Tax Preparer Registration is Finally Here!

Is Your Tax Preparer Registered?

IRS is now registering all tax preparers. I registered years ago. Is your tax preparer registered? If not, why not?

The IRS is implementing new registration requirements for all tax preparers. Each preparer will be issued a Preparer Tax Identification Number (PTIN). The cost is expected to be about $50 a year with a possible small processing fee. The $50 is not very much money to ensure that all tax preparers are legitimate.

There will also be a tax exam requirement to ensure a basic understanding to the tax code, rules and regulations. This will be phased in over the next year or two. The tax exam should be a relatively easy one to pass for those preparers that are trained on the basics and know what they are doing.

If your current tax preparer is not registered you need to find out why. The cost of $50 should not be the issue. Loss of privacy should not be the issue; like I mentioned above, I have been registered for years and have never had an issue with the IRS invading my privacy. So if they are not registered there must be another reason other than cost or privacy concerns.

Has your preparer passed a tax competency test? If not ask why? Don’t be fooled with the worthless “in-house” tests given by some tax preparation firms to their employees. There is a clear conflict of interest with companies testing their own employees on tax rules so they can go out and generate tax revenue for them. The tax test needs to be given by an independent third party for it to be considered legitimate.

The world of tax preparation is finally changing in a positive direction! No more shady under the table deals, scams and rip offs. By requiring a basic understanding of the tax rules and registration, the level of knowledge and professionalism will certainly improve.

Reg Baker, CPA PFS
http://www.regbaker.com/
reg@regbaker.com

Tax Scam Alert

IRS issued another tax scam alert.

Watch for bogus IRS letters & emails claiming you have a refund or credit due you!

This happens a lot more often when the economy is suffering. The scammers are out there trying to take advantage of those hurting the most. Don’t be fooled!

If you receive a letter form the IRS check with your local IRS office or CPA to determine if it is authentic. Be especially suspicious if the letter or email is asking for you to respond with social security number or other personal information and there is a short time frame. The IRS normally does not work this way.

Contact me if you need a second opinion!

Reg Baker CPA PFS
Reg@regbaker.com
http://www.regabker.com/

Financial Literacy Presentations

Financial Literacy is a Must

To ensure a comfortable future we must all be financially literate. I do group presentations in less than an hour that can change lives.

A variety of topics can be selected including:

• Why should I join a 401k?
• What is a family financial plan?
• How can I start building some savings?
• What caused the real estate melt down?
• How to pay for college?
• Can I afford to retire?
• How can I help my kids or parents?
• How can I learn more and get financially literate?

The list can go on and on. The bottom line is that everyone needs to become aware of how a basic understanding of personal finance can affect their lives and the well being of their family’s.

Knowing all the answers is not possible; but knowing when to ask for help or where to find it absolutely possible.

In less than 60 minutes I can provide some basic tools to help those needing help get it. This is a great benefit to non-profits members and company employees.

Contact me for more information!

Reg Baker, CPA PFS
http://www.regbaker.com/
reg@regbaker.com

Deduct Job Hunting Expenses

Six Tax Benefits for Job Seekers

(IRS Tax Tips) 

Did you know that you may be able to deduct some of your job search expenses on your tax return?

Many taxpayers spend time during the summer months updating their résumé and attending career fairs. If you are searching for a job this summer, you may be able to deduct some of your expenses on your tax return. Here are six things the IRS wants you to know about deducting costs related to your job search.  

1. To qualify for a deduction, the expenses must be spent on a job search in your current occupation. You may not deduct expenses incurred while looking for a job in a new occupation.
2. You can deduct employment and outplacement agency fees you pay while looking for a job in your present occupation. If your employer pays you back in a later year for employment agency fees, you must include the amount you receive in your gross income up to the amount of your tax benefit in the earlier year.
3. You can deduct amounts you spend for preparing and mailing copies of your résumé to prospective employers as long as you are looking for a new job in your present occupation.
4. If you travel to an area to look for a new job in your present occupation, you may be able to deduct travel expenses to and from the area. You can only deduct the travel expenses if the trip is primarily to look for a new job. The amount of time you spend on personal activity compared to the amount of time you spend looking for work is important in determining whether the trip is primarily personal or is primarily to look for a new job.
5. You cannot deduct job search expenses if there was a substantial break between the end of your last job and the time you begin looking for a new one.  
6. You cannot deduct job search expenses if you are looking for a job for the first time.

