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Taxes
Audit RatesAccounting Today recently published an article, “Ten Major Trends in IRS Audits,” examining how IRS audit rates have changed over the past several years. This article provides useful information for taxpayers, especially those who own a business.

Your business is less likely to be audited if it is a partnership or an S Corporation. According to the article, “The IRS continues to struggle to audit S corp and partnership returns. This situation is likely to get worse as the more experienced IRS business auditors continue to retire. Audit rates for S corps and partnerships are both 0.22 percent – or, put another way, one in every 455 passthrough entities were examined in 2018. It is no wonder that the number of S corporations have increased by 38 percent from 2005 to 2018 (3.5 million in 2005 versus 4.85 million in 2018).” This is an important factor to consider when thinking about making an “S election” for your business.

In addition, audit rates have dropped overall in the last decade. “Most taxpayers envision Internal Revenue Service audits as intrusive investigations resulting in criminal sentences. Today, nothing could be farther than the truth. The IRS’s auditing power has been greatly diminished in the past decade. IRS audit resources have been reduced by 28 percent in the last decade and the audit rate has dropped from 0.9 percent in 2010 to o.5 percent in 2018. In fact, the number of IRS audits in 2018 (991,168) dropped by almost half compared to 2010 (1.735 million).”

Nevertheless, there are situations where the IRS consistently audits companies or individuals. According to the article, audits are especially popular among the wealthy. “In 2011, one out of every eight taxpayers who earned more than $1 million in income were audited. In 2018, the number dropped to one in every 31 taxpayers. However, those who earn more than $1 million are still among the most popular audit profiles.”



Article References
Accounting Today, “Ten major trends in IRS audits.” By Jim Buttonow. Click here to read the original article.



Massey and Company is a boutique, Atlanta-based CPA  firm serving the needs of small businesses and their owners. We handle tax matters, IRS controversy, tax debts, back taxes, bookkeeping, and accounting. Our offices are in the Buckhead neighborhood of Atlanta and we welcome face-to-face visits.

Gary Massey, CPA

Massey and Company CPA

3550 Lenox Road NE, Suite 2100 

Atlanta, GA 30326

Massey and Company 

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Taxes
The IRS urges taxpayers to act now to avoid “tax-time surprises” and ensure smooth processing of their 2019 federal tax return. It is never too early to start preparing, so we have arranged four tips that will help you file taxes on time.

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1. Adjust Withholding; Make Estimated or Additional Tax Payments


The IRS has a tool called the “Tax Withholding Estimator” that enables individuals to perform a paycheck or pension checkup.  This tool is important for individuals who received a smaller refund than expected or owed an unexpected tax bill last year.

If the Tax Withholding Estimator recommends a change, the employee or recipient of a pension or annuity income can make adjustments. An employee can submit a new Form W-4 to their employer. A recipient of a pension or annuity income can complete Form W-4P and submit it to their payer. Note that these forms should NOT be sent from the employee or recipient directly to the IRS.

The calcuation of quarterly tax payments is especially important for independent contractors and business owners.  Massey and Company will calculate your quarterly taxes upon request, using sophisticated tax projection software.



2. Gather Documents and Organize Tax Records


Massey and Company, along with the IRS, strongly suggests that all taxpayers should develop a recordkeeping system. This can be electronic or paper, but it serves to keep all the important information in one place.   We strongly recommend the use of QuickBooks Online for all our business clients.  The IRS says that taxpayers should keep copies of filed tax returns and all supporting documents for at least three years. 

To avoid refund delays, be sure to gather all year-end income documents before filing a 2019 return. Filing too early, before receiving a key document, often means a taxpayer must file an amended return to report additional income or claim a refund. And it can take up to 16 weeks to get an amended return refund.
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Remember to also notify the IRS of address changes and notify the Social Security Administration of a legal name change to avoid refund delays. 


3. Renew Expiring Tax ID Numbers


An ITIN (Individual Taxpayer Identification Number) is a tax ID number used by any taxpayer who doesn’t qualify to get a Social Security number. Taxpayers with expiring Individual Taxpayer Identification Numbers can get their ITINs renewed more quickly and avoid refund delays next year by submitting their renewal application soon.

Taxpayers who fail to renew an ITIN before filing a tax return next year could face a delayed refund and may be ineligible for certain tax credits. With nearly 2 million taxpayer households impacted, applying now will help avoid the rush as well as refund and processing delays in 2020.


4. Be prepared to File Electronically; Use Direct Deposit for Refunds


Electronic filing is the easiest, safest and most accurate way to file taxes. When you combine Direct Deposit with electronic filing, you get the fastest, easiest way to get your refund.  With Direct Deposit, a refund goes directly into the taxpayer’s bank account. No need to worry about a lost, stolen or undeliverable refund check.

