News For Your Week Ahead: April 29, 2022

Tammy Nickels of Thompson Reuters joined us to tell you about a benefit included in your MSATP membership CCH TaxAware. Be sure to take care of this amazing program to track upcoming tax changes for you and your clients.

Watch on YouTube.


Jim Arnie joined us to give a final update on the Legislative session in Annapolis. Be sure to tune in to learn all this year’s tax changes that affect you and your business.

Watch on YouTube.

Coming Up: On Thursday, May 5 at 12 p.m. Rob Smith of Liscio will join us again for another episode in his Lunch & Learn series on Office 365. View our episodes live on LinkedIn, Facebook, YouTube, and Twitter! If you have questions for the speaker, you can ask them directly in the comments section of the stream on all platforms.


IRS Revises Tax Year 2021/Filing Season 2022 FAQs for the Child Tax Credit | IR-2022-96

The IRS issued a revised set of frequently asked questions for tax year 2021 and filing season 2022 for the Child Tax Credit. These frequently asked questions (FAQs) are released to the public in Fact Sheet 2022-28 PDF, April 27, 2022. The revision adds Topic F:  Commonly Asked Filing Season Questions, Questions 1 through 6.

For more information, click here.


Updated Mortality Improved Rates and Static Mortality Tables for Defined Benefit Pension Plans for 2023 | N-2022-22

Notice 2022-22 sets forth the updated mortality improvement rates and static mortality tables that are used for purposes of determining minimum funding requirements under § 430(h)(3) for 2023 and minimum present value under § 417(e)(3) for distributions with annuity starting dates that occur during stability periods beginning in the 2023 calendar year. Notice 2022-22 will be in IRB:  2022-20, dated May 16, 2022.

For more information, click here.


MSATP Sponsors A Taste for Pro Bono and MCEE’s 2022 Financial Education & Capability Teacher Awards

MSATP was happy to sponsor the MVLS A Taste for Pro Bono event and MCEE’s 2022 Financial Education & Capability Teacher Awards. Several of our MSATP members also volunteered to take on MVLS cases to help out within the community.

News for Your Week Ahead: January 7, 2022

On this week’s MSATP TV, Sami Satouri and Paul Chadowski of Quest Insurance kick-off 2022 on MSATP TV by telling you how they can help with your insurance needs.

Watch on YouTube.

Coming Up: On Tuesday, January 13th at 10 a.m., Don Hoffman of The Hoffman Group joins us to tell you all about our 2022 Interview Bootcamp. This bootcamp is an excellent opportunity for students who are applying for a job or internship for the first time to practice and hone their skills for an interview. To register for the interview bootcamp, click here.

Be sure to Like/Follow us on Facebook so you can catch MSATP TV live every week!


The Maryland Legislature Overrides Governor Larry Hogan’s Veto to Amend Job Creation Tax Credit Eligibility Requirements

The Maryland Legislature has overridden a veto by Gov. Larry Hogan to enact legislation amending the Job Creation Tax Credit. The law alters the definitions of “qualified position” and “revitalization area” for purposes of eligibility under the program. The changes apply to job creation tax credits certified after December 31, 2020.

For more information, click here.


IRS Revised Form 1024, Used by Most Types of Organizations to Apply for Exempt Status, to Allow Electronic Filing | IR-2022-2

As part of ongoing efforts to improve service for the tax-exempt community, the IRS has revised Form 1024, Application for Recognition of Exemption Under Section 501(a) or Section 521 of the Internal Revenue Code, to allow electronic filing. Beginning Jan. 3, 2022, applications for recognition of exemption on Form 1024 must be submitted electronically online at Pay.gov. The IRS will provide a 90-day grace period during which it will continue to accept paper versions of Form 1024 (Rev. 01-2018) and letter applications.

For more information, click here.


IRS Sending Information Letters to Recipients of Advance Child Tax Credit Payments and Third Economic Impact Payments | COVID Tax TIp 2022-03

The IRS started issuing information letters to advance child tax credit recipients in December. Recipients of the third round of the Economic Impact Payments will begin receiving information letters at the end of January. Using the information in these letters when preparing a tax return can reduce errors and delays in processing.

People receiving these letters should keep them. Do not throw them away. These letters can help taxpayers, or their tax professional prepare their 2021 federal tax return.

For more information, click here.

 

News For Your Week Ahead: November 19, 2021

On MSATP TV this week, Julie Weaver from the Maryland Council on Economic Education (MCEE) joined us to discuss the organization’s financial literacy initiatives.

Watch on YouTube.

Later this week, Tammy Nickels from Wolters Kluwer joined us on MSATP TV to highlight the CCH TaxAware program for MSATP members.

Watch on YouTube.

Interested in becoming an MSATP member to take advantage of this perk and other exciting benefits? Click here to join today.

