Wednesday, September 25, 2013

SO LONG, FAREWELL, AUF WIEDERSEHEN, GOODBYE!

As has so often been the case these past 40+ years, “my eyes are bigger than my stomach” so to speak.
 
With the success of THE WANDERING TAX PRO, created for the average middle class taxpayer, I wanted to also write a blog specifically for tax professionals.  I first started the NJ TAX PRACTICE BLOG for NJ tax pros and then THE TAX PROFESSIONAL for all tax pros.
 
Unfortunately I do not have the time to maintain three, or even two blogs, and there is not enough content to keep three, or, again, even two, blogs going 5, or even 3, days a week.  I first closed the NJ TAX PRACTICE BLOG, and now must also put an end to THE TAX PROFESSIONAL.
 
I will keep this blog up, although will no longer post to it, so that you can access the archives.  And I will continue to, on occasion, as a breaking story or the spirit moves me, write posts specifically for tax professionals, from NJ or wherever, at THE WANDERING TAX PRO.
 
TAFG 

Tuesday, August 20, 2013

A "SEASONED" TAX PRO RESPONDS


Over at TAX FACTOR Jamaal Solomon’s “Confessions of a Mad Tax Accountant” continue with the promised "Arrogance of Some (Not All) Old Tax Accountants (30+ years' experience)”.
 
Jamaal advises -

My advice to young tax professional is not to be shy. Young professionals MUST seek advice from ‘seasoned’ tax professionals. You will meet some jerks but hey that’s life! You have to keep on striving for excellence. My advice to ‘seasoned’ tax professionals is don’t be greedy. ‘Seasoned’ professionals MUST share their knowledge.”

In looking back at my more than 4 decades in the business, the only “seasoned” tax pro from whom I actively sought advice during my earlier years was my teacher and mentor James P Gill.  We worked together just short of 30 tax seasons, and he eventually “handed over” his practice to me when he got tired of 1040s at age 75.  To be honest, while I have been attending NATP and other conferences for over 25 years, I did not begin to “network” with other tax pros until only very recently. 

Over the years I obviously received guidance from “seasoned” seminar and workshop leaders at NATP, NSTP and other continuing professional education sessions via their presentations.  And since I began blogging - around the time my mentor went to his final audit - I have sought guidance and help on tax preparation issues from time to time from my fellow tax bloggers (especially the MISSOURI TAXGUY, who actually credits me as one of the reasons he started to blog) – some less “seasoned” than myself.  Different tax preparers have different areas of experience and expertise.

From the odd questions and comments presented during my tenure at various CPE sessions by participant tax preparers, who one would think to be “seasoned” based on years, I have come across many that seem to need a lot more “seasoning”.  Years in the business alone does not necessarily yield “seasoning”.   

I like to think I am one of the “great ‘seasoned’ tax professionals” that JS refers to in his post.  I have tried to be supportive, and provide guidance, support, and publicity (via BUZZ), to new tax bloggers, Jamaal included, over the dozen years I have been writing THE WANDERING TAX PRO.

I do agree with JS that “seasoned” tax pros need to share their experience with newbies, and new tax pros need to seek out “seasoned” mentors.

FYI, Jamaal and I, a “young” tax pro and a “seasoned” tax pro, will soon be providing guidance, advice, and resources for beginning tax preparers in a book that we are currently working on with the tentative working title “Won’t You Take This Advice I Hand You Like a Brother”.  I apologize to JS for not devoting more time to my contributions to the manuscript lately, but I have been plagued by GD extensions.

Next up for JS – turnabout is fair play with “Arrogance of Some Young Tax Professionals”.  I am looking forward to this next post almost as much as I was looking forward to the current one.

RDF

Monday, August 19, 2013

TAXPRO BUZZ


+ The madness continues.  Jamaal Solomon talks about: “Receiving CPE Offers” in “Confessions of a Mad Tax Accountant #4”.

I, too, have noticed that many new CPE providers have sprung up, and have solicited me via email, since the IRS initiated its now hopefully defunct required RTRP regime.  And new RTRP-related membership organizations, most really thinly-veiled profit-making CPE providers also appeared.

While I have attended CPE from various providers and organizations over the years, lately I have limited my CPE to NATP and the NJ chapter, but I also recommend the IRS Nationwide Tax Forum.  Unlike JS, I do not complain about CPE emails, as I am always looking for new legitimate providers either nearby or at locations I would like to visit.

I look forward to the next installment in the Mad Tax Accountant series – “Arrogance of Some (Not All) Old Accountants (30+ years)”.

+ The always on the ball ACCOUNTING TODAY gives us the word that “IRS Postpones Shutdown of Online e-Services Apps” -

The Internal Revenue Service said Friday that it is delaying the planned retirement of its Disclosure Authorization and Electronic Account Resolution online applications for three weeks.”

