22 Jul 2019
0

Summer Hire Tax Credits May Be Available

Roger Rossmeisl, CPA
Small Business Tax Briefs
Summer Hires May Qualify for Tax Credits

Is your business hiring this summer? If so, there may be some summer hire tax credits available to you.  If the employees come from certain “targeted groups,” you may be eligible for the Work Opportunity Tax Credit (WOTC). This includes youth whom you bring in this summer for two or three months. The maximum credit employers can claim is $2,400 to $9,600 for each eligible employee. Summer hire tax credits: WOTC 10 targeted groups An employer is generally eligible for the credit only for qualified wages paid to members of 10 targeted groups: Qualified members of families receiving assistance under the Temporary Assistance for Needy Families program, Qualified veterans, Designated community residents who live in Empowerment Zones or rural renewal counties, Qualified ex-felons, Vocational rehabilitation referrals, Qualified...

28 Jun 2019
0

Social Security Phone Scams

Roger Rossmeisl, CPA
Fraud Briefs
Social Security Phone Scams

Despite the National Do Not Call registry and features such as caller ID, phone fraud is thriving in the mobile phone era. Using spoofed numbers — which appear to be connected to legitimate government offices and businesses or that resemble your own number — fraud perpetrators say anything and everything to try to steal your money. Recently, scammers have posed as Social Security officials to steal from unsuspecting consumers. Since January 2018, the Federal Trade Commission has received more than 63,000 reports about this scam. Only 3% of reporting call recipients lost money, but the losses total $16.6 million. Social Security phone scams: anatomy of a crime Here’s how the Social Security scheme works: Criminals call from spoofed phone numbers and tell consumers that their Social Security number has been...

28 Jun 2019
0

Beware the 100% Payroll Tax Penalty

Roger Rossmeisl, CPA
Small Business Tax Briefs
Beware the 100% Payroll Tax Penalty

If federal income tax and employment taxes (including Social Security) are withheld from employees’ paychecks and not handed over to the IRS, the so-called 100% Payroll Tax Penalty can be imposed. To make matters worse, the penalty can be assessed personally against a “responsible individual.” If a business makes payroll tax payments late, there are escalating penalties. And if an employer fails to make them, the IRS will crack down hard. With the “Trust Fund Recovery Penalty,” also known as the “100% Payroll Tax Penalty,” the IRS can assess the entire unpaid amount against a responsible person who willfully fails to comply with the law. Some business owners and executives facing a cash flow crunch may be tempted to dip into the payroll taxes withheld from employees....

28 Jun 2019
0

Dynasty Trusts Provide a Legacy

Roger Rossmeisl, CPA
Estate Planning Briefs
Dynasty Trusts Provide a Legacy

If a prime objective of your estate plan is to leave your mark, dynasty trusts provide a legacy.  That means it might be the right estate planning vehicle for you. The Tax Cuts and Jobs Act substantially increased the generation-skipping transfer (GST) tax exemption.  That makes a dynasty trust more appealing than ever. GST tax and dynasty trusts Dynasty trusts provide a legacy in that they allow substantial amounts of wealth to grow and compound free of federal gift, estate and GST taxes.  In so doing, tax-free benefits are provided for your grandchildren and future generations. The longevity of a dynasty trust varies from state to state.  It’s becoming more common for states to allow these trusts to last for hundreds of years or even in perpetuity. Avoiding...

28 Jun 2019
0

Chances of IRS Audit are Down

Roger Rossmeisl, CPA
Individual Tax Briefs
Chances of IRS Audit are Down

The IRS just released its audit statistics for the 2018 fiscal year, and the chances of IRS audit are down.  Fewer taxpayers had their returns examined as compared with prior years. Even though less returns are being audited, that will be little consolation if yours is one of them. Chances of IRS audit are down: latest statistics Overall, just 0.59% of individual tax returns were audited in 2018, as compared with 0.62% in 2017. This was the lowest percentage of audits conducted since 2002. However, as in the past, those with very high incomes face greater odds. For example, in 2018, 2.21% of taxpayers with AGIs of between $1 million and $5 million were audited.  That's down from 3.52% in 2017. The richest taxpayers, those with AGIs of $10...

