The IRS has just announced that their interest rates are remaining the same for the 3rd Quarter of 2015. These interest rates are as follows:
IRS Newswire Issue Number IR-2015-84 also provides the following information:
You can also review the Revenue Ruling here.
I was recently lucky enough to visit some family that I have in Florida. It was beautiful weather the whole time I was there until the last day when it was starting to get rainy - their hurricane season had just started. I had been visiting from here in Colorado where it had also been very rainy for several weeks before I left. Normally I wouldn't worry except for the fact that my hometown had been destroyed by flooding less than 2 years earlier. Since then, getting a lot of rain always makes me a little on edge.
You never know when a disaster can strike, so it's important to remember how to safeguard your documents before it happens. The few states I mentioned are not the only ones that have to worry about natural disasters. This is also the time of year for tornadoes in many states and forest fires can spread to residential areas before you know it. It's important for everyone to worry about making sure their important documents are safeguarded. So, here are a few tips to make sure you are prepared.
First, you should always keep an extra set of electronic records for anything important, such as tax returns and financial statements. There are many options for keeping these records such as USB devices, CD's, or DVD's. Keep these in a safe place, like a waterproof or fireproof box, or even a safety deposit box at your local bank. Many options are also available for cloud based storage which can be a great alternative in case your storage device or computer is also destroyed.
Also, be sure to document your valuables for insurance purposes. Photographs and videotapes are helpful in the event of loss during a disaster. Check out Publication 584 for more information on documenting your valuables for emergency situations.
If you are affected by a natural disaster, you can contact the IRS at 1-866-562-5227 to speak with someone trained to handle those types of issues. The IRS may also be able to provide you with copies of tax related records, but this should not be solely relied upon as your backup source for obtaining your records; the IRS only keeps copies of records for a set amount of time before they are also destroyed. Always keep in mind that you are considered solely responsible for the safekeeping of your own records, and you shouldn't rely on your CPA or bookkeeper to keep backup documents for you.
Last, but not least, always make sure your emergency evacuation and protection plans are up to date and understood well. There's nothing more important than making sure you yourself are safe and protected during a disaster.
This information was obtained from IRS Newswire Issue Number: IR-2015-83.
Business owners, don't forget that your 1st Quarter 2015 941 Return is due at the end of this month. Make sure to have this filed and paid on time in order to avoid getting behind in this new year!
If you are a monthly depositor, don't forget that your next payroll tax deposit is due January 15, 2015. This should be your last deposit due before your 941 Employee Withholding Tax Return is due on January 31, 2015.
If you aren't sure what kind of deposit schedule you should be on, you can review the IRS' publication titled "The ABC's of FTD's". This publication is full of information on determining what kind of deposit schedule you should be on, including how and when to make your tax deposit.
Ensuring you are on the right deposit schedule is imperative for avoiding penalties and interest with the IRS. The taxing authorities will also want to see that you are correctly making deposits before they will allow you to make an arrangement to resolve any back tax balances.
For assistance on making sure you are on the right deposit schedule, feel free to contact us. We can be reached at 720-420-7996.
Amy Lee, EA
We are all excited about what 2015 will bring! But, with the arrival of the new year, a new tax season also emerges. For some of you who've filed extensions, you may feel like tax season just ended. However, it's never too early to start planning for your upcoming filings and seeking the right tax professionals for assistance.
The IRS has recently announced that they've joined forces with national tax organizations in order to provide people with information and advice for selecting a tax professional. Since there are unfortunately some inadequate tax professionals out there, this information will be very helpful to point people in the right direction. They will even have information on non-profit organizations for certain taxpayers who may qualify for specialized help. To find more information, visit IRS.gov/chooseataxpro.
We here at Compass Tax Group wish you all the best in 2015 and hope it brings you many blessings. As always, if we can help you to get back on track with your tax matters in this new year, please contact us at 720-420-7996.
Amy Lee, EA
It’s a new year and it’s a great time to get started with resolving that tax balance that has been weighing on your shoulders. Now is the time that the Internal Revenue Service and State Revenue Agents are returning from holiday vacations and are ready to get back to hard work. That means that this is the time of year where collection efforts are ramping up. What better time to get started in keeping them off your back?
Don't forget that your 3rd Quarter 2014 941 Employee Withholding Tax Return is due to be filed today. As long as it is postmarked by today, or filed electronically, you will be filing on time and avoiding late filing penalties.
Amy Lee, EA
Compass Tax Group, LLC
The logic makes sense in that you want to make sure the debt is addressed, and most think that it looks good when payments are being made on the back end. This way, the taxing agency knows you're trying to get it paid, right?
While it is true that the taxing agencies do want to see the debt being addressed, the most important thing that any taxpayer can do is to make sure they are staying current on ongoing tax payments. For example, for most business owners that have employees, the 3rd Quarter 2014 Employee Withholding Tax Return is due to be filed at the end of October. If you are trying to decide between paying your upcoming 3rd Quarter return, or paying a previous balance that is past due, pay your 3rd Quarter return first. This is important for several reasons.
First, this shows the taxing agency you are working with that you can keep current with your ongoing taxes. This is a requirement anytime you are trying to work with an agency on a payment plan for your back taxes; they need to see that your balance isn't going to continue growing. Most often, if new tax balances are continuing to accrue, the taxing agency will not want to continue working with you on back tax balances. Look at it from their perspective: if they see a business that consistently accrues new tax balances, why would they want to let the business continue to operate and get further and further in debt? Sure, you might be making payments on the back end, but the balance isn't getting any smaller because new balances continue to arise. In many of these cases, the Internal Revenue Service or State will find a way to "stop the bleeding" and use more forceful collection techniques, such as bank account levies or even seizure of assets. To help keep from getting to this point, it is important to make efforts to stay in compliance with your ongoing tax payments.
Second, if you are paying your current taxes, you are helping to limit future penalties. Each time you file a return late, or pay a balance late, the Internal Revenue Service or State will tack on a penalty. Your prior balances most likely already have many hefty penalties added. So, it is in your best interests to avoid future penalties by making your ongoing tax payments timely. You will help to make your past debt more manageable if you can keep future penalties from arising.
Another concern I hear when I discuss this with my clients is that the payments the taxing agency wants them to make will keep them from being able to stay current. They wonder how they can stay current AND pay their back tax balances. This is where consultation and budgeting comes in to play. It is important to understand that the government wants you to stay current. They will account for this in reviewing your financial condition to make sure that you can pay your ongoing taxes and pay your past due balance as well. So, negotiating a payment that will help you do this is the key to getting out of past due tax debt and staying that way.
If you would like to speak with someone further about this and how this pertains to you specifically, please give us a call at 720-420-7996. We can talk with you about your budget and ongoing tax obligations to discuss what your best plan of action is. We want to help make sure you can continue successfully growing your business by proactively finding a resolution plan that will help you get on track and stay on track.
Amy Lee, EA
Compass Tax Group, LLC
Did you know that the IRS has a Taxpayer Bill of Rights? These are implemented to protect you as a taxpayer and it is up to you (or your representative) to be sure that they are being met. The IRS has recently released a short video that helps to explain the Taxpayer Bill of Rights and you can watch it here.
If you'd like assistance in ensuring your rights are being met, including your right to representation, call us for a free consultation at 720-420-7996.
Amy Lee, EA
Compass Tax Group, LLC