After a client passes away, there is much more to do than just prepare a final Form 1040, U.S. Individual Income Tax Return. Taking control of the postmortem planning process can be a powerful way to save tax dollars for the decedent’s estate and family. Postmortem planning also applies to
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Gaining (from) your clients’ trust
For decades, CPAs in public practice have laid a foundation of trust with clients by competently handling confidential financial data and performing core services such as tax preparation. Today, forward-thinking CPAs are building on that foundation, expanding their business offerings, nailing down new revenue streams and cementing a more profitable
A click in time saves nine
Q: I like Excel 2010 much better than Excel 2003, but it now takes two clicks (File, Recent) to access my recently used files, instead of just one. Is this a step backward, and is there anything I can do about it? A: You are not the first person to
Tax Court respects stock sale, denies transferee liability
In Norma L. Slone, the petitioners prevailed when the Tax Court refused to apply the substance-over-form doctrine to recast a sale of a company’s stock following an asset sale as a liquidating distribution. The court further found that the taxpayers were not liable as transferees under Sec. 6901 for taxes
GoToMyPC tips
Remote access applications (such as those offered by WebEx, LogMeIn, and Citrix GoToMyPC) are among my favorite and most useful technologies. I use remote access frequently to access my office computer when I travel and to access client computers to troubleshoot their accounting system problems and provide remote training. While
Check it or leave it
Q: I check my email using Outlook 2010 at work and Outlook 2007 at home. My email accounts are set up using POP3, and the problem is that, when I read email on one computer, those email messages then do not show up on the other computer. Having my email
Hire a hero, enjoy the benefits
Most provisions of the work opportunity tax credit (WOTC) expired on Jan. 1, 2012, but the program was modified and partially extended by the VOW to Hire Heroes Act of 2011, P.L. 112-56, to cover military veteran hires. Under Sec. 51, as amended, employers may be eligible for a credit
Compilation reports for valuation engagements?
Business valuation (BV) reports frequently include information presented in the form of financial statements. The reporting requirements for such financial statements have drawn increased attention as a result of the issuance of Statement on Standards for Accounting and Review Services No. 19 (SSARS 19), Compilation and Review Engagements. When conforming
FAF review of FIN 48 shows it meets its objectives
The Financial Accounting Foundation (FAF) issued a post-implementation review (PIR) of FIN 48 (FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes). The PIR is a new process designed to help the FAF trustees with efforts to evaluate the effectiveness of accounting standards as well as the standard-setting process.
Eighth Circuit agrees that CPA was underpaid
The Eighth Circuit Court of Appeals held that a portion of the dividends paid by an S corporation to its CPA sole shareholder/employee was compensation. In upholding the decision by the District Court of Southern Iowa, the Eighth Circuit agreed that the salary to the sole shareholder/employee used to compute
More on auditors’ reporting duties to the SEC
We are writing in response to the JofA’s February 2012 article, “What’s your fraud IQ?” (page 36). The article discusses the Foreign Corrupt Practices Act (FCPA) and includes a 10-question quiz on the FCPA. The JofA’s coverage of this topic is to be commended as it is important for CPAs
Tax-advantaged investing for an uncertain economy
Investors and their advisers have weathered several years of turmoil, with market conditions often upending conventional investing approaches and related tax strategies. As recently as summer 2010, Federal Reserve Board Chairman Ben Bernanke testified before Congress that the outlook for the U.S. economy remained “unusually uncertain.” Slightly more than a
Reasonable salary for S corporation owners
Besides its single level of taxation as a passthrough entity, an advantage of an S corporation over a C corporation is that a shareholder’s share of the corporation’s net income is not considered self-employment earnings and therefore is not subject to self-employment tax (13.3% in 2011 and 2012). This treatment
AICPA: Correspondence audits challenge taxpayers
The IRS’s use of correspondence audits to resolve issues with tax returns has mushroomed over the past decade—but taxpayer satisfaction with the program is fairly low. According to the Treasury Inspector General for Tax Administration (TIGTA), only 48% of those surveyed by the IRS said they were either somewhat or
News highlights for May 2012
Many faulty business decisions can be traced to “confirmation bias” that leads people to unwittingly seek information that bolsters what they want to believe, says Brigham Young University accounting professor Doug Prawitt. “We don’t realize it when we do that, but it’s a very, very powerful human bias,” he said
Dave Nagy, CPA
In retrospect, it was a foolish idea. At 29, I took the leap and started an accounting firm. I had a young family, very little money, and only a handful of clients at the time. The smart thing would have been to seek out a good firm with stability, but
CPAs prioritize tech security
CPAs are confident that their organizations can secure their IT networks and manage data, but they doubt whether their employers will be able to generate revenue streams and other benefits from emerging technologies such as cloud computing and mobile devices, the AICPA reported in releasing the results of its 2012
Give me a break
Q: We receive large text documents each week that contain paragraph breaks at the end of each line, and we must manually remove the breaks to incorporate this text into our websites and reports. Removing these breaks manually is time-consuming, and using the Find and Replace tool doesn’t work well
FTC “splitter” rules issued
The IRS issued final regulations on determining who has the legal liability to pay the foreign tax for foreign tax credit (FTC) purposes (T.D. 9576) and temporary regulations on the application of the “anti-splitter” rules of Sec. 909 (T.D. 9577). The rules are related because the legal liability to pay
IRS launches third offshore voluntary disclosure program
With more than $4.4 billion collected in its 2009 and 2011 voluntary disclosure initiatives, the IRS in January announced its third program designed to encourage taxpayers with undisclosed offshore accounts to disclose them and fulfill related tax obligations (IR-2012-5). The new program, unlike the previous initiatives, has no deadline to
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FROM THIS MONTH'S ISSUE
Flip out with the latest Tech Q&A
The September Technology Q&A column shows how to create dynamic to-do lists with Excel's checkboxes and also how to set up multifactor authentication texts that don't rely on phones. Flip through both items and view a video walkthrough in our digital format.
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