New Businesses in LA: How Sales Tax Can Affect Your Initial ProgressPosted on October 23rd, 2017
LA County is enormous. It includes hundreds of cities and unincorporated areas that are vastly different, affecting how businesses operate even if they are a single zip code away. If you’re a new or developing business in the retail or retail-related industries, sales tax can impede your ability to attract customers and increase profits. For new businesses, their first year can be a volatile time, and sales tax is just one part of the developmental process. The following guide offers tips and ideas to make this initial timeline easier for your operation.
Tailor Products to your Geographic Area
Almost every city, incorporated town, and unincorporated area have their own tax laws and percentages. Per county law, the highest sales tax can be is 10.5 percent. These percentages can fluctuate yearly, depending on tax policies and when tax breaks end. Changes are often rolled into additional tax policy adjustments, and it’s important for businesses to be mindful of these small amounts, which immediately affects the price of their goods and services. The most accurate resource Is the California Government’s online tax resources. Visit the California Tax Board’s website to find sales tax rates for your area and any additional tax information you may require.
Balancing Cost of Goods to Profits
With higher taxes you might have to increase the cost of your goods to maintain profit levels, but how much can you increase it? Consider the common price point of your good across the industry you operate in. A balanced approach will keep your goods affordable, but high enough to maintain positive cash flow. If you can undercut businesses with similar products, this may boost the attraction of your products. LA County’s size means stiff competition for many businesses, but with a sought-after price, these factors balance, and you have found a way to support the success of your business.
Team up with a Tax and Business Professional
Tax law is complex and difficult to navigate, especially when you’re a new business owner. Relying on a CPA for tax and business support can ensure you are properly established, from the right entity to accounting practices. They help you calculate profits, expenses, and how to balance your budget in a way that leads to your operation’s success.
Contact Jeff Rose, CPA, for Expert Business Advice
Our firm has helped new and struggling businesses achieve measurable success despite the many challenges they face. Contact J.M.Rose, a firm dedicated to your business, for a personal and thorough consultation. We will get to know you and provide a plan to help you achieve strong financial standing.
Tips for Managing Your WealthPosted on October 6th, 2017
Whether you’re just beginning to save for the future, are looking to invest, or already have a robust portfolio, you have a variety of tools and options to increase your profitability. In addition to reducing your tax burden and creating a flexible budget, it’s important to establish long-term goals for your financial wealth. Consider the following tips when thinking about the kind of wealth strategies you wish to pursue.
Many Americans are living paycheck to paycheck, but even those who can put away a percentage of their income do not. It is more common and culturally supported to spend what you earn. If you are a young professional and have begun to earn a steady income, craft a budget that allows you to portion finances accordingly. It’s beneficial to set aside any excess money from your paycheck until you’ve saved enough to reach your goals, whether that’s buying a car or putting down a payment on a house. It’s easy to set up automatic transfers into savings accounts. For those with extra income to set aside for the future, you can consider a traditional or Roth IRA, as well as corporate savings offerings.
It’s never too late for anyone to set aside income for future use. Starting a retirement plan allows you the freedom to save at whatever pace you can afford. Your financial advisor can help you determine contribution amounts that will comfortably cover your living expenses after retirement while ensuring your current financial status isn’t compromised. If you have an established portfolio, property, and additional assets, setting up an estate plan or trust can protect how these assets are passed on and shield them from outside influence if health issues arise.
Reduce Your Tax Burden
Tax policy is constantly changing which affects how much taxpayers owe and the available deductions and credits. Minimizing taxes owed and maximizing your return offer many long-term benefits and help ensure you only pay what is owed. Although dealing with tax payments and estimation is difficult, it can pay off in the long run. You won’t need to fear an audit or penalties, and your tax record will be clean.
Many long-term investments affect how you are taxed, especially when you put your money towards a 401(k), IRA, or Roth IRA. By selecting an investment opportunity that is to your liking, or one that reduces your tax burden, you can greatly increase the income you keep.
