IRS Get Ready Campaign

IRS Get Ready campaign — take steps now for 2019 tax filing season There are important changes that you need to know before the 2019 filing season begins. The IRS is launching the fall series of "Get Ready" communications and outreach messages to help you take action to file your tax returns timely and accurately next year.

IRS.gov/getready provides information about issues and actions you can take now to be ready to file your 2018 tax return and avoid tax surprises. In addition to news releases that will be issued through the end of the year, IRS developed a new Publication 5307, Tax Reform Basics for Individuals and Families. It’s available on IRS.gov/getready to help you learn about how tax reform may affect your tax return.

In addition to lowering the tax rates, some of the changes in the law that affect individual taxpayers, like you and your family, include:
• increasing the standard deduction, • suspending personal exemptions,
• increasing the child tax credit,
• adding a new credit for other dependents and
• limiting or discontinuing certain deductions.

The Get Ready campaign covers several key areas in addition to tax reform that affects different taxpayer groups. Some taxpayers must renew an expiring Individual Taxpayer Identification Number. And, if you are using a tax software product for the first time you will need your adjusted gross income from your 2017 tax return to validate an electronically filed tax return. Additionally, if you claim and qualify for the Earned Income Tax Credit or the Additional Child Tax Credit, you may experience a refund hold. By law, the IRS cannot issue refunds before mid-February for tax returns claiming EITC or the ACTC. This applies to the entire refund, even the portion not associated with these credits. You may receive a smaller refund - or even owe an unexpected tax bill – when you file your 2018 tax return next year, especially if you did not adjust your withholding this year after the withholding tables changed. Perform a paycheck checkup to avoid an unwelcome surprise at tax time.

For more information on making estimated or additional tax payments, visit the Pay As You Go, So You Won’t Owe webpage. IRS.gov/getready and Publication 5307 have more information about how tax reform may affect you and your family so you can “Get Ready” to file next year.

Most Common Types of IRS Tax Problems

A notification from the IRS is not something to be ignored. The best step is to take a deep breath, read the notice carefully, and if needed, contact our office for assistance.

Receiving notification from the Internal Revenue Service that there’s some kind of problem is one of the most bone-chilling situations an American taxpayer can experience. Just receiving an envelope with a return address from the IRS can strike fear. There are many different reasons that the IRS might reach out, but some are more common than others.

Here are the top issues that would cause a taxpayer to hear from the IRS or require you to resolve an issue:

• An Error On Your Tax Return – Nobody’s perfect, and filling out tax returns is not an easy thing. If you’ve made a mistake, whether it’s something simple like filing status or number of dependents or something bigger like total income or incorrectly claiming a deduction, if you discover it on your own, all you need to do is file an amended return using form 1040X, the Amended Individual Income Tax Return. If the mistake means that you owe more money, quickly submitting the amount that you owe will help you avoid having to pay too much in penalties or interest. It’s not at all unusual for the IRS to discover mistakes – especially math mistakes – and they will generally notify you that they have made corrections on your behalf.
  
• Mismatched/Underreported Income – Along the lines of the mistakes referenced above, there is a specific form that the IRS will send you if they determine that the amount of income you report on your tax return is different from what has been reported by employers. That form is the CP2000 Notice, and the agency will send it to you, notifying you of the corrected amount, should they review your return and feel that it is appropriate.
  
• Failure to File a Tax Return – Filing a tax return isn’t necessarily required if you don’t owe money or if you’re owed a tax refund, but it’s not a good idea. Failing to file a return when you’re owed a refund puts you at risk of losing out on receiving the money you’ve owed – you have just three years to amend the problem if you want to get your money. For those who are in arrears to the IRS, there is a significant negative outcome to failing to file a return, including having to pay a “failure to file” penalty that can go as high as 25 percent of your unpaid tax bill: 5 percent of the amount you owe, plus interest, will be charged for each month for up to five months
  
• You Owe the IRS for Taxes Not Paid – When the IRS calculates that you have not paid them the full amount that you owe, they will send you notification of what they believe the difference is via form CP14.
  