Coming Up: On Tuesday, November 23 at 10 a.m., we have a special pre-Thanksgiving episode with Rob Smith of Point7Seconds to discuss his class on Microsoft Lists. Have you been struggling with workflow management in processing tax returns? Rob Smith has a solution to help you track your and your associates’ progress throughout a tax return. Give yourself the gift of proper workflow management this holiday season!

To register for the webinar, please click here.

Be sure to Like/Follow us on Facebook so you can catch MSATP TV live every week!


IRS Provides Guidance on Per Diem Rates and The Temporary 100% Deduction for Food or Beverages From Restaurants | IR-2021-225

The IRS issued Notice 2021-63 to make clear how the temporary 100% business deduction for food or beverages from restaurants applies to taxpayers properly applying the rules of Revenue Procedure 2019-48 for using per diem rates.

Previously, the IRS issued Notice 2021-25 providing guidance under the Taxpayer Certainty and Disaster Relief Act of 2020, which added a temporary exception to the 50% limit on the amount that businesses may deduct for food or beverages. The temporary exception allows a 100% deduction for food or beverages from restaurants, as long as the expense is paid or incurred in 2021 or 2022.

For more information, click here.


IRS Announces New Online Tool to Help U.S. Withholding Agents Validate Their 1042-S Data Prior to Filing | IR-2021-223

The IRS launched a new online tool designed to help U.S. withholding agents comply with their reporting and withholding responsibilities with respect to IRS Form 1042-S (Foreign Person’s U.S. Source Income Subject to Withholding).

The tool performs a quality review of data before submission to the IRS. Use of the tool does not change a withholding agent’s obligations to file Forms 1042-S with the IRS and furnish a copy of the Form 1042-S to the payee.

For more information, click here.


IRS Advisory Council Issues 2021 Annual Report | IR-2021-227

The Internal Revenue Service Advisory Council today issued its annual report for 2021, including recommendations to the IRS on new and continuing issues in tax administration.

The IRSAC is a federal advisory committee that provides an organized public forum for discussion of relevant tax administration issues between IRS officials and representatives of the public. IRSAC members offer constructive observations regarding current or proposed IRS policies, programs and procedures.

For more information, click here.


Resources to Make Tax Time Easier for U.S. Service Members and Veterans | COVID Tax Tip 2021-171

The IRS has a variety of resources to help members of the military, veterans and their families navigate the unique and complex circumstances that come with filing taxes while in the military. Reviewing these resources is a good way to get ready for the upcoming tax filing season.

For more information, click here.


Teachers Can Deduct Out-of-Pocket Classroom Expenses Including COVID-19 Protective Items | COVID Tax Tip 2021-169

Fall is here and another school year is in full swing. Many teachers are already dipping into their own pockets to buy classroom supplies that will help set their students up for success. Doing this all year long can add up fast. Fortunately, eligible educators may be able to offset qualified expenses they paid in 2021 when they file their tax return in 2022.

Educators who work in schools may qualify to deduct up to $250 of unreimbursed expenses. That amount goes up to $500 if two qualified educators are married and file a joint return. However, neither spouse can deduct more than $250 of their qualified expenses when they file their federal tax return.

For more information, click here.


IRS Criminal Investigation Releases Annual Report Highlighting 2,500+ Investigations, Law Enforcement Partnerships | IR-2021-232

Over 2,500 criminal investigations, the identification of more than $10 billion from tax fraud and financial crimes, and a nearly 90% conviction rate are just a few highlights from the IRS-Criminal Investigation (IRS-CI) Fiscal Year 2021 Annual Report. The report, released Thursday, details statistics, important partnerships and significant criminal enforcement actions from IRS-CI, the criminal investigative arm of the IRS, for the past fiscal year, which began Oct. 1, 2020 and ended Sept. 30, 2021.

“IRS-CI agents are the only federal law enforcement officers with the authority to investigate criminal violations of the U.S. tax code. Their work reinforces the backbone of our voluntary compliance tax system — a system that funds services and benefits for our nation, including defense, infrastructure and education,” said IRS Commissioner Chuck Rettig.

For more information, click here.


IRS Provides Answers to States and Local Governments on Taxability and Reporting of Payments from Coronavirus State and Local Fiscal Recovery Funds | IR-2021-231

The IRS provided answers regarding Coronavirus State and Local Fiscal Recovery Funds (SLFR Funds). These funds give eligible state and local governments a substantial infusion of resources to meet pandemic response needs.

The answers are in FAQs (FS-2021-16) and detail the tax consequences for individual recipients and the reporting requirements for the states and local governments and employers, as applicable.

For more information, click here.


Tax Professionals Can Now Order More Transcripts from the IRS | IR-2021-226

The Internal Revenue Service today announced that, effective Nov. 15, 2021, tax professionals are able to order up to 30 Transcript Delivery System (TDS) transcripts per client through the Practitioner Priority Service® line. This is an increase from the previous 10 transcripts per client limit.

“Increasing the number of transcripts a caller can receive addresses the concerns the IRS has received from PPS callers. This is another example of addressing concerns from our partners and stakeholders,” said Ken Corbin, the Wage and Investment Commissioner and the IRS Taxpayer Experience Officer.

