Pennsylvanians are rightfully concerned about the impact of the 2018 TCJA (Tax Cut and Jobs Act) “tax reform” legislation on the filing of 2018 individual tax returns. Tax filing season begins in approximately 90 days, and Brennan and Company CPA, PC is well prepared. Read more »
Any business owner or company manager knows just how hard running a successful business can be. There are customers to satisfy, employees to manage, buildings to upkeep, and of course products and services to sell. With so many different facets involved in this complex business world, relief from just one responsibility is a tremendous help. Our company specializes in taking these business responsibilities off of your hands. This blog can show you the benefits of payroll services from Brennan and Co.
Payroll is a huge deal for any company. If your employees’ checks don’t go out in time, there will be a lot of extremely unhappy campers. That’s why it’s important to ensure your company’s payroll is handled promptly and correctly—and Brennan & Co can do just that, for any business.
Benefits of payroll services:
- Guarantee payroll is done on time and correctly, every time
- Outsourcing payroll services keeps you from having to employ your own payroll service staff, saving you tons of valuable time and money
- Ensure all local and state taxes are accurately captured
Brennan and Company CPA, PC received another, unsolicitied honor when they were named to the website: www.threebestrated.com’s list of Philadelphia’s BEST ACCOUNTANTS. It is an honor to receive another nomination for Best Accountant in Philadelphia. Please use this link to read the article:
Best Accounting CPA Firm Philadelphia
We Looked at 319 Accountants in Philadelphia and Picked the Top 20
Why These Accountants?
Our goal is to connect people with the best local experts. Expertise.com scored accountants on more than 25 variables across five categories, and analyzed the results to give you a hand-picked list of the best accountants in Philadelphia, PA.
Expertise.com Selection Criteria:
A history of delighted customers and outstanding service. See our testimonials.
Building customer confidence with licensing, accreditations, and awards.
Masters of their craft, based on years of practical experience and education.
Consistently approachable and responsive, so customers never feel ignored.
Providing service with honesty, reliability, and respect.
And here’s what they said about us:
Brennan & Company CPA, PC
Brennan & Company CPA, PC has been serving Philadelphia clients for more than 20 years. The accounting firm’s services include outsourced accounting, tax preparation, tax representation, payroll services, consulting, and elder care finances. Clients have praised the company for its hardworking and knowledgeable staff.
We contacted Expertise and were told they are an independent marketing research company. They are based in Seattle, Washington. We did not advertise nor answer a survey, etc. to gain the accolade. They did not disclose their rating methodology, however, the five factors shown above were those firm characteristics they felt most were most valued by clients.
Prevent Identity Theft Tax Fraud
Tax-related identity theft continues to be an ever-growing national crisis. We need to prevent identity theft tax fraud.
The Government Accountability Office (GAO) estimated that in tax year 2013, fraudulent tax refunds misdirected to identity thieves was about $5.8 billion and impacted over 2.4 million U.S. taxpayers. Unfortunately, this fraudulent activity has continued to rapidly expand since 2013. All taxpayers must be diligent in further protecting themselves from becoming identity theft victims.
As a valued client, we want to share with you some proactive steps and resources to help in your defense of tax-related identity theft. However, should you become aware that you are a victim of identity theft or that your private financial information has been compromised, please contact us immediately for additional information and assistance.
Suggestions to Protect You and Your Family from Identity Theft
Secure private personal information. Safeguard family names and birthdates, account numbers, passwords, and Social Security numbers. Carefully consider all requests to provide your Social Security number before giving it out and don’t hesitate to ask why your private information is being requested. Secure your Social Security card in a safe or safety deposit box and never in your purse or wallet. Proactively shred all documents that contain personal data before disposing of them, even solicitations and “junk” mail that may unknowingly contain account numbers and personal information.
Monitor personal information shared on social media. Cyber-criminals methodically gather data from online sources, including commonly used identifiers such as birth date, maiden name, pet name, hometown, significant other, and/or children’s information. Be cautious who you communicate with online and be selective before accepting electronic invitations from people you do not know or recognize. Separate what you post publicly from what you post with your personal contacts. Do not post personal and family data to prevent identity theft tax fraud.
Secure your computer. Use current versions of antivirus, malware protection, and firewalls and update these programs frequently. Consider having this software updated automatically, as well as using different computers for business and finances than you do for social media and personal matters. Use strong passwords, change them frequently, and do not share them with others. Review IRS Publication 4524, Security Awareness for Taxpayers, for additional tips.