• You Owe the IRS Penalties and Fees – When you don’t pay your taxes or you fail to file a return, the IRS will notify you that you owe them penalties, and possibly interest.
  
• You Owe the IRS But Can’t Afford to Pay – There are many taxpayers who find themselves facing a tax bill that they are simply unable to pay all at once. If you fall into this category, the IRS does offer the option of paying in installments. To request this type of payment plan, contact the agency. If even paying in small increments is outside of your ability, you may be able to negotiate a reduced tax bill through what is called an Offer in Compromise.
  
• Tax Debt Resulting in Tax Levy – If you are unable or unwilling to satisfy your tax debt, the IRS may opt for a tax levy, which is the legal seizure of your property in lieu of payment. A tax levy can take the form of real property such as real estate, your vehicle or personal property, or your wages, the money in your bank accounts or your financial accounts. Notification that a levy is being issued against you comes via either notice LT11, CP504, CP90, or CP91.
  
• Notification that A Tax Lien Has Been Filed – If you have failed to pay your tax debt, the IRS may take action to protect its own interests ahead of other creditors by filing a tax lien. This comes in the form of Letter 3172, which will be sent to both you and your other creditors to let them know of the government’s claim against your financial assets, personal property and real estate. By sending this letter out, the government ensures that it will benefit from the liquidation of any of your property in order to satisfy the amount that it is owed. Once a lien has been placed on your property, it is extremely difficult to get out of until you’ve paid up. 

A notification from the IRS is not something to be ignored. The best step is to take a deep breath, read the notice carefully, and if needed, contact our office for assistance.

Hardship Exemption Rules for Not Having Health Insurance Eased

The Affordable Care Act (Obamacare) included a “shared responsibility payment,” which in reality is a penalty for not having health insurance. Along with this penalty came a whole slew of exemptions from the penalty, including some that were designated as “hardship” exemptions. However, the hardship relief from the penalty required pre-approval from the government health insurance marketplace, which required the applicant to provide documentary evidence of the hardship. Once approved, the applicant was issued an exemption certificate number (ECN) that needed to be included on the individual’s tax return to avoid the penalty.


Article Highlights:

• Shared Responsibility Payment 
• Executive Order 
• Hardship Exemption 
• Exemption Certification Number 

The Affordable Care Act (Obamacare) included a “shared responsibility payment,” which in reality is a penalty for not having health insurance. Along with this penalty came a whole slew of exemptions from the penalty, including some that were designated as “hardship” exemptions. However, the hardship relief from the penalty required pre-approval from the government health insurance marketplace, which required the applicant to provide documentary evidence of the hardship. Once approved, the applicant was issued an exemption certificate number (ECN) that needed to be included on the individual’s tax return to avoid the penalty.

Hours after being sworn in, President Trump signed an executive order aimed at reversing the Affordable Care Act. The executive order states that the Trump administration will "seek prompt repeal" of the law. To minimize the "economic burden" of Obamacare, the order instructs the secretary of the Department of Health and Human Services and other agency heads to "waive, defer, grant exemptions from, or delay the implementation" of any part of the law that places a fiscal burden on the government, businesses or individuals.

As a result of President Trump’s executive order, the Centers for Medicare & Medicaid Services (CMS) announced on September 12, 2018, that consumers can claim a hardship exemption for not purchasing insurance and avoid the penalty for not being insured for 2018, either by:

• Obtaining an ECN through the existing application process or 
• Simply entering the hardship code on their federal income tax return (a form of self-certification). 

However, the CMS cautioned that consumers should keep any documentation that demonstrates qualification for the hardship exemption with their other tax records.

The following are the more common hardship exemptions affected by this change. For a complete list and additional details related to qualifying for these hardships, visit the CMS website.