Direct Deposit is easy to use. Taxpayers select it as their refund method through tax software or let their tax preparer know they want direct deposit. Taxpayers can even choose Direct Deposit on a paper return. Direct Deposit also saves taxpayer dollars which makes it a win-win solution for everyone.

Massey and Company offers electronic filing and direct deposit to all its clients.

Something to Keep in Mind

The IRS cautions all taxpayers not to rely on receiving a refund by a certain date, especially when making major purchases or paying bills. Some returns may require additional review and may take longer.

The tax and accounting services provided by Massey and Company can help to guide you in getting a jump-start on your taxes. For more information, contact us today by calling 678-235-5460, or send an email to gary.massey@masseyandcompanyCPA.com. You also have the option to contact us through our website.





Massey and Company is a boutique, Atlanta-based CPA  firm serving the needs of small businesses and their owners. We handle tax matters, IRS controversy, tax debts, back taxes, bookkeeping, and accounting. Our offices are in the Buckhead neighborhood of Atlanta and we welcome face-to-face visits.

Gary Massey, CPA

Massey and Company CPA

3550 Lenox Road NE, Suite 2100 

Atlanta, GA 30326

Massey and Company 

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Instruction, Taxes
What is IRS Notice CP2000?


We have noticed a significant increase as of late in the number of Atlanta taxpayers receiving IRS Notice CP2000 in the mail. This notice provides detailed information about issues that the IRS identified in their computerized review of a tax return.   The IRS sends this notice when information from a third party source (such as a 1099 or W-2) does not match the information the taxpayer reported on their tax return.

The notice also provides steps that taxpayers can and should take in order to resolve those issues. Here are 6 things that will help you better understand the importance of receiving an IRS Notice CP2000 and what you should do. 

What You Need to Know

1. As we have already touched on, the IRS sends a notice to the taxpayer when a tax return’s information does not match the data reported to the IRS by third parties, such as banks, vendors or employers.

2. This notice is not a formal audit notification. It is simply a notice to see if the taxpayer agrees or disagrees with the proposed changes.
 

3. Taxpayers should always respond to the notice CP2000. Usually, the taxpayer has 30-days from the date printed on the notice to respond. 

4. The IRS provides a phone number on each notice that they send out. IRS telephone assistors can explain the notice and what taxpayers need to do to resolve any issues. 

5. The IRS will send a follow up notice to taxpayers who do not respond to Notice CP2000, or if the IRS does not accept the additional information provided.   This second notice is called a Statutory Notice of Deficiency. 

6. The Statutory Notice of Deficiency provides detailed information about why the IRS proposes a tax change and how the IRS determined the change. The notice tells the taxpayers about their right to challenge the decision in Tax Court if they choose to do so. It is critical to respond to this notice within the required time period, in order to preserve legal rights.

Massey and Company CPA represents taxpayers who receive IRS Notices.  To learn more, give us a call at 678-235-5460, or email us at gary.massey@masseyandcompanycpa.com. You can also contact us through our website by visiting the home page.



Massey and Company is a boutique, Atlanta-based CPA  firm serving the needs of small businesses and their owners. We handle tax matters, IRS controversy, tax debts, back taxes, bookkeeping, and accounting. Our offices are in the Buckhead neighborhood of Atlanta and we welcome face-to-face visits.

Gary Massey, CPA

Massey and Company CPA

3550 Lenox Road NE, Suite 2100, 

Atlanta, GA 30326

Massey and Company 

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Accounting, Taxes
The Internal Revenue Service is automatically waiving estimated tax penalties for more than 400,000 eligible taxpayers who already filed their 2018 taxes but did NOT claim the waiver. The IRS will apply this waiver to tax accounts of all eligible taxpayers. There is no need to contact the IRS to apply for or request the waiver. 



Earlier this year, the IRS lowered the usual 90% penalty threshold to 80%. This was done to help taxpayers whose withholding and estimated tax payments fell short of their total 2018 tax liability. The agency also removed the requirement that estimated tax payments be made in four equal installments, as long as they were made by Jan 15, 2019.

The automatic waiver applies to any individual taxpayer who paid at least 80% of their total tax liability through federal income tax withholding or quarterly estimated payments, but did not not claim the special waiver available to them when they filed their 2018 return earlier this year. 

In an Effort to Help Taxpayers

According to IRS Commissioner Chuck Rettig,  “the IRS is taking this step to help affected taxpayers.” In addition, he states, “This waiver is designed to provide relief to any person who filed too early to take advantage of the waiver or was unaware of it when they filed.”

The IRS will mail copies of notice CP 21 granting this relief to the affected taxpayers. Any eligible taxpayer who has already paid the penalty will also receive a refund check about three weeks after their CP 21 notice regardless of whether or not they requested penalty relief.

What You Need To Do

For those yet to file their 2018 tax return, the IRS urges every eligible taxpayer to claim the waiver on their return. This includes those with tax-filing extensions due to run out on October 15th, 2019. 

