April 20, 2023 to December 31, 2023 – Tuesday thru Thursday 10:00AM to 3:00PM
January 1, 2024 to January 31, 2024 – Monday thru Friday 9:00AM to 5:00PM
February 1, 2024 to April 12, 2024 – Monday thru Friday 9:00AM to 7:00PM
April 15, 2024 – 9:00AM to 4:30PM
Denise will be out of the office for tax workshops August 7, 2023, to August 11, 2023, and September 17, 2023, to September 20, 2023.
Safety and health guidelines: If you are scheduled for an in-person tax appointment or need to enter our office for any reason and you have a cold, the flu, or other contagious illness, please call us to reschedule your appointment or make arrangements to drop off your tax information and change to a phone appointment. Please be safe and considerate of others!
Beware of COVID-19 pandemic scams: Do not provide direct deposit information or any other personal information to anyone who contacts you through email, text message, phone or social media. See Recent Scams under Security Awareness, Scams and Security for more information.
Throughout the entire year our tax professionals are available by appointment only.
We hope everyone is doing well and staying healthy. The past three years have been different for all of us. As we all get back to some type of normalcy, we should look at the positives over the past three years and learn from the negative moments. This should make the past three years a little less stressful for all of us, plus help us go forward in a much more positive manner.
How will we handle the tax interviews this year? This will be up to you. During COVID times some of you enjoyed the experience of being at home and having a phone call interview. This year those who have an appointment can decide which interview process they prefer. No matter which method you prefer, Denise will review your returns with you as she has always done in the past. We are offering 3 different interview procedures, none of them being new:
- Telephone prescheduled appointment – This procedure is not new to those of you who drop off your tax information every year. This is probably the most popular way for most of our clients to schedule their tax interview. We will review, over the phone, the same questions and tax summary review we do during our in-person tax appointments. We do ask you complete the questionnaire, answering as many of the questions that you can. We need your tax information in our office before your scheduled appointment time.
At your scheduled appointment time Denise will start to review and enter your tax documents; for some individuals this will only take 15 minutes to 1/2 hour. For others, it could take up to 1 hour to 1-1/2 hours before she calls you to review your numbers. If you have more than (1) W-2 form along with other expenses and deductions, you will be looking at the 1-hour time span. Unfortunately, we do not know in advance what you will be sending us; trying to forecast the time Denise will call you is impossible. We will try our best to prewarn you as to when things will happen. Thank you for understanding if you receive a call earlier or later than what is noted above.
- Person-to-Person – (In-Person appointment) – You come into the office at your prescheduled date and time and the interview is completed in the office.
- Drop-off appointments – There really is no change to this process. If you decide you would like a prescheduled telephone interview you will need to call our office so we can schedule your appointment. Dropping off your information can be done through mail, our secure mail slot located on our storm door to the office, or we can send you a secure link through Sharefile and you can upload your tax documents to us. If you chose to mail your tax information to us, please email or call our office so we are aware your information is being mailed. Please call our office if you would like us to send you a secure Sharefile link. You will need a printer and scanner to utilize the Sharefile link.
Our greeter Boomer is doing well and really misses seeing everyone.
We still have ‘Good Things’ on our website, so any new pictures you would like to send us please do. We will get them on the website as soon as we can. The scammers have been going full force since COVID; Sarah has done her best to keep the ‘Security Awareness’ section updated on our website. Please review and share with your friends and family the Security Awareness section of our website. Please take note especially to a scam involving the “Tax Processing Unit”. This scam makes threats including seizure of taxpayers’ property unless they immediate pay back taxes. You can read more about this scam under Recent Scams by clicking on Scams & Security.
We appreciate your trust, loyalty, confidence and friendship. If you have any questions or concerns, please call our office. Remember, do something special for someone to make them smile and always be kind and considerate to others. Stay safe and healthy, most importantly enjoy each moment. We hope all of you and your families have a very prosperous and healthy New Year; wishing you joy and happiness in 2023.
