Tuesday, November 25, 2008
The Internal Revenue Service has announced the 2009 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning on Jan. 1, 2009, the standard mileage rates for the use of a car (also vans, pickups, or panel trucks) will be:
* 55 cents per mile for business miles driven
* 24 cents per mile driven for medical or moving purposes
* 14 cents per mile driven in service of charitable organizations
As I had expected, the new rates for business, medical and moving purposes are slightly lower than rates for the second half of 2008, raised by a special mid-year adjustment in response to high gas prices. Considering that current gas prices are less than half what they were a few months ago the new standard mileage allowance rates are generous.
The rate for charitable purposes is set by law and remains the same as it has been for several years now, which is something Congress needs to address.
Monday, November 24, 2008
"Members, I have sent formal notice to NSTP that I want a Membership roster so that I can circulate a petition for a Special Meeting to discuss the removal of some members of the Board of Directors for Cause. I have not heard back from the Board on this request yet, and I need your support. The Bylaws allow for this petition, but the current BOD is so entrenched in the use of NSTP to feather their own nests that they want to totally ignore me. Please write and send Email demanding they comply. This BOD has already caused us to loose Dorothy as President, and Beanna as Exec. Director. I believe some also had much to do with us losing Tom Cooke. Let them know that this is OUR Organization not their personal piggy bank.
Member since 1996"
I am becoming concerned about this problem.
To be honest, I have no problem with a member being paid a reasonable market fee for writing the workbook for and teaching NSTP-sponsored seminars and workshops, providing the product is worthy. I have always said, including here, that Paul LaMonaca does an excellent job of writing and presenting the NSTP’s educational programs. Paul has a long history of providing quality seminars for NSTP.
I would support the Board of Directors contracting with Paul LaMonaca to provide certain educational services for a reasonable market fee. However I do believe that in such a situation it would be more appropriate if Paul were not a member of the Board of Directors to avoid possible conflict of interest issues.
I have gone so far as to say the only benefit of membership in NSTP has been the insights of the “insider” Executive Directors Tom Cooke and Beanna Whitlock and Paul LaMonaca as an instructor. However with the loss of Tom and now Beanna the value of membership has dropped.
If the current situation was the cause for both Tom and Beanna to resign I am concerned that more is going on then the membership is aware of, and support Steve’s request for a Special Meeting.
Thursday, November 20, 2008
“Unnecessary Estimated Payment Vouchers (Issue 07-0000581) – We're trying to stop – honest.
We're working as fast as we can to eliminate unnecessary mail-outs of ES vouchers. Unfortunately, we won't know if we caught them all until February of '08. If all goes well, there will only be one mailing to ES filers (no more quarterly mailings). Also, the following ES filers should not receive vouchers:
1. Returns with Paid Preparers
2. Software Prepared Returns
3. E-filed Returns
4. E-Pay returns”
So now I know why the IRS did not send the annual quarterly estimated tax package to my clients who file quarterly this past January. Their returns were prepared by a “paid preparer” - me.
This is ridiculous! There is no reason for this. It just means more work for me during a time of the year when every second is precious.
I can understand not sending estimated tax packages for “software prepared returns” (as most of you know I do not use tax software) and “E-Filed” (and since I do not use tax software I do not e-file federal returns) and E-Paid” returns. One would expect that the tax software would automatically generate the quarterly payment vouchers.
I will be writing to the Commissioner of the IRS to complain.
Wednesday, November 19, 2008
Here are the dates for the 2009 and 2010 educational event offered by the NJ chapter of NATP –
* January 10, 2009 - New Jersey Seminar - Woodbridge, NJ 8:00-5:00 pm
* May 28, 2009 - Breakfast Seminar - Location/Content TBA
* September 30 - October 1, 2009 - NJ NATP Annual Conference and 20 Year Birthday Celebration - Location/Content TBA
* October 29, 2009 - Breakfast Seminar - Location/Content TBA
* December 10, 2009 - Breakfast Seminar - Location/Content TBA
* January 9, 2010 - New Jersey Seminar - Location/Content TBA
More details on the events will be reported here as they become available.
Tuesday, November 18, 2008
Governor Jon Corzine is sitting at his desk reading the newspaper. The headline on the paper reads, “CHRIS CHRISTIE STEPS DOWN – POSSIBLE RUN FOR GOV?”.
Corzine’s aide says, “Look on the bright side. If Christie runs, you’ll definitely get the corrupt politician vote. That’s huge.”