• Homelessness 
• Being evicted or facing eviction or foreclosure 
• Receiving a shut-off notice from a utility company 
• Experiencing domestic violence 
• Death of family member 
• Fire, flood or other disaster that caused substantial damage 
• Bankruptcy 
• Medical expenses that can’t be paid, resulting in substantial debt 
• Increased medical expenses to care for a member of the family 
• Claiming a child who has been denied Medicaid or CHIP coverage 
• Ineligibility for coverage because the state didn’t expand Medicaid 

The shared responsibility payment and exemptions are determined on a monthly basis, and a person is eligible for a hardship exemption for at least the month before, the month(s) during and the month after the specific event or circumstance that creates the hardship.

There are a variety of other exemptions in addition to the hardship exemptions, and 2018 is the final year the shared responsibility payment will be assessed. The Tax Cuts and Jobs Act (tax reform) has eliminated the penalty beginning in 2019.

If you have questions related to the penalty for not having health insurance and the exemptions from being penalized, please call.

Three Common Family Tax Mistakes

When it comes to transactions between family members, the tax laws are frequently overlooked, if not outright trampled upon. The following are three commonly encountered situations and the tax ramifications associated with each.

Article Highlights

• Family Member Transactions 
• Renting to a Relative 
• Below-Market Loans 
• Transferring Home Titles 
• Gifts 
• Basis 
• Life Estate 

When it comes to transactions between family members, the tax laws are frequently overlooked, if not outright trampled upon. The following are three commonly encountered situations and the tax ramifications associated with each.

Renting to a Relative – When a taxpayer rents a home to a relative for long-term use as a principal residence, the rental’s tax treatment depends upon whether the property is rented at fair rental value (the rental value of comparable properties in the area) or at less than the fair rental value.

Rented at Fair Rental Value – If the home is rented to the relative at a fair rental value, it is treated as an ordinary rental reported on Schedule E, and losses are allowed, subject to the normal passive loss limitations.

Rented at Less Than Fair Rental Value – When a home is rented at less than the fair rental value, it is treated as being used personally by the owner; the expenses associated with the home are not deductible, and no depreciation is allowed. The result is that all of the rental income is fully taxable and reported as “other income” on the 1040. If the taxpayer were able to itemize their deductions, the property taxes on the home would be deductible, subject to the $10,000 cap on state and local taxes effective starting with 2018. The taxpayer might also be able to deduct the interest on the rental home by treating the home as their second home, up to the debt limits on a first and second home.

Possible Gift Tax Issue – There also could be a gift tax issue, depending if the difference between the fair rental value and the rent actually charged to the tenant-relative exceeds the annual gift tax exemption, which is $15,000 for 2018. If the home has more than one occupant, the amount of the difference would be prorated to each occupant, so unless there was a large difference ($15,000 per occupant, in 2018) between the fair rental value and actual rent, or other gifting was also involved, a gift tax return probably wouldn’t be needed in most cases.

Below-Market Loans – It is not uncommon to encounter situations where there are loans between family members, with no interest being charged or the interest rate being below market rates.

A below-market loan is generally a gift or demand loan where the interest rate is less than the applicable federal rate (AFR). The tax code defines the term “gift loan” as any below-market loan where the forgoing of interest is in the nature of a gift, while a “demand loan” is any loan that is payable in full at any time, at the lender’s demand. The AFR is established by the Treasury Department and posted monthly. As an example, the AFR rates for October 2018 were:

Term	AFR (Annual) Oct. 2018
3 years or less	2.55%
Over 3 years but not over 9 years	2.83%
Over 9 years	2.99%

Generally, for income tax purposes:

Borrower – Is treated as paying interest at the AFR rate in effect when the loan was made. The interest is deductible for tax purposes if it otherwise qualifies. However, if the loan amount is $100,000 or less, the amount of the forgone interest deduction cannot exceed the borrower’s net investment income for the year.

Lender – Is treated as gifting to the borrower the amount of the interest between the interest actually paid, if any, and the AFR rate. Both the interest actually paid and the forgone interest are treated as investment interest income.

Exception – The below-market loan rules do not apply to gift loans directly between individuals if the loan amount is $10,000 or less. This exception does not apply to any gift loan directly attributable to the purchase or carrying of income-producing property.

