The Tax E Man Blog, along with our website www.PatTax.net, are designed to be year round resources for tax consultation, preparation and representation services provided by Baldwin NY Tax Preparation service Pat Tax Inc. and Patrick White, Enrolled Agent .  Please feel free to contact us with any questions or  concerns.

Identity Theft and Your Taxes

Your identity and money can be stolen in a tax-related scam via email (“phishing”), fax, phone, or letters. Some recent examples of identity theft scams are:

• Refund scam. A bogus email, claiming to come from  the IRS, tells you that you are eligible to receive a tax  refund for a given amount if you just follow the instructions
  in the email.
• Inherited funds, lottery winnings, and cash consignment  scams. A bogus email, claiming to come from the  U.S. Department of the Treasury, notifies you that you
  will receive millions of dollars if you follow the instructions  in the email. This may be a multi-step scheme  that includes instructions for you to deposit taxes on
  the funds before they can be paid out or the issuance of  a phony check on which you must pay 10% tax before  the check can be deposited.
• EFTPS scam. A bogus email, claiming to come from  the IRS, contains a realistic-looking screenshot of the  IRS website with a message about fraud attempts regarding  your bank account. The email states that the  bank account can be unblocked if you just click a link  and provide information. EIN scam. A bogus fax, claiming to be from the IRS,  informs you that you have failed to submit required  bank account details. You are asked to fax back a form  that requests your EIN, bank information, and officer  signatures.

 Read 2016 Identity Theft and Your Taxes Here

Notify the IRS
If you receive a tax-related phishing email, do not click  on the links or open any  attachments. Forward the email  to phishing@irs.gov or call the IRS at 800-829-1040.

Any accounting, business or tax advice contained in the Tax E Man Blog or  www.PatTax.net, including attachments, links and enclosures, are not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax related penalties.

If desired, Pat Tax, Inc. would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired.

The Tax E Man Blog, along with our website http://www.PatTax.net, are designed to be year round resources for tax consultation, preparation and representation services provided by Pat Tax, Inc. . Please feel free to contact us with any questions or concerns.

Read 2016 Identity Theft and Your Taxes Here

Services We Provide Include
Income Tax Preparation for individuals and small businesses
Electronic filing of all Federal and State returns with direct deposit of refunds
Scheduled electronic payment of balance due
Income Tax Consulting
IRS Tax Representation
Preparation of Delinquent Tax Returns
Amended Tax Returns

“Empowering clients through education, a stress free transaction and an excellent service experience.”

The Tax E Man Blog, along with our website www.PatTax.net, are designed to be year round resources for tax consultation, preparation and representation services provided by Baldwin NY Tax Preparation service Pat Tax Inc. and Patrick White, Enrolled Agent .  Please feel free to contact us with any questions or  concerns.

Victims of Credit Card Fraud or Identity Theft

1. Report the crime to the police immediately. Get a copy of the police report or case number. Credit card companies, the bank, or insurance companies may ask for the reference to verify the crime.
2. Immediately contact the credit card issuers. Get replacement cards with new account numbers and ask that the old account be processed as “account closed at consumer’s request” for credit record purposes. Follow up with a letter to the credit card  company that summarizes the request in writing.
3. Call the fraud units of the three credit reporting bureaus to report the theft. Ask that the accounts be flagged. Also, add a victim’s statement to the report requesting contact to verify future credit applications

Read 2016 Consumer Credit Here

Any accounting, business or tax advice contained in the Tax E Man Blog or  www.PatTax.net, including attachments, links and enclosures, are not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax related penalties.

If desired, Pat Tax, Inc. would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired.

The Tax E Man Blog, along with our website http://www.PatTax.net, are designed to be year round resources for tax consultation, preparation and representation services provided by Pat Tax, Inc. . Please feel free to contact us with any questions or concerns.

Read 2016 Consumer Credit Here

Services We Provide Include
Income Tax Preparation for individuals and small businesses
Electronic filing of all Federal and State returns with direct deposit of refunds
Scheduled electronic payment of balance due
Income Tax Consulting
IRS Tax Representation
Preparation of Delinquent Tax Returns
Amended Tax Returns

“Empowering clients through education, a stress free transaction and an excellent service experience.”

