TAX PREPARATION AND IRS AUDIT REPRESENTATION

TAX PREPARATION AND IRS AUDIT REPRESENTATION

The IRS has some advice for taxpayers who missed the tax filing deadline. File as soon as possible. If you owe federal income tax you should file and pay as soon as you can to minimize any penalty and interest charges. There is no penalty for filing a late return if you are due a refund. Penalties and interest may be due. If you missed the April 15 deadline you may have to pay penalties and interest. The IRS may charge penalties for late filing and for late payment. The law generally does not allow a waiver of interest charges. However the IRS will consider a reduction of these penalties if you can show a reasonable cause for being late. E-file is your best option. IRS e-file programs are available through Oct. 15. E-file is the easiest safest and most accurate way to file. With e-file you will receive confirmation that the IRS has received your tax return. If you e-file and are due a refund the IRS will normally issue it within 21 days. Pay as much as you can. If you owe tax but can t pay it all at once you should pay as much as you can when you file your tax return. Pay the remaining balance due as soon as possible to minimize penalties and interest charges. Installment Agreements are available. If you need more time to pay your federal income taxes you can request a payment agreement with the IRS. Apply online using the IRS Online Payment Agreement Application tool or file Form 9465 Installment Agreement Request. Refunds may be waiting. If you re due a refund you should file as soon as possible to get it. Even if you are not required to file you may be entitled to a refund. This could apply if you had taxes withheld from your wages or you qualify for certain tax credits. If you don t file your return within three years you could forfeit your right to the refund. It s Tax Season The Office Is Open Monday-Sunday From 9am-9pm As a small business owner you need to understand how taxes are going to affect you and your business. It is important that you file properly avoid audits and claim the right tax deductions. Here are a few tips that may ease the burden of tax preparation and to help you get ready to do your tax return. 1. Keep Good Records Proper record-keeping year-round is the first step to ensuring your taxes are filed accurately and that you have the paperwork you need to back-up your deduction claims should you be audited. 2. Understand Your Deductions What small business deductions can you take Do you have the documentation and original receipts to back them up Tax credits and deductions change each year. 3. Utilize the Small Business Jobs Act Tax Provisions The Small Business Jobs Act of 2010 signed into law by President Obama has over 17 tax provisions decreasing the tax burdens for small businesses--several of these provisions can be taken advantage of during this year s tax season. Utilizing these provisions will provide great savings for your business. 4. Remember the tax credits within the Affordable Care Act These tax credits will allow small businesses to cover up to 35 percent of the premiums a small business pays to cover its workers. In 2014 the rate will increase to 50 percent. 5. Avoid Common Audit Traps It is very important to be aware of potential red flags and act on them before the IRS does Classifying Employees as Independent Contractors -- Independent contractors and employees are not the same and it s important to understand the difference. In the eyes of the IRS misclassification can be seen as an attempt to avoid payroll taxes and non-compliance can bring penalties and back taxes. Home Office Deduction -- This deduction is very specific and not all home-based businesses will qualify. Likewise if you run your business from a commercial location and claim the home office deduction you might trigger some interest from the IRS. Know how to determine if you are eligible to claim it and what specific expenses you can write off. Large Sum Miscellaneous Deductions -- If you claim a large amount of itemized deductions relative to your income the IRS will get suspicious. Likewise if you bucket a large amount of miscellaneous expenses you may raise eyebrows. Be specific and label every deduction. 6. Keep Business and Personal Expenses Separate The IRS scrutinizes personal expenses that may have been claimed as a business expense such as the use of a business vehicle for personal use. Be diligent about keeping good records. Maintain a separate bank and credit card account for your business. In addition to the possible dividend tax increase investors would pay more in capital gains taxes in the event the Bush taxes expire (again from a current long-term capital gains tax rate of 15 percent up to a maximum rate of 20 percent). What do these tax-law changes mean to investors who rely on equities for a significant portion of their income First we believe that it is worthwhile noting that stocks can provide long-term growth and so some equity exposure in an income-generating portfolio is both necessary and desirable to help returns stay ahead of inflation. Second the extent to which your holdings are likely to be affected if these tax increases take place will depend on your individual circumstances. In our view investors facing the greatest level of risk are those investors with a higher-than-average reliance on dividends from their equity holdings to meet their income needs. In our experience this type of investor may be holding large concentrations of stock at a low cost basis--the price at which the stock was originally purchased is significantly below the price at which they could sell that stock today--typically resulting from the sale of a business retirement from a corporate executive position or an inheritance. For such investors