28 Jun 2019
0

Consider a Roth 401(k) Plan

Roger Rossmeisl, CPA
Small Business Tax Briefs
Consider a Roth 401(k) Plan

Roth 401(k) accounts have been around for 13 years now. Studies show that more employers are offering them each year. A recent study by the Plan Sponsor Council of America (PSCA) found that Roth 401(k) Plans are now available at 70% of employer plans, up from 55.6% of plans in 2016. However, despite the prevalence of employers offering Roth 401(k)s, most employees aren’t choosing to contribute to them. The PSCA found that only 20% of participants who have access to a Roth 401(k) made contributions to one in 2017. Perhaps it’s because they don’t understand them. If you offer a Roth 401(k) Plan or you’re considering one, educate your employees about the accounts to boost participation. Roth 401(k) Plans: a 401(k) with a twist As the name implies, these...

27 Jun 2019
0

Employee Conflicts of Interest

Roger Rossmeisl, CPA
Fraud Briefs
Employee Conflicts of Interest

One of the governing principles of the employee/employer relationship is that employees have a fiduciary duty to act in their employer’s interests. Undisclosed employee conflicts of interest can be a serious breach of this duty. In fact, when employees aren't on your side, companies often suffer financial consequences. Employee conflicts of interest: ignorance isn’t bliss Here’s a fictional example of a common conflict of interest: Matt is the manager of a manufacturing company’s purchasing department. He’s also part owner of a business that sells supplies to the manufacturer — a fact Matt hasn’t disclosed to his employer. And, in fact, Matt has personally profited from the business’s lucrative long-term contract with his employer. What makes this scenario a conflict of interest isn’t so much that Matt has profited...

27 Jun 2019
0

Construction Company Anti-Fraud Checklist

Roger Rossmeisl, CPA
Fraud Briefs
Construction Company Anti-Fraud Checklist

According to the Association of Certified Fraud Examiners’ Report to the Nations: 2018 Global Study on Occupational Fraud and Abuse, organizations victimized by fraud lose a median $130,000. But construction companies, in particular, are even harder hit, with a median loss of $227,000. What can you do to protect your construction business? Adopt this construction company anti-fraud checklist. Construction Company Anti-Fraud Checklist: Ways to Tighten Controls An effective strategy for minimizing fraud is to tighten your internal controls. Make sure the following are part of your policies and procedures: Surprise audits and jobsite visits. These visits can not only help detect fraud, but also send a strong message that combating fraud is a priority — which is a powerful deterrent. Segregation of duties. Avoid situations in which one person...

26 Jun 2019
0

Combining Business with Pleasure Travel

Roger Rossmeisl, CPA
Small Business Tax Briefs
Combining Business with Pleasure Travel

Summer is here, so you might be thinking about getting some vacation time. If you’re self-employed or a business owner, you have a golden opportunity for combining business with pleasure travel for a few extra days and offset some of the cost with a tax deduction. But be careful, or you might not qualify for the write-offs you’re expecting. Combining business with pleasure travel: basic rules Business travel expenses can potentially be deducted if the travel is within the United States and the expenses are: “Ordinary and necessary” and Directly related to the business. Note: The tax rules for foreign business travel are different from those for domestic travel. Business owners and the self-employed are generally eligible to deduct business travel expenses if they meet the tests described...

26 Jun 2019
0

Key Q3 2019 Deadlines for Businesses

Roger Rossmeisl, CPA
Small Business Tax Briefs
KeyQ3 2019 Deadlines for Businesses

Here are some of the key Q3 2019 deadlines for businesses and other employers that are tax related. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. July 31 Report income tax withholding and FICA taxes for the second quarter of 2019 (Form 941) and pay any tax due. (See the exception below, under “August 12.”) File a 2018 calendar-year retirement plan report (Form 5500 or Form 5500-EZ) or request an extension. August 12 Report income tax withholding and FICA taxes for the second quarter of 2019 (Form 941), if you deposited on time and in full all of the associated taxes due. September 16 If a calendar-year C corporation, pay the third installment of 2019...

ROGER ROSSMEISL, CPA

Kho & Patel CPAs
160 E. Arrow Highway
San Dimas, CA 91773

(714) 325-0442
roger@khopatel.com

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