For more information, click here.


IRS Announces Changes to Retirement Plans for 2022 | Tax Tip 2021-170

Next year taxpayers can put an extra $1,000 into their 401(k) plans. The IRS recently announced that the 2022 contribution limit for 401(k) plans will increase to $20,500. The agency also announced cost of living adjustments that may affect pension plan and other retirement-related savings next year.

For more information, click here.


IRS Unveils New Online Identity Verification Process for Accessing Self-Help Tools | IR-2021-228

The IRS announced the launch of an improved identity verification and sign-in process that enables more people to securely access and use IRS online tools and applications.

Taxpayers using the new mobile-friendly verification procedure can gain entry to existing IRS online services such as the Child Tax Credit Update Portal, Online Account, Get Transcript Online, Get an Identity Protection PIN (IP PIN) and Online Payment Agreement. Additional IRS applications will transition to the new method over the next year.

For more information, click here.


IRS: Families Will Soon Receive November Advance Child Tax Credit Payments; Time Running Out to Sign Up Online to Get an Advance Payment in December | IR-2021-222

The Internal Revenue Service and the Treasury Department announced today that millions of American families will soon receive their advance Child Tax Credit (CTC) payment for the month of November. Low-income families who are not getting payments and have not filed a tax return can still get one, but they must sign up on IRS.gov by 11:59 pm Eastern Time on Monday, Nov. 15.

This fifth batch of advance monthly payments, totaling about $15 billion, will reach about 36 million families across the country. The majority of payments are being made by direct deposit.

For more information, click here.

News For Your Week Ahead: October 8, 2021

This week, Jonathan Rivlin, CPA gave us a full rundown of his upcoming seminar/webinar on October 21, including some new and exciting updates to the course. If you have not thought about what your firm should look like given the new electronic payment thresholds like Venmo and PayPal, don’t miss this course! Check out the details below.

Watch on YouTube.

Coming Up: On Thursday, October 14, at 10 a.m., Allen Ayers, CPA, CFP will be joining us to discuss his upcoming seminar and webinar, Mergers & Contingency Planning on October 21, 2021.

Be sure to Like/Follow us on Facebook so you can catch MSATP TV live every week.


Farmers and Ranchers Affected by Drought Have Additional Time to Replace Livestock | Tax Tip 2021-146

Farmers and ranchers who were forced to sell livestock due to drought may get extra time to replace the livestock and defer tax on any gains from the forced sales. Here are some facts about this to help farmers understand how the deferral works and if they are eligible.

  • The one-year extension gives eligible farmers and ranchers until the end of the tax year after the first drought-free year to replace the sold livestock.
  • The farmer or rancher must be in an applicable region. An applicable region is a county designated as eligible for federal assistance, as well as counties contiguous to that county.

For more information, click here.


N-2021-58: Extension Timeframes for Elections and Payments of COBRA Premiums | N-2021-58

Notice 2021-58 clarifies the application of the extension of timeframes by the Joint Notice (85 FR 26351, May 4, 2020) and EBSA Disaster Notice 2021-01 (Feb. 26, 2021) (Emergency Relief Notices) to elections and payments of COBRA premiums during the COVID-19 National Emergency. This notice clarifies that the disregarded period for an individual to elect COBRA continuation coverage and the disregarded period for the individual to make initial and subsequent COBRA premium payments generally run concurrently. This notice also addresses the interaction of these rules with the ARP COBRA premium assistance and Notice 2021-31, 2021-23 IRB 1173 (June 7, 2021).

For more information, click here.


ABLE Accounts: A Valuable Financial Solution For People with Disabilities | Tax Tip 2021-148

Achieving a Better Life Experience or ABLE accounts are tax-advantaged savings accounts for individuals with disabilities and their families. These accounts help disabled people pay qualified disability-related expenses without affecting their eligibility for government assistance programs.

For more information, click here.


Here’s How A Taxpayer’s Custody Situation May Affect Their Advance Child Tax Credit Payments | COVID Tax Tip 2021-147

Parents who share custody of their children should be aware of how the advance child tax credit payments are distributed. It is important to remember that these are advance payments of a tax credit that taxpayers expect to claim on their 2021 tax return. Understanding how the payments work will parents to unenroll, if they choose, and possibly avoid a possible tax bill when they file next year.

For more information, click here.

News for Your Week Ahead: July 29, 2021

Connie Hess and Marc Reibman of USB Payment Processing join us to discuss their new cash flow management program Merchant as a Service.

Watch on YouTube.

Jonathan Rivlin joins us to tell us about his upcoming seminar and webinar, Firm of the Future on October 21st in Columbia, MD, or virtually.

Watch on YouTube.

Coming Up: On Wednesday, August 4th at 10 a.m., First Vice President Ana Barnabe will join us to tell us all about all the benefits of an MSATP membership! Are you certain you are taking full advantage of your membership? If not, tune in to find out about your benefits!