Parent Transferring a Home’s Title to a Child – When an individual passes away, the fair market value (FMV) of all their assets is tallied up. If the value exceeds the lifetime estate tax exemption ($11,180,000 in 2018; about half that amount in 2017), then an estate tax return must be filed, which is rarely the case, given the generous amount of the exclusion. Because the FMV is used in determining the estate’s value, that same FMV, rather than the decedent’s basis, is the basis assigned to the decedent’s property that is inherited by the beneficiaries. The basis is the value from which gain or loss is measured, and if the date-of-death value is higher than the decedent’s basis was, this is often referred to as a step-up in basis.

If an individual gifts an asset to another person, the recipient generally receives it at the donor’s basis (no step-up in basis).

So, it is generally better for tax purposes to inherit an asset than to receive it as a gift.

Example: A parent owns a home worth (FMV) $350,000 that was originally purchased for $75,000. If the parent gifts the home to the child and the child sells the home for $350,000, the child will have a taxable gain of $275,000 ($350,000 − $75,000). However, if the child inherits the home, the child’s basis is the FMV at the date of the parent’s death. So in this case, if the date-of-death FMV is $350,000 and if the home is sold for $350,000, there will be no taxable gain.

This brings us to the issue at hand. A frequently encountered problem is when an elderly parent signs the title of his or her home over to a child or other beneficiary and continues to reside in the home. Tax law specifies that an individual who transfers a title and retains the right to live in a home for their lifetime has established a de facto life estate. As such, when the individual dies, the home’s value is included in the decedent’s estate, and no gift tax return is applicable. As a result, the beneficiary’s basis would be the FMV at the date of the decedent’s death.

On the other hand, if the elderly parent does not continue to reside in the home after transferring the title, no life estate has been established, and as discussed earlier, the transfer becomes a gift, and the child’s (gift recipient’s) basis would be the parent’s basis in the home at the date of the gift. In addition, if the child were to sell the home, the home gain exclusion would not apply unless the child moves into the home and meets the two-out-of-five-years use and ownership tests.

Another frequently encountered situation is when the parent simply adds the child’s name to the title while retaining a partial interest. If the home is subsequently sold, the parent, provided they met the two-out-of-five-years use and ownership rules, would be able to exclude $250,000 ($500,000 if the parent is married and filing a joint return) of his, her or their portion of the gain. A gift tax return would be required for the year the child’s name was included on the title, and the child’s basis would be the portion of the parent’s adjusted basis transferred to the child. As mentioned previously, the child would not be able to use the home gain exclusion unless the child occupied and owned the home for two of the five years preceding the sale.

These are only three examples of the tax complications that can occur in family transactions. I highly recommended that you contact this office before completing any family financial transaction. It is better to structure a transaction within the parameters of tax law in the first place than have to suffer unexpected consequences afterwards.

Will You Get a Refund or Owe for 2018?

As a result of tax reform, most taxpayers will be paying less tax for 2018 than they did in 2017. But that may not translate into a larger refund. Your refund is the amount that your pre-payments (withheld income tax, estimated tax payments, and certain credits) exceed your tax liability, and if the pre-payment also got reduced, you could be in for an unpleasant surprise at tax time.

Article Highlights:

• Tax Reform 
• Form W-4 
• Withholding 
• Refund or Tax Due 

As a result of tax reform, most taxpayers will be paying less tax for 2018 than they did in 2017. But that may not translate into a larger refund. Your refund is the amount that your pre-payments (withheld income tax, estimated tax payments, and certain credits) exceed your tax liability, and if the pre-payment also got reduced, you could be in for an unpleasant surprise at tax time.

So, why would the pre-payments, particularly withholding, be less? Simply because the current W-4 form on which employers base the amount of tax to withhold, and the withholding tables provided by the government that employers use to determine the amount to withhold, are not sophisticated enough to deal with the revised tax laws. Congress passed the changes at the 11th hour of 2017, without giving the IRS sufficient time to adjust the W-4 form and withholding tables to account for the changed laws. The IRS did come out with a revised W-4 late in February, but there are serious concerns that the revised W-4 and withholding tables are not coming up with the correct amounts based upon the new tax law and that the form itself is much more complicated for employees to complete than prior versions were. In fact, the government is so concerned about this that the IRS issues almost daily notices cautioning taxpayers to double check their withholding.

