Tuesday, December 10, 2013

Stolen Employer ID Numbers Causing Headaches for IRS

Internal Revenue Service reports that it is losing billions of dollars to fraudsters every year from stolen or fraudulent Employer Identification Numbers, or EINs.

In a government report released Thursday by J. Russell George, Treasury Inspector General for Tax Administration, the IRS needs to do more to prevent fraud from the use of stolen EINs despite the fact that the agency already has some processes in place to authenticate individuals who apply for an EIN.
The government's review of 2011 e-filed individual tax returns identified 767,071 tax returns with potentially fraudulent refunds totaling almost $2.3 billion. 
There were 285,670 EINs used on these tax returns: 277,624 were stolen EINs used to report false income and withholding on 752,656 tax returns with potentially fraudulent refunds issued totaling more than $2.2 billion. 
8,046 were falsely obtained EINs used to report false income and withholding on 14,415 tax returns with potentially fraudulent refunds issued totaling more than $50 million.

For more information about this issue, see Accounting Today or contact Neikirk, Mahoney & Smith CPAs.

Tuesday, December 3, 2013

Closing Your Fiscal Year

Some people look forward to December 31 because of the parties, the people and the abundant optimism for the coming year.

But if you're a business owner or managing executive, all you're probably hoping to survive your firm's fiscal year end.

A fiscal year end - or closing of the books - marks the completion of a one year accounting period. The date of your company's fiscal year-end may or may not be on December 31 - it can be on any day throughout the year, depending upon the date you and your accountant set when your corporation papers were filed.

Most small businesses employ the year end strategy, except for retail entities. Another common year end date - or fiscal year end date - is June 30. The default IRS system is based on the calendar year, so fiscal-year taxpayers have to make some adjustments to the deadlines for filing certain forms and making certain payments. In many instances, even fiscal year taxpayers must adhere to the calendar-year deadlines.

Additionally, the year-end date is different for different business entities because every company's needs are different. Retailers typically choose to establish their year-end date sometime in Spring because of their sales cycle. Many retailers see a heavy selling season in November and December, making it virtually impossible to produce annual financial statements, count inventories, etc. because its manpower will be going toward selling its product.

It's important that you check with a reputable accounting firm when closing your books on another fiscal year. Here's a quick list of year-end procedures that you might find helpful, courtesy of MSN.com. 

  • Verify the closing options that you have selected. 
  • If you are using Inventory management, complete the inventory closing process.
  • Complete month-end and other period closings in all modules other than General ledger, including exchange adjustments on unrealized transactions.
  • Complete month-end and other period closings in General ledger and print financial reports for the month and quarter.
  • If your company is a consolidation company, complete steps 1 through 4 for each subsidiary, and set up the subsidiary accounts to consolidate data. If the data for the subsidiary companies is in a separate database, export the subsidiary data to use in a trial consolidation.
  • To close the fiscal year for a subsidiary company, refer to Prepare a consolidated company for a consolidation and Perform an online consolidation.
  • Complete year-end closing activities in all modules, other than General ledger, that might create some ledger postings, such as processing year-end depreciations in Fixed assets.
  • Create the new fiscal year. For more information, refer to Create new year (form).
  • Set appropriate periods to Stopped for the current fiscal year.
  • Back up your company's data.
  • Make adjusting entries. Click General ledger > Periodic > Fiscal year close > Closing sheet to create and post all necessary adjustments, including adjustments to taxes and write-offs.
  • Print final financial statements.
  • Print 1099 statements for vendors that require the statements.
  • Transfer opening balances for ledger accounts to a new fiscal year.
  • You can reset number sequences. Click Basic > Setup > Number sequences > Number sequences.
  • Print the final reports for the fiscal year, including financial statements, such as the operating statement and the balance sheet, and 
  • publish the statements as required by law.
There is nothing simple about year-end closings and caution is recommended if you're going to try and do this yourself. But you can do it if you follow the rules!

If you would like to get some input from a reputable accounting firm, contact Neikirk, Mahoney & Smith PLLC at 502-896-2999.

