Finding Tax Loopholes, the Blog

The Pro Advisor?

The Pro Advisor?
Back in 1999, Quickbooks was all the rage. Like I mentioned last week, QuickBooks holds more than 80% of the bookkeeping software market for small to mid-sized businesses. There was a time when I used this, and followed along with my peers as I was just getting going and became a QuickBooks Pro Advisor. I learned much. Over the years, I have developed reservations about some of the “advisors” and QuickBooks itself. I am no longer a part of the QuickBooks family, mostly because of the IRS. More...

Bookkeeping service –

Bookkeeping service –
Most business owners understand that they must wear many hats and have to be involved in areas of their business that they do not excel in. Of the many things you shouldn’t do, you shouldn’t do your own bookkeeping unless you’re a skilled bookkeeper. A bookkeeper is responsible for processing the paperwork for a company’s business transactions. Ultimately the transactions will be recorded in accounts within the company’s general ledger. Bookkeepers are expected to be accurate,...

Why your business needs Bookkeeping?

Why your business needs Bookkeeping?
According to the US Small Business Administration: half of all new small businesses fail within the first five years, and the number one cause of failure is financial mismanagement. Tough to hear, however, you need to be aware of the critical role bookkeeping plays in successful businesses. When you own a small business, it is imperative that you keep a good set of consistently updated books. The IRS will not be satisfied with records that were thrown together at the end of a year. It’s...

Why save records?

Why save records?
Now what follows pertains to tax returns but in my opinion should be used towards all records that are of importance. Once you file your tax return is there any reason to save the records? Most will answer this incorrectly. You do need to save them. How long is somewhat dependent, allow me to explain. Mainly you want to save these records so you can substantiate the information on your tax return, if you need to. Just because a year has passed, doesn’t mean you are in the clear. The IRS is...

No sure way to avoid an audit

No sure way to avoid an audit
          Well, here we go again, these days everyone is talking about audits. I normally try not to join into what everyone is doing but, Some things need to be Pointed out.           First and foremost, there is no sure fire formula or guide that dictates by “doing this you’ll avoid an audit.” At best you can do is lower the possibility and having the records to substantiate your return. Meaning, have the records to back up the numbers.           The IRS conducts random audits to serve as...

How to track Car expenses. . .

How to track Car expenses. . .
Even when taking actual car expenses, gas, oil changes…. Mileage should be tracked on a daily basis – the same way you record in your calendar where you went, who you went to see and why, you also need to keep the miles.  Ask Yourself On your tax return when you claim a deduction for auto expense there are two questions that being able to check “yes” to, is of major importance for a well prepared return: Do you have evidence to support business use? Is the evidence written? In all...

Red Flags to help you get Audited

Red Flags to help you get Audited
The IRS states in Publication 556 that it uses a computer program called the Discriminant Inventory Function System (DIF) IRS assigns a numeric value to each tax return known as a DIF score. Returns with a DIF score higher than a pre-specified number are flagged and sent to IRS regional examiners for further review and analysis. The IRS examiners are trained to look for tax return items that indicate a high probability of error or fraud. These items are known in the industry as “red flags.”...

Get the most from Itemizing

Get the most from Itemizing
Itemizing is an incredibly easy theory to understand, yet the strategies behind it all can be intricate and countless. The rule for when to itemize is simple You’ll do it if the total of your itemized deductions is greater than your standard deduction. First of all, your tax is based on your “taxable income.” That’s your total income after you’ve subtracted above-the-line deductions like your Individual Retirement Account (IRA) or other qualified retirement-plan...

Retired

Retired
Now is the time when you really have to be careful about market slumps. Because the combination of investment losses and pulling money out for living expenses can depress the value of your portfolio. So much so that it may not be able to recover sufficiently even when the market rebounds. There are two ways to protect yourself against the risk of going through your money too soon. One is to scale back your stock holdings enough to allow for modest growth. This can limit the damage from a...

Retirement, late in your career

Retirement, late in your career
You’re hitting the home stretch With about 10 or 15 years to go until retirement, the kids are leaving and you’re at/near your peak earnings. This is an excellent time to rev up your savings effort – including making catch-up contributions to your 401(k) and IRA/s. Yup, Catch-up contribution option to retirement plans enable savers age 50 and over to increase contributions when retirement draws near. Age-50 catch-up contributions are possible in 401k, 403(b) and 457 plans,...