Now as the calendar turns to February, you may be starting to feel the pressure of tax time a little more. We are here, too, but are really only amped up and excited for the season. Much of this excitement, though, comes from watching our schedule fill up, so to get the best choice of slots that work for you, do not put off making your appointment.

Having a better choice of appointment time isn’t the only reason to think about making an appointment, though. The earlier you start preparing your return, the more chance you will have to get things together that can help you receive more deductions. This happens more than one may suspect. Taxes often seem that they turn out the same every year, but there are always changes to the tax code, and even some changes in your own life that may open up new tax avenues of which you were unaware.

Some of those roads are not large ones, but anything is better than nothing, right? And if you get enough of those smaller things together, it can really add up.

An interesting look at that is spotlighted by a recent article in Accounting Today. Away from accounting concerns, one may be surprised and/or impresses at the rise of Uber (company politics aside), and this article definitely highlights its emergence at the expense of the rental car and traditional taxi industry. But the fact that those Uber rides are such a corporate expense (and then likely a tax deduction) may seem wilder.

The surprise one feels in that area is probably because it seems like such a small-scale transaction. An Uber ride may only cost a few dollars, so can that really be such a grand expense? The biggest corporate expenses and deductions must come from different, more mysterious spots, no?

Well, no.

Look at some of other names in that article - Dunkin Donuts, McDonald’s, Starbucks, Subway - all of those are largely transactions that are under $10, but the fact that there are so many of them makes them very important. Essentially, this comes down to economies of scale.  Yes, one big purchase is important because of how much it costs. If 150 smaller transactions add up to the same amount at the end of the year, however, the importance is roughly equal.

This is something to keep in mind whether you’re an individual or a business. I find often that when a family breaks down its budget, they are not so much surprised at how much their bills and larger purchases cost, but at how much the purchases they do not give a second thought to eat into their finances.

To use ultra-simple math, if you buy one $5 coffee every day for a month, you’re looking at $150. Each of those individual Lincolns is easy to pass across the counter and not feel like a big deal, but would you cut a check for $150 at the beginning of the month to pay for your coffee intake? A double-take is much more likely in that scenario. Keeping this type of math in mind is always a good idea to help you keep track of where your money is going and if it is going to the destinations you want.

The amassing of these seemingly minor transactions is just as important for those with legitimate business expenses to keep in mind, for when tax time arrives, you want to be able to get all to which you are entitled. So make an appointment now and help us help you get there!

Now that we are out of the holiday season, it means we can look back, and can you believe that it’s only been about a month since Christmas?

It seems that a lot has happened since then, but maybe now that we have passed the inauguration of Donald Trump and its immediate fallout, we can get back to feeling normal. Or maybe in this holiday-season lookback, we can at least start to give some hope to those who are finding it difficult to come by.

This optimism can come in the economic realm, where numbers show that spending over the holiday season grew at a high rate. The growth was at least mild across many indicators, but was especially pronounced in the online realm.

This does not surprise me, as more and more people I know get the most value from their Amazon Prime membership around the holidays. Also, knowing people that have done ALL of their holiday shopping online is no longer rare and these numbers seem only bound to grow.

It stands to reason then that at the same time that those numbers are increasing, I have also noticed a marked decrease in the amount of people who worry about shopping online. Even those in older generations (traditionally the ones least accepting of new technology) no longer seem to have many qualms about inputting a credit card number online to make a purchase.

With all those dynamics in place, though, it does still surprise me that some people are still hesitant about embracing online accounting. If society is already pushing more and more of their transactions into cyberspace, why hold back from embracing that next step?

From my end, I not only have been moving to learn about such new types of accounting, but am impressed at what it allows me to do. Many of the traditional issues one has with an accountant, after all, happened with communication breakdowns and the ensuing waiting those breakdowns cause. If I am waiting on a couple answer to easy questions, of a few receipts, and my client is then waiting in turn for me to address them once received, those bits of time add up and can hold books from being finalized when they’re 98% of the way there.