Your Friends at Main Street Tax
Denise, Barb and Sarah
DISCLAIMER: Any tax advice noted below is based on the facts provided to us and on current tax law interpretation. Tax law is subject to continual change, at times on a retroactive basis and may result in incremental taxes, interest or penalties. Should the information below be incorrect or incomplete or should the law or its interpretation change, our advice may be inappropriate. We are not responsible for updating our advice for changes in law or interpretation after the date noted above. The following cannot be used as support in any tax audit.
As a reminder, please remember the IRS does not initiate contact with taxpayers via email. Should you receive an email from the IRS, be cautious. Do not respond, do not click on any links, do not open any attachments, but DO forward the email to firstname.lastname@example.org.
Below is an example of an email you may receive that may be suspicious…
ENERGY EFFICIENT HOME IMPROVEMENT CREDIT INDIVIDUALS
The update to this tax law now increases credits for some of the energy improvements you may make on your home and second home. Those who qualified for credits in the past may now qualify for credits going forward for any energy improvements they might do going forward. Please ask your tax professional about the new credits and the information you will need from your contractor.
CLEAN VEHICLE CREDIT
The credits for energy efficient vehicles have changed and will also have income limits. Starting in 2023 the credit might also apply to previously owned vehicles. Please ask your tax professional for more information.
REQUIRED MINIMUM DISTRIBUTIONS (RMD)
The Secure Act increased the age for required minimum distributions (RMD) to age 72. This legislation does not affect the rules for 2019. If you were 70½ or older on December 31, 2019 you will be required to continue to pull your RMD and follow the old rules. This legislation change only effects individuals who were not 70½ or older on December 31, 2019. For those reaching 72 in 2023 the age for you to pull your RMD will be 73. The Secure 2.0 Act will eventually increase the RMD age even higher.
NEW VIRTUAL CURRENCY GUIDANCE
The IRS has issued new guidance to help taxpayers better understand their reporting obligations for specific transactions involving virtual currency. The new guidance includes Revenue Ruling 2019-24 and frequently asked questions. Please call our office if you are dealing with virtual currency so we can assist you in your required recordkeeping.
TUITION (FORM 1098-T) AND BILLING STATEMENTS
If you have a child attending college we will need the 1098T from the college (this will be in your child’s name). We will also need the tuition and fees billing statements from the college for the full calendar year. We want to be sure we are not missing any qualified expenses. You may have to go on the school’s website to retrieve the billing statements. The information will most likely be in the student’s name. The student most likely will have access to this information. Tax preparers are mandated by IRS to verify the numbers we enter on your return. The only way for us to verify this information is to review the billing account statement for the calendar and Form 1098T.
What is sharing economy? Sharing economy is a term for a new way of distributing goods and services – a way that differs from the traditional model of corporations hiring employees and selling products to consumers. An economic system in which assets or services are shared between private individuals, either free or for a fee, typically by means of the Internet. Thanks to the sharing economy you can easily rent out your car, your house, your apartment, your bike, even your Wi-Fi network when you do not need it. Sharing economy activity is generally taxable even when:
- The activity is only part time
- The activity is something you do on the side
- Payments are in cash
- You receive a 1099 form or W-2 form for your service
You will want to call Denise if you are participating in sharing economy. We will review the items you will want to track and receipts you will want to save in order to take a deduction for these expenses to offset the income.
MARKETPLACE SALES or commonly known purchasing items online (PA Rules)
PA has issued guidance on its website related to the Marketplace Sales legislation that was passed by the General Assembly in 2017. The legislation required certain remote sellers and referrers facilitation, making or referring sales to PA customers to make an election to either
- Register to collect and remit sales tax or
- Comply with tax notification and reporting requirements
Beginning April 1, 2018, PA customers will begin receiving information notices from businesses who have elected not to collect sales tax. The information notice will list the purchases and the purchase price of the products for which sales tax was not collected by the seller.