Checking one’s withholding does little good since it is difficult to determine if your withholding will produce near the desired refund result without also projecting what your tax will be for 2018 and then comparing that to your pre-payments, including withholding, for the year. Prior to the tax reform, you generally could use the tax liability from the prior year, compare that against your current year pre-payments, and be pretty confident in what the bottom line would be for the current year. However, that is not possible for 2018, since the tax computation is significantly different from how it was in 2017 and earlier years.

The IRS is developing a new W-4 form to hopefully do a better job of determining the proper withholding based on your wages but just recently announced that it will continue to use the current W-4 for 2019 and unfortunately won’t be releasing the new one until 2020.

If you count on a large refund to pay other liabilities, such as property taxes, you may want to take the time to project your 2018 tax and then compare it to your pre-payments to see if you can expect a refund and determine approximately how much it will be.

At the same time, if your pre-payments are short and you end up owing taxes, you could be hit with underpayment penalties.

We are almost ¾ of the way through the year, and any adjustments to withholding or estimated payments should be made sooner rather than later to produce the desired result at tax time. Please call for assistance.

21% of Taxpayers Will Owe in 2019

After the Government Accountability Office (GAO) assessed the impact of the Tax Cuts and Jobs Act provisions and the withholding allowances established by the IRS, has estimated 21% of taxpayers will under withhold for 2018, up from 18% in 2017.

This means that 21% of taxpayers will owe tax when filing their return in 2019. This also means that for taxpayers who normally get a large refund will get less of a refund than they were expecting.  Be advised that under withholding can be a real financial hardship, do a Paycheck Checkup.

Check Your Withholding Soon

The IRS advises that taxpayers who owed additional tax when they filed their federal return earlier this year should do a “paycheck checkup” as soon as possible. The IRS Withholding Calculator and Publication 505, Tax Withholding and Estimated Tax, can help these taxpayers do a checkup and avoid another possibly bigger tax bill next year.

Following the Tax Cuts and Jobs Act, which was passed last year, there are many changes to the tax law that could affect these taxpayers. Doing a checkup now will help them make sure their current tax withholding is in line with their 2018 tax situation.

Here are some things for these taxpayers to keep in mind:

• These taxpayers may not have had enough taxes withheld from their pay throughout 2017, causing them to owe in 2018.
• If they continue to have too little withheld from their paychecks the rest of this year, they could find themselves in the same situation again next year. 
• They might even end up with a larger tax bill when they file their 2018 return next year. 
• It’s important to remember that if a taxpayer underpays their tax too much, penalties and interest can apply.
• The Withholding Calculator can help taxpayers apply the new law to their situation. The results from the calculator can help them make an informed decision about whether to change their withholding this year. These taxpayers need to adjust their withholding as soon as possible for an even withholding amount throughout the rest of the year.
• Waiting means there are fewer pay periods to withhold the necessary federal tax, which could have a bigger effect on each paycheck.
• Taxpayers with more complex situations might find that using Publication 505 is a better option for figuring their withholding than using the Withholding Calculator. Publication 505 works better for employees who owe self-employment tax, the alternative minimum tax, or tax on unearned income from dependents. It can also help those who receive non-wage income such as dividends, capital gains, rents and royalties.

Underpayment penalties

• To avoid paying the estimated tax penalty, taxpayers should ensure they have enough tax withheld from their paychecks and appropriate estimated tax payments. Ordinarily, taxpayers can avoid this penalty by paying at least 90 percent of their tax during the year.
• If taxpayers expect to owe at least $1,000 in tax after subtracting withholding and refundable credits, they should make estimated tax payments.

