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Cpa Tax 13

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Last Updated: 01 December 2020

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General | Latest Info

Just ahead of the first presidential debate, former Vice President Joe Biden released his own 2019 income tax returns, as per custom of recent presidential candidates. Although Biden's returns are as newsworthy as Trumps returns, they provide some interesting insights. According to reports from the New York Times, individual income tax returns filed by President Donald Trump reflect a relatively small amount of federal income tax pay, in some cases no tax at all, for the better part of the last two decades. This was a point of contention in the fractious presidential debate between Trump and Biden on September 29. Here are several key facts for Biden Tax returns: on joint 2019 return filed by Biden and his wife, Dr. Jill Biden, couple pay almost $300 000 in federal taxes on approximately $985 000 of adjusted gross income, resulting in a relatively high effective tax rate of 29. 5%. Biden has been in the national spotlight for about quarter of a century and has now released 22 years of returns for public inspection. By way of comparison, New York Times report, which Trump has claimed is inaccurate, indicates that Trump personally hasnt paid any individual income Tax in many recent years and just $750 in 2016 and 2017, mostly due to losses suffered in his business enterprises. Biden's 2019 individual income Tax return includes salaries from S corporations that the former Vice President set up for the purpose of receiving income earned from books and speeches. For 2 017 and 2018, S corporations generated more than $13 million in profits and paid couples less than $800 000 in wages. In 2019, Bidens' S corporations net approximately $229 000 in profits and pay about $309 000 in wages. Because of its nature, additional pass-through income in the form of distributions from S corporations was avoided 3. 8 percent net investment income Tax which was enacted during the Obama administration, and some controversy has arisen in the press over this issue. The Bidens receive substantial income from a range of sources in 2019, including the University of Pennsylvania, where Joe has established a diplomacy center, and Northern Virginia Community College where Jill serves as English professor. Joe Biden also benefits from a federal pension for his years in Public Service. Bidens report $52 595 in Social Security income. The couple reported $7 546 in interest income and zero income from dividends or capital gains. The couple itemized deductions on their 2019 return and reported charitable donations of nearly $15 000, including contributions made to religious organizations such as the Church in Delaware where they commonly attend mass. Notably, bidens were limited to a maximum $10 000 deduction for State and local Tax payments under the Tax Cuts and Jobs Act provision spearheaded by the Trump administration. Without limitation, total SALT deduction would have been $111 717. Biden has advocated repeal of the TCJA limit on SALT payments.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions

GENERAL PERFORMANCE

According to a new Report by watchdog agency that oversees IT, award Program For Internal Revenue Service Employees honors some less than honorable staff. According to Treasury Inspector General For Tax Administration, more than 2 800 employees with recent substantiated conduct issues resulting in disciplinary action receive more than $2. 8 million in monetary awards and more than 27 000 hours in time-off awards between October 1 2010 and December 31 2012. Among these, more than 1 100 IRS employees with substantiated Federal Tax Compliance problems receive more than $1 million in cash awards and more than 10 000 hours in time-off awards. The IRS awards Program do, however, comply with Federal regulations, TIGTA note. These awards are designed to recognize and reward IRS employees for job well done and that is appropriate, because IRS should encourage good performance, said J. Russell George, Treasury Inspector General For Tax Administration. However, while not prohibit, providing awards To Employees who Have Been discipline For failing To pay Federal Taxes appears to create conflict with IRSs charge of ensuring integrity of the System Of Tax Administration, he add. TIGTA conducted its Audit because New Federal Guidance issued in FY 2011 requires agencies to reduce spending on awards programs beginning in FY 2012. The overall objective of the TIGTAs review was to evaluate IRS Compliance with procedures for expenditures on awards and to review IRS controls over awards made to employees with conduct and performance issues. TIGTA found that the IRS awards Program complies with Federal Requirements to limit awards expenditures and save additional funds by keeping aggregate Incentive Payments, Individual Employee Compensation, and aggregate awards below Federal limits. For FY 2011, IRS awarded almost $92 million in cash and almost 520 000 hours of time off to 70 500 of its approximately 104 400 employees. For FY 2012, IRS awarded $86 million in Cash and almost 490 000 hours of time off to 67 870 of its approximately 98 000 employees. TIGTA recommend that IRS Human Capital Officer determine the feasibility of implementing a policy requiring Management to consider conduct issues resulting in disciplinary actions, especially nonpayment of Taxes, prior to awarding all types of performance and discretionary awards. IRS agrees with TIGTAs recommendation and plans to conduct study by June 30 2014 for Implementation of such policy.