Tuesday, September 24, 2013

Tea Party Finally Bags Lerner

The poster girl for American conservatives, Lois Lerner, the Internal Revenue Service's director of the IRS exempt-organizations division, finally tossed in her towel and retired effective today, IRS officials said in a statement. 
Lerner became a fixture on news broadcasts when she first went into a tirade during her testimony in front of Congress about how she didn't do anything wrong and then almost immediately claimed protection under the Fifth Amendment .
"I am very proud of the work that I have done," Lerner told Congress before pleading the Fifth. "I have not done anything wrong. I have not broken any laws."
Her May 22 statement came as a result of the Treasury Department's Inspector General for Tax Administration's report that criticized the agency's handling of tea-party groups' applications.
Lerner was placed on paid administrative in May. Acting IRS Commissioner and former quarterback for the Florida Gators Danny Werfel told Congress that she had not been terminated and she was still employed. 
Lerner's office oversaw the review of applications from groups seeking tax-exempt status. Evidence indicates that her office selected tea party affiliated groups for further scrutiny if the term tea party was in their names.
But Lerner's resignation won't have any effect on Republican efforts to investigate the agency's actions. “Just because Lois Lerner is retiring from the IRS does not mean the investigation is over,” Utah Senator Orrin Hatch, the top Republican on the Senate Finance Committee, said. “Far from it. In fact, there are many serious unanswered questions that must be addressed so we can get to the truth.”
According to the Wall Street Journal, a Democratic congressional aide said Ms. Lerner's decision came after an IRS review board had informed her that it was set to propose her removal from the agency. The board had found "neglect of duties" during her tenure as , as well as mismanagement consistent with critical findings of an earlier inspector general's report, the aide said. However, the congressional aide noted the board found no evidence of political bias or willful misconduct.
The IRS scrutiny began in early 2010 and affected dozens of tea-party and other grass-roots conservative groups. Some have remained in limbo for years awaiting a decision on their applications, according to the inspector general's report.
Democrats claim that no evidence of political bias exists because some liberal groups were also scrutinized. But Republicans say the number of conservative grass-roots groups that were swept up in the IRS net is far larger, and the scrutiny more onerous, than what liberal groups experienced, according to Accounting Today.
The IRS said that since May—when —it has taken "decisive actions to correct failures" in management of the exempt-organizations division, including replacing the top managers.

Wednesday, September 18, 2013

What is an IRS audit?

An IRS audit is a review or examination of an organization's or individual's accounts and financial information to ensure information is being reported correctly, according to the tax laws and to verify the amount of tax reported is accurate. At least that's what the IRS says.
In reality, there aren't many things more frightening or humiliating than getting the Certified Letter that makes you catch your breath, while your heart pounds in your chest. It's a scary term - audit. But is an audit really that bad, other than the similarity between an audit and the days when your mother used to root through your underwear drawer?
Just because you've been served notice that you're being audited doesn't automatically infer that you've done anything wrong and your accountant or accounting firm can verify that. Nor does it always suggest that an error has been made.
Returns to audit are chosen through a number of ways, including random selection and computer screening and sometimes returns are selected based solely on a statistical formula. 
Other audits are spurred on by triggering issues. One example of an issue that can trigger an audit is document matching - when payor records, such as Forms W-2 or Form 1099, don't match the information reported on your return. 
Returns may be selected for audit when they involve issues or transactions with other taxpayers, such as business partners or investors, whose returns have already been selected for an audit. Like your mother said, watch out who you hang around with - they can get you in trouble!

Friday, September 13, 2013

Twitter Preparing for IPO

In a move that has been long anticipated by business and technology experts worldwide, San Francisco-based Twitter announced Thursday that it has privately filed for its first public sale of shares.

Twitter said Thursday afternoon in a statement that "We've confidentially submitted an S-1 to the SEC for a planned IPO. This Tweet does not constitute an offer of any securities for sale."

Experts project the Twitter IPO to create as much of a stir as the Facebook IPO did but Twitter executives are hoping for a smoother road for the company and investors.