Be sure to Like/Follow us on Facebook so you can catch MSATP TV live every week.


NFIB: Senate Bill Limiting Small Business Deduction Will Hurt Small Business

The Hill reported that Senate Finance Committee Chairman Ron Wyden (D-Ore.) “released a bill that would overhaul a deduction for noncorporate business income that was created by Republicans’ 2017 tax law.” NFIB Vice President of Federal Government Relations Kevin Kuhlman “said in a statement that Wyden’s bill ‘would directly hurt small businesses’ ability to hire, invest in their businesses, and increase employees’ compensation, and threatens the fragile economic recovery.’”

For more information, please click here.


Security Summit: Tax Pros Should Encourage Clients to Obtain IP PINs to Protect Against Tax-Related Identity Theft | IR-2021-158

Internal Revenue Service Security Summit partners called on tax professionals to increase efforts to inform clients about the Identity Protection PIN Opt-In Program that can protect against tax-related identity theft.

The IRS, state tax agencies, and the nation’s tax industry – working together as the Security Summit  – need assistance from tax professionals to spread the word to clients that the IP PIN is now available to anyone who can verify their identity.

For more information, click here.


Guidelines for the Application of the Retail Sales and Use Tax to Sales of Accommodations Facilitated by Accommodations Intermediaries 

Effective September 1, 2021, Senate Bill 1398 (2021 Acts of Assembly, Special Session I, Chapter 383) changes the application of the Retail Sales and Use Tax to sales of accommodations facilitated by accommodations intermediaries. The legislation makes similar changes to the local transient occupancy tax. Additionally, these changes will apply to the state-imposed transient occupancy taxes that fund transportation purposes in certain localities under Va. Code § 58.1-1743 and Va. Code § 58.1-1744 because these taxes are administered by local governments in the same manner as their local transient occupancy taxes. Virginia Tax has issued guidelines to provide processes and procedures for implementing the provisions of Va. Code §§ 58.1-602, 58.1-603, and 58.1-612.2, relating to the Retail Sales and Use Taxation of accommodations, as required by Senate Bill 1398.

For more information, click here.


Here’s what Taxpayers Need to Know About Higher Education Tax Credits | Tax Tip 2021-106

As a new school year approaches, students are considering what classes they need to take and how much the classes will cost. Whether it’s community college, a trade school, a four-year university or an advanced degree, higher education is expensive. The good news is tax credits can help offset these costs.

These credits reduce the amount of tax someone owes. If the credit reduces tax to less than zero, the taxpayer could even receive a refund.

For more information, click here.


Franchot Announces Shop Maryland Tax-Free Week, August 8-14 | Comptroller of Maryland

Comptroller Peter Franchot has announced that Shop Maryland Tax-Free Week returns August 8-14 with significant savings for consumers, scholarship opportunities for college and trade school students, and a much-needed sales boost for retailers.

“Tax-free week is a rite of Maryland’s late summer, signaling the approach of a new school year, cooler weather and a change of wardrobe,” Comptroller Franchot said. “Maryland’s high vaccination rates means life is beginning to return to normal. While I continue to urge caution, Marylanders should take advantage of tax-free week savings and support locally owned businesses that have been hit hard during the pandemic.”

For more information, click here.


Tax Tips for Students Working Summer Jobs | Tax Tip 2021-108

During the summer many students focus on making money from a summer job. They may want to gain work experience, earn some spending money or help pay for college. Here are some facts all student workers should know about summer jobs and taxes.

Not all the money they earn will make it to their pocket because employers must withhold taxes from their paycheck.

For more information, click here.


Special Edition of e-News for Small Business – Information for FIRE Users | Issue Number: 2021-11

The IRS will be making significant improvements to the Filing Information Returns Electronically (FIRE) application process for new users. The new online Information Returns (IR) Application for Transmitter Control Code (TCC) is scheduled to deploy on September 26, 2021. The new application will be available on IRS.gov and will replace both the current Form 4419 and the Fill-in Form 4419 on the FIRE System.

For more information, click here.

News for Your Week Ahead: June 18, 2021

On this weeks’ episode of MSATP TV, Jerry Lotz join Executive Director Bill Feehley to tell us how CostSeg can help and you clients be fiscally fit.

Watch on YouTube.

Coming Up: On Thursday, June 24 at 10 a.m., Michael Ashley of Registered Agents will be joining us to discuss how he can help you and your clients incorporate a business, form a limited liability company, or for other incorporation needs in all 50 states! Like/Follow us on Facebook to see this episode and more!


Update on Mandatory Electronic Filing for Form 4720 by Private Foundations

Section 3101 of the Taxpayer First Act requires certain exempt organizations to file information and tax returns electronically for tax years beginning after July 1, 2019. Private foundations required to file Form 4720, Return of Certain Excise Taxes Under Chapters 41 and 42 of the Internal Revenue Code, are included in the electronic filing mandate. Pending conversion of Form 4720 to electronic format, the IRS continued to accept the 2019 tax-year version of this return on paper. While software for the electronic version of Form 4720 has been under development, the IRS also continued to accept the 2020 tax-year version of Form 4720 from private foundations on paper. See Notice 2021-01, 2021-2 I.R.B. 315.