the risk of complacency is very real. If you don t qualify for the IRS Offer in Compromise program a Payment Plan may be the way to resolve your problem. Setting up a payment plan with the IRS gives you a little more time to pay off your tax debts. Unfortunately penalties and interest will continue to be charged on your outstanding balance as you pay the debt off. You are required by law to pay the interest on your tax debt. The Internal Revenue has just over 1 billion in tax refunds for approximately one million individuals who still need to file an income tax return for the year 2011. The IRS keeps copies of W-2 forms 1099 s and other income-related documents. You can request copies of these tax documents by ordering an income transcript from the IRS. Either download or fill out Form 4506-T and take this to your local IRS office The IRS District of Columbia 77 K STREET N. E. WASHINGTON DC 20002 Open from 8 30AM -4 30 PM (they ll print out the transcript for you) or call the IRS at 1-800-908-9946 and ask that the transcript be mailed to you. Your tax professional can also order an income transcript for you that can be delivered by fax. Use the income transcript as a starting point for finding your original documents. You can contract previous employers brokers and other financial institutions to obtain copies of your original tax documents. Original documents can contain more information compared to what s found on the income transcript. For example the IRS doesn t show any state-related tax withholdings on its transcripts. Similarly if your income transcript shows you sold some investments you may want to contact your broker to obtain more detailed account history information. This year have an experienced financial professional prepare your return. Not just to ensure you take advantage of all the deductions you are entitled to for 2010 but to review your financial position and tax situation and make sure that you positioned to save money on your taxes in 2011 as well. The last few years have brought significant changes in tax laws-are you sure that you re positioned to take advantage of all of them In many cases my rates are less than the H& R Block. I can e-file your return and have the IRS deposit your refund directly into your account. Call or e-mail today for an appointment and fee quote. You ll be glad you did. What If I Don t File Voluntarily The IRS is taking enforcement steps for those who repeatedly choose not to comply with the law. IRS employees will prepare returns when taxpayers do not file. The returns prepared by the IRS might not give credit for deductions and exemptions a taxpayer may be entitled to receive. Bills will be sent to those taxpayers for the tax due plus penalties and interest. The IRS and the state don t know if you have dependents or other credits. People who repeatedly don t comply with the law are subject to additional enforcement measures. Mar a Elena L pez MSA MBA TEL (202)882-0935 Tel (202)526-4889 Fax 202)882-0935 Mobile (202)489-7054 E-mail maelenalopez1(at)yahoo.com WHAT TO DO IF YOU RECEIVE AN IRS NOTICE It s a moment many taxpayers read. A letter arrives from the IRS -- and it s not a refund check. Don t panic many of these letters can be dealt with simply and painlessly. Each year the IRS sends millions of letters and notices to taxpayers to request payment of taxes notify them of a change to their account or request additional information. The notice you receive normally covers a very specific issue about your account or tax return. Each letter and notice offers specific instructions on what you are asked to do to satisfy the inquiry. If you receive a correction notice you should review the correspondence and compare it with the information on your return. Agree If you agree with the correction to your account usually no reply is necessary unless a payment is due. Disagree If you do not agree with the correction the IRS made it is important that you respond as requested. Write to explain why you disagree. Include any documents and information you wish the IRS to consider along with the bottom tear-off portion of the notice. Mail the information to the IRS address shown in the upper left-hand corner of the notice. Allow at least 30 days for a response. Most correspondence can be handled without calling or visiting an IRS office. However if you have questions call the telephone number in the upper right-hand corner of the notice. Have a copy of your tax return and the correspondence available when you call to help us respond to your inquiry. Be sure to keep copies of any correspondence with your records. This year have an experienced financial professional prepare your return. Not just to ensure you take advantage of all the deductions you are entitled to for 2012 but to review your financial position and tax situation and make sure that you positioned to save money on your taxes in 2013 as well. The last few years have brought significant changes in tax laws-are you sure that you re positioned to take advantage of all of them In many cases my rates are less than the H& R Block. I can e-file your return and have the IRS deposit your refund directly into your account. Call or e-mail today for an appointment and fee quote. You ll be glad you did. I prepare - Individual Income Tax Returns - Corporate (C & S) Income Tax Returns - Partnership Returns - LLC Returns - Non-Profit Returns - Trust Returns - Quarterly Estimated Tax Payments - Year-End Tax Planning - Tax Advice - IRS Audit Representation - Notices from IRS & Franchise Tax Board OR If you Bought or sold a home or investment property-or are planning to buy Got married or divorced-or are planning to do one or the other Started a family Are in school or have a dependent in school Changed jobs Have a side business or self-employment income Started or