Using the Withholding Calculator or Publication 505

• Taxpayers should have their completed 2017 tax return handy to help estimate the amount of income, deductions, adjustments and credits to enter. They’ll also need their most recent pay stubs to help compute their withholding to date this year. Results from these tools depend on the accuracy of information a taxpayer provides.
• Employees can use the results from the Withholding Calculator or Publication 505 to help determine if they should complete a new Form W-4, Employee’s Withholding Allowance Certificate, and, if so, what information to include on the form.
• The calculator may also be helpful to recipients of pension and annuity income. These recipients can change their withholding by filling out Form W-4P and giving it to their payer.
• If a taxpayer’s personal circumstances change during the year, they should re-check their withholding.

Adjusting withholding

• If an employee determines they should adjust their withholding, they should complete a new Form W-4 and submit it to their employer as soon as possible.
• Some employers have an electronic method to update a Form W-4.
• Taxpayers who change their 2018 withholding should recheck their withholding at the start of 2019. A mid-year withholding change in 2018 may have a different full-year impact in 2019, so if taxpayers don’t submit a new Form W-4 for 2019, their withholding might be higher or lower than intended.
• If an employee has a change in personal circumstances that reduces the number of withholding allowances they can claim, they must submit a new Form W-4 within 10 days of the change.
• The fewer withholding allowances an employee enters on the Form W-4, the higher their tax withholding will be. Entering “0” or “1” on line 5 of the Form W-4 means more tax will be withheld; entering a bigger number means less tax will be withheld.

Additional information

• The Withholding Calculator does not request personally identifiable information such as name, Social Security number, address or bank account numbers. The IRS does not save or record the information entered on the calculator. Taxpayers should be aware of tax scams, especially via email or phone and cybercriminals impersonating the IRS. The IRS does not send emails related to the calculator or the information entered in it.
• The calculator and Publication 505 are not tax-planning tools. Taxpayers needing advice regarding the new tax law and personal situations should consult a trusted tax professional.

For more information visit the below websites:
www.irs.gov/newsroom/withholding-calculator-frequently-asked-questions
www.irs.gov/payments/tax-withholding
www.irs.gov/newsroom/tax-reform

Taxpayers can get help any time of the year

When the federal income tax-filing deadline come and go, some taxpayers might still need tax help. To offer their hep the IRS has several resources available for taxpayers year-round: 

Resources

IRS.gov. Taxpayers can find all sorts of helpful information on IRS.gov. They can click on “Help” at the top of the home page to access several online tools. They can also get answers to their tax questions with the Interactive Tax Assistant and the IRS Tax Map. Anyone who is waiting for their refund this summer can use ‘Where’s My Refund?’ to check the status of their refund.

Taxpayer Advocate Service. TAS is an independent organization within the IRS. TAS employees can help people who are experiencing economic harm, who are seeking help in resolving tax problems, or who believe that an IRS procedure is not working as it should. Taxpayers can contact TAS by calling the case intake line at 1-877-777-4778 to determine if they are eligible for assistance.

Low Income Taxpayer Clinics. The LITCs provide professional representation to individuals who need to resolve tax problems. These clinics also help taxpayers who speak English as a second language. They can represent eligible taxpayers at no charge in tax disputes with the IRS.

Multimedia Center. Taxpayers can watch dozens of YouTube videos on a variety of topics. They can view them in English, Spanish or American Sign Language. They can also listen to IRS podcasts. All are available in English and Spanish.

Twitter.  Taxpayers on Twitter can get tax-related announcements and tips from @IRSnews. @IRStaxpros tweets news and guidance for tax professionals. Tweets from @IRSenEspanol have news and information in Spanish. The Taxpayer Advocate Service sends tweets from @YourVoiceAtIRS.

Galloway Tax Express is open year-round to help taxpayers with an issues they may have after tax season. We can be contact by phone at 336-705-6322, website or email.

Taxpayers Can Now Connect with the IRS on Their Phone

Anyone with tax questions can just grab their phone for answers. The IRS has a mobile app, IRS2Go, which is available for free to use on Android and iOS devices. It’s also available on Amazon. Taxpayers use the app to:

• Check the status of their refund.
  Taxpayers can check on their refund status within 24 hours after the IRS receives their e-filed return, or about four weeks after mailing a paper return.
  
