IRS Tax Tip 2019-117, August 27, 2019 https://www.irs.gov/newsroom/tax-pros… http://accountinginstruction.info/ Tax professionals should review security steps to make sure they are fully protecting sensitive taxpayer data. All tax pros should give their data safeguards a thorough review. Part of this review is following the “Security Six” protections. Here is more info about these basic protections that everyone – especially tax professionals handling sensitive data – should use: Anti-virus software This software scans computer files or memory for certain patterns that may indicate there’s malicious software – also called malware – on the device. Anti-virus vendors find new issues and update malware daily. This is why it’s important for users to install the latest updates of the software. Firewalls Firewalls provide protection against outside attackers. The firewall shields computers and networks from malicious or unnecessary web traffic. This helps prevents malicious software from accessing the user’s system. Two-factor authentication Two-factor authentication adds an extra layer of protection beyond a password. The returning user enters credentials like a username and password. Then, there’s another step, such as entering a security code. Backup software or services Users should routinely back up critical files on their computers and hard drives to external sources. Drive encryption Because tax professionals keep sensitive client data on their computers, users should consider drive encryption software. Drive encryption is also knowns as disk encryption. It transforms data on the computer into unreadable files. This means only people who are authorized to access the data can do so. Virtual private network Many tax firms’ employees must occasionally connect to unknown networks or work from home. So, the office should establish an encrypted virtual private network. This allows for a more secure connection. A VPN provides a secure, encrypted tunnel to transmit data between a remote user over the internet and the company network.
IRS Tax Tip 2019-116, August 26, 2019 https://www.irs.gov/newsroom/these-ta… http://accountinginstruction.info/ Starting a business can be very rewarding. It can also be a little overwhelming. From business plans to market strategies, and even tax responsibilities…there are many things to consider. Here’s what new business owners can do to help get off to a good start. Choose a business structure. The form of business determines which income tax return a business taxpayer needs to file. The most common business structures are: Sole proprietorship: An unincorporated business owned by an individual. There’s no distinction between the taxpayer and their business. Partnership: An unincorporated business with ownership shared between two or more people . Corporation: Also known as a C corporation. It’s a separate entity owned by shareholders. S Corporation: A corporation that elects to pass corporate income, losses, deductions, and credits through to the shareholders. Limited Liability Company: A business structure allowed by state statute. Choose a tax year. A tax year is an annual accounting period for keeping records and reporting income and expenses. A new business owner must choose either: Calendar year: 12 consecutive months beginning January 1 and ending December 31. Fiscal year: 12 consecutive months ending on the last day of any month except December. Apply for an employer identification number. An EIN is also called a federal tax identification number. It’s used to identify a business. Most businesses need an EIN. Have all employees complete these forms: Form I-9, Employment Eligibility Verification (U.S. Citizenship and Immigration Services) (PDF) Form W-4, Employee’s Withholding Allowance Certificate Pay business taxes. The form of business determines what taxes must be paid and how to pay them. Taxpayers interested in starting a business can find information for some industries on the Industries/Professions Tax Centers webpage. Each state has additional requirements for starting and operating a business. Prospective business owners should visit their state’s website for info about state requirements. More information: Small Business Admiration’s 10 steps to start your business
WASHINGTON — The Internal Revenue Service and its Security Summit partners today warned taxpayers and tax professionals about a new IRS impersonation scam campaign spreading nationally on email. Remember: the IRS does not send unsolicited emails and never emails taxpayers about the status of refunds. https://www.irs.gov/newsroom/security… http://accountinginstruction.info/ The IRS this week detected this new scam as taxpayers began notifying email@example.com about unsolicited emails from IRS imposters. The email subject line may vary, but recent examples use the phrase “Automatic Income Tax Reminder” or “Electronic Tax Return Reminder.” The emails have links that show an IRS.gov-like website with details pretending to be about the taxpayer’s refund, electronic return or tax account. The emails contain a “temporary password” or “one-time password” to “access” the files to submit the refund. But when taxpayers try to access these, it turns out to be a malicious file. “The IRS does not send emails about your tax refund or sensitive financial information,” said IRS Commissioner Chuck Rettig. “This latest scheme is yet another reminder that tax scams are a year-round business for thieves. We urge you to be on-guard at all times.” This new scam uses dozens of compromised websites and web addresses that pose as IRS.gov, making it a challenge to shut down. By infecting computers with malware, these imposters may gain control of the taxpayer’s computer or secretly download software that tracks every keystroke, eventually giving them passwords to sensitive accounts, such as financial accounts. The IRS, state tax agencies and the tax industry, which work together in the Security Summit effort, have made progress in their efforts to fight stolen identity refund fraud. But people remain vulnerable to scams by IRS imposters sending fake emails or harrassing phone calls. The IRS doesn’t initiate contact with taxpayers by email, text messages or social media channels to request personal or financial information. This includes requests for PIN numbers, passwords or similar access information for credit cards, banks or other financial accounts. The IRS also doesn’t call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes. See Report Phishing and Online Scams for more details.