Beware of impersonators. Criminals utilize sophisticated computer technology, such as dialers and automated questions, to contact thousands of targets daily. Prevent identity theft tax fraud by not providing personal information to callers you do not know. If any caller requests that you verify personal information, be extremely cautious and ask for further confirmation of their identity, such as their telephone number, website, email address, supervisor’s name, and mailing address. The IRS never initiates contact by telephone.
Beware of unsolicited emails and current phishing scams. Don’t open attachments or electronic links unless you know the sender. Internet sites should have a lock symbol to show the site is encrypted. Always beware of entering sensitive data. Forward emails received from IRS impersonators to email@example.com. The IRS never initiates contact by email, text message, or social media channels. For more guidance on phishing scams, go to irs.gov/uac/report-phishing.
Monitor your personal information. Review your bank and credit card statements often.
Consider electronic transmission of financial information. No sensitive tax or personal information should be sent via unsecured email, even information being transmitted to CPAs, bankers, and/or financial advisors. A secure portal, encrypted email, or physical mailing of sensitive information is necessary.
Order your free annual credit report. Call 1-877-322-8228 or go to www.annualcreditreport.com to request your report and/or search for creditors you do not know. Choose to use only the last four digits of your Social Security number on your report. Consider placing a credit card freeze on your account so only creditors you approve are allowed to access your file.
What to Do if You Become a Victim of Tax-Related Identity Theft
If you cannot prevent identity theft tax fraud, you may learn that your identity has been compromised by receiving a letter in the mail from the IRS. Alternatively, your CPA may contact you when your personal income tax return is electronically filed and subsequently rejected. If you receive a notice indicating identity theft, please contact us immediately to schedule a meeting to receive assistance in taking the appropriate steps with the IRS to resolve the matter.
Other ways you may discover your identity has been stolen include:
- Finding purchases on your credit card that you did not make
- Discovering withdrawals from an account that you did not make
- Seeing that your address has been changed for certain accounts, or no longer receiving your regular bills. (Cyber criminals may change your address when filing a return.)
The unfortunate reality is that personal data is already at risk everywhere, but we will work with you to reduce the likelihood of you being victimized by cyber criminals. As your CPA and trusted advisor, we understand the need to protect your privacy and take data protection very seriously. Our security and data integrity meets the highest industry standards established by the IRS and Federal Trade Commission. We have also established protocols to guard access to client files.
Please don’t hesitate to contact us at 215.951.5585 with questions or concerns or if you would like to meet with us to discuss this issue or any financial or tax needs. Check out the Contact Us Form here.
Brennan and Company CPA, PC
Sean J. Brennan CPA, MBA, President
IRS and Partners Look to Start of 2018 Tax Season- Tax Tip
IRS Tax Tip 2017-57, October 12, 2017
While taxpayers will not start filing their tax returns for a few months, there are a few things they can do to make the process easier next year. Here are two things that could affect the 2017 returns they will file in 2018.
1. Report name changes. Recently married or divorced taxpayers who change their name should notify the Social Security Administration. They should also notify the SSA if a dependent’s name changed. Taxpayers need to do this so that when the taxpayer files next year, the new name on the tax return matches A mismatch between the name shown on their tax return and the SSA records can cause problems in the processing of their tax return and may even delay their tax refund.
2. Renew Individual Taxpayer Identification Numbers. Taxpayers who use an Individual Taxpayer Identification Number should check to see if their number expired in 2016 or will expire this year. If so, and they need to file a return in 2018, they should apply now to renew their ITIN to avoid certain disallowed tax credits and processing delays next year. Taxpayers who have not used their ITIN to file a federal return at least once in the last three years will see their number expire Dec. 31, 2017. Additionally, ITINs with middle digits 70, 71, 72 or 80 will also expire at the end of the year. Only taxpayers with expiring ITINs need to take any action. To renew an ITIN, a taxpayer must complete a Form W-7 and submit required documentation. No tax return is required when submitting an application to renew.
IRS and Partners Look to Start of 2017 Tax
Season; Encourage use of IRS.gov and eFile;
Warn of Refund Delays IRS Tax Tip
Jan. 5, 2017
WASHINGTON — The Internal Revenue Service and partners from the states and tax industry today reminded taxpayers that the nation’s 2017 individual income tax filing season opens January 23.
The IRS expects more than 153 million tax returns to be filed this year and taxpayers have until Tuesday, April 18, 2017, to file their 2016 tax returns and pay any tax due.
The deadline is extended because the Emancipation Day, a holiday in Washington, D.C., will be observed on Monday, April 17 pushing the nation’s filing deadline to April 18.