• Make a payment.
  The app offers easy access to mobile-friendly payment options like IRS Direct Pay. This offers the taxpayer a free, secure way to pay directly from their bank account. Users can also make a credit or debit card payment through an approved payment processor.
  
• Find free tax preparation assistance.
  Eligible taxpayers can access free tax software from their mobile device to quickly prepare and file their taxes and get their refund. Taxpayers who got an extension of time to file their taxes can use the app to file through the October extended filing deadline.
  
• Get Helpful Tips and Information.
  Taxpayers can use the app to link to IRS accounts on social media. Users can do things such as watch helpful videos and access IRS tweets. Taxpayers can also use the app to sign up to receive IRS Tax Tips by email.
  
• Stay Secure.
  Users can use IRS2Go to create login security codes for certain IRS online services. This allows the taxpayer to retrieve codes through IRS2Go instead of using text messages.

What Tax Preparers Don't Want You To Know

For most tax season is one of the best times of the year. However, we want you to keep in mind things tax preparers don't want you to know when you decide to use their services.

Ø  I am not prepared to prepare your taxes

All tax preparers are required to have a Preparer Tax Identification Number (PTIN) issued by the IRS before December 31 of every year. This PTIN is not an indicator that the tax preparer is a tax expert, rather, required by the IRS to be registered with the IRS to prepare tax returns for compensation. All tax preparers are not educationally experienced in preparing taxes. 

Ø  CPAs are not all tax experts

Reality is most CPAs are actually auditors with little to not experience in taxes, specifically personal taxes. Make sure you match expertise with your needs.

Ø  I did not prepare your return

Most large corporations use a tiered tax preparation system. Meaning, a lower-end tax preparer inputs your information and a manager reviews your return before submitting it to the IRS. Although this is a check process, which is the best practice, it will not guarantee the manager or reviewer will catch any mistakes made by the preparer. Keep in mind to that some tax preparer outsource returns left with them. This is something you want to ask your preparer.

Ø  I conservatively prepare returns 

Because of federal tax codes and regulations preparing a return can sometimes be over complex for a tax preparer. Therefore, instead of researching and applying potential advantages, most tax preparers apply general tax rules, which is on the surface; like over-the-counter tax programs. Some prepares to this to reduce your odds of getting a tax notice with you having a higher tax liability. To get the most benefits from the complexities of the tax code, you must be willing to pay the fees necessary for a preparer to research to get a worthy conclusion. This is necessary when you keep in mind that wasting time and 

money trying to save a few bucks versus hundreds or thousands of dollars.

Ø  I am afraid to look more deeply into your situation, even if it saves you money

Understand that time is money and most tax preparers may fear giving you a big bill for it, in fear you may not pay or complain. There is a lot of opportunity that exists in itemizing deductions for a more advantageous conclusion, which the cost it worth it. Make sure your preparer knows you want him or her to look for opportunities of tax saving and that you are willing to pay for it. 

Ø  I cannot give you a bunch of tax credits

Preparers do know how to get you tax credits and some over that you may not qualify for. Be aware that if your tax preparer offers to get you a bunch of tax credits, especially those you know you do not qualify for--run in the opposite direction-- an audit is soon to come following those credits.

Always remember that paying a business to prepare your taxes is simple. Finding the right business to prepare your taxes isn't. Make sure you thoroughly understand your preparer's competence and experience (and are willing to pay for it) so you aren't leaving money on the table come April 17, 2018.

Website: www.gallowaytax.com
Email: gallowaytax@gmail.com
#gallowaytax

Dirty Dozen of Tax Preparers--Is Your Tax Preparer legal or Not

12 Ways You Can Tell If Your Tax Preparer is Legal or Not

Please, choose wisely if you choose a tax professional. If you choose a paid tax professional, please, protect yourself. 

1. If a paid tax professional is stating something that seems too good to be true, it likely is. A valid paid tax professional will NOT tell you "I can get you xxx$." 