+ The IRS has issued draft copies of a lot of 2013 forms and instructions recently.  Click here to check them out.

+ Diane Gilabert explores “The Section 199 Deduction – 9 True/False Questions” at her TAX MAVEN BLOG –

The section 199 deduction is one of the most overlooked tax breaks for businesses. The alphabet soup of acronyms is intimidating. But a potential tax deduction of 9% of qualifying taxable income is too compelling to pass up.”  

+ And DG also provides a detailed “Purchase Price Allocation Example” for reporting the sale of a business.

RDF

Monday, August 12, 2013

TAXPRO BUZZ


+ “Psychopathic CPAs? Not Likely”.  I don’t know about that.

Bill Sheridan of the MARYLAND ASSOCIATION OF CPAS suggests that, according to the Great British Psychopath Survey, “If you're a CPA, here's a bit of good news: You're probably not a psychopath.”

It is no surprise that #2 on the list of the most psychopathic professions is Lawyer.  With some exceptions, I have always thought of lawyers as #2.

+ TAX MAVEN Diane Gilabert lists “5 Things Bill Belichick can Teach us About Winning an IRS Audit”, the third installment in her series on IRS audits.

To be honest, until I read the post I had no idea who Bill Belichick was.  The only sport I follow is bowling. 


+ TAX PROFESSIONALS RESOURCE has a great inventory of “Tax Articles”.

+ FYI, the “other NSA” is offering an online seminar on “Financially Distressed Taxpayers: Cancellation of Debt, Foreclosures and Repossessions” on August 27th at 2:00 PM EDT, 1:00 PM CDT, 12:00 PM MDT, 11:00 AM PDT.

RDF

Monday, August 5, 2013

TAXPRO BUZZ


Finally a “meaty” Taxpro BUZZ!

+ Jamaal Solomon has posted #2 of his series of “Confessions of a Mad Tax Accountant” - “Dealing With Bum Clients”. 

I agree when JS says -

There is nothing wrong with firing bum clients. Life is too and complex to deal with them! Firing bum clients will give you more time to concentrate on your valuable clients.” 

As tax pros we get enough agita dealing with the IRS, the states, and good clients.  More agita we don’t need.

JS is more lenient than I am – he gives these cafones “two chances to prove that I should keep them as clients”.  At this point in my career, especially as I am trying to “thin the herd”, one strike and you are out.

+ In “Spousal IRAs Retitled” JK LASSER tells us that “In honor of a former U.S. senator, the spousal IRA has been renamed the Kay Bailey Hutchison Spousal IRA.”  Like the Keogh Plan, the Roth IRA, the Coverdell Education Savings Account, and the Pease in PEP and Pease.

I am not familiar with KBH, so I cannot properly comment on the appropriateness of the naming – but considering today’s Congress it seems the members deserve contempt more than they do “honor”.

Back in the late 80s (I believe) someone suggested that the government “sell” naming rights to bills and items created therein, like what is done with stadiums and concert venues.  For example the “Citibank Spousal IRA”.  At least that would generate some cash to reduce the deficit. 

+ Once again Jason Dinesen asks “What’s the Upside of Preparer Regulation for Enrolled Agents?” in light of “recent NAEA talking points were regarding tax preparer regulation at a legislative day NAEA held in Washington, D.C. in May.”

As usual, Jason makes good points.  And he again correctly points out that most of the taxpayer public has no idea, or the wrong idea, what an EA is. 

I believe my proposal for incorporating the RTRP designation, with a more difficult competency test (and a grandfathering exemption from the test for proven experienced tax pros), into a 2-part voluntary certification program with the Enrolled Agent credential would appropriately deal with his issues.  See my TAXPRO TODAY editorial “What the IRS Should Do About the RTRP”.

+ I have not attended an IRS Nationwide Tax Forum since the east coast location was changed from New York City to National Harbor (near Wash DC).  They are a good source of CPE, although the individual seminars are limited (at least when I attended) to 50 minutes, which also limits the coverage of a topic or ability for Q+A.  The seminar rooms were always crowded, and it was often difficult to take notes as there were no tables at which to sit. 

The main benefit of the Forum is the IRS speakers – hearing the Service’s point of view on tax topics.  It also has a good Exhibition Hall.


I asked Kay, via “tweet”, “Did Werfel address the RTRP issue?”  Her response was “no he didn't ...”.  Odd, considering he was addressing tax professionals.  Kay told me the RTRP program was not discussed anywhere at the Forum.

+ Speaking of the IRS - in case you haven’t heard, the WASHINGTON POST announced “Obama Nominating Restructuring Expert to Lead IRS Amid Political Controversy” -

President Barack Obama has chosen a retired corporate and government official with experience managing numerous organizations in crisis to take over an Internal Revenue Service under fire for targeting political groups.

