS estimates that the median refund is $718. If no return is filed to claim a refund within three years, the money becomes the property of the U.S. Treasury. The window closes on April 18 (April 19 for taxpayers in Maine and Massachusetts). A 2012 refund check may be held if the taxpayer hasn’t filed tax returns for 2013 and 2014.

The states with the most taxpayers potentially due 2012 refunds are Texas (96,400 non-filers due a potential median refund of $771), California, (94,900 non-filers, median refund $656), Florida (64,700 non-filers, $721) and New York (57,600 non-filers, $796).

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.