Rely on Professional Assistance
People of any age can improve their financial management, all it takes is a bit of time and investment into dedicated budgets and plans. J.M.Rose offers wealth management assistance and expert advice that is personalized to your needs. With our help, you can increase the profitability of your accounts and increase your financial security. Call us today for a one-on-one consultation!
Tax Planning Tips for Small BusinessesPosted on September 15th, 2017
With tax season only a few months away, small business owners would benefit from organizing their paperwork and researching ways to reduce the amount they owe. Planning ahead offers unique benefits and has the potential to save a larger percentage of income than before. The following advice outlines the benefits business owners stand to gain with proper planning.
Start Planning Early
By organizing your financial paperwork ahead of time, businesses can avoid the potential errors which commonly occur due to last-minute filing. Whether it’s avoiding reporting incorrect earnings or noticing opportunities to decrease the amount owed to the IRS, businesses can increase their margin of success by planning for tax day ahead of time. With the additional leeway to address certain issues, businesses can avoid tax penalties and continue operating without fear or receiving an audit.
Calculate Credits, Deductions, and Estimates
Each year, tax policy changes. This alters how businesses can reduce taxes owed on income, or what is owed altogether. Sole proprietorships and small businesses have much to gain in the form of deductions and credits. From credits for office renovations (including home offices) to rebates for hiring veterans, businesses who plan ahead won’t miss out on these tax breaks that help protect their bottom line.
An enormous issue many business owners face is related to estimation. Those who do not have automated payroll tax withholding, or are self-employed individuals needing to calculate what they will owe at the time of filing are especially at risk. State and federal revenue agencies know these smaller entities have the opportunity to avoid reporting on income, which makes these regulatory bodies much more alert to discrepancies on income reported. If improper estimates lead to an inaccurate filing, your chances of receiving an audit increase greatly.
Correct Errors or Fix Discrepancies
If you are aware of estimation errors or inconsistencies with prior filings, then it is crucial to address them now. By correcting any mistakes from prior tax years, you are provided an opportunity to avoid severe penalties and clear your tax record, which will deter scrutiny from revenue agencies in the future.
Hire a Professional
J.M.Rose is an accounting firm with decades of experience with small business tax preparation. If you have tax problems or have a complicated filing, our expert staff will assist you. We pride ourselves on being personal and professional which grants clients’ peace of mind. Contact us today for a consultation!
Business Management for Executives and Working Professionals – Services provided by J.M.RosePosted on August 28th, 2017
Professionals and individuals with high-value portfolios can benefit additional assistance managing their wide assets and unique financial situations. J.M.Rose, an accountancy firm, offers this distinct support, which frees your time and energy to devote to your interests and independent businesses. To obtain this high-touch assistance, please contact us.
As a local to the Woodland Hills area, our founder is no stranger to the needs of individuals who have large portfolios and require knowledgeable service for their specific needs. Whether you’re an actor, executive, hedge fund manager, or someone who juggles many obligations, you require a dedicated manager who supports your continued success in your many endeavors.
Jeff Rose, founder of J.M.Rose, offers a wealth of experience with personal financial management to anyone who wants to reduce their stress regarding their portfolios. He understands how to deliver the specialized assistance that experienced professionals require.
Besides our experience, we ensure all our services are secure and meticulous. When sensitive financial information needs to be handled, or what you require is time-sensitive, we reliably fulfill your needs.
How We Can Help
As the personal manager for the many financial needs of working professionals in our area, there are many ways we can help. From accounting assistance for new home projects to reconciling accounts and saving your income from taxation, we effectively simplify organizing these important facets of your finances. We manage your finances according to individual needs, according to the level of involvement you wish to have.