"Twitter's massive growth has produced strong IPO buzz for years, but neighbor Facebook's rough Wall Street debut quieted much of the excitement," according to the Wall Street Journal.

"The Menlo Park company exercised a record-breaking IPO in May 2012 that valued CEO Mark Zuckerberg's creation at more than $100 billion, but problems with initial trades and doubts about Facebook's ability to generate revenues helped push shares from an initial price of $38 to less than $20 in the first year of public availability."

Facebook's Wall Street experience has become less hectic and the company's stock has fully recovered, posting an all time high of $45 Wednesday after recent earnings reports showing strong gains in mobile revenues.

Twitter was founded in 2006 by Jack Dorsey, Ev Williams and Biz Stone, and has grown to more than 200 million users who share their thoughts in bursts of no more than 140 characters at least once a month, with estimates of total users surpassing 500 million.

If you need advice about how you should be planning for your financial future, contact Neikirk, Mahoney & Smith CPAs. We'll be happy to assist you.

Wednesday, September 11, 2013

CPA Poll Indicates Upward Hiring Trend

In a poll conducted by the American Institute of CPAs, accounting executives in US companies are projecting increased hiring despite concerns about the outlook of the American economy. The quarterly AICPA Economic Outlook Survey polls CEOs, CFOs, controllers and other CPAs in U.S. companies who hold executive and senior management accounting roles, according to Accounting Today.
Friday’s monthly jobs report from the U.S. Bureau of Labor Statistics indicated that current hiring trends are still relatively weak. The AICPA survey, however, serves as a forward-looking indicator of hiring expectations over the next 12 months. 
Some 15 percent of respondents now say they have too few employees and are planning to hire in the next 12 months, up from 12 percent last quarter and 9 percent a year ago. Another 19 percent say they have too few employees but are reluctant to bring on new staff. 
Some 53 percent of business executives indicated their companies have the right number of employees. The largest companies (those with more than $1 billion in annual revenue) are more likely than other businesses to say they have too few employees. On an industry basis, the construction, technology, and professional, technical and scientific services sectors are expected to post the largest job growth.
If you're anticipating hiring additional personnel for your company and you have questions, please give Neikirk, Mahoney & Smith PLLC a call. We'd be happy to advise you. 
See this from Indeed.com (http://indeed.com) 

Job Postings

Accounting job postings have increased 6% since August 2012.
Clicks on Accounting jobs have increased 21% since August 2012.



Top Job Titles


Top Keyword Searches


Top Locations

Statistical approximations are used to compute these results.

Wednesday, September 4, 2013

How the Affordable Care Act Affects Your Books

Our friends at Accounting Today have announced that they will be offering a free webinar dealing with how the Affordable Care Act will affect your accounting practices.
Participants will learn

  • How the ACA will impact your small and large business clients (hint: it will be different for both)
  • Which requirements your clients have to comply with
  • Which key deadlines are approaching, and which aren¹t an issue yet
  • How your firm can turn health care reform into a profitable service area

Whether your business is large or small, one thing is for certain - that this will affect you! If you have any questions, please don't hesitate to contact us at (502) 896-2999 or at http://nmscpas.com.

Click here to register.

Tuesday, September 3, 2013

Same Sex Couples Getting Tax Breaks

Legally married same sex couples are going to get the same federal tax breaks as traditional married different sex couples, according to the Internal Revenue Service.

"Today's ruling provides certainty and clear, coherent tax filing guidance for all legally married same-sex couples nationwide. It provides access to benefits, responsibilities and protections under federal tax law that all Americans deserve,"said Treasury Secretary Jack Lew in a statement.

Kentucky law does not recognize gay marriage but activists continue to push for related legislation. According to Marriage Equality Kentucky, an organization supporting same sex marriage rights, same sex spouses in Kentucky currently are not allowed accidental death benefit for the surviving spouse of a government employee; appointment as guardian of a minor; beneficial owner status of corporate securities; Bill of Rights benefits for victims and witnesses; consent to post-mortem examination; or control, division, acquisition, and disposition of community property, among other issues.