“There are a number of important changes this year involving refunds and tax law changes that we
encourage people to keep in mind,” said IRS Commissioner John Koskinen. “We encourage
taxpayers to plan ahead and take a few minutes to review these changes. As we enter the filing
season, taxpayers should know that the dedicated workforce of the IRS and the nation’s tax
community stand ready to help.”
Taxpayers that are efiling can still submit returns to their software provider before Jan. 23.
They will hold the return and transmit it to the IRS when the systems open. The IRS also reminds taxpayers that they don’t have to wait until Jan. 23 to contact their tax professional.
In 2016, the IRS issued 111 million individual tax refunds and expects more than 70 percent of
taxpayers to receive a refund in 2017. Also, the IRS reminds taxpayers that a new law requires the
IRS to hold refunds claiming the Earned Income Tax Credit (EITC) and the Additional Child Tax
Credit (ACTC) until Feb. 15.
“We encourage taxpayers to file as they normally would, including returns claiming the EITC or
ACTC” Koskinen said. “The IRS and the nation’s tax community are committed to making this
another smooth filing season.”
eFile and Free File
More than four out of five returns are expected to be filed electronically, with a similar proportion of
refunds issued through direct deposit. Tax Tip: The IRS encourages taxpayers to plan ahead and take
advantage of the online resources available on IRS.gov.
Choosing efile and direct deposit for refunds remains the fastest and safest way to file an accurate
income tax return and receive a refund. The IRS anticipates issuing more than nine out of 10 refunds in less than 21 days from the time returns are received.
The IRS Free File program, available at IRS.gov, opens Friday, January 13. Commercial partners of the IRS offer free brand name software to about 100 million individuals and families with incomes of $64,000 or less. Seventy percent of the nation’s taxpayers are eligible for IRS Free File.
Protecting Taxpayers from ID Theft Related Refund Fraud
The IRS continues to work with state tax authorities and the tax industry to address tax related
identity theft and refund fraud. As part of the Security Summit, the IRS made significant inroads
against fraudulent returns in 2016.
Summit leaders detailed new and expanded safeguards for taxpayers in the upcoming
2017 tax season. The 2017 focus revolves around “trusted customer” features that will help
the authenticity of the taxpayer and the tax return before, during and after a tax return is filed. Additional protections will build on the 2016 successes that prevented fraudulent returns and
protected tax refunds.
Health Care Basics
Again this year, meeting the tax obligation of the Affordable Care Act for the vast majority of
taxpayers will simply mean checking a box to verify everyone on their return has health coverage.
For others, IRS.gov/aca features useful information, tips and interactive online tools to help
taxpayers with the premium tax credit, the individual shared responsibility requirement and other tax related provisions of the ACA.
The Affordable Care Act requires that a taxpayer and each member of their family either has
qualifying health coverage for each month of the year, qualifies for an exemption, or makes an
individual shared responsibility payment when filing their tax returns.
Assistance Filing the Tax Return
More than 90 percent of all tax returns are prepared using tax return preparation software. This
software generally includes tax law help along with reminders and prompts about tax breaks and
Tax Tip: The IRS reminds taxpayers that a trusted tax professional can also provide helpful information about the tax law. Information on tips about selecting a preparer and national tax professional groups are available on IRS.gov.
The IRS urges all taxpayers to make sure they have all their year end statements in hand before they file their return. This includes Forms W2 from employers, Forms 1099 from banks and other payers, and for those claiming the premium tax credit, Form 1095A from the Marketplace. Doing so will help avoid refund delays and the need to file an amended return later.
The IRS expects to issue more than nine out of 10 refunds in less than 21 days. However, the
Protecting Americans from Tax Hikes (PATH) Act mandates the IRS hold refunds on tax returns
claiming the EITC or the Additional Child Tax Credit (ACTC) until midFebruary.
The change helps ensure that taxpayers get the refund they are owed by giving the IRS more time to help detect and prevent tax fraud.
The IRS will begin releasing EITC and ACTC refunds starting Feb. 15, but cautions taxpayers that
these refunds likely will not start arriving in bank accounts or on debit cards until the week of Feb.
27. The IRS wants taxpayers to know it will take additional time for their refunds to be processed.
The IRS reminds taxpayers many financial institutions do not process payments on weekends or holidays, which can affect when refunds reach taxpayers. For EITC and ACTC filers, the threeday
holiday weekend involving President’s Day may affect their refund timing.
Where’s My Refund? on IRS.gov and the IRS2Go phone app will be updated with projected
deposit dates for early EITC and ACTC refund filers a few days after Feb. 15.
Taxpayers will not see a refund date on Where’s My Refund? or through their software packages until then. The IRS, tax preparers and tax software will not have additional information on refund dates, so Where’s My Refund? remains the best way to check the status of a refund.