We can also advise you on important decisions regarding new opportunities for your business. With our knowledge of tax code and experience in accounting for clients with distinguished economic standing, you benefit from skilled and knowledgeable assistance. It is our mission to improve the efficacy of your cash flow, making sure it is distributed properly to all assets and parties without an issue.
Contact J.M.Rose for Assistance, Today!
Our firm in Woodland Hills has helped individuals for decades. With our support, you may increase the efficiency of your finances and have mundane tasks taken care of, allowing you to focus primarily on your ventures. As a personal manager to your obligations, you receive one-on-one attention and high-touch care.
How CPAs Can Help Clients Avoid FraudPosted on August 17th, 2017
As a client, whether business or individual, you are entrusting your entire financial blueprint to your CPA. As such, you probably did your research before you chose your accountant, or perhaps you’re still on the lookout for the perfect candidate to place your faith in. Either way, as protectors of their clients, many CPAs consider it their duty to prevent their clients from falling victim to any number of scams.
Remember: your CPA has the responsibility to uphold high standards of ethics and professionalism; as such, they are accountable to uphold the integrity of not only themselves and their clients but their profession as well. Failure to abide may lead to fines or loss of license.
No one is immune to fraud – it affects the young, the old, and even major corporations.
A Look at the Numbers
Fraud is only growing in this country. Dave McClure of CPA Practice Advisor points out that the Fraud Enforcement Task Force within the FBI has uncovered more than $8 billion in securities, commodities, and investment fraud losses. In addition, the Federal Trade Commission estimates 48.7 million individual fraud transactions took place in 2005, with an average loss of $60 per transaction. This is why everyone should have a stock fraud lawyer on their side in the event this happens.
Online Tools. There are some tools out there gaining momentum on the market today: the Identity Theft Resource Center (http://www.idtheftcenter.org/) and the Scam Detector web site (http://scam-detector.com/) which can aid you in guarding against fraud. Discuss any questions with your CPA. These two sites are ripe with information on how to be more aware of fraud, how it happens and how to prevent it. ID Theft Center offers documents, videos, games, training workshops, and presentations on risk reduction for both businesses and individuals. Scam Detector blends the benefits of a web site and a smartphone app to help identify and resolve scams worldwide, with resources such as the Better Business Bureau’s list of the most prevalent scams each week.
Be wary of scams. In addition to online tools, there are white papers and research papers on fraud and how to prevent it. Your accountant may be able to point you in the right direction, such as this resource from the Office of the State Comptroller for New York (http://www.osc.state.ny.us/localgov/pubs/red_flags_fraud.pdf) entitled “Red Flags for Fraud.” The Leicestershire County government in the UK lists 20 common scams unearthed by auditors. Check out this link to see the most common forms of fraud, from tax fraud to phishing. (http://www.leics.gov.uk/audit_twenty_common_frauds_and_scams.htm)
Pull from knowledge of the industry. Your CPA is likely continually trained in their craft, taking workshops, updating their knowledge base and learning new tax laws each year. By drawing on their education, vast resources available from the IRS and others, and the auditing process itself, your CPA can help you get around the latest scams by taking the time to clue you in through, for example, online newsletters offered every month. This is especially true of older clientele who are statistically more likely to fall for scams due to their trusting nature. However, scams can and do happen to corporate clients and small businesses, bilking them of billions of dollars a year.
Reputable CPAs are doing their part to educate their clients on scams and fraud, helping build a better, more trusting relationship over time. Protecting your personal assets has never been more important, and with the right accounting services, your CPA can help you safeguard both you and your family. Located in Woodland Hills, J.M.ROSE (A CPA Firm) offers tax filing and preparation, business consulting, bookkeeping and more. Call 818-992-5800 or 800-992-5800 for your consultation.
IRS Identity TheftPosted on August 17th, 2017
Are you receiving suspicious emails or phone calls? People claiming they are they are the IRS and demanding money? The Internal Revenue Service has issued several recent warnings on the fraudulent use of the IRS name or logo by scammers trying to gain access to consumers’ financial information in order to steal their identity and assets.