Now, however, there are more ways to this communication to happen, more access to books on both sides of the relationship, and thus more ways to finish things quicker.

With that, reporting happens faster.

With that, reporting is more powerful because it more accurately reflects what is happening in your business as this moment

With that, why would one not want to embrace these new technologies?

Those who do not want to make the cloud accounting jump seem to most hesitant about security concerns. I hope then that this little anecdote about how much holiday shopping happens online helps illuminate why this need not be a giant concern. Sure, no one can ever 100% guarantee complete cyber security, but with that many online transactions happening, they are clearly coming with a level of security with which we are comfortable.

So if you have been reticent about making the cloud accounting jump in the past, we understand. But if it is something you would like to explore, we would love to hear from you now and see what we can do to help. 

There are a number of different 1099 forms and chances are pretty good that at least one will be making its way into your mailbox (be it the actual one at the curb or a virtual one) over the coming weeks. These forms cover a large range of money that you may have received during the year and include things from interest income to dividends to tax refunds to real estate transactions. The most mysterious of these, however, may be the 1099-MISC from that reports miscellaneous income.

I think that many have their first introduction to this form come in a negative way. Wait, what’s this? I have to report this money that I got months ago, and only now pay taxes on it?

Well, yes.

Beyond that, however, there may be money that you received over the last year that did not result in someone needing to send you that 1099 form, but chances are to be completely legal, the IRS would require you to still report that income if you want your return to be valid in their eyes.

Yes, it may feel unfair that you have to pay taxes on this money. Yes, it may feel strange that with any money you ever receive, you should default to thinking that taxes will be owed on it. This, though, is just another one of those topics that show why it is best to have a tax professional on your side when you try to navigate these waters.

Growing up, I thought of these forms as what people received for their side hustle; they had a real job they went to from Monday to Friday, did something else smaller to supplement their income, and this form showed up at the beginning of year when it was time to account for that. More and more people, however, are finding their way through the modern economy with only income of this 1099 nature.

The Bureau of Labor Statistics published data in August that said nearly 15 million people are self-employed. This makes up about 10 percent of U.S. workers, which is a number that I found rather surprising. Granted, my profession brings me into contact with many people who are working in such a way and need help to make sure they are handling their finances correctly, but I had no idea how large a portion of the work force these people constituted.

On one side of this, I am thrilled by it. The idea that one can plot their own way through life, choose what they want to do, and succeed in doing so lines up with much of what we believe is inherently great in our country. On the other side, however, I am afraid that this might mean there is a great number of people blazing this path who are unaware of just what their tax burden is. Sadly, lacking this knowledge could lead to the end of the dream where you blaze your own course.

So if you are someone worried about what your upcoming tax bill is going to look like, or just what money you made that will be taxed, this is the time to tackle those questions. At least now you are giving yourself some time to get the money together if you are facing a large bill you did not count on. And, as always, we would love to help you answer all those questions.

I might be pushing it by stretching some end-of-last-year/beginning-of-this-year thoughts into the second week of the year, but hey, at least I’m warning you early in this article that I am about to do it.

And yes, it seems everyone and their second cousin’s sister-in-law craft year-end lists (we rank our top 10 pointless relatives inside!), but some of them seem to have some value. For instance, I believe those of you who own your businesses could benefit from this article that discusses the best business lessons of 2016.

The lesson that stood out most to me on the list was “Understand Metrics and Data, and Don’t Misuse Them.” Working in the accounting industry, I have certainly seen people who know the answers they want before they even look at their financials. Unfortunately, there is often a way to shift things around to make the numbers give those answers, at least at first.

Such machinations eventually catch up with those businesses, though. Instead of looking for the mental bandage of seeing what you want to see, use the real numbers to make moves that can get your business where you want it without having to fudge anything.