A gay couple from Louisville recently filed a federal lawsuit against Kentucky's ban on same-sex marriage. Gregory Bourke and Michael Deleon's suit claims existing laws deprives them of numerous legal protections that are available to opposite-sex couples in Kentucky.

The Treasury Department and IRS ruling assures tax benefits for all legally married same-sex couples in an effort to ensure their ability to move freely throughout the country without altering their federal filing status.

The ruling states that, beginning with 2013 returns, same sex married couples can file their federal tax returns using either the married filing jointly or married filing separately filing status. Same sex married couples can amend previously filed returns as far back as 2010.

Read full article in US News & World Report
Contact Neikirk, Mahoney & Smith PLLC if you have specific questions.

Wednesday, August 14, 2013

Tax News From Around the Nation

Spiraling National Debt - First Detroit, Who's Next?
Glenn Hubbard and Tim Kane opined in the New York Times that both political parties have misjudged the effect of the nation's spiraling debt will have on near term growth and long term national security. Read more.

Group Advocating Tax-free Savings Accounts for Home Buyers
A coalition that includes real estate developers and investors has been floating the idea of IRA-ish tax free savings plans as part of a package of reforms intended to overhaul federally funded real estate programs. Read more.

Proposals to Eliminate the Cap on OASDI Unlikely to Pass, WSJ Says
There is a limit on the amount of earnings subject to Social Security's "Old-Age, Survivors and Disability Insurance" program, known as "OASDI" for short and proposals to either eliminate or increase it sharply, have little chance of passing through Congress in today's economic climate.

For 2013, that limit is $113,700, up from $110,100 in 2012. The increase reflected changes in a national average wage index. For more details, see the Social Security Administration's website (ssa.gov).

There is no limit on the amount subject to Medicare taxes. Starting this year, many upper-income taxpayers have to pay an additional Medicare tax of 0.9% on earned income exceeding a certain amount. The threshold generally is $200,000, or $250,000 for joint returns.

If you work for two or more employers during a year, make sure to keep track of the total amount of Social Security tax that was withheld from your pay. Check to see whether you paid more than you owed. (IRS Publication 17 has details.) If so, you can claim the excess amount as a credit against your federal income tax.

IRS Sends Threatening Letter to Approximately 20,000 Employers 
According to Accounting Today, the Internal Revenue Service has sent threatening letters to some 20,000 employers accusing them of possible income underreporting based on reports it has received on their debit and credit card transactions.

And House Small Business Committee chairman Sam Graves, R-Mo., has written a letter to the Internal Revenue Service complaining about it.

“We have heard from tax practitioners whose clients are small business owners who have received letters from the IRS titled Notification of Possible Income Underreporting,” he wrote to Faris Fink, the commissioner of the IRS’s Small Business/Self-Employed Division, in a letter last Friday. 

“First, although my staff met with you and your team, you assured us that the IRS is merely seeking additional information, the initial sentence of the notification letter begins, ‘Your gross receipts may have been underreported.’ This gives the impression that the IRS is looking for more than just additional information. To the contrary, the letter implies that this is a serious matter that could lead to assessments of additional tax, penalties and interest.” Read more

Innocent Spouses Given More Time to File
On Monday, the IRS issued a new regulation that proposes to expand from two to 10 years the amount of time that taxpayers could apply for innocent spouse relief so they are no longer responsible for the tax debts of estranged spouses. Read more.

Married Same Sex Couples Likely to See Tax Increase
The increase probably would result from phasing out income tax credits for families, depending on the distribution of income between two working spouses, now that same-sex couples will be required to file joint returns with the Internal Revenue Service, according to a Congressional Research Service report.

If you'd like to speak with one of our accounting professionals, please call us at 502-896-2999 or visit our website at http://nmscpas.com

Tuesday, July 30, 2013

New tax saving tips posted on our website

Check out today's tax saving tip at http://nmscpas.com/how-to-save-money-on-taxes-tip-5

If you need help with your taxes or if you have a need for financial related business advice, visit our website at http://nmscpas.com!