experienced substantial growth in your own business Have been receiving big refunds or paying penalties for underpayments Haven t filed taxes for a few years and want to get back on track Or simply haven t met with a financial professional in the last few years to make sure you are on the right track you owe it to yourself to do it right this year. Did your accountant make a mistake your tax return A couple of years ago I reviewed my clients prior year tax return prepared by their accountant and I found that their accountant made a mistake on their tax return. Please bring a copy of your last year s tax return we ll be glad to look over your tax return for you to ensure you take advantage of all the deductions that you are entitled to. Business Owners-Self Employed Most of my clients are self-employed operating Sole Proprietorships LLCs or partnerships. Some are working at their own businesses full-time while others have full-time jobs and are building their own business evenings and weekends. They have found that working with me has saved money. I have helped them identify overlooked deductions alternative tax treatments opportunities to use tax deferred savings plans more effectively and provided general business advice that has saved them real money. I then look at their projections and help them plan for estimated tax payments this year to ensure that they avoid penalties in 2011 while maximizing their current cash flow. Home Owners Many are new homeowners who are able to itemize for the first time and want to ensure that they catch everything the first year. Some plan to go back to Turbo Tax next year but want a little advice this year-just to make sure. I take the time to get a feel for their financial situation and walk them through the deductions for which they are eligible. I look at their projected income for 2014 and provide them with a new W-4 that takes their new tax situation into account and enables them take more money home each paycheck instead of waiting for a big refund at the end of the year. Why let the IRS keep your money all year when it can earn interest in your bank account or help you pay down your debt faster I have evening and weekend appointments available. All clients will enjoy affordable one on one service from knowledgeable hardworking professionals. Let us help you organize your finances and avoid the costly mistakes that can affect your bottom line. We will be your point people for all things financial allowing more free time to focus on your family business etc. . . . Business Owners Having trouble reaching your accountants when you need them Not getting the personal attention or quality of service you deserve Do you feel that you are paying too much of your hard earned money for poor results Let us show you how beneficial having a qualified Accountant can be for your business. You will receive better quality service & SAVE . Services We offer tax preparation including Federal State & Local for Individual Corporation Partnership and Business. We provide full-service accounting. For new business setup. Incorporations and new business advisory services offered to put your business on the path to success. Our services also include year round tax planning as well as compliance and auditing. E-mail maelenalopez1(at)yahoo.com Professional TAX returns in 3 business days Preparing your own income tax return can be a task that leaves you with more questions than answers. According to a study released by the US Government s General Accounting Office last year most taxpayers (77% of 71 million taxpayers) believe they benefited from using a professional tax preparer. Whether we like it or not today s tax laws are so complicated that filing a relatively simple return can be confusing. It is just too easy to overlook deductions and credits to which you are entitled. Even if you use a computer software program there s no substitute for the assistance of an experienced tax professional. Maria Elena Lopez LLC Bookkeeping Income Tax and Legal Document Preparation Services can help you with all of your Bookkeeping and Income Tax needs. We specialize in tax preparation for individuals and small businesses. We prepare computerized federal and state tax returns for all (50) states E-file. Your tax returns are prepared according to current tax laws and rulings. We will also handle tax audits reassessments and any other tax inquiries on your behalf. Maximize your refund. Get the deductions you deserve. Avoid tax hassles this is not software a tax professional will do it all for you. No waiting in line for hours we go to your home office or can process online. Convenience At any time all week including evenings and weekends. Get your Refund Fast -- avoid snail mail -- E-file today. Save Money Flat low pricing. We do not just process returns we also take the time to evaluate analyze your tax information and identify the correct approach to reporting your income while minimizing your current tax burden. Minimum prices for 2010 tax return ranges from 135 -- 450 based on complexity of the return. You will receive a written estimate specific to your return prior to the commencement of services. Our staff will show you how to adjust your payroll withholding to get more money back each week. Why give the IRS an interest free loan for up to 16 months. Books a Mess No Problem If you own a small business and haven t kept up your bookkeeping don t worry. We can help you. We ll prepare your bookkeeping for the year prepare a full Schedule C as well as your personal income tax return. Then we ll help you set up an easy system that allows you to keep your books in tip-top shape next year. R & S Unlimited is OPEN all year and believes that proper tax planning requires decision making all year-round not just at tax time. Our services are available by phone