Wednesday, February 22, 2012

Monday, February 20, 2012

Price for Tax Preparation

Question: I was wondering if you would be able to give me a general idea of how much tax preparation will run? Not sure if it is based on the number of papers we have or type of job. Also, do you offer E-file? We would also be new clients and I did see your sign about $35 off for new clients. If you could please let me know the cost, that would be great!! We are new to Smyrna and are trying to find a place that isn't too expensive as we do live on a tight budget. Thank you for your time!

Answer:
Our fees are based on the schedules we file with your tax return. Our base fee is $200 which includes the 1040 Long Form, Schedule A (Itemized Deductions), and State of Delaware return. We do offer a $35 discount for all new clients. We e-file all returns for free since e-filing is mandated. If you want to email your return from last year, I could review and get a more specific estimate because it is impossible to quote a return without understanding the specifics. Additional schedules which are required for the professional preparation of your tax return run between $5-$35 each, based on the complexity of the return. Since you are new to Smyrna I assume you may have moved from another state and/or sold a home, so that will certainly require additional work. When you are ready to set-up your appointment, please feel free to give us a call or you may schedule online through our website at www.saggioaccounting.com and click on Book Now.

Congress passes payroll tax cut extension

Congress passes payroll tax cut extension

Saturday, February 18, 2012

My mother passed away...not what do I for taxes?

Question: My mother passed away in May of 2011. All she received was SS and a pension from my deceased fathers work. What is involved with finalizing her taxes. She did have a very small home that was left to my sister and I which we have started renting to my daughter @ $600 a month with the first payment coming in 2012. Thanks and by the way I am going to be scheduling to have you do my business/personal taxes, as well as my daughters taxes which are simple but she also is going thru a divorce.




Answer:
I am certainly sorry to hear about the loss of your mother. We can certainly assist you with all of these issues. Your mother's taxes will require us to understand more of the specifics about the situation and based on that review we will let you know exactly what is needed. When you come in your appointment we can discuss the specifics, but basically we will need to file a final tax return for your mother and we may need to file an estate tax return based on how the estate was handled. We certainly will need to discuss the rental property which now is shared with your sister. Give us a call when you have a moment and schedule an appointment and we will review all of these items and I will certainly assist you. Good hearing from you and I look forward to seeing you soon.

Handling the final affairs of our loved ones can be tricky, so call Ralph V. Estep, Jr., of Saggio Accounting+PLUS and he will assist you in making sure everything is done correctly. Call us today to schedule your appointment at 302-659-6560 or visit our website www.saggioaccounting.com

Where's my Refund?

Question: I filed my taxes several weeks ago and I still have not received my refund. Do you know how I can check on my refund status?

Answer: Here's a great IRS you tube to explain the process. You may also go to www.irs.gov and click on Where's my Refund.

When we file returns for our clients our clients receive an email once the tax returns is processed and accepted by the IRS and States. We take your tax filing seriously and we want to build a life-long relationship with our clients. Call Ralph V. Estep, Jr., of Saggio Accounting+PLUS today at 302-659-6560 or visit our web site at www.saggioaccounting.com

Thursday, February 16, 2012

IRS Gives Advice on Reporting Unemployment Benefits: Accounting Today

Here's a good article on Unemployment Benefits. For more specific information contact Ralph V. Estep, Jr., of Saggio Accounting+PLUS at (302) 659-6560 or visit our web site at www.saggioaccounting.com


IRS Gives Advice on Reporting Unemployment Benefits: Accounting Today

Wednesday, February 15, 2012

Top Ten Ways To Annoy An I.R.S. Agent

Regulations Issued on Repair Expenditures

This is a very good article for those who have rental properties and are concerned about the difference between improvements and repairs. For more specific information and assistance, contact Ralph V. Estep, Jr., of Saggio Accounting+PLUS at (302) 659-6560 or visit our web site at www.saggioaccounting.com.

Regulations Issued on Repair Expenditures

Monday, February 13, 2012

Office in Home Deduction

Question: I work at home for a company located in Wilmington, Delaware. They provide an office for me, but it's just easier to work from the comfort of my home in Smyrna and I avoid all the travel. I would like to know what expenses I may deduct for my "home office" on my tax return.

Answer: Ok, are you ready for this NOTHING! Sorry to report, but since you are working at home for your convenience, you may NOT deduct the costs associated with your home office. If your employer is providing you with an office, but you elect to work from home, then the home office is not allowed. If on the other hand, your employer does not provide an office and you are working for the employer's convenience, then you will have some legitimate home office deductions. We will need to start by looking at the total square footage of your home. We then need to know the square footage of the specific space which is exclusively used for business. We will then figure out a home office percentage. We will then need to know the costs associated with your home and we will derive a home office deduction. You will need to remember that the deduction is a 2% limited deduction on your Itemized Deduction schedule, so the savings will be based on the amount of space, costs, and your income. We may also discuss taking a depreciation deduction for your home, but that gets complicated so we will leave that for another day.

For more specific assistance with the home office deduction and other tax questions, contact Ralph V. Estep, Jr., of Saggio Accounting+PLUS at (302) 659-6560 or visit our website at www.saggioaccounting.com. Call today to take advantage of our $35 discount for all new clients.

Saturday, February 11, 2012

Benefits of a Roth IRA

Question: Wondering about the benefits of a Roth IRA. When do we need to purchase to benefit us for 2011 taxes? Where do we need to go to purchase?