I also want to highlight the last item on the list  “Give Employees a Way to Shine.” I am not one who has been able to embrace a millennial mindset of complete equality in the workplace, and believe that some structure tends to keep a necessary level of focus. I do, however, like this idea of making sure that everyone has a way to show what they can do and outperform expectations. Not only will the business as a whole benefit from those shining moments, it is also a good way to identity potential and the employees you want to do your best to keep in the fold.

A fact that I cannot possibly avoid is that this time of year also signals the beginning of tax season. Yes, I also mentioned this last week when I mentioned tax scams topping the Better Business Bureau’s list of scams. But when it comes to taxes, you’re just going to have to get used to hearing about them for the next few months.

Tax scams themselves, though, came back around since I last wrote. The IRS is continuing its efforts to stay ahead of criminals taking advantage of their system, and recently gathered people together from across the tax landscape to discuss security measures.

I have been positive in the past about how the IRS is being proactive in its stance surrounding tax fraud, but I was especially impressed when I read in this article that there was a 50 percent reduction in the number of affidavits of taxpayer identity theft that were filed with the IRS last year. Now, I did just say that one should not move numbers around to make them show what you want, but that number is big enough that even if the IRS has moved some numbers around to make this one look really good, there is a great deal of positivity behind it.

There is so much money involved that the IRS has definite reasons to do its best to stay ahead of those who want to take advantage of it. Maybe with that much interest, it could even lead to advances that will be helpful to cyber security beyond the tax world.

Or maybe I’m just still holding on to too much early-year optimism. 

At the beginning of the year, many people get ramped up many different things – and the amount of commercials I’m seeing from Planet Fitness says it’s doing its best to take advantage of this.  For those of us in the tax industry, though, it means we are ramping up for our busy season.

And although I am sure that I will wish take this back come mid-April, I am only excited for this.

For yes, it is our busy season, but it is also our fulfilling season. This is when I get to do the most for the most people, saving money for clients and helping many get refund checks they may not have been expecting.

This means, however, that this time of year will also send us many commercials for both franchise tax preparers and do-it-yourself methods. I obviously have a stake in this game, but I think it is unfortunate how many taxpayers use those methods for filing.

There is a reason that I take pride in my job, and it is because it takes a lot of work and many years of experience to do it as well as I do. That franchise tax preparer, however, probably started taking some standardized courses just a few months ago and software does not have the power to understand your situation like another person who can ask personal questions.

If you are undergoing any medical procedure, you want it to be done by someone who possesses the highest level of knowledge, but so many put their taxes in the hands of those on the lower end of that spectrum. And yes, this is a little hyperbolic and taxes aren’t a life-or-death situation. I do believe, though, that it highlights how we should be trusting those who can do the best job.

It is true, after all, that taxes are complicated and can be treacherous. I wrote many times over the last year about tax scams, to the point where I occasionally feel like a broken record. This seems to have been justified, though, as the Better Business Bureau deemed tax scams the biggest scam going for the second year in a row.

Now if someone said you owed some tax money wouldn’t you want the confidence in knowing your return was handled by a professional? If you worried it was a scam, wouldn’t you want a trained practitioner on your side whom you could consult?

Beyond that, taxes are difficult. I mean if the only thing needed to handle them was to write a check to the IRS of some predetermined amount every year, we would all do it on our own.  Everyone enters a return not completely knowing how it will turn out, though. The reason for that is just what counts as a deduction or an expense and what counts as income do not come with easy definitions.

For a humorous example of that, I encourage you to look at this article from Wise Bread on things you could be taxed on.

So as we start this new year, I hope this finds you having enjoyed a wonderful holiday season.  I also hope this symbolizes the start of us being able to work together for a productive tax season and beyond.

Just maybe give me a break come late April. 

As we are deep in the holiday season, I hope you are getting the chance to spend some extra time with friends and family and getting a chance to recharge.  It also means we are approaching the moment when it comes time to declare any New Year’s Resolutions.