The waiver most likely applies to anyone with unexpected tax bill or penalty on their tax return this year. It also likely applies to those who made withholding adjustments in 2018 or had a major life change. Those that are high at risk for having too little tax withheld include those who itemized in the past but now take the increased standard deduction, as well as two wage-earner households, employees with non-wage sources of income and those with complex tax situations.

To discuss, give us a call at 678-235-5460, or send an email to Gary.Massey@MasseyandComapnyCPA.com. You can also contact us directly through our website by visiting our Home Page





Massey and Company is a boutique, Atlanta-based CPA  firm serving the needs of small businesses and their owners. We handle tax matters, IRS controversy, tax debts, back taxes, bookkeeping, and accounting. Our offices are in the Buckhead neighborhood of Atlanta and we welcome face-to-face visits.

Gary Massey, CPA
Massey and Company CPA
3550 Lenox Road NE, Suite 2100, 
Atlanta, GA 30326
Massey and Company 

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Do you have upcoming travel plans? If you are owe significant tax debt, you could be in for a surprise. Your passport can be revoked on account of the debt you owe. If you have significant tax debt, you should contact the IRS or your tax professional as soon as possible to avoid the revocation of your passport. 



How Much Debt is Too Much?

The IRS will notify the State Department of all taxpayers who owe a seriously delinquent tax debt, which is currently $52,000 or more.  The State Department may deny passport applications or renewals from those individuals. If the individual has a valid passport, the State Department has the power to revoke their passport or restrict their ability to travel internationally.

If You Owe Debt, Don’t Wait!

When a passport is revoked, the taxpayer or their representative will have to petition the IRS for the action to be reversed.  Expedited processing of these petitions reduces the normal 30-day processing time by 14-21 days.   However, taxpayers seeking expedited action will need to be able to demonstrate to IRS that they have travel scheduled within a 45-day time-frame, or that they live abroad. 

Taxpayers or their representatives must call the IRS within 30 days after receiving notification that their passport will be denied or revoked.  The matter can often be corrected if the taxpayer is able to show a good-faith attempt to resolve their tax debt.   For example, this can be done by means of an Offer in Compromise or an Installment Agreement.


Working with the IRS on passport matters can be intimidating. Our firm regularly represents taxpayers with significant tax debts, including those faced with the revocation of their passport. For a free consultation, contact Gary Massey, CPA by calling 678-235-5460, or email us at gary.massey@masseyandcompanyCPA.com.



Massey and Company is a boutique, Atlanta-based CPA  firm serving the needs of small businesses and their owners. We handle tax matters, IRS controversy, tax debts, back taxes, bookkeeping, and accounting. Our offices are in the Buckhead neighborhood of Atlanta and we welcome face-to-face visits.

Gary Massey, CPA
Massey and Company CPA
3550 Lenox Road NE, Suite 2100
Atlanta, GA 30326
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If you are a business owner, you know how important it is to track your expenses. You are probably also aware that keeping track of your money is becoming more and more difficult in our fast-paced digital world. 

When it comes time to filing taxes, you need to be prepared with an organized expense record for your business. This has been a difficult task in the past. However, with QuickBooks’ new online receipt capture feature, this task has changed. Now, keeping a current record of your expenses has never been easier!





“Audit-Proof” Your Business with the Snap of a Picture

QuickBooks Online has always given you the option to sync your bookkeeping records to your bank accounts, credit card accounts, Paypal and Square.  What’s new is that you can now take pictures of your receipts on your smart phone, using the QuickBooks app.  The pictures are attached to your transaction inside QuickBooks and saved forever.  No more paper.  And your books are now audit-proof, in case the IRS ever comes knocking.

And with the ease of the QuickBooks App, you can audit-proof your business from virtually anywhere! 


The Best Part – No Extra Fees!


The best part of this new feature is that it comes with no extra cost for users of QuickBooks Online.

This feature could change the way you run your business, and make your life easier.  Think about what it will be like to eliminate years of paper receipts with the click of a button!  Plus, imagine going to sleep at night without worries of the IRS challenging your expenses in an audit.

We can show you how Receipt Capture works.  Feel free to give us a call at 678-235-5460, or shoot me an email at Gary.Massey@MasseyandCompanyCPA.com.  You can also contact us via our website.






Massey and Company is a boutique, Atlanta-based CPA  firm serving the needs of small businesses and their owners. We handle tax matters, IRS controversy, tax debts, back taxes, bookkeeping, and accounting. Our offices are in the Buckhead neighborhood of Atlanta and we welcome face-to-face visits
Gary Massey, CPA
Massey and Company CPA
3550 Lenox Road NE, Suite 2100, 
Atlanta, GA 30326
Massey and Company

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Taxes
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Taxes
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