Requirement to Have Health Insurance
Beginning January 2014, nonexempt U.S. citizens and legal residents are required to maintain minimum essential coverage. Minimum essential coverage can include government-sponsored programs, eligible employer-sponsored plans, plans in the individual market, grandfathered group health plans, and other coverage as recognized by the Secretary of Health and Human Services (HHS), in coordination with the Secretary of the Treasury. Government-sponsored programs include Medicare, Medicaid, Children’s Health Insurance Program, coverage for members of the U.S. military, veteran’s health care, and health care for Peace Corps volunteers.Eligible employer-sponsored plans include governmental plans, church plans, grandfathered plans, COBRA coverage, retiree coverage, and other group health plans offered in the small or large group market within a state.

Read the entire communication here.Health Care Reform Individual Insurance Requirement

Health Insurance Portability and Accountability Act (HIPAA)
Excepted Benefits
Minimum essential coverage does not include coverage that consists of certain HIPAA excepted benefits. HIPAA excepted benefits include:
1) Coverage only for accident or disability income insurance,
2) Coverage issued as a supplement to liability insurance,
3) Liability insurance, including general liability insurance and automobile liability insurance,
4) Workers’ compensation or similar insurance,
5) Automobile medical payment insurance,
6) Credit-only insurance,
7) Coverage for on-site medical clinics, and
8) Other similar insurance coverage, specified in regulations, under which benefits for medical care are
secondary or incidental to other insurance benefits. Other HIPAA excepted benefits that do not constitute
minimum essential coverage if offered under a separate policy, certificate, or contract of insurance
include long-term care, limited scope dental and vision benefits, coverage for a disease or specified illness,
hospital indemnity or other fixed indemnity insurance, or Medicare supplemental health insurance.

Read the entire communication here.Health Care Reform Individual Insurance Requirement

Any accounting, business or tax advice contained in the Tax E Man Blog or http://www.PatTax.net, including attachments, links and enclosures, are not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax related penalties.

If desired, Pat Tax, Inc. would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired.

The Tax E Man Blog, along with our website http://www.PatTax.net, are designed to be year round resources for tax consultation, preparation and representation services provided by Pat Tax, Inc. . Please feel free to contact us with any questions or concerns.

Read the entire communication here Health Care Reform Individual Insurance Requirement

Services We Provide Include
◾Income Tax Preparation for individuals and small businesses
◾ Electronic filing of all Federal and State returns with direct deposit of refunds
◾Scheduled electronic payment of balance due
◾Income Tax Consulting
◾IRS Tax Representation
◾Unified Tax Returns
◾ Amended Tax Returns

“Empowering clients thru education, a stress free transaction and an excellent service experience.”

Education Tax Benefits

If you pay tuition, fees, and other costs for attendance at an eligible educational institution for yourself, your spouse, or your dependent, you may be able to take advantage of one or more of the education tax benefits.You can claim more than one education benefit in a tax year as long as you do not use the same expenses for more than one benefit.

Exception:  Qualified expenses used to claim education benefits can also be used to eliminate the 10% penalty on premature IRA distributions.

You may claim only one of the following education tax benefits for the same student per year: tuition and fees deduction, American Opportunity Credit, or Lifetime Learning Credit.

Read the entire communication here Education Tax Benefits

Education Deductions.

Deductions reduce the amount of income subject to income tax. Deductions for education expenses include:

• Tuition and fees deduction up to $4,000 from gross income. Income limitations apply.

• The provision for deducting tuition and fees expired for tax years after 2013.

• Student loan interest deduction up to $2,500 from gross income. Income limitations apply.

• Business deduction on Schedule C or F. You can deduct the cost of education related to the business or farm activity.

• Miscellaneous itemized deduction on Schedule A, subject to the 2% AGI limitation. You can deduct the unreimbursed cost of education required to keep your current job or maintain and improve skills needed for your job. You cannot deduct the cost of education that qualifies you for a new trade or business.

Read the entire communication here Education Tax Benefits

Any accounting, business or tax advice contained in the Tax E Man Blog or http://www.PatTax.net, including attachments, links and enclosures, are not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax related penalties.

If desired, Pat Tax, Inc. would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired.

The Tax E Man Blog, along with our website http://www.PatTax.net, are designed to be year round resources for tax consultation, preparation and representation services provided by Pat Tax, Inc. . Please feel free to contact us with any questions or concerns.

Read the entire communication here Education Tax Benefits

Services We Provide Include 

• Income Tax Preparation for individuals and small businesses
•  Electronic filing of all Federal and State returns with direct deposit of refunds
• Scheduled electronic payment of balance due
• Income Tax Consulting
• IRS Tax Representation
• Unified Tax Returns
•  Amended Tax Returns

“Empowering clients thru education, a stress free transaction and an excellent service experience.”

