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Tax season is quickly approaching. According to its website, the IRS received 149,684,000 individual income tax returns in 2014 as of December 26, 2014 (2014 Filing Season Statistics). Of these returns, the IRS states that more than half were prepared by hired tax professionals. If you decide to hire a tax professional to prepare your tax return this year, it is essential to choose them carefully to avoid hiring an abusive return preparer.
What is an abusive return preparer?
The IRS defines a return preparer as “any person (including a partnership or corporation) who prepares, for compensation, all or a substantial portion of a tax return or claim for refund under the income tax provisions of the Internal Revenue Code.” An abusive return preparer is a return preparer who engages in return preparer fraud, which involves preparing and filing false income tax returns.
An abusive tax return preparer may use different methods to commit this type of fraud. For instance, he or she may prepare a false Schedule C, Profit or Loss from Business, to claim deductions for fake expenses to counterbalance income derived from outside employment. Another method is to take false and overstated deductions on Schedule A, Itemized Deductions, for charitable contributions and medical expenses. An abusive return preparer may also claim fake Schedule E, Supplemental Income and Loss, losses. Finally, he or she may include impermissible credits or excessive exemptions to lower taxable income or taxes owed.
How do you avoid an abusive return preparer?
To avoid an abusive return preparer, the IRS lists several helpful tips on its website:
Regardless of whether or not you hire a return preparer, remember that you are responsible for the information on your tax return, including all related schedules, forms, and supporting documentation. 
If there is something on your return that does not make sense or that you do not understand, always ask your return preparer to explain it and correct it, if necessary. You do not want to be liable for additional taxes, interest, and possible penalties when the IRS discovers your false return.
Which resort will I buy my season pass to next year?
This is a question that I ask myself every winter when the ski and snowboard season is in full swing here in Lake Tahoe. I have learned over the last 24 years of skiing and snowboarding that I will visit one single resort enough to make buying a season pass worth the price. I have also learned that buying a season pass in April of the proceeding season saves me a ton of money. 
It may not be that easy for some of you to choose which season pass is right for you, or if buying a season pass is even worth it, so I am here to help you make up your mind.
The first step is to identify how many days you plan on skiing/riding during the upcoming season. This may change from year to year depending on vacations or other happenings that get in the way of your shredding, so be reasonable with your estimate. It is not simply enough to know how many days you will be skiing/riding, but you also need to know how many days at which resorts you will be riding. A few of the resorts in the Lake Tahoe area have teamed up with each other, as well as with resorts in other states, to offer season passes that include more resorts than ever before. Therefore, if you are making a ski or snowboard trip somewhere other than Lake Tahoe, you may want to look and see if tickets to the resort you will be visiting are included with the price of your Lake Tahoe season pass. Take myself for example, I buy the Sierra at Tahoe pass which also includes Squaw Valley and Alpine Meadows in the Lake Tahoe area, as well as resorts in 10 other states! There are some restrictions on use at the non Sierra at Tahoe resorts – you only get 4 total days at Squaw and Alpine combined, but the fact that the pass offers access to 17 different resorts is what grabs my interest because I like to travel and the price ($279) just cannot be beat.
Once you know how many days you will be riding at which resorts, look up that resorts single day lift ticket price and multiply it by the number of days that you will ride that particular resort. This will give you the total amount you would spend if you bought single lift tickets each day at that resort which, if higher than the amount for a season pass, makes the pass worth buying. One thing to note is that with all the different resorts offered on a single season pass, you will need to add up the total price for each resort that falls under that particular pass. This means if you are going to be riding Kirkwood, Heavenly, and Northstar, you will want to add up the totals of all these resorts (as well as some resorts in Utah and Colorado) because they are all included under one season pass. Remember, there are tons of different pass options offered through our Lake Tahoe resort websites, so check them all out to make sure that you do not miss the pass that is right for you. Happy Shredding!!!
It seems like Medicare has been around forever, but actually, President Lyndon Baines Johnson called on the Congress to create Medicare in 1964 and signed the bill creating it on July 30, 1965. Medicare services began July 1, 1966 when more than 19 million Americans 65 and older enrolled in the program.
Basically, the traditional (or original) Medicare is a health insurance program and has deductibles and copayments. Medicare was not established to pay all the health care costs of participants. Routine vision and hearing care are not covered by traditional Medicare.
Components of traditional Medicare consist of three parts:
Participants enrolled in traditional Medicare may use services from health care providers who accept Medicare.
Medicare Advantage (also known as Medicare Part C plan) offers a variety of plans offering managed care options, or coordinated care options. These plans are offered by private insurers and health care organizations contracted with Center for Medicare and Medicaid Services (CMS).