For more information, please click here.


IRS Unveils Online Tool to Help Low-Income Families Register for Monthly Child Tax Credit Payments | IR-2021-129

The Treasury Department and the Internal Revenue Service unveiled an online Non-filer Sign-up tool designed to help eligible families who don’t normally file tax returns register for the monthly Advance Child Tax Credit payments, scheduled to begin July 15.

This tool, an update of last year’s IRS Non-filers tool, is also designed to help eligible individuals who don’t normally file income tax returns register for the $1,400 third round of Economic Impact Payments (also known as stimulus checks) and claim the Recovery Rebate Credit for any amount of the first two rounds of Economic Impact Payments they may have missed.

For more information, click here.


New FAQs Available to Aid Families and Small Business Under the American Rescue Plan | IR-2021-128

The Internal Revenue Service today posted two new, separate sets of frequently-asked-questions (FAQs) to assist families and small and mid-sized employers in claiming credits under the American Rescue Plan (ARP).

Both the child and dependent care credit as well as the paid sick and family leave credit were enhanced under the ARP, enacted in March to assist families and small businesses with the fallout of the COVID-19 pandemic and recovery underway. The two sets of FAQs provide information on eligibility, computing the credit amounts, and how to claim these important tax benefits.

For more information, click here.


Filing Payroll Taxes Electronically Makes Good Sense | Tax Tip 2021-86

Running a business with employees can be hard work. One way business owners can make things a little easier on themselves is by filing payroll and employment taxes electronically. There are several benefits to filing these forms electronically:

  • It saves time.
  • It’s secure and accurate.
  • The filer gets an email to confirm the IRS received the form within 24 hours

There are two convenient ways businesses can e-file:

  • Employers submitting the forms themselves will need to purchase IRS-approved software. There may be a fee to file electronically. Also, the software will require a signature by one of two ways:
  • The software instructs the user to apply for an online signature PIN.

Taxpayers should allow at least 45 days to receive their PIN.

  • The user can scan and attach Form 8453-EMP, Employment Tax Declaration for an IRS e-file Return.
  • Employers can have their tax professional file the form for them. The Authorized IRS e-file Providers for Individuals and Businesses can help employers locate an Electronic Return Originator near them.

For more information, click here.


Facts to Help Taxpayers Understand Backup Witholding | Tax Tip 2021-85

Backup withholding is a federal tax on income that otherwise typically doesn’t require tax withholding, such as 1099 and W2-G income. Taxpayers who receive this type of income may have backup withholding deducted from their payments.

Here are some basic facts about backup withholding.

Backup withholding is required on certain nonpayroll amounts when certain conditions apply.

The payer making such payments to the payee doesn’t generally withhold taxes, and the payees report and pay taxes on this income when they file their federal tax returns. There are, however, situations when the payer is required to withhold a certain percentage of tax to make sure the IRS receives the tax due on this income.

For more information, click here.


News from the Justice Department’s Tax Division 

The United States has filed a complaint in the U.S. District Court for the Middle District of Georgia, Macon Division, seeking to bar Shondre D. Pitts, an Irwinton, Ga., tax return preparer, from preparing tax returns for others. The civil complaint against Pitts alleges he has a long history of preparing fraudulent returns and, as a result, his customers may face large income tax debts and may be liable for penalties and interest.

Hildares Kinkesha Parker-Greene, a Kinston, N.C., return preparer, was sentenced to 30 months in prison for conspiring to file false tax returns for her clients. In addition to the term of imprisonment, Parker-Greene has been ordered to serve three years of supervised release and pay $442,576 in restitution to the IRS.

Herbert E. Lewis, a Georgia certified public accountant, has been charged with one count of conspiracy to defraud the United States, 24 counts of wire fraud, 32 counts of aiding or assisting in the preparation of false federal tax returns and five counts of filing false federal tax returns. If convicted, Lewis faces a statutory maximum sentence of 20 years in prison for each count of wire fraud, five years in prison for conspiring to defraud the United States, three years in prison for each count of filing a false tax return and three years in prison for each count of aiding and assisting in the preparation of a false tax return. He also faces a period of supervised release, monetary penalties and restitution.

Social Security Administration Online Access // FB Live Recap

One update we had to mention is Franchot announced the BPW approval of a $160 million contract to replace the state tax processing system. Some of the areas covered: adjusting fraud prevention, increase ability of taxpayers to match their account via an online self-service application, best practice for security standards, audit collection reporting and estimating functionality, and security. Security tends to be a hot topic at all times due to enhancements in the field, tightening the reins, and increasing protection where possible.

Talking about security…

Let’s switch gears into Social Security. Chuck Liptz agreed to come down and talk to our members and our followers about what’s going on in Social Security and how we can benefit from what services they have to offer. Bonus, these services are online. Yay!