Charitable Organizations

Qualified charitable organizations include nonprofit groups that are religious, charitable, educational, scientific, or literary in purpose, or that work to prevent cruelty to children or animals.

Expenses Incurred While Volunteering

Out-of-pocket expenses incurred in performing volunteer work for a charitable organization (including the charitable mileage deduction) are considered cash contributions. The value of a donor’s time is not deductible.

Read the entire communication here Charitable Contributions Guide

Contributions That Benefit the Taxpayer

If a taxpayer receives a benefit in exchange for a charitable contribution, the deduction is reduced by the value of the benefit received.

Example: Paul made a $70 donation to Public TV and received a $40 CD of his all-time favorite band, Herman’s Hermits, in appreciation for his donation. His deduction equals $30.

Auto Expenses

Deductible out-of-pocket expenses include the cost of using the taxpayer’s auto in providing services for a charitable organization. Deduct the actual cost of gas and oil or the standard mileage rate. Add parking and tolls to amount claimed for either standard mileage rate or actual expenses. A mileage log is required.

Read the entire communication here Charitable Contributions Guide

Standard Mileage Rate

The general standard mileage rate for charity is 14¢ per mile in 2014.

Contributions of Property

If used items were given to charity, such as clothing or furniture, the fair market value of the items is used to determine the deductible amount. Fair market value is what a willing buyer would pay a willing seller when neither has to buy or sell and both are aware of the conditions of the sale.

Planning Tip:  Most cell phones today can take pictures. Take a picture of all items donated. Keep the electronic pictures for proof the items were in good used condition or better at the time they were donated.

Note: No deduction is allowed for a charitable contribution of clothing or household items unless the clothing or household item is in good used condition or better. The IRS is authorized by regulation to deny a deduction for any contribution of clothing or a household item that has minimal monetary value, such as used socks and undergarments.

Read the entire communication here Charitable Contributions Guide

Any accounting, business or tax advice contained in the Tax E Man Blog or http://www.PatTax.net, including attachments, links and enclosures, are not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax related penalties.

If desired, Pat Tax, Inc. would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired.

The Tax E Man Blog, along with our website http://www.PatTax.net, are designed to be year round resources for tax consultation, preparation and representation services provided by Pat Tax, Inc. . Please feel free to contact us with any questions or concerns.

Services We Provide Include 

• Income Tax Preparation for individuals and small businesses
•  Electronic filing of all Federal and State returns with direct deposit of refunds
• Scheduled electronic payment of balance due
• Income Tax Consulting
• IRS Tax Representation
• Unified Tax Returns
•  Amended Tax Returns

“Empowering clients thru education, a stress free transaction and an excellent service experience.”

Gift Tax

There is no dollar limit on the amount that one person is allowed to give to another. Gift tax rules do not prohibit a donor from making gifts in excess of the annual exclusion ($14,000 for 2014). However, if more than the annual exclusion is given to any one recipient, the amount over the annual exclusion is considered a “taxable gift.” Consequences of making taxable gifts:

•  Donor is required to file a gift tax return (Form 709)   for the year.
•  Taxable gifts reduce the donor’s $5,340,000 (2014) lifetime  gift tax exclusion.
•  Gift tax  is   only paid once the  exclusion is exhausted.
•  Taxable gifts are added to the donor’s taxable estate at death.

Donors with small estates can make gifts over the annual exclusion and pay no gift or estate tax.

Read entire article here on Gift Tax

Any accounting, business or tax advice contained in the Tax E Man Blog or http://www.PatTax.net, including attachments, links and enclosures, are not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax related penalties.

If desired, Pat Tax, Inc. would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired.

The Tax E Man Blog, along with our website http://www.PatTax.net, are designed to be year round resources for tax consultation, preparation and representation services provided by Pat Tax, Inc. . Please feel free to contact us with any questions or  concerns.Services We Provide IncludeIncome Tax Preparation for individuals and small businesses

•  Electronic filing of all Federal and State returns with direct deposit of refunds
• Scheduled electronic payment of balance due
• Income Tax Consulting
• IRS Tax Representation
• Unified Tax Returns Amended Tax Returns

Empowering clients thru education, a stress free transaction and an excellent service experience.”