Individuals are eligible to enroll for Medicare coverage the first day of the month in which they turn 65. They are eligible the month before they turn 65 if their birthday is on the first of the month. Medicare eligibility is tied to Social Security benefits. Individuals must be eligible for Social Security to be eligible for Medicare.
Additional information can be found at official Medicare website.
I always find it interesting to hear the back story of people’s success…men and women.
Over the last few months I’ve read a couple of historical novels: The Aviator’s Wife by Melanie Benjamin and The Paris Wife by Paula McLain. 
What struck me the most from these novels was the strong influence on their families and the fortitude these women had. Which led me back to thoughts of my youth when I was intrigued by western shows and the strength and fortitude required of the women living in the wild frontier.
Fortitude – strength of mind that enables a person to meet danger or bear pain or adversity with courage. Synonyms – grit, backbone, pluck.
We’ve been doing this for a long time. However, our roles continue to change from a strong supporting role to a strong leadership role.
My last plane trip I grabbed the October issue of Fortune featuring the 50 Most Powerful Women.
The list goes on. The list is impressive. And the issue includes some in depth insight into these power players.
With these leadership roles comes even more of a balancing act. Innately women tend to be better at balancing. 
We do a lot of it.
Forbes Women Leadership column recently published “The Morning Routines of 12 Women Leaders.” Each routine was different yet similar…very busy.
Women…ourselves, our daughters, our friends, our co-workers…we are all striving to balance our lives. I listen to the stories and they all have a similar theme…not enough time. Both men and women.
As we move into the holiday season, let’s ensure we are using some of that pluck to prioritize and enjoy much needed time with family and friends!
There are 55 tax provisions, also know as “extenders” that expired at the end of 2013. In a letter from the Internal Revenue Commissioner sent to the United States Congress, members of the tax writing committees stated that if Congress waits until 2015 to enact tax law changes affecting the tax year 2014, there may be a delay in the opening of tax filing season.
The 2014 filing season opened on January 31, 2014, instead of January 21, due to the 16-day federal government closure in October of 2013. 
A delay is very possible in 2015 if the decision whether to extend the expired tax provisions is not made before the end of this year.
Several tax extenders that may affect individuals in particular are:
This deduction benefited individuals who lived in states without state income tax, such as Nevada. Sales taxes are deducted in lieu of state and local income taxes on Schedule A, Itemized Deductions.
Taxpayers who are 70 ½ or older are able to exclude from income up to $100,000 per year when distributions are made directly to certain qualified charities. Seniors who can no longer itemize deductions benefit from this extender.
Qualifying individuals could deduct qualifying higher education tuition or expenses above-the-line.
The Mortgage Debt Relief Act provided the exclusion from income of up to $2 million of qualified cancellation of mortgage debt on a principal residence.
This extender provides for the 50 percent bonus depreciation on qualified property purchased and placed in service in a business.
A taxpayer may immediately expense up to $25,000 of Section 179 property, with a dollar for dollar phase-out of the maximum deductible amount for purchases in excess of $200,000 for tax years 2014 and thereafter. The proposal would increase the maximum amount and phase-out threshold to $500,000 and $2 million, respectively.
If Congress does not act on these and other tax extender issues before the end of 2014, and instead reinstates them retroactively sometime in 2015, millions of Americans would be forced to file amended returns to claim these deductions.
http://crfb.org/blogs/are-accelerated-write-provisions-effective
Whether you were for or against health care reform, there is no denying that the recently implemented Affordable Care Act (ACA or “Obamacare”) is something that will affect you during the coming tax season.
Even if you have been insured during the entire year, the IRS will require that you provide proof of insurance during your tax preparation in the coming year. This will increase the burden on tax preparers to retrieve documentation from the taxpayer in order to file your 2014 tax return. Be prepared upon filing that in order to complete any personal tax return, your accountant will require proof of health insurance coverage.
If you did not have insurance for the year, or had insurance for only a portion of the year, you may be subject to a tax penalty based upon your household income. The penalty for 2014 is the greater of $95.00 per adult ($47.50 per child), or 1% of your household income that is above the tax return filing status threshold for your filing status. This amount is prorated for the months that you were covered by the minimum health insurance coverage.
The vast majority of taxpayers will fall into the 1% penalty, which will be significantly larger than the $95.00 penalty that most individuals assume they will be hit with. The penalty continues to increase in 2015 and 2016 to “encourage” the un-insured to pursue health insurance from the marketplace or other provider. The penalty is capped at $3,600 per adult and $1,900 per child for 2014, and continually increases over the next two years. A family of four could be hit with a penalty as much as $11,000.00 for 2014!(Equivalent to the bronze plan premium for insurance coverage).