Chuck used to be the director of employer wage reporting and relation staff, so he not only has an understanding of the wage reporting process but also you as their customer base. Everything he had to share with us happens to be FREE. As a service provider, what you choose to charge your client is up to you, but all the services that the Social Security Administration has to offer are free.

A few reminders you’ll need to know for 2018:

  • SS tax rate is 7.65%
  • Self-employment rate is 15.3%
  • And the max for SS Earnings is $128,400
  • There’s no maximum for Medicare Taxes

You must give W2’s to employees by January 31st. Same due date applies, whether paper or electronic, to submit your W2’s to the Social Security Administration. If you fail to comply, you could be penalized by the IRS after that date.

All numbers are the same for 2019 except SS Earnings goes up to $132,900.

Up to 90% of all the W2’s received by the Social Security Administration comes in electronically. Remember, all services are free, so filing your W2s electronically is also free! Take advantage of that assistance if you aren’t already.

Visit https://www.ssa.gov/employer/ and register for a username and password to access handbooks, tutorials, videos, among other resources. Simply register as an individual on behalf of the company rather than registering for each company separately. Theoretically, you could register on the 30th and have your w-2’s sent in on time on the 31st (but we recommend registering with a wider window of time). Most cases provide immediate usage upon signing up so long as you meet all of the requirements. Security is our middle name, so we set up a process to make the verification procedure as secure as possible.

After 90 days, your password goes into a hole. The next time you come in after (be it 90 days or 120 days or longer), we tell you to put in your old password and change it to a new password. This step means you don’t have to check in every 90 days.

Electronic Wage Reporting Online

If your software creates a file, you tell us where on your computer it is, you hit upload, we get it, and then you receive confirmation as well as the “receipt” with a code for the file that you sent. Applying this into your activities will save you a bit of hassle. Being able to upload and send to the Social Security Administration with relative ease and having a way to keep track of the trail in a simpler manner. Information at your fingertips.

W-2 Online

Clients need to give papers to their employees. The online form to fill out looks like the paper version, so you can do up to 50 of these via the website at one time for free. You can also put in the state information, but it doesn’t go TO the state. All the information will be stored there, but you still have to deal with that aspect separately.

When you finish entering information, you need a W3, and the website will generate that for you. All the math is done for you, and the math will be correct if no errors were made. So, you want to match it to the 941s, but it will all be there for you with a confirmation to click “yes” it all correlates.

You can print out all the appropriate copies and just save the PDF’s rather than keeping the paper copies somewhere. This measure allows you to have the PDF readily available. Save the file to a folder, and you can give it to your client right then and there when they need it.

How do I know you did this?

When you inevitably get asked that question, you can print out the confirmation with the number, provide the assurance that they got it on time to prevent late penalties, etc. There’s an earlier version when filing in which you can print out information and ensure everything is correct or check for any changes that need to be applied.

W-2C

The website offers a free service to print out paper copy after entering this information online, as well.

SSNVS (Social Security Number Verification Service)

An important note: this application only ensures that the names and numbers match the Social Security Administration records. When someone gets hired, look them up right then and there. Before you send in W2’s or do payrolls, you want to check the numbers and names. People change their names (married, divorced, etc.) and sometimes forget to report those alterations.

The information will not be shared with anyone else. The correct name or number will also not be given, so you can try various combinations in case they forgot something or mixed up letters or numbers. We all have those moments.

The verification codes will say the name, number, they match or don’t match, date of birth may not match, or there’s another problem that says they need to go into the local Social Security office to handle. If something doesn’t match, check for typos and correct information, ask to see the cards (you can’t demand, but you can ask to see the card), or ask them to check with the local Social Security Office.

You can also perform this process on behalf of your clients. Just put in their EIN to begin checking information for them. Up to 250,000 Social Security Numbers per file can be analyzed, and you get a response by the next business day! How amazing is that?

Employer Correction Request Notices (EDCOR)

This year, starting around the end of March or early April, any W2 file that you send to the Social Security Administration (SSA) that has a name or Social Security Number mismatch will have a letter sent to the employer – not to you as the third party but to the employer – that states the name and number does not match. For that reason of receiving that notification, you want to use the verification service. You can take a look at the examples of what to expect in the notice online. In the memo, the employer is informed about the issue and what to do to try to fix the problem.

MySocial Security (www.ssa.gov/myaccount)

Signing up for a mySocial Security account gives you access to a plethora of information about the benefits whether you currently collect or not. Say you didn’t get or can’t find your 1099 information. With a mySocial Security account, you can look up that data and print it out. The account is very easy, very efficient, and simple to use to get all the information you need.

If you don’t receive Social Security Benefits, you can:

Request a replacement Social Security (SS) card if you meet certain requirements, check the status of your application or appeal, get your SS statement to estimate your future benefits or verify your earnings or view the estimated SS and Medicare taxes you’ve paid, and get a benefit verification letter.