For more information about job search expenses, see IRS Publication 529, Miscellaneous Deductions. This publication is available on IRS.gov or by calling 800-TAX-FORM (800-829-3676).

 

Contact me if you need advice on how to take advantage of these deductions.

Reg Baker, CPA PFS
(702) 283-0784
reg@regbaker.com
http://www.regbaker.com/

Are Banks Really Lending?

Banks say they have plenty of money to lend. But are they lending?

What has been your experience?

Some of my clients (some very credit worthy with cash in the bank; and with over 15 years in banking I would know about credit worthiness) are being told by their bank's "Relationship Managers" at their branch that getting a working capital loan should not be a problem.  After completing all the necessary forms and providing the required financial statements and projections they get turned down from an out of state "Manager".  This despite all the local announcements that they have plenty of money to lend. 

This is very frustrating and a big waste of time.  Especially in the economic environment we are in that does not allow for wasted time and effort. 

Based on my experience and what I am seeing and hearing, even with all the advertising print to the contrary, banks are not lending in certain locations of their local or regional markets.  If they are experiencing a higher than expected loan failures in certain markets they reduce their exposure in those markets by not lending in those markets.  Sometimes the bank regulators even require this of the banks. 

So if this is the case, why can't the banks just be quiet about their cash hoard and lending opportunities in the markets with "challenges"?  It is all about image.  If the banks even hinted that they were not lending in specific markets the reaction of the residents and businesses in those markets would be swift and negative.  Deposits would begin to shift to other banks and before you know it those non lending banks wouldn't have all those cash balances to lend any more.  So they continue to mislead those challenged markets in order to maintain cash balances to lend in other markets. 

Welcome to the world of banking!

Reg Baker, CPA
Reg Baker, CPA Website

Summertime Child Care

Summertime Child Care Expenses May Qualify for a Tax Credit

 

Did you know that your summer day care expenses may qualify for an income tax credit? Many parents who work or are looking for work must arrange for care of their children under 13 years of age during the school vacation. Those expenses may help you get a credit on next year’s tax return.

 

Here are five facts the IRS wants you to know about a tax credit available for child care expenses. The Child and Dependent Care Credit is available for expenses incurred during the lazy hazy days of summer and throughout the rest of the year.

1. The cost of day camp may count as an expense towards the child and dependent care credit.
2. Expenses for overnight camps do not qualify.
3. If your childcare provider is a sitter at your home or a daycare facility outside the home, you'll get some tax benefit if you qualify for the credit.
4. The actual credit can be up to 35 percent of your qualifying expenses, depending upon your income.
5. You may use up to $3,000 of the unreimbursed expenses paid in a year for one qualifying individual or $6,000 for two or more qualifying individuals to figure the credit.

For more information check out IRS Publication 503, Child and Dependent Care Expenses. This publication is available on the IRS Web site, IRS.gov or  Reg Baker CPA Internet Links (click on IRS Web Site)

 

Links:  

IRS Publication 503, Child and Dependent Care Expenses

http://www.regbaker.com/

 

Please contact me to discuss if you want a second opinion on any tax or personal financial planning topic.  I am always here to help!

Reg Baker CPA PFS

Reg Baker CPA Update

Hope everyone had a great 4th of July break!

For the next week or so I will be preparing to renew my securities licenses. Wish me luck!

Being securities licensed allows a higher level of service to clients that need this type of support.  Although many individuals already have an investment relationship there are times when a second opinion is needed or maybe even a change is necessary.  Please keep me in mind should either of these situations should present themselves.

Have a great week!

Reg Baker, CPA PFS

Investment Tax Rates Increasing

Tax Thunder Clouds Ahead!

Tax rate increases impacting investment activities will begin next year. Tax rate increases for income tax, dividends, capital gains all going up.

Consider taking capital gains now before increases take effect! Or take some capital losses now which will carry over to future years sheltering future investment capital gains.

With tax rates in the 40% range for some tax payers (and increasing) it is critical to always consider the tax impact on your investment returns.

Contact me if you need a second opinion!

Reg Baker, CPA PFS
http://www.regbaker.com/