In order to avoid exorbitant tax penalties in the future, it is important to know when the enrollment periods are open to obtain health insurance. A recent poll indicated that 89% of registered voters were unaware of the open enrollment periods for the Marketplace. Here are the dates that you need to be aware of:
2015 Open Enrollment start November 15, 2014
2015 Open Enrollment Ends February 15, 2015
In future years the enrollment period will shift from October 31 to December 7. So make sure you are aware of the open enrollment periods and obtain health insurance to avoid this costly tax penalty.
Companies having their data hacked seems to be a common occurrence these days. This is causing credit card companies to issue new cards every few months, or at least it feels like it happens this often. 
This has me thinking that maybe using cash more frequently may be a good idea. There are times when using a credit card can be beneficial; however, if not used properly, a credit card can cause a lot more harm than good.
Paying with a credit card lets you postpone the actual obligation of payment to the future, while cash payments make you physically have the cash to make the purchase. Purchasing items on credit without being able to afford it will just lead to debt sitting on your card accumulating finance charges. Using cash would be beneficial if you have a tough time holding off on large purchases until you have the money.
Avoid using a credit card when the company requires large processing fees. These processing fees can sometimes be more expensive than waiting until you have the cash and paying the late fee. 
These fees will usually offset the rewards one would receive by using a credit card. To avoid paying more than you need to, compare the processing fees to the late fees to make sure you are making the right choice.
Most credit cards offer many types of rewards and exclusive benefits. You can avoid interest and late fees by making payments on time and paying off your balance. The rewards will add up, making credit cards more beneficial than paying cash. Just make sure you pay off your balance so the fees are not also adding up. Other credit card benefits include additional warranties and purchase protection.
As much of a pain as it is when your credit card company issues a new card after a potential data hack, it is actually one of the credit cards’ greatest advantage.
If cash is stolen from you it is hard, if not impossible, to retrieve this cash. However, if your credit card is stolen or fraudulent charges are made on your card, it takes one call to cancel the credit card, refute the charges, and have another card sent to you. This is a much less painful process than trying to retrieve stolen cash.
These are only a few examples of situations where you should decide what is better, paying with cash or credit. By making conscious choices when it comes to your payment method, it can end up saving you money.
On June 10, 2014, the IRS implemented the Taxpayer Bill of Rights. 
In an effort to make it easier for taxpayers to understand and access their rights when dealing with the IRS, this Taxpayer Bill of Rights arranges the numerous existing rights established in the Internal Revenue Code into ten basic rights. These rights include:
Initially, the Taxpayer Bill of Rights was only released in English and Spanish. However, in August, to reach as many taxpayers as possible, the IRS published it in four additional languages: Chinese, Korean, Russian, and Vietnamese. 
The Taxpayer Bill of Rights has also been included in IRS Publication 1, Your Rights as a Taxpayer, which is sent to countless taxpayers across the nation with various IRS notices. Only time will tell whether or not this new Taxpayer Bill of Rights will fulfill the IRS’s mission, which is to “Provide America’s taxpayer’s top-quality service by helping them understand and meet their tax responsibilities and enforce the law with integrity and fairness to all.”
In today’s low yield environment, where a five year CD yields 1.5%, publicly traded partnerships (PTPs) have been proliferating. These are companies, usually associated with oil and gas, that are required to distribute their “distributable cash flow” and avoid the double taxation that is inherent to corporations. 
They usually have yields in excess of 5% with the biggest names in the sector such as Kinder Morgan yielding 6.8%, Energy Transfer Partners 6.7%, Linn Energy 9.4%, and Enbridge Energy Partners 6.6%, just to use a few as examples.
So what is the downfall of these high yields? – Cost. Owners of these PTP’s, no matter how small, receive a K1 for their share of the earnings. Having multiple K1s creates an inordinate of time for tax preparation. On these K1s there is usually ordinary income, interest, capital gains and losses, intangible drilling costs, and alternative minimum tax items that CPA’s have to contend with. And these are just some of the pass-through items.
Recently, Kinder Morgan decided to do away with their complex PTP and combine with their general partner to create a regular C Corporation. They did this to make a simpler structure and reduce their borrowing costs. 
This disclosure made their stock go up almost 20% in a day. But wait, there is a caveat. Upon this conversion, all holders of KMP units that are to be converted into this new company will have to pay capital gains taxes. This can be a complicated calculation with the distributions received over many years that weren’t taxable combined with income or losses that have accrued that may or may not have been deductible.
For PTPs, as with any investment decision, it is important to weigh the tax consequences and costs. 
This is an area where CPAs can come in handy; we aren’t here just for April 15!
Pending federal legislation allowing states to tax internet sales could potentially means big changes for retailers in the way they process and account for their sales and use taxes. 
Of course, the International Council of Shopping Centers states “this bill signals that leveling the playing field for all retailers is a top priority for Congress this year”.
On the other hand, small internet retailers will no doubt find the provisions of the bill onerous. Check here for a snap shot of the provisions of the proposed bill, SB 2609.
