Practice Builder

Asking clients great questions is central to ruthlessly efficient workflow (REW) management. Great client questions can save hundreds of hours of time during tax season and prevent projects from falling behind schedule. Here is an example of questions done badly. ... Frank Stitely, CPA

Feature Article

The nature of tax practice presents a number of unique ethical issues. Tax practice requires compliance with multiple ethical frameworks. This creates ambiguities and raises complex questions. Courts have even questioned whether certain regulatory... Ryan Dean

EVP Message

Our readers fall into two buckets, those who read the March/April issue when it arrives and those who catch up later in the year. The magazine reflects this reality as well, as does this message. For those of you reading this when it falls on your doorstep (as the son of a postman, I have a rather romantic notion of mail delivery), the message is this: What gift are you going to give your future self? You are learning things during this fi... Robert A. Kerr

Feature Article

Form 1040 changed significantly for the 2018 tax season. It is changing again for the 2019 tax year. It appears that the 2017 and 2018 forms had a baby — the 2019 form. In other words, the pendulum is swinging back a bit. Beth Logan, EA. 1040 and 1040-SR The cha... Beth Logan, EA

Feature Article

I read Gil Charney’s analysis of the application of §199A to a rental activity in the September/October 2019 edition of EA Journal (“Your Questions Answered,” pp. 12-13) and I do not agree with it. In that case, I believe the taxpayer clearly qualifies to take the §199A deduction on th... Thomas A. Gorczynski, EA, CTC, USTCP

Capitol Corner

Ten years ago this December, IRS Commissioner Doug Shulman announced the creation of a program to regulate paid tax return preparers. After years of pushing and advocating, IRS had finally picked up the ball and scored a touchdown. Rebecca Hawes

Feature Article

Donor-advised funds are growing in popularity as a way for individuals and corporations to give to charities. Broad-sweeping changes to the tax code at the end of 2017 sent nonprofits into a state of panic. The doubling of the standard deduct... Kim Moore

Feature Article

The Ins and Outs of Part Day-Care Provider Taxes Part 1 By Laura Strombom, EA As the profession adapts to the changes under the Tax Cuts and Jobs Act of 2017, those who prepare primarily basic returns, such as a 1040 with only a Schedule A, may need to add additional areas to their practices. One strategy is to specialize in an area that will continue to demand expert preparation services.... Laura Strombom, EA, MBA, NTPI

Feature Article

When clients hands over a QuickBooks (QB) file at income tax time, the expectation is you have what you need and tax preparation will be a breeze. Depending on the client, you are either elated or you want to cringe; there is not much in between. It is important for tax preparers to feel ... Geri Bowman, EA, CPA, USTCP

Payroll Corner

Forms W-2 were filed with the Social Security Administration (SSA) by January 31, 2019, but that is the end of the story only if all those Forms W-2 are correct. While 100 percent accuracy is always the goal, it is rarely achieved. So, the second part of the year-end pro... Alice Gilman, Esq

Feature Article

Please remember that this article was written in late September based on the draft forms available at that time. Some changes may have occurred between that date and the publishing of this article. Line 7 Wages. Line 21 — Other income. Lines 37 and 38 – adjusted gross income (AG... Beth Logan, EA

Feature Article

This year, we get to deal with many tax changes. Members of Congress, as well as presidential candidates, stated that one of their goals was to simplify the tax code (U.S. Code title 26). And simplification has occurred to some extent with Public Law 115-97, also known as the Tax Cuts and Jobs Act of 2017 (TCJA). Congress made some issues simpler while creating at least one new issue that has confused many. Many popular de... David Mellem, EA

Feature Article

IRC Section 162, Trade or Business Expenses Section 162(a) states: In general there shall be allowed as a deduction all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business... . In a home daycare, many of the expenses have personal and business elements. Te Audit Technique Guide for child-care providers (ATG for CC) states: The examiner needs to evaluate in a fair a... Laura Strombom, EA, MBA, NTPI Fellow®

Feature Article

The word “fraud” conjures up many images, none of which are positive. As Circular 230 tax professionals, we never knowingly jeopardize our credentials while serving clients. Ever cautious, we could, nevertheless, find ourselves representing a client who has engaged in fraudulent activity. Can you recognize the signs of tax fraud? How do you handle a client’s matter with potential or actual fraudulent transactions? According to the Interna... Alan L. Pinck, EA, Ann E. Kummer, EA, CPA

Tax Court

Barry Leonard Bulakites, Petitioner v. Commissioner of Internal Revenue, Respondent Many taxpayers prepare their own tax returns, without professional help, by using off-the-shelf retail software programs. These programs often offer recommendations based upon the information that is inputted by the taxpayer and may also provide one-toone answers... Steven R. Diamond, CPA

Feature Article

The failure to file an accurate and complete Financial Crimes Enforcement Network (FinCEN) 114, (Report of Foreign Bank and Financial Accounts (FBAR)) can result in serious penalties and consequences for a taxpayer. Unfortunately, the FBAR is one of those deceptively simple forms that does not appear to be complex due to the limited number of entries required. However, those unfamiliar with the form are prone to mistakes, as detailed rules ex... Randall Brody, EA

Feature Article

The first in a series on using tax planning to guarantee satisfied clients and grow your business By Beth Logan, EA People think of tax season as running January through April. But most people make their biggest tax mistakes from May through December. There are two reasons for this. First, they aren’t thinking about taxes. Second, there are more days in which to err. This is my tax mantra. If you tell clients this, they ... Beth Logan, EA

Feature Article

Do you have clients who are foster parents? Do you have clients who have adopted from the foster care system? If you have answered yes to either of these questions, you need to know about the Adoption Tax Credit. Many taxpayers who are adoptive parents have been told they do not qualify for the Adoption Tax Credit because they had no expenses. As tax professionals, we often hear our clients say, “My friend told me something different.” Wi... Becky Wilmoth, EA

Feature Article

The Tax Appointment Worksheet is a tool to help you gather the needed information for new and returning clients for the 2016 tax year. This year’s worksheet has been enhanced to reflect the changes in tax law. Now that the American Opportunity Credit is permanent, the need for the proper Form 1098-T and the educational expense evidence is increasingly crucial. Type of plan Amount of contribution Form 1099-... Mary Mellem, EA

Feature Article

One of the primary reasons people become enrolled agents is to be able to help their clients with tax problems. EAs (as well as attorneys and CPAs) can represent taxpayers before all administrative levels of the IRS. In order to effectively represent taxpayers, however, EAs need to be aware of just how far a practitioner can go, both ethically and professionally, without exceeding the limits of authority granted by the EA designation. In the ... Thomas A. Gorczynski, EA, USTCP, Kevin C. Huston, EA, USTCP

Feature Article

Matt Groening, creator of The Simpsons, once lamented, “I know all those words, but that sentence makes no sense to me.” As an enrolled agent, you may mutter something similar to yourself as you scan through the latest IRC update for the umpteenth time. Then, once you master the tax jargon, you must translate it into layman’s terms and communicate with your clients. Challenging as this may be in English, some NAEA members go another step furt... Julia Shenkar