If you receive benefits or have Medicare, you can:

Request a replacement SS card if you meet certain requirements, report your wages if you work and receive SS Disability Insurance (SSDI) and/or Supplemental Security Income (SSI) benefits, get your benefit verification letter, check your benefit and payment information, change your address and phone number, start or change direct deposit of your benefit payment, request a replacement Medicare card

Tip:

If you want to visit a field office, make an appointment ahead of time. You don’t want to sit in the office for hours on end to file for benefits. So, call ahead and prevent that wait. However, pretty much anything you need is on the website which is always available.

Let’s use their services as we’ll be getting into our busy season for W2 preparation. E-filing the W2 and W3 will be a big timesaver.

All of these changes will have no impact on the 2019 tax season. This is a process and will take several years to build the entire thing. Smooth sailing!

SSA Helpful Resources:

www.ssa.gov/employer (wage reporting, employer tax information, etc.)
General Wage Reporting Questions – 1-800-772-6270 or by email at employerinfo@ssa.gov
BSO technical Help 1-888-772-2970 or by email at bso.support@ssa.gov
Employer Services Liaison Officers (ESLO) 8 of them nationwide
Social Security Administration Website – www.ssa.gov
1-800-772-1213

Pre-Tax Season Kick Off

On January 17th, a Thursday, we will be celebrating here in the office. We invite you to come for a little wine and cheese, talking about what’s going to be happening, commiserating all together, and toasting into the next wonderful filing season. Plus, free shredding! Bring some items to shred and we’ll shred those for you for free. We hope to see you there.

Happy New Year!

Protect Your Finances and Prepare This Holiday Season // Facebook Live Recap

As we move into the new year and through the holiday season, we need to keep a couple of items in the forefront of our business minds.

Scamming increases during this time, so take precautions to prevent becoming a victim. If you have an FSA (Flexible Spending Account), figuring out if you have a balance left to use should be done now so you don’t lose those funds. And, we have a couple of reminders for you!

That Scamming Business

This week is the IRS’s 3rd Annual National Tax Security Awareness Campaign that runs the entire week. They are bringing this topic to the forefront because of the huge scams we’re seeing out there. Every day they are putting out a notice in the form of a post on their website about how to protect your data and financial records. They also had a free webinar Monday on “Understanding the Dark Web” covering this topic. Feel free to check that out and look through those posts to reduce your risk.

When bringing your computer to and from the office, consider the importance of not leaving it exposed in your car. If you plan to stop somewhere to shop, take that extra time to either run back to the office to grab the computer or drop it off at home prior to shopping. On that shopping trip, a great idea for a gift would be a wallet with an RFID blocker in it so scammers can’t scan someone’s wallet and get their credit card numbers or anything. Also, be sure your firewall software remains updated, do not leave your hard drive on overnight, and 2-factor authentication when using a cloud service may be a good thought.

Use It or Lose It

Since January is right around the corner, those Flex Spending Accounts need to be looked at. Health Savings Accounts will continue to build, but you forfeit an FSA money back to your employer if not used. Many employees may not even be aware of what ways to use these plans. There’s a pretty wide range of possibilities, such as:

  •      Medical
  •      Dental
  •      Vision
  •      Sunscreen SPF 30 or above
  •      Acupuncture
  •      Prenatal Vitamins
  •      Prescriptions
  •      Hearing aids

You can even use your FSA dollars to sign up for an Aflac plan and get extra benefits on top of your current insurance. Basically, any type of health care that either isn’t fully covered or may not be covered at all by your insurance can be weighed as an option for an FSA expense.

REMINDER: Spaces are still available for the Payroll Class December 13th from 3:30-5:30 with past President of MSATP, William Feehley, CPA. You could even make a whole day of it with ethics, Maryland tax update, and payroll update classes.

Topics that will be covered include:

Diving into workman’s compensation insurance and independent contractor groups among other items. He will be discussing issues that affect you as a tax preparer rather than simply explaining how to fill out a 940 and 941.

Where workman’s comp insurance is concerned, you want to look at whether you are getting and using all of it. If you’re paying for insurance that isn’t being used, you may want to elect into that insurance for the officers and others beyond the main employees. Checking into this will at least get through to your minimums.

When you think about what you use your independent contractors for, you need to examine control. If you have any kind of control over what they do, that is almost a guarantee that they are actually an employee. Telling someone they have to be to work at 8:00 in the morning and you’ll provide the tools and everything they need to do the job for that day, they probably will not fit into the contractor category even though you want to pay them that way.

Then, subcontractors will no longer be considered as part of the wages for increasing your QBI deduction. Also, taking care of any unemployment taxes you need to match up front, so you prevent getting hit with a huge liability that can crush you if you allow it to grow while waiting. Be diligent in knowing whether or not subcontractors are subject to unemployment

If you’re a sole proprietor or LLC, make sure clients issue a 1099 if you receive more than $600 from them. Also, the first year for this requirement, landlords must be issued 1099s for the rent being paid. The filing deadline for paperwork is January 31st. In prior years, you could get an automatic 30-day extension for those forms. But this year, not only do you need to apply for that extension, they can choose to either grant you the extension or not.