Now, not everyone does this, and even those who do are not always successful. I think we all appreciate that on some level, but it may be alarming just how many fail. Now the science behind how to measure this can be tricky (just how much weight does one need to lose before claiming triumph?), but I have seen numbers that go as low as claiming only eight percent of those who make resolutions carry them out to success.

And sure, if you are looking to enter the new year with the typical but admirable goals of either losing weight or quitting smoking, I wish you only the best of luck. That is not where my expertise lies, however. But if you are entering the new year with hopes to be better with money and make better moves to improve your financial situation, it’s possible I could offer help there, and would love to do so.

In the interests of being a generally helpful person, let me also help guide you through the end of this season. For it is not only resolutions that come about with the turning of the calendar. At some point you are also going to hear that standard Auld Lang Syne and everyone is going to sing the first two lines, then mumble their way through the rest.

So here are the real lyrics, tuck them away in your mind (or in your pocket) and impress everyone at your New Year’s Eve gathering. Note, this is the English translation, for no one is in a state to muscle through Robert Burns’ original Scottish by the time the song begins:

Should old acquaintance be forgot,
and never brought to mind?
Should old acquaintance be forgot,
and old lang syne ?

CHORUS:
For auld lang syne, my dear,
for auld lang syne,
we'll take a cup of kindness yet,
for auld lang syne.

And surely you will buy your cup
and surely I’ll buy mine
And we'll take a cup of kindness yet,
for auld lang syne.

CHORUS

We two have run about the slopes,
and picked the daisies fine,
But we’ve wandered many a weary foot,
since auld lang syne.

CHORUS

We two have paddled in the stream,
from morning sun till night,
But seas between us broad have roared
from auld lang syne.

CHORUS

And there’s a hand my trusty friend,
And give us a hand of thine,
And well take a right good-will draught,
for auld lang syne.

CHORUS

But please don’t ask me exactly what the lyrics mean.

Happy New Year!

I understand that this is a week where many people start to check out (at least mentally) from the work world. Although it is clear that I cannot completely lay claim to that as I type out this message, but I am looking forward to that wonderful holiday break, as well.

For those of us in the tax world, however, this time of year symbolizes the rapid advance toward our busy season. And the dates of it are even starting to get concrete.

Earlier this month, the IRS put out a notice to get everyone prepped for tax season. The agency let it be known that its tax season begins on January 23, meaning that is the first day it will begin accepting electronic returns and processing paper returns. That does not mean that you cannot have your work done before that date, but the IRS will not look at it until then.

In the same notice, taxpayers were reminded that anyone claiming an Earned Income Tax Credit and/or the Additional Child Tax Credit could experience a delay on their refunds. Any early returns claiming those will have their refund held until at least February 15. This is because a high number of fraudulent returns try to take advantage of those credits.

Okay, we can all agree that is enough real work now, right?

So to close, I just wanted to wish everyone Happy Holidays for whatever ones you observe, or just a welcome respite from life’s fast pace if you don’t celebrate.

And either way, there is always good holiday entertainment out there, so since we have agreed that we have done enough work, let me provide some:

First, those of us of a certain age remember how we used to only be able to watch A Charlie Brown Christmas once a year, and this opening still makes me feel good:

https://www.youtube.com/watch?v=GPG3zSgm_Qo

I also tried to make all the classic Rankin & Bass specials appointment viewing:

https://www.youtube.com/watch?v=nu8UCrqMtwg

If you like to still get some Christmas cheer from regular TV, you won’t miss a scene even if you sporadically take in some of the 24-hour A Christmas Story marathon that TBS/TNT has provided for years, and there are some scenes that still make me giggle:

https://www.youtube.com/watch?v=jp-BN9skTP0

And finally, Will Ferrell’s Elf has rapidly made its way onto my must-see list this time of year, and it deserves to be seen if you have not yet, and seen again if you have:

https://www.youtube.com/watch?v=9jyCfRHumHU

Enjoy!