Monday, July 22, 2013

Tax Week

New Pages Added to Our Website

- We've added some new pages to our website at http://nmscpas.com and we hope you'll find them useful. We've set up links where you can go and download Kentucky and Indiana business tax forms. Check it out!

Former KPMG Partner Pleads Guilty

Scott I. London, a former senior partner with the accounting firm KPMG whose clients included Herbalife and Skechers USA, pleaded guilty on Monday before a federal judge in Los Angeles to a charge of securities fraud arising from his involvement in insider trading. Read More

Companies Plan to Increase Outsourcing

IT, accounting and finance administrative processes dominate the future outsourcing plans of major companies, according to a new survey by KPMG.
Roughly half of major enterprises intend to increase the volume of their application development and maintenance outsourcing during 2013, while about 40 percent intend to increase their finance and accounting outsourcing. Read More

PCAOB Considering Deregistering Accounting Firms

The Public Company Accounting Oversight Board is taking a close look at the nearly 1,000 accounting firms that have registered with the PCAOB although they do not audit public companies or broker-dealers, and may decide to drop many of them. “Currently 923 firms are registered with the PCAOB even though they do not conduct audits that would subject them to mandatory PCAOB registration,” said PCAOB member Jeanette Franzel. Read More

Governments To Review Multinational Tax Avoidance

The international Organization for Economic Cooperation and Development has produced an action plan at the request of the G20 finance ministers to address the problems of base erosion and profit shifting that are depleting corporate tax revenue as multinational companies transfer their profits to low-tax countries. Read More

Online Sales Taxes Targeted for Collection

Conservative economist Dr. Arthur Laffer has co-written a study that identified a positive economic impact in efforts to require online retailers to collect sales taxes from customers on Internet purchases. The study was released by the Alliance for Main Street Fairness, a group that has been pressing for passage of the Marketplace Fairness Act, which was passed by the Senate in May, but has not yet been voted on in the House.

Venture Investing On the Upswing

Venture investing rebounded in the second quarter from a slow start to the year, returning to the levels of late 2012 on a surge of early stage investing.
Venture capitalists in the United States put $6.7 billion to work in 913 deals from March to June, according to the MoneyTree Report from PricewaterhouseCoopers, the National Venture Capital Association and peHUB publisher Thomson Reuters. Read More

Small Business Owners Vacationing Less

Small business owners are working more hours, extending their workweeks, and taking less vacation than they were five years ago, according to the 2013Sage Reinvention of Small Business Study, a Sage North America survey focused on how small businesses are changing the way they conduct business in a recovering economy."The latest reinvention survey reveals the true reality that many small business owners are facing: that they continue to show resilience in the face of an anemic recovery, all the while increasing their management acumen to ensure their businesses are successful," Connie Certusi, executive vice president and general manager of Sage Small Business Solutions, said in a written statement. Read More

House Republicans Pushing for More Extensive Tax Code Makeover

The top Republican tax writer in Congress is being pulled toward a more extensive rewrite of the U.S. code, with about half his party's members in the House backing proposals to rip up the rules. More than 100 House Republicans have supported proposals to end the income tax, halt audits for six months, and terminate the entire code in 2018 to force Congress to create a simpler system. Sixty-eight of them favor what they call a "fairtax," replacing the income, payroll and estate levies with a national sales tax. Dozens back estate-tax repeal proposals. A flat-tax bill has 10 Republicans on board. Read More

Top 10 Considerations for Employee Benefit Plans After Windsor

The recent U.S. Supreme Court decision in U.S. v. Windsor struck down §3 of the federal Defense of Marriage Act (DOMA) as unconstitutional, and held that the federal government must recognize and accept same-sex marriages recognized under state law. As a result of theWindsor decision, the definition of "spouse" under any federal law governing employee benefits must now be interpreted to include same-sex spouses recognized under state marriage laws.

If you're looking for an accounting firm that can provide you with fresh new ideas, contact Neikirk, Mahoney & Smith today at (502) 896-2999 or by submitting our form.