How true. But I expect Corzine already has the corrupt politician vote sewed up!
Some of my “homemade” forms are given to clients to help them provide me with the information I need to properly prepare their returns. Some are used as “memos” to the client’s copy and my office file copy to back-up items reported on the returns. Others are used as attachments to the returns.
These forms, schedules and worksheets have proven helpful to me in my practice, and I believe you will find them helpful in your practice as well.
I am offering a package of 25 of my “homemade” forms, schedules and worksheets, sent as an email “attachment”, for only $5.00!
The package includes forms, schedules and worksheets for itemized deductions, charitable contributions, medical expenses, employee business expenses, Schedule C deductions, rental income and expenses, etc.
The package will be sent as a “word document”. While the contents of the package are copyrighted material and for your internal use only, you may edit and revise the forms, schedules and worksheets as you see fit to personalize them to your firm, to customize them be more relevant to your particular practice or clients or for specific professions, or to update information for annual COLAs or tax law changes.
To order your package send a check or money order payable to ROBERT D FLACH LLC for $5.00 along with your email address to –
TAX PROFESSIONAL FORMS, SCHEDULES AND WORKSHEETS
ROBERT D FLACH LLC
72 VAN REIPEN AVENUE
JERSEY CITY NJ 07306-2806.
Once you have received the package and reviews the forms, schedules and worksheets I would very much appreciate hearing your comments on the forms, schedules and worksheets included in this package, including any suggestions you may have for improvements or additions.
Monday, November 17, 2008
While the SUI employee tax rate remains at .00425 and the SDI employee rate continues to be .005, there is a new “contribution” beginning with wages paid on January 1, 2009.
Legislation passed in 2008 created Family Leave Insurance. This new law provides up to six weeks of benefits for the care of a family member suffering from a serious health condition, a newly born child or a newly adopted child. While the payment of FLI benefits does not begin until July1, 2009 employee tax withholding to fund the benefits begins January 1, 2009.
The FLI tax rate for employees is .0009 of wages, up to the $28,900 maximum.
The maximum 2009 employee withholdings are -
* $144.50 = SDI
* $122.83 = SUI
* $26.01 = FLI
* $293.34 = Total
Here are some additional related facts for 2009 -
* 2009 Maximum Unemployment Insurance weekly benefit = $584
* 2009 Maximum Temporary Disability Insurance weekly benefit = $546
* 2009 Base week amount = $143
Friday, November 14, 2008
+ Alice Shope provides a listing of new ways the great State of New Jersey has devised to nickel and dime small businesses in her post “NJ– Unfriendly To All” at the ALICE’S RESTAURANT blog (Fighting for political truth and accountability - An informational blog dedicated to the taxpayers in New Jersey).
+ Check out my “client wish list” – a list of things I wish all my clients would do – over at THE WANDERING TAX PRO. What would you add to the list?
+ The NATP TAXPROWeekly e-newsletter reminds us that –
“Recent legislation changed the due date for furnishing Copy B of certain information returns to recipients for returns required to be filed after 2008. The new due date is February 15 of the year following the calendar year for which the return is required to be filed. This change applies to Form 1099-B, Proceeds From Broker and Barter Exchange Transactions, and Form 1099-S, Proceeds From Real Estate Transactions.
This change also applies to Form 1099-MISC, Miscellaneous Income, but only if substitute payments in lieu of dividends and tax-exempt interest or payments to attorneys are reported.
An incorrect due date is printed in the 2008 general instructions for Forms 1099, 1098, 5498, and W-2G, and in the instructions on the reverse side of Copy C of the 2008 Forms 1099-B, 1099-MISC, and 1099-S. The correct due date for furnishing the 2008 Copy B to recipients is as follows:
* February 17, 2009, for Forms 1099-B and 1099-S.
* February 17, 2009, for Form 1099-MISC if substitute payments are reported in box 8 or gross proceeds paid to an attorney are reported in box 14. If no such payments are reported, February 2, 2009, remains the due date for furnishing Copy B of Forms 1099-MISC to recipients.”
So let your clients know – so that they do not panic if a 1099-B or 1099-S is not received by February 1st.
+ The same issue also reports –
“For the 2009 processing year, the IRS is realigning the filing locations for four states. Paper returns from Delaware, New York, and Rhode Island will be sent to Kansas City and returns from Illinois will be sent to Fresno.