It is important you bring to me these notices which will give me the proper information I need to file your PA use tax when we file your PA income tax return. Please remember PA Dept of Revenue is receiving copies of these notices and will be looking for this information on your PA-40.
CHANGES FOR THE BUSINESS COMMUNITY
Qualified Improvements on Nonresidential Real Property
Qualified Improvements on nonresidential real property is now 15 year property qualifying for a 100% deduction. Examples of such qualifying improvements include installation or replacement of drywall, ceilings, interior doors, fire protection, mechanical, electrical and plumbing. Excluded from the definition are improvements attributable to internal structural framework, enlargements to the building, and elevators or escalators.
PA Withholding Might Be Required For Payments To Contractors
Payments you make to out of state subcontractor doing work here in PA might need to have PA income tax withheld before you submit your payments to the subcontractor. The moment you hire someone to do work on your PA property and their business is NOT located in the State of PA please call Denise before hiring the contractor or submitting any payments to the contractor. Denise will help you decide if PA tax must be withheld.
MEALS AND ENTERTAINMENT CHANGES
Effective 01/01/18 entertainment expenses are non-deductible no matter what. Your business can still pay for the cost of the entertainment; the expense will be non-deductible on the tax return.
However, team-building activities, including the purchase of tickets for your staff is allowed and 100% deductible. The tax code states that “expenses for recreational, social or similar activities primarily for the benefit of employees” qualify for the 100% deduction. There could be more to this story by tax time.
Meals– Are your meals 100% deductible, 50% deductible, or non-deductible?
As part of the Consolidated Appropriations Act (2021), the deductibility of business meals is changing. Food and beverages will be 100% deductible if purchased from a restaurant in 2021 and 2022. This temporary 100% deduction was designed to help restaurants, many of which have been hard-hit by the COVID pandemic. It is my understanding of the law, as long as the meal is eaten at the restaurant it is 100% deductible. If the meal is not eaten at the restaurant, it is 50% deductible. There could be more to this story by tax time.
Please remember if you are traveling on business and away from your office the meals you purchase for yourself, while you are away will be deductible. Per the law if you eat the meal in the restaurant, it is 100% deductible. As long as the restaurant provides seating the business meal will be 100% deductible.
Documentation – you will still need all the documentation you needed in the past.
You are allowed to deduct ordinary and necessary expenses paid or incurred during the tax year in carrying on your trade or business. You will still need to discuss business and document the cost with a receipt. Briefly noting what was discussed will help you back up the cost; verifying it is an ordinary and necessary business expense for you to carry out your trade or business.
HOTEL AND TRAVEL
As of the writing of this document there has not been any change as to the deductibility of hotel and travel expenses for business purposes. You need to note the business purpose and of course who, what, when, where and why for the expense to be deductible to the entity.
If you are giving a client hockey or baseball tickets: This could be classified a gift. The tax laws state you can deduct business gifts given to your clients up to $25.00 per recipient; this is per year per recipient. You cannot give a client 2 deductible gifts in one year. Your business can pay for the expense. If the cost is above $25.00, the difference will be non-deductible. Be sure to note on your receipt the client’s name and business.
TAX PLANNING WHY OR WHY NOT?
If you are planning on improving your home how are you going to pay for the cost? Pulling the money from your Retirement Savings might cost you way too much in income tax. Using a home equity loan might be a good idea; the problem might be your home equity loan you had for the past 10 years may not be set-up properly. Here is where tax planning might be helpful. I will give you ideas on how to fund the improvements and at the same time review the tax advantages or disadvantages with each scenario.
Do you want to buy a vacation property or rental property? Again proper planning may just save you income taxes. You have a child or grandchild attending college and you would like to gift them some money towards their college tuition. Call Denise so she can tell you the best way you can assist your child or grandchild.
Remember prior to refinancing, purchasing or taking out a home equity loan please call Denise for proper guidance.