Tuesday, June 18, 2013

How to Save Money on Taxes - Tip 4

Leave no tax deduction or credit unreported. Making certain that you don't leave any deductions on the table is the single best way you can save money on your taxes. With the IRS, the rules are always changing, so keep up with them, but if you do, the rewards will be there. And don't be afraid to take all the legit deductions you have available. Have courage. Like the TV commercial says, it's your money. 
And pinching pennies may be a noble way to think in some cases, but when it comes to your taxes its totally worth it to hire a good CPA. You'll avoid a lot of unnecessary headaches and a tax professional's knowledge of the tax code can help you save money.
It's okay to use tax software programs when filing your taxes. Today's options are quite helpful and they are programmed to give sound advice in certain areas, but robotic responses don't generally allow for much give and take discussion. And the IRS offers quite a bit of sound information if you can work your way through the verbiage. 
And check your work. And then check it again. Make sure it's complete and that you've signed and dated it. If you make a mistake, it could trigger an audit, something that is about as much fun as a root canal. 
If you can't file your taxes on time, don't forget to file an extension. And make sure you send them some money, if you'll have to pay additional taxes. If you don't pay at least 90% of what you'll owe, they can hit you with some very steep penalties.

If you have questions, call Neikirk, Mahoney & Smith at 502-896-2999.

Monday, June 17, 2013

FASB, AICPA Partner to Simplify Accounting for Small Businesses

The American Institute of Certified Public Accountants and the Financial Accounting Standards Board, trade groups that manage and supervise standards used in the accounting profession, has announced that it is has created a “framework” that would simplify accounting for such companies. It would differ from the “generally accepted accounting principles,” or GAAP, that public companies must follow in a number of ways, large and small.

The goal is to make accounting-related life for small businesses (companies that are not publicly traded) easier to manage. Click here to read more

Congress Looking at Closing Some Loopholes

Congress has begun the process of reviewing current corporate tax reforms. With the highest statutory tax rates in the world, the pressure is beginning to mount internally as other world economies are trending up while the US economy shows signs of lagging.

The House Ways and Means Committee held a hearing Thursday to examine corporate tax reform and the impact of offshore tax havens on base erosion and profit shifting by multinationals.

House Ways and Means Chairman Dave Camp, R-Mich., noted that the U.S. "has the highest statutory tax rate in the industrial world of up to 35 percent," according to an article in Accounting Today.

Camp said that advisors have "offered a universal observation—having the highest corporate rate in the developed world along with an outdated international tax system is a barrier to success that leaves our country falling further behind our foreign competitors.” 

Click here to read the full article

Fasten Your Seatbelt - Gas Going Up Again

Gas prices are going up again in the Commonwealth and this time you can't blame the dealers, their wholesale suppliers or the Arabs.

This latest price increase comes courtesy of our state government in Frankfort and although July's scheduled 2.4 cent increase doesn't sound like much, when you consider that the total take on every gallon of gasoline that the state pockets is now 32.3 cents a gallon or approximately 8.5% of the cost of every gallon you pump.

When combined with Uncle Sam's take, 18.4 cents per gallon, local taxes that can vary and a smidgeon of a percentage that goes to a fund that cleans up gasoline tank seepage, Kentuckians pay more than 50 cents a gallon, or approximately 14%, in taxes.

Gasoline taxes are the result of a slew of state and federal tax laws intended to raise funds to keep highways maintained. In Kentucky, the increase is automatic and tied to the average wholesale price of gas. That law has resulted in periodic small increases in our gas tax rate that have aggregated into a rather significant chunk..

The rate has nearly doubled in the past ten years, from 16.4 cents to the new 32.2 cents.

The tax was tied to the wholesale price because of concern that soaring gas prices would cause motorists to buy less gas, causing revenues for road work to plunge while the cost increased.