2. A paid tax professional, legally, can NOT file a tax return using only a pay stub, unless it is after Feb 15th and a Form 4852 is included with the return. 

3. A paid tax professional must provide you with a complete copy of your tax return PRIOR to e-filing the return. 

4. A paid tax professional can NOT charge a % (percentage) of your refund amount. 

5. A paid tax professional MUST sign the tax return and provide their PTIN# on the tax return that you pay them to prepare. 

6. A paid tax professional must have you sign a Form 8879 to authorize e-file of your tax return. If you have paid a tax professional to assist with your tax return and the signature area says "self-prepared," that is NOT a valid tax professional. 

7. A valid tax professional will NEVER state, "So, what kind of refund do you want?" 

8. A valid tax professional will NOT tell you what you want to hear or adjust numbers if you don't like the outcome on your tax return.

9. If you have a question about your tax return and have chosen a tax professional, that tax professional should be able to readily answer your questions in a way that you understand. A valid tax professional has a vast amount of education that they complete, on a yearly basis. If a tax professional states that they have IRS Credentials, you can check those credentials at the IRS website in the "RPO Directory and Authorized E-File Directory." https://irs.treasury.gov/rpo/rpo.jsf. Please not that all tax professionals are not credential some are classified as preparers who hold current PTIN active status with the IRS, which makes them legal.

10. A valid tax pro will NOT allow you to deposit your refund into their bank account or sign a refund check for you. They also can NOT negotiate your tax preparation fees into their personal bank accounts or to their prepaid card. They can use a bank provider that allows you to pay for tax preparation from your refund, but your refund goes through a bank provider, NOT the tax professionals account. While there are many legitimate tax professionals, there are plenty that are not. 

11.If you have paid a tax professional to assist with your tax return and something is fraudulent on that tax return, YOU, the taxpayer are ultimately responsible for what is on that return. 

Be very aware of those out there that say they are a tax professional and are nothing but "rogue & shady" and only out to charge you for something that will be incorrect or fraudulent. It is not uncommon for a taxpayer to receive an IRS or State tax notice even when everything on a tax return is accurate. If you choose a tax professional, make sure it is someone who will help you address any future IRS or State tax notice. There is a big difference between an error on a tax return and something that is downright, fraudulent. Taxes are not always easy to understand so it is common to reach out to a tax professional if you don't feel comfortable preparing a return on your own. That's fine, as long as you can verify that person is a true tax professional. May your 2017 tax returns be accurate, legal and stress-free. God Bless.

GTE Travels To Charlotte, NC on January 27, 2018

The Queen City Business Expo features 50 businesses from the Charlotte Metro area. These companies are the back bones of our communities and the current/future employers to develop the city. Companies of all facets of business will be in attendance showcasing their companies. You can expect free giveaways, coupons, discounts, and special offers. 150 FREE swag bags and 300 FREE samples from Crabtree & Evelyn will be door prizes.

Galloway Tax Express will be doing taxes on the spot. File early and get your refund early. Do you need a job? Check out “Career Row” and bring your resume. Multiple companies will be onsite hiring! Music, food, shopping, and entertainment round out the festive event. 

Already have your W-2 and other tax documents? Galloway Tax Express will be at The Queen City Business Expo preparing tax returns. Be among one of the first this year when you come to the expo and get your tax return prepared.

What Will Happen in 2018 If The Government Shutsdown

If government shutdown happens, either will happen or both. The tax season will start later than January 29, 2018 or refunds maybe released in mid-or late March! From #gallowaytax, this is not good for taxpayers who have paid in their tax dollars and is expecting their refunds.

https://www.politico.com/story/2018/01/19/government-shutdown-2018-tax-law-350858?lo=ap_b1

GTE Referral Progam to pays $75 per referral

Have you ever thought about the complaints your hear from friends and family members about their tax preparer or their unhappiness with their tax return? We have the perfect solution for you! Refer them to Galloway Tax Express. We will pay you $75 for every person you refer to us! YES, $75! You do not have to be a client of GTE, just refer and you get paid! Refer someone today.