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One of the highest priorities at the IRS is to protect taxpayer and tax preparer data as well as its systems. Starting in October, the IRS will strengthen the protection for e-services. As part of that effort, all users must re-register and validate their identities, most using the Secure Access authentication process. Learn more about this new process at Important Update for Your e-Services Account . What is planned? In late October – target date October 24 – the IRS will strengthen the protections for e-services accounts by requiring a stronger identity verification process for existing and new e-services users. Existing e-services users...
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IRS Definition of a Farm IRC Section 2032A(e)(4): The term “farm” includes stock, dairy, poultry, fruit, furbearing animal, and truck farms, plantations, ranches, nurseries, ranges, greenhouses or other similar structures used primarily for the raising of agricultural or horticultural commodities, and orchards and woodlands. Special Tax Treatments for Farms Special Estimated Tax payment modif: If more than 2/3 of gross income comes from farming, farmers can make 1 estimated Payment or pay in full rather than 4 quarterly estimated payments. No capitalizing of current year Fertilizer & Lime. Safe harbor for bus use of...
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This post provides a brief overview of computing the effective tax rate and how certain business deductions/credits can significantly reduce the Effective Tax Rate to maximize business tax incentives. For a complete overview, tune in to the NSA Webinar Tomorrow. How to Compute the Effective Tax Rate: The Effective Tax Rate (ETR) demonstrates how a corporation’s actual tax rate relates to a “hypothetical tax rate” which is the tax the company would pay if there were no permanent differences. A multinational corporation reduces its effective tax rate when a portion of its world-wide income is taxed in non-US tax jurisdictions....
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Those passing the exam and earning the ATP and ABA credentials will be exempt from the AFTR course and exam. Registration is now open for the Accreditation Council for Accountancy and Taxation ® (ACAT) Fall 2016 exams for accountants, tax preparers and students seeking to earn credentials: Accredited Business Accountant/Advisor (ABA) Accredited Tax Advisor (ATA) Accredited Tax Preparer (ATP) Achieving ACAT accreditation provides a distinction that sets accounting and tax professionals apart and open doors for practice development and career advancement. Earning ACAT credentials provides evidence to clients that accounting...
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Qualified small employers who want to apply a new research tax credit against Federal Insurance Contributions Act liabilities are to report the credit amounts on the 2016 Form 6765 in Section D, according to Judy Davis, a senior IRS tax analyst. Davis said that the draft of 2016 Form 6765 , Credit for Increasing Research Activities, includes a new Section D to report the tax credit. Section D is used to elect the entire research credit that employers want to use as a payroll tax credit for the employer's share of FICA and employers should enter the amounts on line 42 or 44 in Section D, she said. Employers should take amounts from Form 6765...
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The following officers were installed to the NSA Executive Committee for 2016-2017: President: Alfred Giovetti First Vice President: Brian L. Thompson Second Vice President: Christine Freeland District Governors elected to new terms in several districts included : District II: Robert Genovese , ATA, ATP, Howard Beach, NY District IV: Dave Rancourt , EA, ATA, ABA, ARA, Sarasota, FL District VI: Debra J. Cope , CPA, ATA, ATP, Chattanooga, TN District VIII: Marchelle Foshee , CPA, Morrilton, AR District X: Ruth Godfrey , EA, Upland, CA State Directors elected include: ...
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Leaders of the National Society of Accountants (NSA) have sent a letter to leaders of the U.S. House of Representatives opposing any resolution to impeach or censure Internal Revenue Service (IRS) Commissioner John Koskinen. The letter was co-authored by NSA President Al Giovetti, CPA, ABA, ATA, ARA, and NSA Executive Vice President John Ams. It was sent to House Speaker Paul Ryan, House Democratic Leader Nancy Pelosi, Ways and Means Committee Chairman Kevin Brady, and Ways and Means Committee Ranking Member Sander Levin. “We are concerned that the effort to censure or impeach Commissioner Koskinen will hasten the deterioration of the voluntary...
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John Ams, Executive Vice President of the National Society of Accountants (NSA), was appointed to the Electronic Tax Administration Advisory Committee (ETAAC) of the Internal Revenue Service (IRS). The ETAAC provides an organized public forum for discussion of electronic tax administration issues to promote paperless filing of tax returns, which ETAAC believes should be the preferred and most convenient method of filing tax and information returns. ETAAC members convey the public’s perception of the IRS electronic tax administration activities, offer constructive observations about current or proposed policies, programs, and procedures, and suggest improvements....
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The Internal Revenue Service is warning tax professionals of a new wave of attacks that allow identity thieves to file fraudulent tax returns by remotely taking over practitioners’ computers. As part of the Security Summit effort, the IRS urged tax professionals to review their tax preparation software settings and immediately enact all security measures, especially those settings that require usernames and passwords to access the products. The IRS is aware of approximately two dozen cases where tax professionals have been victimized in recent days. The IRS, state tax agencies and the tax industry – working as partners in the Security Summit –...
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As part of the ongoing Security Summit efforts, the IRS today released a new YouTube video urging tax professionals to take the necessary steps toward guarding their data and protecting clients from identity theft. The video featuring IRS Commissioner John Koskinen warns tax professionals that cybercriminals increasingly are targeting their offices and their data. The video spotlights the "Protect Your Clients; Protect Yourself" campaign recently launched by the Security Summit. The campaign seeks to raise awareness about cybercriminal activity and provide tax professionals the information needed to improve safeguards. A series of fact sheets and tips...