Section 1274.–Determination of Issue Price in the Case of Certain Debt Instruments Issued for Property https://www.irs.gov/pub/irs-drop/rr-1… http://accountinginstruction.info/ (Also Sections 42, 280G, 382, 467, 468, 482, 483, 1288, 7520, 7872.) Rev. Rul. 2019-20 This revenue ruling provides various prescribed rates for federal income tax purposes for September 2019 (the current month). Table 1 contains the short-term, mid-term, and long-term applicable federal rates (AFR) for the current month for purposes of section 1274(d) of the Internal Revenue Code. Table 2 contains the short-term, mid-term, and long-term adjusted applicable federal rates (adjusted AFR) for the current month for purposes of section 1288(b). Table 3 sets forth the adjusted federal longterm rate and the long-term tax-exempt rate described in section 382(f). Table 4 contains the appropriate percentages for determining the lowincome housing credit described in section 42(b)(1) for buildings placed in service during the current month. However, under section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after July 30, 2008, shall not be less than 9%. Finally, Table 5 contains the federal rate for determining the present value of an annuity, an interest for life or for a term of years, or a remainder or a reversionary interest for purposes of section 7520. Applicable Federal Rates (AFR) for September 2019 Period for Compounding Annual Semiannual Quarterly Monthly Short-term AFR 1.85% 1.84% 1.84% 1.83% 110% AFR 2.03% 2.02% 2.01% 2.01% 120% AFR 2.22% 2.21% 2.20% 2.20% 130% AFR 2.40% 2.39% 2.38% 2.38% Mid-term AFR 1.78% 1.77% 1.77% 1.76% 110% AFR 1.96% 1.95% 1.95% 1.94% 120% AFR 2.13% 2.12% 2.11% 2.11% 130% AFR 2.31% 2.30% 2.29% 2.29% 150% AFR 2.68% 2.66% 2.65% 2.65% 175% AFR 3.12% 3.10% 3.09% 3.08% Long-term AFR 2.21% 2.20% 2.19% 2.19% 110% AFR 2.43% 2.42% 2.41% 2.41% 120% AFR 2.66% 2.64% 2.63% 2.63% 130% AFR 2.88% 2.86% 2.85% 2.84% Period for Compounding Annual Semiannual Quarterly Monthly Short-term adjusted AFR 1.40% 1.40% 1.40% 1.40% Mid-term adjusted AFR 1.34% 1.34% 1.34% 1.34% Long-term adjusted AFR 1.68% 1.67% 1.67% 1.66% REV. RUL. 2019-20 TABLE 3 Rates Under Section 382 for September 2019 Adjusted federal long-term rate for the current month 1.68% Long-term tax-exempt rate for ownership changes during the current month (the highest of the adjusted federal long-term rates for the current month and the prior two months.) 1.89% REV. RUL. 2019-20 TABLE 4 Appropriate Percentages Under Section 42(b)(1) for September 2019 Note: Under section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after July 30, 2008, shall not be less than 9%. Appropriate percentage for the 70% present value low-income housing credit 7.46% Appropriate percentage for the 30% present value low-income housing credit 3.20%
IRS Summertime Tips 2019 August http://accountinginstruction.info/ Summertime activities often affect the tax returns people file the following year. Here are some things taxpayers do during the summer along with tips they should consider now: Getting married. Newlyweds should report any name change to the Social Security Administration. They should also report an address change to the United States Postal Service, their employers, and the IRS. This will help make sure they receive documents and other items they will need to file their taxes. Sending kids to summer day camp. Unlike overnight camps, the cost of summer day camp may count towards the child and dependent care credit. Working part-time. While summertime and part-time workers may not earn enough to owe federal income tax, they should remember to file a return. They’ll need to file early next year to get a refund for taxes withheld from their checks this year. Normally, employees receive a Form W-2, Wage and Tax Statement, from their employer to account for the summer’s work. They’ll use this to prepare their tax return. They should receive the W-2 by January 31 next year. Employees will get a W-2 even if they no longer work for the summertime employer. Summertime workers can avoid higher tax bills and lost benefits if they know their correct status. Employers will determine whether the people who work for them are employees or independent contractors. Independent contractors aren’t subject to withholding, making them responsible for paying their own income taxes plus Social Security and Medicare taxes
