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Sullivan Strategic's President, John P Sullivan, CPA/ABV, CVA was interviewed by Rod P. Burkert, a nationally renowned valuation expert who writes a regular article on practice management in The Value Examiner, an industry publication issued in print form by The National Association of Certified Valuators and Analysts (NACVA). The article can be found in the July/August 2018 issue or you can download the PDF below.
Winter is Coming . . . and so is Tax Season!
We are so excited to move into our new office just in time for tax season! Most of all, we are very thankful to our clients and colleagues who have fueled our growth to make this happen. Wishing you a wonderful holiday season and cheers to 2017!
PLEASE UPDATE YOUR RECORDS!
Sullivan Strategic | Certified Public Accountants
Laurel Oak Corporate Center
1000 Haddonfield-Berlin Road, Suite 206
Voorhees, NJ 08043
Some of the Before & After Pictures . . .
Another season done, but this one was special. My Alma mater Villanova won the NCAA National Championship (see my article on Philly2Philly) and our firm grew leaps and bounds over 2015 in both number of clients and firm revenues. I want to thank our dedicated team (especially Cheryl, Tammi, and Rose) who successfully ensured that not a single client was forced into an extension against their will.
Our success is only possible from the continuing referrals from our satisfied clients and our network. Our laser focus on entrepreneurs rather than large corporations has proven to be a strategy that just plain works and allows us to add true value to our clients.
I'd like to give a special shout out to our friends at ElysianFields Philadelphia @elysianflds in trusting us to work tax strategy with many of their clients.
Let the growth for our fellow #Entrepreneurs continue! Bring it! Let’s make 2016 a year to remember!
Are you thinking about taking a chance and not filing 1099s? Think again! The IRS has recently focused its attention on this area and has recently increased PENALTIES for non-compliance.
Sending 1099 Forms is not voluntary, it is mandatory. If your business paid somebody (other than employees on payroll or for product purchases) the IRS and State Revenue Agencies want to know about it. To ensure you follow the law, business income tax returns (including Schedule C on Form 1040) include a question asking if 1099 Forms were filed as required with your signature, under penalty of perjury, certifying your response to be true.
Please contact our office if you need help preparing required 1099s by the February 1, 2016 deadline. We are happy to help you stay compliant.
Please forward us the following information as soon as possible so we can meet the required February 1, 2016 filing date for distribution to those individuals and businesses:
What to Do Next?
Thoroughly review all disbursements made from January 1, 2015 through December 31, 2015, summarizing all payments to un-incorporated individuals and businesses where accumulated total is $600 or more. You should make sure that you have the correct name, address, and employer identification or social security number.
The key here is getting a W-9 from every vendor with their Tax Identification Number (SS# or EIN#). A good policy is to request every vendor to complete and provide a W-9 before you pay them. If vendors seem hesitant to give this to you, please blame your accountant! If they still give you a problem, explain that for any contractor who does not provide you with his/her SS # (or EIN #) and/or doesn't sign a W-9 form, you must withhold 28% of their income prior to make any payment to him/her; it is mandatory. The 28% backup withholding must be remitted to the IRS. If you do not collect and pay backup withholding from affected payees as required, you may become liable for any uncollected amount. W-9 forms must be kept for a minimum 6 years in case you get audited by the IRS and/or the department of labor.
Summary - Should or Should Not 1099-MISC Forms be Filed?
A business or trade must file Form 1099-MISC (Miscellaneous Income) for each of its payees that received:
Due Dates (2015 Tax Year)
If you fail to file a correct 1099 information return by the due date and you cannot show reasonable cause, you may be subject to a penalty. The penalty applies if you fail to file timely, you fail to include all information required to be shown on a 1099 return, or you include incorrect information on a return. The 1099 penalty also applies if you file on paper when you were required to file 1099s electronically, you report an incorrect TIN (Tax Identification Number), you fail to report a TIN, or you fail to file paper 1099 forms that are machine readable. The penalties were increased this past year.
The amount of the penalty is based on when you file the correct information return. The penalty is:
Common Areas of Confusion
Since this information is presented in a generalized fashion, it is not meant to replace professional advice specific to your individual situation. Imparting this information does not constitute a client-accountant relationship. As such, the reader should evaluate and bear all risks associated with the use of any comments, including any reliance on the accuracy, completeness, or usefulness of such content.
As we gather with our families today to eat, drink, and watch football, tax strategies may be the last thing on your mind! So on this special holiday, we thought it would be nice to discuss how "giving" will allow you to help those less fortunate and lower your tax bill at the same time. Please keep in mind the following tax rules to maximize your tax deduction.
Timing your deduction. To receive a deduction for 2015, your charitable contribution must be paid to a qualified charity by December 31, 2015. You still qualify for the deduction if you charge it on a credit card by 12/31, even if you do not pay the credit card bill until 2016.
Qualified Charity. Is your charity qualified? Make sure you ask your favorite charitable organization about its tax-exempt status. You can also visit IRS.gov for a list of qualified organizations. Unfortunately, giving cash directly to the homeless or friends and family that have fallen on dark days does not count.