fax e-mail mail And in person Washington DC area and beyond. Tell us how we can be of services Hours of Operation Monday -- Friday 9 30 a.m. -- 9 00 p.m. Saturday 9 00 a.m. -- 8 00 p.m. Sunday 10 00 am -- 8 00 pm Located at 4416 Georgia Avenue N.W. Washington DC20011 202-882-0935 202-489-7054 Se Habla Espa ol 19Years Of Experience Business & Individual Taxes Licensed To Practice Before IRS Small Business Start Up Accounting Compliance Acceptance Agent For District Of Columbia Notary Public We Visit Our Clients Government Contractor Accounting Available All Year Electronic Filing & Fast Refunds Income Tax Preparation (Business & Individual Business Return Tax Check List Income Gross receipts from sales or services Sales records (for accrual based taxpayers) Inventory (if applicable) Beginning inventory Inventory purchases Ending inventory Items removed for personal purposes Returns and allowances Business checking savings account interest (1099-INT or statement) Other income Expenses Advertising Transportation and travel expenses Local transportation Business trip (mileage) log Contemporaneous log or receipts for public Transportation parking and tolls Travel away from home Airfare or mileage actual expense if drove Hotel Meals tips Taxi tips Internet connection (hotel Internet caf etc.) Other Commissions paid to subcontractors File Form 1099-MISCand 1096 as necessary Depreciation Cost and acquisition date of assets Sales price and disposition date of any assets sold Fringe benefits Employer-paid pension profit sharing contributions Employer paid HAS contributions Employer-paid health insurance premiums Cost of other fringe benefits Business insurance Casualty loss insurance Errors and omissions Other Interest expense Mortgage interest on building owned by business Business loan interest Legal fees Office supplies Pens paper staples etc. Other consumables Rent expense Office space rent Business-use vehicle lease expense Other Office-in-home Square footage of office space (hours of use for daycare business) Total square footage of home (not applicable for daycare business) Mortgage interest or rent paid Utilities Wages paid to employees Form W-2 and W-3 Federal and state payroll returns(Form 940 etc.) Other expenses Repairs maintenance of office facility etc Personal Information Your social security number Your spouse s full name and social security number Amount of any alimony paid and ex-pouse s Social security number Add Your 2011 2010 and 2009 tax return(s). Your Tax Professional can check them for accuracy Other people who may belong on your return Dates of birth and social security numbers Childcare records (including the provider s ID number) if applicable Approximate income of other adults in your home (not spouse if you re filing jointly) Form 8332 copies of your divorce decree or other documents showing that your ex-spouse is releasing their right to claim a child to you Education Payments Bills from the educational institution or anything else that itemizes what you paid or received loans for versus what was covered by scholarship or other financial aid Forms 1098-T and 1098-E if you received them Scholarships and fellowships Employee Information Forms W-2 Self-Employment Information Forms 1099-MISC Schedules K-1 income records to verify amounts not reported on 1099s. Records of all expenses -- check registers or credit card statements and receipts Business-use asset information (cost date placed in service etc.) for depreciation Office in home information if applicable Vehicle Information Total miles driven for the year (or beginning ending odometer readings) Total business miles driven for the year (other than commuting) Amount of parking and tolls paid If you want to claim actual expenses receipts or totals for gas oil car washes licenses personal property tax lease or interest expense etc. Rental Income Records of income and expenses Rental asset information (cost date placed in service etc.) for depreciation Retirement Income Pension IRA annuity income (1099-R) Social security RRB income (1099-SSA RRB-1099) Savings and Investments Interest dividend income (1099-INT 1099-OID 1099-DIV) Income from sales of stock or other property (1099-B 1099-S) Dates of acquisition and records of your cost or other basis in property you sold Other Income Unemployment state tax refund (1099-G) Gambling income (W-2G or records showing income as well as expense records) Amount of any alimony received and ex-spouse s name Health care reimbursements (1099-SA or 1099-LTC) Jury duty records Hobby income and expenses Prizes and awards Other 1099 Itemizing Deductions Forms 1098 or other mortgage statements Amount of state local income tax paid (other than wage withholding) or amount of state and local sales tax paid Real estate and personal property tax records Invoice showing amount of vehicle sales tax paid HUD statement showing closing date of home purchase Cash amounts donated to houses of worship schools other charitable organizations Records of non-cash charitable donations Amounts paid for healthcare insurance and to doctors dentists hospitals Amounts of miles driven for charitable or medical purposes Expenses related to your investments Amount paid for preparation of your 2010 tax return Employment-related expenses (dues publications tools uniform cost and cleaning travel) Job-hunting expenses IRA Information Amount contributed for 2011 (and 2012 if applicable) Traditional IRA basis Value of IRAs on Dec. 31 2011 If you were affected by a federally declared disaster City county you lived worked had property in Records to support property losses (appraisal clean up costs etc.) Records of rebuilding repair costs Insurance reimbursements claims to be paid FEMA assistance information Check FEMA site to see if my county qualifies for individual assistance