The IRS is also making some changes to filing locations for business returns. Beginning in 2009, business returns from Georgia and Tennessee will be filed at the Cincinnati processing site. Business returns from those two states were previously filed in Ogden.
The next site scheduled for closing is Andover. After the 2009 filing season, Andover will no longer process tax returns.“
The TAXPRO Weekly email newsletter is just one of the many benefits of membership in NATP. I would certainly recommend that all serious tax professionals join this organization. If you do mention my name as the person who referred you and I will get a “thank you” present.
+ Many final 2008 forms are available for download and review at the IRS website. Click here. Thankfully Congress acted on time for a change, so everything current is included in the final 2008 forma and instructions.
Wednesday, November 12, 2008
Aside from the obvious opening typo FU it looks good. Looks like they fixed the FU.
Not only is the look and layout much better, but “the navigation structure on the site has been updated to provide you with improved access to information about the taxes and fees administered by the Division.”
I expect some politician’s relative or crony got a nice check for the redesign.
Tuesday, November 11, 2008
+ The Fall 2008 issue of New Jersey State Tax News is now available online. Click here to download the issue.
The lead article in the newsletter concerns the new Family Leave Insurance, an extension of NJ’s Temporary Disability Insurance program that was signed into law by Governor Corzine on May 2, 2008.
The new insurance provides up to six weeks of FLI benefits for the care of a family member suffering from a serious health condition, a newly born child or a newly adopted child
+ A new website, www.change.gov, has been created as part of President-Elect Obama’s transition. This site includes details on Obama’s plans and policies, from civil rights and defense to veterans and women.
You can click here for the site’s page on Obama’s tax policies. The site allows you to submit your comments and suggestions.
I have submitted my specific comments and suggestions regarding tax policy, much of which I have posted at my THE WANDERING TAX PRO blog in the past. I am waiting to see if there will be any response – and will let you know if I hear anything.
+ Have you checked out my new free online newsletter FROM THE DESK OF ROBERT D FLACH yet? It provides links to a wide variety of personal finance and other blog postings and online articles and resources that I have come across in my "wanderings" on the web. Click here to download the premiere issue in "pdf" format - OCTOBER 2008 ISSUE.
+ CCH reports that “the New Jersey Supreme Court has agreed to review a previously reported Tax Court decision upholding as facially constitutional the corporation business tax ‘throwout’ rule” in the item “New Jersey --Corporate Income Tax: State High Court to Review "Throwout "Rule”.
+ Click here to download the registration form for the NJ-NATP December 11th “breakfast seminar” on “Keeping Up With Circular 230” presented by Howard Bookbinder at the Hanover Marriott on Route 10 in Whippany.
Monday, November 10, 2008
I thought it was from the local New Jersey office to report the findings of an inquiry I had initiated a while ago regarding the IRS treatment of a legitimate alimony deduction claimed by a client in 2004 and 2005 (that situation is in itself quite a story – one which I will probably tell here when I get some free time). The Service had apparently decided in the client’s favor, as monies withheld by the IRS from subsequent refunds had been returned. However I did not hear word one from the Service that this was indeed the situation, or that the case had been settled.
When I opened the letter it turned out that it was from Nina E Olson, the IRS National Taxpayer Advocate.
Nina was asking for my “help in improving the Taxpayer Advocate Service” by participating in a telephone survey by an independent company. “In about a week, you will be called by a Macro International interviewer and you will be asked to evaluate your experience using the Taxpayer Advocate Service. This survey should take about 5 minutes.”
I will have to think about how I will respond. While I have been extremely pleased with the results of my various dealings with the TAS over the years - I do believe that in 100% of the cases the determination favored my clients, proving that I was correct in the first place – I was very frustrated with my last experience - regarding the alimony deductions. I had to write to Nina herself in order to get an acknowledgement and action from the NJ office.
Overall I do believe that the Taxpayer Advocate Service is indeed an excellent and effective organization.
A personal point of annoyance regarding the letter. At the bottom of the letter, after Nina’s signature, it read “Nota – Version en espanol de esta carta se encuentra al dorso.” On the back the entire letter was written in Spanish. This is the first time I have received bi-lingual correspondence from the IRS, or any government agency.
My name is Robert Flach, not Roberto Flaco. There was no indication in any of my correspondence that Spanish was my first language. All of my letters to the TAS were written in English.
I expect that everyone receiving this obviously form letter received a Spanish translation.
Why only Spanish? Why not also Farsi, French, German, Hebrew, Hindi, Japanese, and Russian?