According to the Federal Trade Commission, there are over 9 million victims of Identity Theft in the US every year. It has become a stressful challenge for individuals, businesses, organizations and government agencies, including the IRS.
So what exactly is Identity Theft? By Merriam-Webster’s definition, Identity theft is the illegal use of someone else’s personal information (such as their Social Security number) in order to obtain money or credit. In most cases of Identity theft, the victims remain unaware that their information has been stolen until they file their tax returns.
Thankfully, the IRS is being vigilant about this issue and has set up procedures in order to combat this crime. The Internal Revenue Service has joined with representatives of the software industry, tax preparation firms, payroll and tax financial product processors and state tax administrators to announce a sweeping new collaborative effort to combat identity theft refund fraud to protect the nation’s taxpayers.
The IRS has launched an awareness campaign in order to inform the general public about the need to protect their personal, tax and financial data online and at home. Arm yourself with information on how to detect scams and reduce your chances of being victimized by these cunning criminals.
The first thing to remember is that the IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels. They will never call with threats of jail or lawsuits. The people who are sending these emails and making these calls are impersonators trying to intimidate or trick people into giving them their personal information.
Second, protect your computer by using firewall and security software. Having an up-to-date anti-virus and pop-up blocker helps identify suspicious files and websites. Make sure to check out the authenticity of a company or website before entering any information.
Third, safeguard your records and personal information. Avoid carrying your social security card and other documents with your SSN in your wallet. Identity thieves can also use information shared via social networking sites, bills and old tax returns to gather information.
Lastly, help shut down Identity Theft and Phishing Schemes by reporting suspicious emails and phone calls. Forward IRS-related scam emails to email@example.com and report IRS-impersonation telephone calls at www.tigta.gov.
The Dirty Dozen: Identity Theft and Phone ScamsPosted on August 17th, 2017
It’s tax season once again, and while everyone is frantically getting their money matters in order, cyber criminals are also working tirelessly to cook up scams and schemes to trick unsuspecting victims into giving them private information that can be used to steal the victim’s’ identity.
The Internal Revenue Service warns taxpayers of the “Dirty Dozen” –a list of common scams that peak during tax filing season. These scams involve IRS impersonators who calls or emails individuals and businesses to trick, and even harass them into giving them their personal information. The IRS urges everyone to familiarize themselves with these tricks and be wary of people claiming to be from the IRS.
Identity theft occurs when someone uses another’s’ personal information, such as their name, Social Security number (SSN) or other identifying information, without their permission, to commit fraud or other crimes. In many cases, an identity thief uses a legitimate taxpayer’s identity to fraudulently file a tax return and claim a refund. Others use personal data they gained to steal their victim’s’ financial accounts, run up charges on the victim’s existing credit cards, apply for new loans, credit cards, and services or benefits in the victim’s name.
The number of tax-related identity theft incidents has increased substantially in recent years. The problem has grown worse as organized criminal actors have found ways to steal the Social Security numbers (SSNs) of taxpayers, file tax returns using those taxpayers’ names and SSNs, and obtain fraudulent tax refunds. Then, when the real taxpayer files a return claiming the refund, that return is rejected. The impact on victims is significant, and it may take a long time before the case is fully investigated and resolved.
The IRS has a special section on IRS.gov dedicated to identity theft issues, including YouTube videos, tips for taxpayers and an assistance guide. People who believe they are at risk of identity theft due to lost or stolen personal information should contact the IRS immediately so that the agency can take action to secure their tax account. They can also call the IRS Identity Protection Specialized Unit at 800-908-4490.
Pervasive Telephone Scams
The IRS has seen a recent increase in local phone scams across the country, with callers pretending to be from the IRS in hopes of stealing money or identities from victims.