Obama said his nominee for commissioner of the tax agency, John Koskinen, ‘is an expert at turning around institutions in need of reform’.”


+ The NATP’s weekly email newsletter advised members that the IRS has released the 2013 draft Form 4684, Casualties and Thefts, and the accompanying instructions. The draft form includes a new Section C, Theft Loss Deduction for Ponzi-Type Investment Scheme Using the Procedures in Revenue Procedure 2009-20. This revenue procedure provides an optional safe harbor treatment for taxpayers who experienced losses in certain investment arrangements discovered to be criminally fraudulent. It also describes how the IRS will treat a deduction for such a loss if the safe harbor treatment is not elected.

I have had one client who was a victim of a non-Madoff Ponzi-like scheme a few years back.

+ FYI, NFIB (National Federation of Independent Business) has an online “Healthcare Resource Center” with lots of information on the Patient Protection and Affordable Care Act (PPACA).

+ And another FYI – I was recently emailed for review “7 Career Options for the Aspiring Accountant”, an “infographic” you might find interesting “on career possibilities for the aspiring accountant. It highlights the various job opportunities that are available for those entering the accounting workforce. Additionally, it provides a closer look into average salaries, qualifications, job growth and other key facts and figures.”

RDF

Monday, July 29, 2013

TAXPRO BUZZ


Sorry to be late in getting this post “up”.  I was hoping for more “stuff” to include.  If you have come across any BUZZ you want to share with fellow tax pros let me know.


+ William Perez provides “IRS Update for July 26, 2013”, which lists “pages or files residing on IRS.gov that are new or updated from July 19 to July 25, 2013”.

William will be posting such an update every Friday.

+ The IRS’s mandatory RTRP program may be dead (hopefully for good), but the PTIN program continues.  ACCOUNTING TODAY reports “IRS Sends Warning Letters to Preparers With Old PTINs”.
 
The following statement still applies -

As of Jan. 1, 2011, anyone who, for compensation, prepares or helps prepare all or substantially all of any federal return or claim for refund must have a valid PTIN and use that PTIN as the identifying number on returns, the IRS noted. All PTINs must be renewed annually.”

And -

The IRS also said it is continuing efforts to identify paid preparers entering no identifying number on returns that they prepared.”

+ An email from NATP introduced me to the product described below.  Perhaps it is something you should consider purchasing.  I have not ordered or seen this book but am considering a purchase to supplement the many forms, schedules and worksheets I have developed for external and internal use in my 1040 practice (click here). 

FYI - there is a special discounted price of $75.00 for NATP members.  If you are not already a member, email me at rdftaxpro@yahoo.com (with “NATP Membership” in the subject line) to receive membership information. 

NATP Tax Store - Audit Proof the Tax Office - #3298

It’s becoming harder and harder to protect ourselves from ourselves. Tax professionals are under the IRS microscope and are being audited. Thousands of offices are being targeted each year.

In this manual, you will find the forms and instructions you need to audit proof your office. In addition to the paper forms, you will also receive a flash drive with over 35 forms including many PDF fill-in forms.

Price - $89. To place your order go to the Tax Store or give us a call at 800.558.3402.”

RDF

Friday, July 26, 2013

THE NEW JERSEY ELECTRONIC FILING MANDATE


This post is for NJ tax pros.  I will outline my NJ-1040 submission practice – and ask that you let me know if you think I am following the law.

Under the NJ “Electronic Filing Mandate” preparers that reasonably expect to prepare 11 or more individual gross income tax resident returns (including those filed for trusts and estates) during the tax year must use electronic methods to file those returns for which an electronic filing option is available.

I do not use flawed and expensive tax preparation software to prepare my federal and state 1040s – and at this point in my career I never will.  Therefore the only electronic filing option available to me for NJ returns is NJWebFile.

Because of the many, in my opinion unnecessary, restrictions and limitations to the NJWebFile system I cannot submit all of my NJ-1040s using this method – even if I wanted to.  For these returns, and in my case, there is no electronic filing option available.  I do not, in my opinion, need a client-signed OPT-OUT form for those returns I cannot submit electronically because NJWebFile will not allow me to do so.

Whenever possible I submit my NJ-1040s “electronically” via NJWebFile, unless the client specifically “opts out” of electronic filing.  In such a case I get a signed OPT-OUT form from the client.

It is beneficial for a client whose NJ-1040 requests a refund to submit their return via NJWebFile because doing this allows their refund to be directly deposited to their bank account.  Despite the fact that direct deposit would save the state money, NJ does not allow direct deposit for refunds requested on returns that are not, or cannot be, submitted electronically.

So what do you think?

FYI, New York State specifically exempts me from the NY electronic filing mandate because I do not use flawed and expensive tax preparation software.  They still, however, extort $100 from me each year for the “privilege” of preparing a little over 20 NY state income tax returns.

RDF