This is the United States of America, not Canada. We have only one official language – English! I find it irksome that politicians have decided, without public support, that Spanish is the second official language of the USA.
Friday, November 7, 2008
In it I discuss what Tax Code changes I would propose if I were running for President. The post was inspired by the fact that I was asked to contribute to an article on the topic for the upcoming NATP quarterly TAXPRO JOURNAL.
So what would you propose?
Thursday, November 6, 2008
The 7th Annual “Northern New Jersey Working Together Conference”, a joint effort of the IRS and various tax professional organizations, will be held on Tuesday, January 13, 2009 from 7:30 AM to 4:30 PM at Downs Hall of Kean University in Union.
As I believe I mentioned in an earlier post, the keynote speaker for the day will be IRS National Taxpayer Advocate Nina Olson.
The cost of the conference is $110.00 for registrations received by January 4, 2009. After January 4th the fee is $125.00. Breakfast and lunch is included.
Participants will earn 8 CPE credits for full-day attendence.
Wednesday, November 5, 2008
I do not believe in the old adage “You can’t teach an old dog new tricks.” As a tax professional I must learn “new tricks” every year, as Congress is constantly making changes and additions to the federal Tax Code, and the members of the New Jersey legislature are always finding new ways to nickel and dime NJ residents so they can continue to milk the state dry with pork.
Just because I can learn new tricks doesn’t mean that I necessarily want to. There are many specialized “tricks” related to individual taxation that I have no desire to learn at this point in my career.
For example, the Offer In Compromise program is an excellent way for taxpayers who owe excessive amounts of money to “Sam”, which continues to accrue interest and penalties daily, to finally satisfy their outstanding debt and “wipe the slate clean”.
While I think this is a great program, I have no intention or desire to learn how to prepare and submit an Offer In Compromise, even though I may have a client or two who would benefit from this program.
Similarly, the Injured/Innocent Spouse procedures (which are confusing even to me) can save a truly injured or innocent spouse, who has filed a joint return with a less than honest spouse, from having refunds on subsequent separately filed (or filed as Single) returns “garnished”. I have at least one client who would definitely benefit from such a submission. Yet, again, I do not want to spend the time to learn how to properly prepare a submission.
To be perfectly honest, it takes enough time, effort, and expense just keeping up-to-date on the basic 1040 and NJ-1040 laws. I do not want to spend time learning a “trick” that I will probably use once or twice every three or four years – my time could be put to much better use. A wise lesbian once told me, “Only Sherwin Williams can cover the Earth”. I am content being a basic 1040 expert and do not feel the need or desire to add specialized “tricks” to my repertoire.
It is not that I do not want to help my clients. It is similar to my response when I am asked to prepare various financial and other applications and forms that have nothing to do with taxes. I do not have the experience, or enough knowledge of the intricacies involved, to confidently prepare the form or application (nor, again to be perfectly honest, do I particularly want the knowledge and experience). More important, I do not want to jeopardize the client’s chances of acceptance by my lack of knowledge or experience.
As a result I need to locate fellow New Jersey tax professionals who are knowledgeable and experienced in these and other special “tricks”. Specifically I need preparers who will provide specific services on a one-time basis for a client without attempting to “steal” the client’s 1040 business.
To start with I would like a New Jersey tax professional who is experienced with the Offer In Compromise program and another who is knowledgeable in the Injured/Innocent Spouse rules to email me.
I have suggested to the NJ chapter of NATP that they try to generate an online data base where members can be listed according to their area or specialization(s) to be included on their website.
Tuesday, November 4, 2008
I was indeed surprised when NATP announced “November 2008 Member of the Month - Beanna J. Whitlock, EA, CSA”. Yes, this is the same Beanna J. Whitlock who was for about 2½ years the Executive Director of the National Society of Tax Professionals!
It is not surprising that a tax professional would be a member of both NATP and NSTP – I have been a member of both for many, many, many years. It is just weird that just the other day I was posting about an area of concern with Beanna’s recent resignation from NATP and now she shows up on the NATP website.
Not to take anything away from Beanna’s designation as Member of the Month. She has certainly been dedicated to the tax profession and deserves whatever accolades she gets.
My curiosity about the situation with NSTP is further piqued. I continue to follow the entries in the Comment Room of the NSTP WEB BOARD. Now it seems that the President has also resigned and one of the issues concerns the compensation paid to long-time instructor Paul LaMonaca (who I have always thought of as an excellent instructor).