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5/9/2016

High Income Tax Bill for Your Small Business? Here's some examples of what You Should Do:

​We all want to pay as little income tax as possible without breaking the law. If your small business tax bill is too high, try the following tips to bring it down in subsequent years.
Provided by McVay Business Services Pensacola, FL 
1. Keep impeccable records.Most of the deductions your small business can claim depend on solid record keeping. To ensure that you don't miss any opportunities to lower your taxable income, establish a strong record-keeping system and make sure that all of your employees follow it carefully. Make sure that your system includes procedures for collecting and organizing receipts, as well as tracking income and expenses.
 
2. Choose the right business structure.
The structure of your business will change how you are taxed. If you aren't sure which business structure is best for you, talk to one of the experts at McVay Business Services to learn more. 850-725-5696
Keep in mind that a change of entity will apply from the date the change is made forward. It won't provide you with any retroactive tax advantages. In addition, because some changes of entity may result in an extra tax bill if they aren't completed carefully, it is important to seek guidance from the experts at McVay Business Services if you are considering such a change.
 
3. Make smart choices when you prepare your return.For many of the deductions you can claim, the IRS will allow you to choose how you will calculate the deductible amount. For example, when deducting home office expenses, you can calculate your deduction based on the actual expenses you incurred during the year or by using the IRS' simplified deduction. The same option is available for calculating expenses for business vehicles. With each of these deductions, do the calculation both ways to see which one is more beneficial.
 
4. Defer your income.If it is possible to defer some of your income to the following year, take advantage of the option. For example, you may delay income by sending out bills a little later than normal so that they won't be paid until after the current tax year has ended.
 
5. Make use of carryovers.Some of the deductions and credits your business can claim are limited for each year but allow you to carry over some or all of the excess deduction to the next year. Keep track of any carryovers you may have and use them to reduce your tax bill during subsequent years.


6. Use retirement plans to shelter profits.Provide your employees with access to a qualified retirement plan to shelter their income from taxes. Providing these plans will also allow you to reduce your own taxes as well by making contributions to your employees' retirement plans and deducting them from your taxable income at the end of the year. Furthermore, in addition to saving on taxes by contributing to employee retirement plans, you may be able to reduce your tax liability further by contributing to your own retirement plan. Keep in mind that the amount of retirement contributions that can be deducted in any given year will depend on the type of plan, your income, your business's structure and other factors.
Whether you are establishing a retirement plan for employees or setting up an account for yourself, it is important to seek professional help so that you can be sure that you have selected the right plan and that you are maximizing the plan's tax benefit by adhering to deadlines, contribution limits and other regulations.


7. Pay deductible expenses early.If you have deductible expenses that wouldn't normally be paid until January (or the beginning of your next tax year), pay them a month early to increase your deductions for the current year.
For more income tax tips, or for one-on-one assistance with your small business taxes, please
McVay Business Services - 850-725-5696

5/3/2016

Important Information Regarding ACH ID Changes with Intuit Payroll

To protect bank accounts from unauthorized withdrawals (debits), banks offer services for Automated Clearing House (ACH) debit filtering (also called debit blocking).  This service is based on Origin ID's or Company ID's (ACH ID) which are numbers that identify the institution trying to withdraw money from your bank account.
Beginning May 9, 2016, your Intuit Online Payroll / Intuit Full Service Payroll debits may come from a new ACH ID which will need to be added if you have debit filtering with your bank. To prevent Intuit-initiated debits (i.e.: a payroll debit for direct deposit) from failing, please take the following actions.
Am I affected?
This alert applies to you only if you have debit filtering with your bank. When you want a company to be able to debit your account for a legitimate reason, you need to add that company's ACH ID to your bank account. Otherwise, the debit will fail, resulting in an ACH Return Code R29 and you will be charged a $100 fee.
Why can't Intuit do this for me?
We would love to but unfortunately, since Intuit is not the account holder and has no rights to your bank account, we cannot call your bank on your behalf to add the ACH IDs. All customers will need to call their own banks as they have a high level of security to prevent fraud.
What do I need to do?
Contact your bank's ACH department and request that the following ACH ID’s be added to authorize debits from Intuit. Some banks may take 3-5 banking days to process the request:
4462800242
5943345425
6943345425Please do not remove any existing Intuit ACH ID’s as they may still be used for tax payments and billing.
Intuit is finalizing several improvements to our payroll processing technology which is why we have additional ACH ID’s along with the existing ones. You (and your employees) may also notice some changes to your bank statement descriptions which will indicate more clearly that Intuit is debiting your account and employees are being paid by your company.
The Intuit Payroll Team

If you have any questions please contact Mike McVay, Payroll Administrator
850-725-5696​
BestVirtualBookkeepers@gmail.com

5/3/2016

 I Just Filed My Income Tax Return but Couldn't Pay. What Should I Do Now?

Whether you are an individual or a small business, filing your tax return on time is important. However, if you can't pay the full amount of income tax you owe on or before the due date, you will face interest and penalties even if you filed on time. If you have filed your tax return and you aren't able to pay your bill, consider the following options.
 
1. Use credit or a loan to pay your bill.In some cases, the interest you pay on a loan or credit card may be less expensive than the penalties associated with delinquent tax bills. If possible, consider using one of these resources to cover the income taxes you owe.
2. Pay as much as you can.
If paying your entire tax bill is impossible even with a credit card or loan, pay as much of the bill as you can. Doing so will reduce the amount of penalties and interest you owe to the IRS.
3. Work out an installment agreement.
Depending on your situation, you may qualify for an installment agreement with the IRS. Setting up such an agreement will allow you to pay your tax debt over time, thus reducing the financial burden. Having a payment agreement in place also prevents the IRS from taking aggressive collection action. Keep in mind that you can apply for an installment agreement before you receive a tax bill. Apply as soon as you can in order to limit and/or eliminate penalties and interest.
4. Contact the IRS.
If you need a federal extension, you may need an extension on the deadline for your state income taxes as well. In many cases, your federal extension request can be used to extend the deadline for your state taxes as well. However, this may not be possible if you owe state taxes or if your state's laws differ.
5. Get professional help.
McVay Business Services understands all of the options available to individual taxpayers and small businesses that can't afford to pay their taxes. Depending on the situation, we may be able to have your interest and penalties waived, help you negotiate an affordable payment plan or help you take advantage of other debt relief options available from the IRS. Contact us today to discuss your situation in detail. 

 
850-725-5696​
BestVirtualBookkeepers@gmail.com


    Mike McVay, Tax Accountant Blog
    Certified ​QuickBooks ProAdvisor & Licensed Tax Accountant Pensacola, FL

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    Mike McVay, Accountant Experienced IRS Tax Resolution Specialist
    With over 20-years experience working with individuals, families & small business owners. McVay has long term knowledge in taxation to help with their income tax, I.R.S tax issues and businesses management.
    850-725-5696​
    Mike@MikeMcVay.com

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