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The IRS has launched a web page providing informal guidance for individuals and groups using technology to generate income through vacation rentals and ridesharing services. The web page, dubbed the Sharing Economy Resource Center, provides tips to help people meet their tax reporting obligations, the Internal Revenue Service said in an August 22 news release. "This rapidly evolving area often presents new challenges for people engaged in these economic activities, whether they are renting a room or providing a ride," IRS Commissioner John Koskinen said. "The IRS is working to help people in this area by providing them the information and resources...
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The IRS yesterday issued a news release alerting tax professionals to a new tax scam involving fake emails purporting to be from tax software providers. The IRS said that in the new scheme, which was identified as part of the IRS Security Summit process, tax professionals are receiving emails pretending to be from a tax software companies. The email scheme requests the recipient to download and install an important “software update” via a link included in the e-mail. Once a recipient clicks on the embedded link, they are directed to a website prompting them to download a file appearing to be an update of their software package. The file has a naming...
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NSA Executive Officers meeting with IRS Commissioner Koskinen August 10 discussion will focus on improving services, reducing audit requests during tax season and increasing IRS budget appropriations. Top leaders of the National Society of Accountants (NSA) will meet with Internal Revenue Service (IRS) Commissioner John Koskinen on August 10 to discuss a range topics relating to the services the IRS provides to tax preparers. NSA President Kathy Hettick, EA, ABA, ATP; NSA First Vice President Al Giovetti, CPA, ABA, ATA, ARA; NSA Second Vice President Brian L. Thompson, CPA; NSA Secretary-Treasurer Curtis Banks Lee, Jr., ATA, ATP, and NSA Executive...
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The Internal Revenue Service today announced important changes to help taxpayers comply with revisions to the Individual Taxpayer Identification Number (ITIN) program made under a new law, which implements provisions of the December 2015 PATH Act. The changes require some taxpayers to renew their ITINs beginning in October. The new law will mean ITINs that have not been used on a federal tax return at least once in the last three years will no longer be valid for use on a tax return unless renewed by the taxpayer. In addition, ITINs issued prior to 2013 that have been used on a federal tax return in the last three years will need to be renewed starting...
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A federal court on August 3 again dismissed the American Institute of CPAs' lawsuit to stop the implementation of the Internal Revenue Service's voluntary registration program. NSA members may recall that the U.S. District Court for the District of Columbia previously dismissed the AICPA's lawsuit on the basis that, as a professional society, it was not injured by the IRS program and therefore did not have standing to file suit. The U.S. Court of Appeals for the District of Columbia Circuit reversed, finding that the organization could argue that its members were injured parties because they could lose business to the voluntarily registered preparers....
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A total of 32 students have earned scholarships from the National Society of Accountants (NSA) Scholarship Foundation. Together, they will receive $35,300 in scholarship awards. The Foundation has provided more than $1 million since 1969 to deserving undergraduate and graduate students who are committed to pursuing a career in accounting, helping to develop more qualified young accountants. The scholarships range from $500 - $2,050. Recipients were selected on the basis of an overall outstanding academic record, demonstrated leadership and participation in school and community activities, honors, work experience, stated goals and aspirations, and financial...
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When Brian L. Thompson, CPA, a partner with Bailey & Thompson Tax & Accounting, P.A., in Arkansas, was forced by the Internal Revenue Service (IRS) to conduct a tax return audit for a client with an IRS representative on April 15, 2015, he was surprised and disappointed that this awkward timing could not be adjusted to a date other than the IRS tax filing deadline. So imagine his shock when a similar situation happened again this year. Tax returns for two individual clients and their three related business were audited, this time in January. The IRS auditor finished the field work in February, and audit reports were due by mid-March. But...
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Over the past few months, lawmakers have continued to press for the Small Business Health Care Relief Act (HR 5447) to move forward. The bipartisan initiative is meant to help restore the traditional use of Health Reimbursement Arrangements (HRAs) by small business employers to help defray the costs of health insurance premium costs and healthcare expenses without the threat of penalty. On June 15, 2016, the House Ways and Means Committee held a markup of the bill, which passed by voice vote. The bill heads to the House floor, where it is expected to face little opposition in passage. If the bill is not implemented by July 1, 2016, small business employers...
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The IRS normally sends correspondence in the mail. We mail millions of letters to taxpayers every year. Keep these important points in mind if you get a letter or notice: Don’t Ignore It. You can respond to most IRS notices quickly and easily. Follow Instructions. Read the notice carefully. It will tell you if you need to take any action. Be sure to follow the instructions. The letter will also have contact information if you have questions. Focus on the Issue. IRS notices usually deal with a specific issue about your tax return or tax account. Your notice or letter will explain the reason for the contact and give you instructions...
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The IRS Security Summit, consisting of the IRS, state tax agencies and the private-sector tax industry, has released a warning to tax preparers that they increasingly are targets of cybercriminals and should take appropriate steps to protect clients from data theft. IRS also posted Fact Sheet 2016-23 to help tax professionals get started with safeguards to protect clients’ data. It’s the first in a series of fact sheets and tips on security, scams and identity theft prevention measures aimed at tax professionals. The “Protect Your Clients; Protect Yourself” campaign is intended to raise awareness among tax professionals on their responsibilities and the...
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