Year End Tax Planning Stratigies

Some Year-End Tax Planning Strategies
The 2009 tax year is drawing to a close. The sooner you address year-end tax planning issues, the better. Whether you are approaching year-end planning from an individual or business perspective, you can take action to benefit from favorable tax law provisions.

Careful planning can reduce your tax liability. The lower your liablity the more money you have available to invest, or save for future goals. Set goals, stay on track and make sound financial decisions.

IRA Charitable Donation Rule for 2009
Contributing to charity is a way to benefit others and realize valuable tax benefits at the same time. If you are an older IRA owner, you may be eligible for a special charitable contribution rule that extends through the end of 2009. Under federal tax law, an IRA owner age 70½ or older can directly transfer tax free up to $100,000 from the IRA to an eligible charitable organization in 2009. This planning option is eligible to IRA owners regardless of whether they itemize their deductions. To qualify, the funds must be contributed directly by the IRA trustee to the eligible charity. The transferred amounts are not taxable to the IRA owner and no deduction is available for the amount given to charity. We can help you determine if this strategy would be beneficial to you in your planning.

IRA Contributions
The deadline for contributions to a traditional IRA for the year is the due date of your return, not including any extensions of time to file. Amounts you withdraw from your IRA are fully or partially taxable in the year you withdraw them. If you made only deductible contributions, withdrawals are fully taxable. Use Form 8606 to figure the taxable portion of withdrawals.

Withdrawals made prior to age 59 1/2 may be subject to a 10% additional tax. You also may owe an excise tax if you do not begin to withdraw minimum distributions by April 1st of the year after you reach age 70 1/2. These additional taxes are figured and reported on Form 5329 (PDF). Refer to Form 5329 Instructions for exceptions to the additional taxes. For information on Roth IRA contributions or distributions, refer to Topic 309. For information on conversions from a traditional IRA to a Roth IRA, refer to Publication 590.

5 Money Monitoring Tips

In today's world of finances we need to have a better handle on our money. Do you know how much you spend on that latte' per month? Simple guidelines for monitoring your money will help in the long run.

These Five Tips can help you stay on top. There is no need to continue to have questions about your finances when you can have answers. If you will only monitor a few items you could be well on your way to greater control over your finances.

1.Hang Up on High Phone Bills
Monthly savings up to: $145*Eight out of 10 U.S. families pay too much for phone service, reports billshrink.com. Use one or more of these strategies to ensure yours isn't among them. Take a message. Teens who live at home average 1,742 texts a month. Switch to a family cell plan with unlimited texting. Get smart. College students text less than high school kids. Spring for a smartphone (like an iPhone) with unlimited data if your child agrees to a limited text and calling plan. Drop the landline. Some 20% of homes have only cellphones. Maybe yours should be one. If you decide to keep the landline check the bill for hidden fees. Question your carrier about the fees.

2. Check your medical bills.
Don't assume the bill is correct. Does your insurance company pay for some medical bills? If so attached the hospital or doctor's off bill to the insurance company statement. Compare what your insurance company says is your portion to what the doctor or hospital charges. Sometimes the part the insurance company has already paid can be charged to you because of a simple mistake.

3. Check your auto insurance.
Does your auto insurance company offer you the cheapest rate. Many companies offer deals to match other companies if you find a cheaper rate. Check around for a better auto insurance rate. Did you know your insurance rate is based on where your vehicle is parked at night. i.e your residence address.

4. Check your Grocery bill.
Studies show that if you go to the grocery store when you are hungry you are likely to spend more. Make sure you do not go to the grocery store on an empty stomach. Don't be afraid to use coupons on items you buy on a regular basis. Most stores offer double coupon savings days. Check your local Sunday paper for coupon offers.

5. Check Your Internet Carrier
If you have internet service at your home or office check that you are getting the best deal. Is there a better service than the one you are using. Consider all of you choices. Bigger is not always better.

These tips are just a few to get you to see where you may be able to save. If you will take a look at your normal daily activities you may see other areas you can monitor and maybe save money. Happy Money Monitoring

Using Quickbooks To Track & Pay Sales Tax

QuickBooks software allows for you to track sales tax that is owed. Companies that collect sales taxes are required by law to pay the taxes collected to the appropriate taxing ageny. QuickBooks makes that job easier.

The state of Michigan only has a state sales tax. There is not a county, local or city sales tax. For more information on the tax regulations for the state of Michigan go to http://www.michigan.gov/taxes/0,1607,7-238-43519_43521_44039-5922--,00.html

In order for the sales taxes to be calculated correctly the software has to be set up correctly. Several steps are required in setting up the sales tax information. You must set your company preferences to let the software know you are collecting sales tax.

You also need to complete the following steps.

First you should set up sales tax items. You'll set up your sales tax items with rates and the tax agencies to pay, assign taxable or non-taxable status to your items and customers, and set up a payment schedule.
Second you should enter and opening balance for your sales tax payable account. If you have sales tax that you currently owe to your tax agency, you need to enter that balance in the sales tax payable account where your sales tax is tracked.
Third you should charge sales tax when you make a sale. Once your sales tax information is set up, sales tax is automatically added to your invoice, sales receipt, or other sales forms. QuickBooks does the calculations for you.

The last thing you should do is pay your tax agency. You can run a sales tax liability report to track what you owe, then pay the sales tax when it's due.

Sales tax tracking is just another of the benefits of using QuickBooks to track your company finances. Your accountant should be able to help you further.

Using QuickBooks to Customize Letters and Forms

Customized forms (invoices, credit memos, sales receipts, sales orders, purchase orders, statements, and estimates) help you run your business more efficiently by providing you with the sales forms you need for your day-to-day activities. How much or how little you customize your forms depends on your business needs and how you set up the template.