Playlist http://bit.ly/2MullRX 0:26 Payroll Introduction http://bit.ly/2YxXJSW 6:29 Regular & Overtime Pay Calculation http://bit.ly/2YhusNa 11:40 Federal Income Tax FIT http://bit.ly/2YdqxRr 18:54 Payroll Legislation http://bit.ly/2ynPwSG 26:47 Payroll Consideration and Tax Forms http://bit.ly/330xrIy 43:06 Payroll Periods and Time Frames http://bit.ly/2Gyjvfh 50:11 New Employee Tax Forms & Contractor vs Employee http://bit.ly/2MBHEFJ 1:07:26 Federal Income Tax FIT – Percent Method http://bit.ly/2KdIhlX 1:15:09 Federal Income Contributions Act (FICA) http://bit.ly/3100GJA 1:23:15 Social Security Tax Calculation http://bit.ly/2yqpFd2 1:29:25 FUTA, SUTA Workers Compensation http://bit.ly/315gASW 1:34:18 Medicare Tax Calculation http://bit.ly/333BB2o 1:37:49 Federal Unemployment Tax Act Calculation http://bit.ly/2MsXfXV 1:41:32 Payroll Ethics & Practices http://bit.ly/2Kd5SDa 1:50:00 Employer Taxes Calculation http://bit.ly/2yrvnes 1:57:19 Employer Responsibilities and Processes http://bit.ly/30YAlvA 2:05:10 Payroll Expense Journal Entry http://bit.ly/2MtUJRc 2:15:50 Payroll Tax Expense Journal Entry http://bit.ly/2ZpJQ6A 2:24:07 Pay Payroll Tax Expense Journal Entry http://bit.ly/2SZqrqQ 2:32:58 Form 941 Payroll Controls and Documentation http://bit.ly/2ylSuqX 2:55:39 Form 940 http://bit.ly/331dxNB 3:07:14 Form W-3 & W-2 http://bit.ly/2GDGiGv 3:19:11 Reconciling Year End Payroll Forms http://bit.ly/2Mrwran 3:28:30 Minimum Wage & Nonexempt Employees http://bit.ly/2K6Rhuj 3:34:03 Payroll Calculations http://bit.ly/2GDIxcL 3:40:16 Overtime Calculation http://bit.ly/2K4fzFd 3:49:43 Payroll Register http://bit.ly/2LTpGPg 3:59:24 Fringe Benefits http://bit.ly/2SSxGAz 4:05:32 Deductions From Gross Pay http://bit.ly/316pD6k 4:11:55 Retirement Plans http://bit.ly/2K6MPLO 4:21:11 Post Tax Deductions http://bit.ly/2YxnPkQ 4:26:33 Net Pay Calculation http://bit.ly/2LO3AgY 4:31:55 Federal Income Tax (FIT) http://bit.ly/2KdIoxH 4:46:43 Social Security http://bit.ly/2LQzSYM 4:58:18 Medicare Tax http://bit.ly/2YwqvTV 5:04:21 Other Deductions & Payment Methods http://bit.ly/333CesM 5:12:29 605 Taxes Employer Employee http://bit.ly/2Ow8SjB 5:21:50 FICA Employer http://bit.ly/2LQRWCd 5:26:47 Form 941 http://bit.ly/2K65d7W 5:38:44 Form 940 http://bit.ly/2yr5nzY 5:47:35 Form W-3 http://bit.ly/2KeVURU This financial accounting and payroll video will cover payroll topics including payroll legislation, payroll calculations, and entering payroll journal entries. Because payroll is becoming more complex and more of a specialized field it is difficult to find content that puts it all together in one spot like this course does. We will discuss payroll legislation, going over a wide variety of laws that influence payroll. Because payroll is such a broad topic and because it overlaps with other areas of business like human resources many laws influence the processing of payroll. We will concentrate on laws that deal with the calculation of payroll and payroll withholdings. The video will cover the generation of payroll registers and earnings reports, the primary tools to help us calculate payroll. We will discuss how to calculation payroll tax withholding like federal income tax (FIT), social security, and Medicare. We will calculate net pay from gross pay. This video will cover journal entries related to payroll; a topic often overlooked in may payroll classes. Payroll journal entries can be complicated. Learning payroll journal entries helps our understanding of both payroll and debits and credit. We will post payroll journal entries to the general ledger and analyses the effect on the financial accounts and accounting equation. This video will cover the processing of payroll tax forms like form 941, form 940, form W-2, form W-3, and form W-4. We also include a comprehensive a problem, allowing us to see the entire process in one problem. This video includes key terms and definitions related to payroll and a general comprehensive accounting cycle comprehensive problem. The accounting cycle comprehensive problem will take a step back, so we can see the big picture and visualize how the payroll process fits into the overall accounting cycle.