Wednesday, June 12, 2013

IRS Still Producing Videos

According to Accounting Today's Michael Cohn, the Internal Revenue Service is still making movies at taxpayers' expense.
Their latest release is a  "Mad Men”-themed continuing professional education video last year featuring an actor patterned after the Don Draper character in the popular AMC cable TV series.
The video has not yet caused much of an uproar like the “Star Trek” and “Gilligan’s Island” parody videos or the “Cupid Shuffle” music dance video that were shown to embarrassed IRS officials and ex-officials in a congressional hearing last week about excessive spending at IRS conferences (see IRS’s Mr. Spock Impersonator Apologizes for Inappropriate Parody and IRS Music Dance Video Released by Congress).
The IRS' acting commissioner, Danny Werfel, has promised to treat taxpayer dollars with a little more respect in the future.

Tuesday, June 11, 2013

Writing Off Vacation Expenses

In a year where industry experts are predicting a 14% decrease in the average American family's vacation expenditures, it's understandable that the subject of writing off vacation expenses would be top of mind this time of year.
People do it all the time but it also involves swimming in some pretty murky waters, but that doesn't mean you shouldn't do it.
Money Talks News founder Stacy Johnson warns that the rules for travel-related tax deductions are complicated. If you want to avoid a trip to Audit City, check these tips along with your baggage:
  1. Getting there. If the trip is primarily for business and within the U.S., the cost of your transportation is fully deductible both ways. If it’s international, the trip has to be at least 75 percent business in order to write off your plane ticket. (Less than that and you can only deduct the percentage related to business.)
  2. Cruises have special rules. To be deductible, a business-related cruise has to be aboard a ship registered in the U.S. and avoiding foreign ports. Click here to read the complete free article.

Ways to Save Money on Your Taxes

If you are still in shock from having to write another big check to the Internal Revenue Service, you might want to bookmark this website because we're going to be sharing some tips as to ways you can save money on your taxes.

Some of the tips we share you may have already figured out, but some are hot off the press - as long as there is a Congress, the tax codes are subject to change. 

To stay on top of these changes, you can review countless articles, keep your CPA on speed dial or follow Neikirk, Mahoney & Smith online or by giving us a call.

Friday, May 31, 2013

This N That from the Tax World

May 31, 2013

IRS Making System Improvements for e-Filers

Changes the Internal Revenue Services have been making to their e-File computer system will result in a more reliable system and reduce delays in the processing of your tax returns, IRS officials said in a recent report.

The report noted that during the 2013 tax season, IRS officials had to reboot the system on at least two occasions to correct system performance problems. They spent a ton of our money to conduct a system evaluation to define the work that needed to be done.

Our fingers remain tightly crossed/:-)

Tea Party Groups File Suit Against IRS

Tea Party groups have banded together to file suit against the Internal Revenue Service and top administration officials in the wake of allegations that the IRS delayed applications for tax-exempt status from Tea Party groups by subjecting them to additional security.

The Obama administration has come under fire amid accusations that it played an inappropriate role in the IRS's actions against the Tea Party and its conservative base.

The lawsuit was filed by the American Center for Law and Justice on behalf of 25 Tea Party groups and it urges that the court to fine that the Obama Administration violated the First and Fifth Amendments to the US Constitution, the Administrative Procedure Act as well as the IRS's own regulations.

According to Accounting Today's Michael Cohn, the suit requests a declaratory judgement that the agency and some of its officials unlawfully delayed and obstructed the organizations' applications by means of conduct that was based upon unconstitutional criteria and seeks injunctive relief to protect its clients, officers and directors from further IRS abuse or retaliation.

The lawsuit seeks compensatory and punitive monetary damages the amount of which will be determined at trial.

General Fund Revenue Still Down in KY

The US economy seems to be on the upswing but revenue from key tax sources in the Bluegrass State saw substantial declines in April, according to a State Budget Director Jane Driskell.

Driskell released a monthly revenue report showing that corporate income tax revenue fell by nearly 90 percent in April compared to April 2012 levels says the Associated Press' Roger Alford.

The report showed property tax collections down by 53.5 percent. Cigarette tax revenue was down 22.2 percent. And collections from the all-important sales tax were off 7.3 percent.

The two bright spots in the monthly report were a 5.5 percent increase in income tax revenue and an 18.6 percent rise in coal severance tax collections.

Road Fund collections reached $143.1 million in April, an 18.3 percent over the April 2012 level.