Health Savings Accounts for your small business

Many people who launch small businesses start out as sole proprietors. Here are nine tax rules and considerations involved in operating as that entity. 1. You may qualify for a pass-through deduction. To the extent your business generates qualify business income, you are eligible to claim a 20% pass-through deduction, subject to limitations. Deduction is taken below line, meaning it reduces taxable income, rather than being taken above line against your gross income. However, you can take deduction even if you dont itemize deductions and instead claim standard deduction. 2. Report income and expenses on Schedule C of Form 1040. Net income will be taxable to you regardless of whether you withdraw cash from business. Your business expenses are deductible against gross income and not as itemized deductions. If you have losses, they will generally be deductible against your other income, subject to special rules relating to hobby losses, passive activity losses and losses in activities in which you are at risk. 3. Pay self-employment taxes. For 2020, you pay self-employment tax at 15. 3% rate on your net earnings from self-employment of up to $137 700, and Medicare tax only at 2. 9% rate on excess. Additional 0. 9% Medicare tax is imposed on self-employment income in excess of $250 000 for joint returns; $125 000 for married taxpayers filing separate returns; and $200 000 in all other cases. Self-employment tax is imposed in addition to income tax, but you can deduct half of your self-employment tax as an adjustment to income. 4. Make quarterly estimate tax payments. For 2019, these are due April 15, June 15, September 15 and January 15 2021. 5. You may be able to deduct home office expenses. If you work from home office, perform management or administrative tasks there, or store product samples or inventory at home, you may be entitled to deduct an allocable portion of some costs of maintaining your home. And if you have a home office, you may be able to deduct expenses of traveling from there to another work location. 6. You can deduct 100% of your health insurance costs as business expense. This means your deduction for medical care insurance wo be subject to rules that limit medical expense deductions. 7. Keep complete records of your income and expenses. Specifically, you should carefully record your expenses in order to claim all tax breaks to which youre entitle. Certain expenses, such as automobile, travel, meals, and office-at-home expenses, require special attention because theyre subject to special recordkeeping rules or deductibility limits. 8. If you hire employees, you need to get a taxpayer identification number and withhold and pay employment taxes. 9. Consider establishing a qualified retirement plan. The advantage is that amounts contributed to the plan are deductible at time of contribution and are taken into income until theyre are withdraw. Because many qualified plans can be complex, you might consider SEP plan, which requires less paperwork.


Reporting embedded leases

In 2016, Financial Accounting Standards Board published guidance that requires major changes to how leases are reported on financial statements. One area of guidance thats especially complicated relates to embedded Leases. Accounting Standards Update no. 2016-02, Leases, require organizations to report on balance sheet assets and liabilities associated with leasing office space, vehicles and other assets. Public companies implement updated guidance in 2019. In June, FASB extended the effective date for ASU 2016-02 for private companies and not-for-profit organizations. One-year deferral is welcome news for smaller organizations that have been trying to get a handle on complex new rules during the COVID-19 crisis. In some cases, contracts that qualify as lease do have the word lease written on top. Instead, leases may be embed in contract terms. Unless private companies and nonprofits adopt changes early, theyre currently expensing operating lease payments as theyre incur, as per prior guidance. Carving out embedded leases from supply or service contracts wasnt big deal under those rules; costs would be classified as operating expenses either way. But updated guidance requires service contract payments to continue being expense while embedded leases are reported on the balance sheet. Updated guidance is clear about identification and criteria for embedded lease: contract contains lease if it conveys right to control use of identified asset in exchange for cash or other consideration. This includes the right to obtain substantially all economic benefits from assets for a specific period. Equipment leases may be buried in supply and service contracts with equipment manufacturers. Likewise, lease agreements may contain nonlease components, such as maintenance and property taxes. During the implementation phase for updated guidance, youll need to train other departments, such as procurement, sales, operations and information technology, to recognize when contract terms convey right to control use of specific asset. After implementation, youll need to execute controls or processes to identify embedded leases when contracts are sign. To simplify matters, consider adopting practical expedient in updated Accounting guidance that allows lessors to combine lease and nonlease - components. While this treatment will increase lease liability report on your balance sheet, simplified reporting may be worthwhile, depending on the size and duration of embedded leases. For private companies and private not-for-profits, updated lease guidance has now gone into effect for fiscal years beginning after December 15 2021. For public not-for-profits, updated guidance now go into effect for fiscal years beginning after December 15 2019, including interim reporting periods. One-year deferral isnt excuse to procrastinate. The issue of embedded Leases shows how implementing updated guidance can be challenging and may require significant changes to systems and procedures. We can help. Sam Brown, CPA, Inc., Troy, Ohio, www. Sbcpaohio.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions

LIKES AND DISLIKES

For the second year in row, beginning of the income tax filing season was delay. This year, delay was due to a 16-day partial government shutdown in October 2013 that resulted in Jan. 31 start date for IRS to accept electronically filed returns. Other complicating factors include the advent of net investment income Tax, new 39. 6% top tax rate bracket, and return of itemized deduction limitation and personal exemption phaseout. Software vendors nonetheless manage to roll out their updated versions on time, and users are generally satisfied with results obtained with products. Most respondents to our annual survey of Tax practitioners were in small to midsize firms, with 21% of users working as sole practitioners, 41% in firms of two to five preparers, 27% in firms of six to 20 preparers, 7% in firms of 21 to 100 preparers, and 4% in firms larger than that. The majority of respondents prepare between 51% and 75% of returns for individuals and 26% to 50% of returns for businesses. Fifty-seven percent of respondents had sole or primary authority for deciding which software to use, and another 28% had some input into decision. Of 3 833 CPA respondents who indicate that they are preparing Tax year 2013 returns for fee, 3 817 predominantly use one of 15 software products identified by the survey; of those, users of each of eight products identified in Exhibit 1 make up at least 1% of responses. This year they include CCH Axcess Tax, which was not represented in the 2013 survey. Three products with the greatest number of users were in nearly dead heat: Lacerte, ProSystem fx, and UltraTax CS, which account for 24%, 22%, and 24% of respondents, respectively. ProSeries was used by 11% of respondents and Drake by 9%, both higher than in 2013. Notably, share of ATX users dropped markedly from 11% in 2013 to 4% this year, likely result of serious performance problems with the new version last year. However, 2014 users of ATX report a satisfaction average rating of 4 on a 5-point scale, which, while slightly below that of most other products, represents a significant rebound from 2. 1 rating in 2013. Users of GoSystem Tax RS account for only 2. 8% of respondents, down slightly from 3. 5% in 2013. Other products asked about but whose users account for less than 2% of all responses combined were Intuit Tax Online, TaxAct, TaxSlayer Pro, TaxWise, and TurboTax. Users of all major products combine give their software rating of 4. 3 out of 5, which is higher than in 2013. Users of UltraTax CS and Drake give their software the highest rating, followed by users of Lacerte. Other than ATX, overall ratings for each major product and ratings in particular areas this year, such as ease of use and updates, were not significantly different than for 2013.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions

TECHNOLOGY, TRAINING, AND SUPPORT

Accounting is an attractive educational option for many. Students interested in pursuing this field have vary choices available to them, including scores of accredited online programs, which are well known for providing excellent, flexible Accounting education. Additionally, many programs offer opportunity to specialize in particular area, such as auditing, taxation, or forensic Accounting. Students unsure which type of degree to pursue can review the table below to get a better sense of prospects available at each level. Degrees in Accounting are available at associate, bachelors, masters, and doctoral levels via traditional campus-base learning or online options. Each level of degree can lead to specific opportunities for graduates, ranging from entry-level clerk and assistant roles to academic professorships. Students should identify their goals and understand how completion of each degree will aid them in meeting those aspirations. A review of each type is given below. The associate degree in Accounting prepares graduates for a variety of positions within industry and can be completed in 1-2 years depending on students ' preference for part or full-time education. Though taking half time require to complete bachelors degree, associate degree in Accounting still cover wide spectrum of topics relevant to the field, including basic Accounting principles, fundamentals of taxation, payroll Accounting, and personal finance. Other topics relevant to Accounting are also include, such as micro / macroeconomics, business law, and Accounting technology. As the world of Accounting evolves to incorporate more technology and data analysis, this knowledge will become particularly valuable to employers; students with competency in Accounting software will be highly desirable. Below is a breakdown of some courses students can expect to take at associate degree level, along with an explanation of industry skills gain: typically offered as a Bachelor of Science, four-year degree in Accounting is a highly specialized program that prepares graduates to work in varied capacities within the Accounting industry. This level of education may be ideal for students who are not looking to become Certified Public accountants, as certification requires additional coursework at graduate level. Graduates of the Accounting degree program will have in-depth and holistic knowledge of business cycle and Accounting principles governing responsible practices. Specific skills include preparing financial statements and Tax documents, internal auditing, financial advisement, and more broad-base skills in organizational management and evaluation of companys overall effectiveness. Below, students can find a more in-depth look at some of the courses they may expect to take at bachelor level, along with skills they will be able to apply to professional settings. Master of Accounting is an ideal program for students looking to become CPAs or aspiring to high-level Accounting positions within competitive firms. For students with an existing background in Accounting, this degree can typically be completed in one year. Some programs will offer students the option to complete intensive internship program, providing hands-on experience and opportunities to make valuable contacts within industry.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions

IDENTITY THEFT

For the fifth year, Tax software survey also asked about CPAs' experience during the current Tax season of having clients victimized by Tax Identity Theft, and for the fourth year, report incidence decline. From high of 59. 3% in 2016, percentage of respondents saying any clients were victims declined to 17. 4% in 2020, down from 20. 7% in 2019. Most who do report ID theft say few clients were affected; for nearly 97%, less than 5% of their clients were affected. Correcting resultant problems remains relatively onerous, however, with a rating of 3. 0 out of 5, about the same as previously.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions

Sources

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions.

* Please keep in mind that all text is machine-generated, we do not bear any responsibility, and you should always get advice from professionals before taking any actions

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