The Accounting Closing Process Playlist http://bit.ly/2GDpYFT 0:27 Closing Process Explained http://bit.ly/2ysr0jr 7:14 Post Closing Trial Balance http://bit.ly/2ZlyHnl 11:19 One Step Closing Process http://bit.ly/2K6cAMx 23:09 Two Step Closing Process http://bit.ly/2Yz8r7E 34:03 Closing Process Step 1 of 4 – Journal Entry 1 of 4 http://bit.ly/2LPRDHF 37:23 Closing Step 2 of 4 – Journal Entry 2 of 4 http://bit.ly/2YBXKVS 42:41 Closing Entries Journal Entry 3 of 4 Step 3 Income summary http://bit.ly/2K8xvNy 47:39 Closing Process Step 4 of 4 Closing Journal Entry Draws or Withdraws http://bit.ly/2Yfq6WF 1:01:29 Post Closing Trial Balance & financial statements http://bit.ly/2OE9FyG The financial accounting closing process is the final step in the accounting cycle. We will learn why the closing process in needed and be able to perform the closing process multiple ways. As indicated by the title, the closing process takes place at the end of the accounting cycle. The main event of the accounting cycle is the financial statements. Once we have completed the financial statements we need to get ready for the next accounting period, get ready with the closing process. The closing process will zero out temporary accounts including income statement accounts of revenue and expenses and the draws or dividends account. We can perform the closing process multiple ways. We will consider the closing process from three perspectives. Each perspective has pros and cons and the repetition of each method as well as performing the closing process from multiple angles will provide a solid understanding of the concepts. Understanding the closing process helps understand the concept of temporary accounts and permanent accounts, which helps us understand the relationship of the financial statements and how to read them.
Accounting Major Second Guessing & Dealing With Criticisms http://accountinginstruction.info/ Objectives Work with different points of view, take what is helpful, and discard the noise. (Not designed to increase argument but possibly facilitate more productive debate). Help structure personal goals and use doubts constructively In this presentation we’re going to take a look at a problem from the perspective of an accounting major. Someone who is going to school and has chosen accounting as their primary field. Although we’re talking here to people that have chosen accounting and are in school for accounting, the same kind of thing applies to people that are working within the accounting field and more broadly basically any type of career choice or career path will apply or at least some of these items will apply to it, that problem being the second guessing of the major that we have chosen and dealing with some type of criticism with regards to the major, debate about the major that has been chosen, either from other students or from instructors or from other individuals that we are involved with Now we’re assuming at this point in time we’re thinking about someone who has basically chosen which path they want to go on. Note typically if someone’s going through say high school or undergraduate then we’re talking to a whole bunch of people trying to decide what’s an appropriate major what’s going to be a good major. At some point in time the decisions going to be made and we have to basically go into that process and continue with the decision making process and move forward with whatever decision we have been chosen. Typically at this point we’re thinking about people who have chosen accounting as their major and now are thinking about moving forward in accounting. Note that as you choose a major, as you narrow things down, as you have to do, it can be concerning because we often think about the things that we have given up That’s of just the way the mind is wired. We’re mentally set to be more concerned about the things that we’ve lost than the things that we’re going to gain. With regards to the choices that we make as we go into the choice usually we find that the choice that we have made and the more we think about the choice we’ve made then there’s basically infinite possibilities we have within that choice that we’ve made. We still have a tons of choices to make. Most people don’t narrow down enough and have too many choices and they end up basically getting stuck at a standstill. Business, Economics, & Practical Technical Skills questions: Accounting is not where the money is at Wake up and go where the action is Accounting will be completely automated someday Your job will be outsourced Accounting is not an integral part of the business model but just a miner task that need to be done, similar to the trash needing to be taken out Real business people focus on the money making components and higher somebody do accounting. Accounting is not the fun part of business. Marketing and advertising is where the fun is. Arts and Humanities Life activities should be focused on what you love doing. Who could love doing accounting? Money doesn’t really matter. Why focus so much time counting it? Life should be spent doing stuff and interacting with people. Why spend so much time working on number, ledgers, and with computers Sciences qeustions Life is about understanding the physical world. Money is just a tool that should be used towards this end As we learn accounting, we should be integrating these other areas as we can Whatever career we choose can be thought of as a focal point we use to build on. Whatever we know best will eventually lead into other topics as we expand out knowledge. As students we can expand our knowledge by learning components of other disciplines that most directly apply to ours Learn accounting software. Learn databases Learn tax software Learn managerial concepts, group dynamics, and economics