Scammers generally use common names and surnames to identify themselves in these calls, and use fake IRS badge numbers to “prove” their identity. Some of them even do research on their victims, and can provide them with information such as their full name, address, birthdate and the last four digits of their Social Security Number.
Some of the more sophisticated ones can even imitate the IRS toll-free number on their victim’s caller ID and sends out fake emails to support their calls. A number of victims also reported that they heard background noise of other calls being conducted to make it seem like the scammers are operating from a call site.
These scams include many variations, ranging from instances from where the IRS impostors say the victims owe them money, or are entitled to a refund. Some calls even harass and threaten their victims with arrest or driver’s license revocation. These bogus calls are sometimes paired with follow-up calls from other fraudulent individuals pretending to be from the local police department or the DMV.
Another variation is a phone scam targeting recent immigrants throughout the country. Victims are told they owe money to the IRS and it must be paid promptly through a pre-loaded debit card or wire transfer. If the victim refuses to cooperate, they are then threatened with arrest, deportation or suspension of a business or driver’s license. In many cases, the caller becomes hostile and insulting.
The best thing to do when one encounters these phone calls is to stay calm and call the IRS directly 1-800-366-4484 to determine if the caller is a legitimate IRS employee. Having the caller’s name, badge number and call back number helps confirm their identity. If the IRS confirms that the person who called is indeed an IRS employee, call them back. If not, help shut down this scheme by reporting the incident to TIGTA and at firstname.lastname@example.org with the subject ‘IRS Phone Scam.’
Always remember that the IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels. They will never call with threats of jail or lawsuits. Being familiar with these scams helps reduce the risk of being victimized by these criminals.
Dirty Dozen Scam: PhishingPosted on August 17th, 2017
In an earlier article we posted, we talked about two out of the twelve most common scams listed in the Dirty Dozen, Identity Theft, and Phone Scams. The Dirty Dozen Listing is compiled by the IRS each year in an effort to inform taxpayers about the different forms of tax related schemes and how they can protect themselves against the criminals that are behind these scams. Today we will be talking about the next on the list, Phishing.
Phishing is the attempt to gain someone else’s personal information such as their username, password, and credit card information by posing as a trustworthy entity or organization via electronic communication such as emails or instant messaging. This scam is typically carried out by sending unsolicited emails containing malware or links to fake websites to unsuspecting victims. Opening such emails and clicking on the links attached exposes the user’s computer to malware and other potential threats that can track browser history or keystrokes.
Taxpayers should also be cautious about hyperlinks sent through such emails. Hackers have found several ways to spoof official websites to gain the user’s information and use it for malicious purposes. Misspelled URLs or the use of subdomains are the most common trick used by phishers. Many email clients or web browsers will show previews of where a link will take the user to the bottom left of the screen while hovering the mouse cursor over the link. Although it helps to identify whether the link leads to the official site or not, it is not foolproof, and in some cases may be overridden by the hackers.
The best way to deal with suspicious emails is to not respond to it at all. Any kind of email claiming to be from the IRS that contains a request for personal information, taxes associated with a large investment or inheritance or lottery are all scams. It is important to keep in mind that the IRS does not initiate contact with taxpayers by email to request personal or financial information. Forward the suspicious email as-is to email@example.com and delete the email afterward.
For users who fear they may be a victim of these emails and other scams, visit the IRS’s Identity Protection page at https://www.irs.gov/Individuals/Identity-Protection to learn more about this issue and for help in resolving it.
Dirty Dozen Scams: Return Preparer FraudPosted on August 17th, 2017
On today’s entry, we will be focusing on Return Preparer Fraud; next in line in the IRS’ Dirty Dozen, a list of the most common tax related schemes.
Most taxpayers use professionals to prepare their tax returns every year. It is important to choose an expert that is trustworthy and reliable to avoid refund fraud and identity theft. While most return preparers provide their clients with honest service, there are some deceitful people who prey on innocent victims this time of the year. The IRS urges everyone to be careful and uses only professionals who sign the returns they prepare and enter their IRS Preparer Tax Identification Numbers or PTINs.