Answer: Thank you for the great question. The Roth IRA was set-up by Delaware's own Bill Roth who served for many years as one of our U.S. Senators. Roth IRA accounts are set-up with after-tax money, so their is no tax deduction in the current year for the contribution to a Roth IRA. Unlike traditional IRA accounts, which are a reduction in income in the current year and will result in current year tax deductions, the Roth account is funded with after tax money. The benefit to the Roth account is that distributions/withdrawals from a Roth account, once the account has been held for a certain period are tax-free. When you take a distribution from a traditional IRA you have to pay tax when you take the money out, but with the Roth, both the principal and the income is tax-free when taken from the account.

You will need to speak to your investment advisor to provide you with more specific information the benefits of a Roth versus traditional IRA account. We can certainly assist you with the basic account fundamentals when you come in for your tax preparation appointment.

For more specific answers to your tax questions, contact Ralph V. Estep, Jr., of Saggio Accounting+PLUS at (302) 659-6560 or visit our web site at www.saggioaccounting.com

Friday, February 10, 2012

Why did the State send me a 1099 for my tax refund from last year?

Question: The State sent me a form 1099-G for the exact amount of my refund from last year. It said something about having to report this on my current year tax return. What is this all about?

Answer: This is a question that I bet we are asked at least three times a day during tax season. The State sent you a form 1099-G to report as income the amount of the State tax refund you were paid last year because this is taxable income to you in the current year if you itemized your deductions on last year's return. When your return was prepared you took an itemized deduction for the full amount of the State taxes which were withheld from your payroll, you found this number on your form W-2. Your deduction was for the full amount of tax which was withheld from you pay, but your tax burden was less than this withholding since you received a refund. You actually took a tax deduction for taxes which you did not owe, therefore, the refund becomes income in the year where you receive the refund. This only applies when you itemized your deductions since that is the only way you would have taken the deduction. This is something that you MUST report since the State will be sending a copy of the Form 1099-G to the Internal Revenue Service and they will no doubt send you a summer letter adjusting your federal return if the refund is not claimed as income.

For navigating these income reporting issues as well as other tax complexities, contact Ralph V. Estep, Jr., of Saggio Accounting+PLUS at (302) 659-6560 or visit our website at www.saggioaccounting.com where you will find a great deal of information about tax savings tips.

Thursday, February 9, 2012

Late Mortgage Interest Statement

Question: Hey Ralph, I hope you can help me with this question. Last year, after I filed my taxes on one of those free file sites I received another Mortgage Interest statement from the lender who took over my mortgage. Since I had already filed my taxes and received my refund I was not able to claim the interest. I was wondering if I could just add it to this year's return? It's quite a bit of interest so I don't want to loose the deduction.

Answer: Unfortunately we see get this question frequently. The mortgage interest must be taken on the tax return for the year when it was paid so the only option is to amend your tax return from last year and include the mortgage interest as part of a correction to your previously filed return. The filing of amended/corrected tax returns is very common, but you will have to file it the old paper format and it can take some time for the Internal Revenue Service to review and issue your refund. It is in your best interest to file the amended return since you will increase your refund.

Filing amended returns and computing corrections can be complicated so call Ralph V. Estep, Jr., of Saggio Accounting+PLUS at (302) 659-6560 or visit our website at www.saggioaccounting.com.

Friday, February 3, 2012

Identity Theft Video from the IRS


Here is a great Identity Theft video from the Internal Revenue Service.

We work hard to guard your personal information. We employ the most up-to-date systems to protect our clients and their valuable data. For more information about our services and the extra efforts we employ to prevent client data intrusion, contact Ralph V. Estep, Jr., of Saggio Accounting+PLUS at (302) 659-6560 or visit our website at www.saggioaccounting.com

Wednesday, February 1, 2012

Taxes for a Delaware LLC

Question: I am looking for an accountant to help prepare and file my taxes. I started a Delaware LLC in December 2011 and I am looking to recoup the start up costs and file with the IRS. I would like a breakdown of what services I would need and the breakdown of cost as well.
Thank you


Answer: Thank you for your question. What seems to be a pretty simple question is actually quite complex. We need to first start by understanding what type of LLC was formed. When you create an LLC, the Internal Revenue Service by default considers it a disregarded entity and would expect to see either the LLC reported on your personal income tax return or on a partnership return. You may also have filed an S Election, form #2553 to be taxed as a corporation. All of this is normally spelled out in your Operating Agreement, if you have one, and you should have one. The attorney or incorporator who established your LLC should have drafted this for you.

We file LLC tax returns of all types and we work with our clients in creating the best tax structure to meet your business needs. Contact Ralph V. Estep, Jr., of Saggio Accounting+PLUS at 302-659-6560 or visit our website at www.saggioaccounting.com and let us build a relationship with you.

Lawmaker Introduces Bill to Close Newt Gingrich Medicare Tax Loophole : Accounting Today

Small Business Owners Take Note!

You have to read this article and you need to keep an eye on this. This is a huge item and will significantly affect anyone who is currently taking "reasonable" compensation from an S Corporation. When you read between the lines, what this actually proposes is the full self-employment taxation of all earnings in an S Corporation. The Congress has been looking for a way to raise more revenue and this may very well be the start. I will keep everyone in the loop as this moves forward. I would also encourage everyone to contact Rep. Peter Stark from California to state your objection to this legislation.

Lawmaker Introduces Bill to Close Newt Gingrich Medicare Tax Loophole : Accounting Today

IRS and DOJ Bust Identity Thieves Across U.S.

Great Article, a must read!

IRS and DOJ Bust Identity Thieves Across U.S.