The template is the foundation—the building block—of your sales forms. You can present the same information in different ways by how you design the template and by which template you choose for the form. So customizing your templates and selecting the right template for a form is an important part of working with your different forms.

Create the forms you need to run your business

There are many uses for customized forms in a business. For example, you can:
·Create different versions of a form for use in specific situations. For example, if you ship goods with a packing slip, you can create an invoice form that has the title "Packing Slip" instead of "Invoice."
·Add new columns and fields (or delete ones you don't need). For example, if you've created custom fields for your inventory, you can add those fields to different forms so you can use just the right form when you need it.
·Change the layout of the form by moving a field to a different location in order to give it greater visibility. Or if you want to have your company address centered on the form or use a larger font size, you can move other objects on the printed form to make room for the address.
·Have some fields or columns appear when you view or fill out the form onscreen but not be on the form when you print it.
·Add standardized text, such as warranty information, contractual details, or special sections, to the form.
·Change the font size or color used for your company name; and add or move your company logo to a different position on your printed forms.
·Choose from over 100 predesigned templates from the QuickBooks online Template Gallery. These templates are already set up for different businesses with special layouts (including watermarks and special sections). By far, the quickest and easiest way to start using a professional-looking form is to download a predesigned template.
·And much more.

QuickBooks comes with a variety of templates for you to use for your invoices, estimates, credit memos, sales orders, purchase orders, sales receipts, statements, packing slips, and pick lists. A template determines the appearance of your forms such as which information is included, whether a logo appears, what color scheme is used, and where all elements are placed.

Five Facts about the Home Office Deduction

With technology making it easier than ever for people to operate a business out of their house, many taxpayers may be able to take a home office deduction when filing their 2009 federal tax return next year. Here are five important things the IRS wants you to know about claiming the home office deduction. 1. Generally, in order to claim a business deduction for your home, you must use part of your home exclusively and regularly: As your principal place of business, or As a place to meet or deal with patients, clients or customers in the normal course of your business, or In the case of a separate structure which is not attached to your home, it must be used in connection with your trade or business For certain storage use, rental use or daycare-facility use, you are required to use the property regularly but not exclusively. 2. Generally, the amount you can deduct depends on the percentage of your home that you used for business. Your deduction for certain expenses will be limited if your gross income from your business is less than your total business expenses. 3. There are special rules for qualified daycare providers and for persons storing business inventory or product samples. 4. If you are self-employed, use Form 8829, Expenses for Business Use of Your Home, to figure your home office deduction. Report the deduction on line 30 of Schedule C, Form 1040. 5. Different rules apply to claiming the home office deduction if you are an employee. For example, the regular and exclusive business use must be for the convenience of your employer. For more information see IRS Publication 587, Business Use of Your Home, available on IRS.gov.

Does the IRS Owe You Money?

Who couldn't use a little extra cash this summer! The IRS may have some money for you. If you have not filed a prior year tax return and are due a refund, you should consider filing the return to claim that refund. If you are missing a refund for a previously filed tax return, you should contact the IRS to check the status of your refund and confirm your current address. Unclaimed Refunds Some people may have had taxes withheld from their wages but were not required to file a tax return because they had too little income. Others may not have had any tax withheld but would be eligible for the refundable Earned Income Tax Credit. To collect this money a return must be filed with the IRS no later than three years from the due date of the return. If no return is filed to claim the refund within three years, the money becomes the property of the U.S. Treasury. There is no penalty assessed by the IRS for filing a late return qualifying for a refund. Current and prior year tax forms and instructions are available on the Forms and Publications web page of IRS.gov or by calling 800-TAX-FORM (800-829-3676). Information about the Earned Income Tax Credit and how to claim it is also available on IRS.gov. Undeliverable Refunds Were you expecting a refund check but didn't get it? Refund checks are mailed to your last known address. Checks are returned to the IRS if you move without notifying the IRS or the U.S. Postal Service. You may be able to update your address with the IRS on the "Where's My Refund?" feature available on IRS.gov. You will be prompted to provide an updated address if there is an undeliverable check outstanding within the last 12 months. You can also ensure the IRS has your correct address by filing Form 8822, Change of Address, which is available on IRS.gov or can be ordered by calling 800-TAX-FORM (800-829-3676). If you do not have access to the Internet and think you may be missing a refund, you should first check your records or contact your tax preparer. If your refund information appears correct, call the IRS toll-free assistance line at 800-829-1040 to check the status of your refund and confirm your address. for more information go to www.irs.gov

10 Ways An Accountant Can Help Your Business

Many businesses make the mistake of trying to do it all. One reason for failure of small business is poor financial record keeping. It is important to know where your business stands as you move forward in our current economic season. The IRS sets new tax guidelines quite regularly. Are you up to date and in compliance with all of the current regulations?

Here are some of the ways in which an accountant can assist your business:

·Prepare periodic financial statements and annual audit reports.
·Assist you in analyzing your financial statements, looking for problem areas or ways you could improve your financial management.
·Determine working capital and cash flow requirements.
·Help you develop a budget and a system of monthly reporting so that you can regularly check on you actual financial transactions in relation to what had been budgeted.
·Prepare tax returns and assist with tax planning.
·Set up a tax calendar and a system to help you comply with all filing requirements.
·Help set up your accounting systems.
·Assist with determining loan or capital requirements.
·Act as your advisor and sounding board in financial and administrative matters.
· Perform operational reviews to help you find ways to run more efficiently.
·Analyze product and customer profitability, and breakeven levels.