Return preparer fraud generally involves the preparation and filing of false income tax returns by individuals or companies who claim inflated personal or business expenses, false deductions, unallowable credits or excessive exemptions on returns prepared for their clients. These people usually manipulate income figures in order to fraudulently obtain tax credits such as the Earned Income Tax Credit.
It is very important to note that when the IRS detects a false return, the taxpayer is held responsible for paying the additional taxes and interest and may even be subject to penalties; even if they have no knowledge of the fraudulent claims shown on their account.
This is why it’s imperative to choose your tax preparer very carefully. A paid tax professional is primarily responsible for the overall substantive accuracy of their client’s return and is required by law to sign the return and include their PTIN. Although the tax return preparer always signs the return of their client, the taxpayer is ultimately responsible for the overall accuracy of every item reported on their return.
Read on for some helpful tips to keep in mind when choosing a tax preparer.
Find out the person’s credentials. Only attorneys, certified public accountants (CPAs) and enrolled agents can represent taxpayers before the IRS in all matters including audits, collection, and appeals. Other return preparers may only represent taxpayers for audits of returns they actually prepared.
Be cautious of people who claim they can obtain larger refunds than other preparers, or those who base their fee on a percentage of the amount of the refund.
Consider electronic filing. The IRS provides an online database for all Authorized IRS e-file Providers that chose to be included in the database. Clients can find the closest authorized provider in their area by indicating their zip code in the IRS locator athttps://www.irs.gov/uac/Authorized-IRS-e-file-Providers-for-Individuals
Reputable preparers always ask to see their client’s records and receipts. They ask multiple questions to determine their client’s qualifications for expenses, deductions, and other items to help them avoid penalties, interest or additional taxes.
Always review the return before signing. Don’t hesitate to ask questions if something isn’t clear.
For those who know of an abusive return preparer or suspect tax fraud, they may report suspicious activity by completing the IRS Form 3949-A, Information Referral and sending it to Internal Revenue Service, Fresno, CA 93888. The form can be downloaded from the IRS website or mail-ordered by calling 1-800-829-3676.
Dirty Dozen Scams: False Promises of Free MoneyPosted on August 17th, 2017
But these messages are most likely sent by scammers to lure victims with false promises of “free money.” These fraudsters use flyers, advertisements, fake names and businesses, and even the word of mouth in order to get to as many people as they can. The most common prey of these scammers is people with no filing requirement, such as the elderly, or low-income individuals. Non-English speakers are also high on their list.
Scammers build false hope by tricking people into making claims for fictitious rebates, benefits or tax credits. They may pose as tax preparers and charge their victims with fees in exchange for legal advice. Or worse, they file a false return in a person’s name and that person would never know that a refund was paid.
Scam artists also victimize people with a filing requirement and due to a refund by promising inflated refunds based on fictitious Social Security benefits and false claims for education credits, the Earned Income Tax Credit (EITC), or the American Opportunity Tax Credit, among others.
There are also cases in where victims lost their federal benefits, such as Social Security benefits, certain veteran’s benefits or low-income housing benefits. The loss of benefits was the result of false claims being filed with the IRS that provided false income amounts.
While honest tax preparers provide their customers a copy of the tax return they’ve prepared, victims of scams are often not given a copy of what was filed. In most cases, the refund is credited to the scammer’s bank account, but there are also instances where the impostor deducts a large ‘professional fee’ before issuing the check to the victim.
Aside from a huge loss of money, victims of these scams may even end up being penalized for filing false claims or receiving fraudulent refunds, since the taxpayer is ultimately legally responsible for what is on their returns, even if it was prepared by someone else. The IRS urges everyone to take care when choosing an individual or firm to prepare their taxes and be wary of suspicious people, calls or emails claiming to be from the IRS.