Documentation. You must document all charitable contributions using cash or check. Acceptable documentation includes a cancelled check, credit card statement, payroll deduction record, or a written acknowledgement from the charity. If your contribution is $250 or more, you must obtain a written acknowledgement from the charitable organization.
Limitation for Benefits Received. If you receive a benefit such as merchandise, tickets to an event or a dinner, you can only deduct the amount that your cash donation exceeds the fair market value of the benefit received.
Non-Cash Contributions. Property donated is usually valued at the fair market value of the property, which is generally defined by the IRS as the price at which the property would change hands between a willing buyer and a willing seller. If your deduction is greater than $500, you must complete Form 8283 and show how the property was acquired, the date of acquisition, and the adjusted basis of the property. For deductions more than $5,000, most contributions will require a written appraisal by a qualified appraiser or valuation analyst.
Donating Your Time or Services. Using your time and skills to help charitable organizations is an honorable thing to do, however, you cannot receive a deduction for the value of your personal time or services. However, you are able to deduct any out-of-pocket expenses that directly benefit the charity such as supplies and travel costs (mileage rate of 14 cents per mile).
Gifting. Giving a gift to family members can be a great strategy for estate tax planning, but it has nothing to do with charitable deductions for your income tax returns. Current rules allow you to give up to $14,000 a year to as many people as you choose ($28,000 if you and your spouse both make gifts) to help reduce your federal gift and estate taxes.
We know that the rules related to charitable giving can be cumbersome. The list above only provides general guidance on substantiating a limited number of deduction types. If you are unsure as to whether or not the information you possess is sufficient to substantiate a deduction, please work with a reputable and experienced financial advisor or Certified Public Accountant. We at Sullivan Strategic are always happy to help!
Wishing you and your family a Happy Thanksgiving and upcoming holiday season!
Check out a familiar face at 0:17 and 3:23.
"We are Numbers People" - Skip ahead to 0:16
John P Sullivan, CPA/ABV, CVA has been named a Finalist in SmartCEO's 2015 Philadelphia CPA & ESQ Awards! The CPA & ESQ Awards program honors the region’s most enterprising accountants and attorneys for their leadership, accomplishment, innovation and success. An independent committee of local business leaders chooses the CPA & ESQ finalists based on the quality of nominations submitted. Awards will be presented to accountants and attorneys that have made an outstanding impact on their clients’ businesses at the aw. The CPA & ESQ finalists are celebrated at an awards reception on June 11, 2015 at Union Trust in Philadelphia where the winners are announced live.
John and the other finalists are profiled in the May/June issue of SmartCEO magazine. Click here to read.
Congratulations and best of luck to the other finalists! Click here to see the full list of finalists.
One could argue who gave me a better Valentine's Day present - my wife, kids, or the IRS. It may have been Friday the 13th, but it felt like love when the IRS finally succumbed to the repeated pressures from taxpayer and preparer advocate groups such as the AICPA to formally offer relief to certain small business taxpayers from filing Form 3115, Application for Change in Accounting Method, this year. If you haven't followed the news lately, the 2014 tax filing season is slated to be a nightmare due to the impact of the Affordable Care Act (“ACA” or "Obamacare") and IRS Final Regulations regarding Deduction and Capitalization of Expenditures Related to Tangible Property (the “Repair Regs”). If you think this doesn't apply to you, think again. If you own a rental property or small business, these Repair Regs apply to you. As such, prior Rev. Proc. 2015-20 issued on February 13, 2015, the IRS pretty much expected you to file the complex Form 3115. If you have a reputable CPA, they would know this and likely pass the increase in time to prepare this complex form onto you. So Happy Valentine's Day to all of my "small business" clients, you are off the hook! The new simplified procedure is generally available to small businesses, including sole proprietors, with assets totaling less than $10 million or average annual gross receipts totaling $10 million or less. Now before you celebrate too much, make sure your Capitalization Policy is in place and you are compliant with the Repair Regs. We hope you had a nice Valentine’s weekend!
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Please take a look at the memo we've put together on the Repair Regs:
The "most wonderful time of the year" is over. The New Year has come and gone and now what? Yep, it's a small business owner's least favorite time of the year...tax time! While most W-2 wage earners are enjoying the "work from home" snow days of January, many of the self-employed entrepreneurs, business owners, or their accounting staff are scrambling in the last weeks of January to get out their 1099-MISC forms to their independent contractors for work performed (greater than $600) in 2014.
I like to think of the 1099 filing season as kind of like "Spring Training" to the "Busy Season" that lies ahead for most of my CPA peers. Despite having a month to prepare the 1099 forms, most of us will wait until the last days before the deadline to get these forms out. Procrastination is human nature. Remember cramming for finals, last minute term papers? No matter how much one can prepare, most of us will wait until the last minute to get these done. Well, the deadline is a few days later in 2015 due to the weekend. You are required to send the 1099-MISC to recipients by Monday 2/2/15 (normally Jan 31). The IRS will need their copy a month later, but if you e-file, you get another month (3/31).
Please take a look at the memo we've put together for 1099 FAQs and other tips: 1099 Reminder Memo
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