Expired Individual Taxpayer Identification Numbers (ITIN)
The PATH Act requires that certain ITINs expire on Jan. 1, 2017. Any ITIN not used on tax returns once in the past three years and any ITIN with middle digits of either 78 or 79 must be renewed before a return can be processed.
Anyone filing a tax return with an expired ITIN could experience return processing and refund delay as well as denial of some tax benefits until the ITIN is renewed. An ITIN renewal application could take as long as 11 weeks to process during tax filing season. ITINs are used by people who have tax filing or payment obligations under U.S. law but are not eligible for a Social Security number.
Help for Taxpayers
The IRS reminds taxpayers they have a variety of options to get help filing and preparing their tax
return on IRS.gov. Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly
offer free tax help to people who qualify.
Go to irs.gov and enter “free tax prep” in the search box to find a nearby VITA or TCE site. The IRS2Go Mobile App can help find free tax preparation assistance, check your refund status.
All taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software
product for the first time may need their Adjusted Gross Income (AGI) amount from their prior year
tax return to verify their identity. Taxpayers can learn more about how to verify their identity and
electronically sign tax returns at Validating Your Electronically Filed Tax Return.
The IRS also reminds taxpayers that a trusted tax professional can provide helpful information and
advice about the ever changing tax code. Another IRS Tax Tip for choosing a return preparer and details about
national tax professional groups are available on IRS.gov.
As the year comes to an end, it’s easy to find yourself overwhelmed as you try and wrap things up and close out the books for the year. Depending on your business, you could be frantically trying to send out 1099s, receiving final payments, etc. And once all that is wrapped up, you likely are looking to get started on your tax return for the year. However, it’s important that you not jump the gun and overlook important details. One such detail is that last estimated tax payment for the year. When is it due? January 15.
This is probably the most overlooked payment for the year, as some people get mixed up as to which year that goes toward. Yes, you pay it in 2017, but the payment will go towards the previous year. Failing to make the payment can leave you short for the year, which could cause penalties—not to mention you could end up owing rather than getting a refund.
When it comes to gathering and organizing all of the different tax preparation records and information for your business tax preparation- the papers can stack up quickly. The accumulation of years of tax returns, receipts, and other important business information could take several days to sift through. People wonder if it’s even necessary to be saving tax records and documentation.
The truth is that while it’s extremely important to keep certain business and personal tax information available and readily organized, many of these documents only need to be kept for a maximum of six years.
The following documents that deal with tax preparation should be kept for at least six years:
- Tax receipts
- Business records
- Employee business expenses
- Closing papers from the sale or purchase of a home
- Investment records
- Payroll records
While the statute of limitations for record keeping in most cases is three years, it may be a good idea to be saving tax records indefinitely.
Some other documents to hold indefinitely are:
- Tax Returns
- Inheritance records
- Stock and bond basis records
- Pension Documentation
During the past year a client came to our office with a notice from the State of Pennsylvania which was requesting a copy of the clients 1983 tax return. Being a senior in high school at the time my office was not responsible for this omission but this example does highlight the need to retain tax preparation documentation – at least the tax return – indefinitely.
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The cost of financing college education continually increases. Parents and students need to understand some basic college financing options and start saving – now! It is never too early!
The Uniform Transfers to Minors Act (UTMA) and Section 529 plans are two investment vehicles that, when used properly, can assist with reducing or eliminating taxes on certain college investments. The more money received from investments – obviously, the less your college student will borrow.
Parents can shelter up to $2,100 of passive income, in the form of dividends and net capital gains, without having taxes. The income must be dividends or net capital gains to be certain of that treatment. When the income is a mix of dividends and capital gains and say, interest income, then some of the income could become taxable.
Income in the students account that exceeds the $2,100 thresh-hold may incur taxes at the parents marginal rate. This could become costly. Financing college does not need to incur these high rates.
Earnings from Section 529 plans (named after the relevant IRS code section) are not taxed currently nor are the plan distributions used to pay for higher education costs. Section 529 plan contributions are deductible in the State of Pennsylvania (and most states) but not for federal tax purposes.
Certain 529 plans are considered pre-payment plans. These plans will index and increase the 529 investment amount if the student’s selected college increases its tuition. This is an important protection against the ever increasing cost of higher education.
The more – small job, birthday, gift and special occasion money received over the years, the more years that money can grow. So maximize the time you invest for college tuition in-order to maximize the college funds available – while minimizing taxes with some basic tax strategies – a highly intelligent strategy indeed! Brennan and Co can consult with you on this matter.
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