Since the standard deduction is so much higher a lot of our clients will not qualify for itemizing. Those clients who fall under Required Minimum Distribution requirements can make special contributions to their favorite charities, when pulling their required minimum distributions from their IRA accounts. This is part of tax planning and might save you quite a few tax dollars. Let Denise know your plans when donating to your favorite 501C3 organization.
Some of you might be able to just call Denise, ask the question and she will give you a pretty quick answer. Others, additional time might be needed depending on the complexity of the question.
Most important to remember is Denise is here to save you time and tax dollars. Please call her anytime.
BEFORE BAD WEATHER AND DISASTER STRIKES – BE PREPARED!
Being prepared for the worst is always a good idea. Your plan shouldn’t only include bottled water, batteries, candles and an evacuation plan — but also your financial and family documents. While putting together your emergency kit, don’t neglect your financial kit:
- Update emergency plans. Taxpayers should review and update their emergency plans annually because personal and business situations are constantly evolving.
- Create electronic copies of documents. Documents should be kept in a secure place. Secure places include a password-protected WiFi, encryption of the documents and/or perhaps an external drive or flash drive that is disconnected to your computer after loading documents. Documents include, but are not limited to, bank statements, tax returns and insurance policies. Saving electronic copies is much easier right now since most institutions provide you with electronic statements. If you only have access to paper copies, you should scan them to a flash drive or CD or in the cloud.
- Document valuables. Taking pictures or videos of valuables before disaster strikes helps with your insurance claim and tax benefits, if necessary. IRS.gov has a disaster loss workbook to help taxpayers document room-to-room items of their belongings.
- Know what tax relief is available in disaster situations. Information on disaster assistance and emergency relief for individuals and businesses is available at IRS.gov. Also review the itemized deduction for casualty and theft losses. Net personal casualty and theft losses are deductible only to the extent they are attributable to a federally declared disaster. Claims must include the FEMA code assigned to the disaster.
- Remember, the IRS is ready to help. In the case of a federally declared disaster, people can visit Around the Nation on IRS.gov and click on their state to review the available disaster tax relief. Taxpayers who live in a county qualifying for tax relief receive automatic filing and payment extensions for many different tax forms do not need to contact the agency to get relief. Any disaster-related questions, call the IRS at 866-562-5227 to speak to an individual trained to answer disaster-related questions.
AFTER DISASTER STRIKES—REBUILDING YOUR LIFE
If you were not able to prepare for a natural disaster by taking the steps listed above and have lost your paperwork, you may need documentation for tax purposes, federal assistance programs or insurance claims. Below is some information to help you gather this information.
- Tax Records. You can get free tax return transcriptions immediately using Get Transcript on IRS.gov. Or, you can order transcripts by calling 1-800-908-9946 (follow the prompts).
- Financial Statements. Past credit card statements can be retrieved online or from your credit card company or bank. You can also contact your bank for paper copies of your bank statements.
- Property Records. Any documents related to your property can be retrieved from the title company, escrow company or bank that handled the purchase of your home. If you made home improvements and need to verify the cost and work performed, contact your contractor. You can also get written descriptions from friends and relatives who saw the house before and after the improvements. For inherited property, taxpayers can check court records for probate values. If a trust or estate existed, the attorney who handled the trust can give you this information. If no records are available, check the county assessor’s office for old records that may address the value of the property. If you owned a car, you can research the current fair-market value online using Kelley’s Blue Book, the National Automobile Dealers Association and Edmunds.
DISCLAIMER: Any tax advice noted above is based on the facts provided to us and on current tax law interpretation. Tax law is subject to continual change, at times on a retroactive basis and may result in incremental taxes, interest or penalties. Should the information below be incorrect or incomplete or should the law or its interpretation change, our advice may be inappropriate. We are not responsible for updating our advice for changes in law or interpretation after the date noted above. The above information cannot be used as support in any tax audit.