To hear more about these topics and more, join William Feehley, CPA December 13th in the Payroll Class.

Another great objective to contemplate is a website. If you’re not on the internet, you better get there! Websites for Tax Pros builds websites for pretty much everyone who’s a Maryland Society Attendee (and hopefully member). A low-cost provider, they offer a $99 setup, then just $49 per month which is a special for anyone who attends a Maryland Society Seminar.

Custom templates, content, and IRS updates come provided to you as a service. We all know January to about April, you won’t be touching your website. To get a website up and running, you can expect about 2-3 weeks. Although they’re hitting their busy season, they always meet a deadline.

Starting with templates, they still ensure that every single website is unique for the individual user. After giving you the starting point, they customize it from there (move menus, color changes for logo, etc.). You can do it yourself or have the power of a web developer if you want one.

If you have tax software that integrates, they can link that in. They also offer a share file if you do not have a portal or it’s cost-prohibitive which starts at $19 per month when you pay annually. This share file includes one user and an unlimited amount of client accounts with many user-friendly and simplifying features. Get in touch with them at https://www.websitefortaxpros.com or call them at 302-401-4717.

Reminder: Get your PTIN renewed! December 31st is the due date. Do not wait until the last minute to get it done, you never know if the IRS system will go down. So, remember to do it now and complete it before the 31st.

Financial Education In the Workplace

It’s no secret that there’s a financial literacy problem in America. In fact, we’ve covered the issue in greater detail on our blog in the past. Financial stress can be a great burden on any individual, especially young professionals just starting their careers, and if you have an employee stressed out about their finances, you can expect to see a decline in performance — which means your business could potentially take a hit.

If you care about the wellbeing of your employees and you want your business to maintain an upward trajectory, setting up a financial literacy program in the office may prove beneficial. It might be difficult to justify spending a great deal of time and money on such a program, but if you have employees who will be working with you for a long time, you can count on reaping the benefits once you provide them with such education.

Don’t have the capacity to take on the task of teaching your employees about their finances? That’s nothing to worry about — there are plenty of professionals out there that you can hire to  teach your employees about various aspects of their personal finances. On top of that, you can find programs online that teach employees about various topics like 401k’s, interest, identity theft, budgeting, and more.

Before your employees have had the opportunity to learn about managing their finances, make sure you sit down with them to get a better understanding about how much they know. Then, once they’ve received the education and training, have another conversation using the same questions you asked them before to see what kind of progress they’ve made. Not only will this reassure you that you spent your time and money on a program that was worth it, but it will also increase your employee’s confidence in their ability to manage their finances, making them happier and therefore less stressed at work.

At this year’s Solo & Small Firm Principal’s Conference in Bethany Beach, DE, MSATP members learned about the importance of financial literacy from the Maryland Council on Economic Education. Some attendees are participating in the Stock Market Game which is used to teach financial literacy in Maryland schools.

If you would like to learn more about how to get involved in the conversation about financial literacy, give us a call at 1-800-922-9672, or email us at info@msatp.org.

Want to learn more about the financial literacy problem? Check out this infographic.

Why Is America Struggling With Financial Literacy?

According to PEW, the U.S. household debt has reached $13.2 trillion in the first quarter of 2018, which is higher than what it was during the 2008 financial crisis. Additionally, student loan debt has reached a record high of $1.5 trillion in the first quarter of 2018.

Does America’s increasing debt have something to do with the fact that only 17 out of the 50 states have personal finance as a prerequisite for high school graduation?

Kentucky is one of the states that’s behind in financial literacy. They have the eighth-highest personal bankruptcy rate in the U.S., with 345 bankruptcy filings per 100,000 residents.

PEW relates that last year, Kentucky’s state Treasurer Allison Ball spoke to high school seniors about credit cards and finance, but saw that the information being relayed to them was met with blank stares. She attributes that to the fact that one week before graduation, the students were unaware of what the term “interest” even meant.

In 2020, Kentucky will require incoming high school freshmen to take a financial literacy course before they graduate. In the course, students will learn how to understand and manage their credit, create a budget, take out a loan for a large purchase, and even how to save for retirement.

It took six years for Kentucky policymakers to finally bring this financial literacy measure into law. Though there are no studies to prove how financial literacy classes affect students as they transition into adulthood, Kentucky state officials are hopeful that by investing in their students, they will bring about a change for the state’s financial status.

Maryland is one of the states whose Board of Education, in 2011, set financial literacy standards for grades 3 through 12. However, whether or not these standards are implemented has been left up to each school district. For more information about the state of financial literacy in Maryland, tune into last week’s Facebook Live to hear from the State of MD Financial Literacy Committee.

What do you think — should financial literacy be a required high school prerequisite around the country? Leave your thoughts in the comments below!