Anthony Sykes & Company

          There has been a significant adjustment regarding Individual Taxpayer Identification Numbers ( ITIN ). They are used by Taxpayers who are not eligible for a Social Security number. Many of these expired on January 1 and need to be renewed in order to be used again.           An adjustment made to the PATH Act, made it so that an ITIN that has not been used in the past 3 years has expired. Any ITIN with middle digits of 78 or 79 are also no longer valid. Renewal applications for these identifiers must be turned in soon because the process can take up to 11 weeks . See your Tax Professional for assistance.

          To finish our examination of what to look for when choosing a Tax Professional, we will take a brief look at Representation Rights before the IRS. The goal is to always have a quick and easy filing, but complications do come up at times. It’s always good to know what your preparer can do before those situations happen.           Unlimited Representation Rights. Professionals with the following credentials may represent any taxpayer on any matter before the IRS: Enrolled agents (licensed by the IRS), Certified Public Accountants, and attorneys. This is true if they signed the filing in question or not.           Limited Representation Rights. A Tax Professional that does not hold one of the above credentials is able to represent taxpayers, only if they were the tax preparer for that filing. If they did not sign the Tax Return in quest...

          You may be aware of the announcement from the IRS that Tax Refunds for this year will only be available starting in late February. Have you wondered why this is the case? This delay will directly affect those who claim the Earned Income Tax Credit ( EITC ) or the Additional Child Tax Credit ( ACTC ). A law was passed by Congress last year that allows the IRS to hold any refunds claiming these credits until February 15. Why was this done?           Last year over 70 percent of all the Tax Returns submitted received a refund. Those numbers are expected to remain the same this year. The Tax Refunds claiming the EITC or ACTC will be a big part of that and are held a little longer to check for fraud. That is a special circumstance with these 2 credits, but they will arrive.

          Here are some more points to keep in mind when choosing a tax preparer. The person chosen will be representing you to the IRS, there is nothing wrong with making sure that you can be confident in his or her abilities.           Read and ask questions about the Tax Return before signing. The Taxpayer is responsible for what is on the Return, no matter what it says. Be sure you agree with what it contains, and have any questions answered before signing it. Also make sure your preparer will be available after the filing date in case questions come up, or to represent you.           Ask if they have a Preparer Tax Identification Number. A valid PTIN is needed for those who are paid to prepare Tax Returns. Along those lines, asking if they are a part of any professional organizations or go to continuing education classes is a good idea. Th...

Tax season has officially arrived! With that in mind, there have been moves to allow the IRS to license Professional Tax Preparers. In December 2015, the Tax Preparer Competency Act was introduced to the US House of Representatives. The bill, as it was written, would require Tax Professionals to ( 1 ) pass a competency exam, ( 2 ) attend continual education classes every year, and ( 3 ) pass a background check. Those who meet these standards would be listed in a public database. This bill is the most recent attempt to reach this goal.           A few years ago, the IRS tried to do this on their own and were challenged in court. The result of that activity was the Preparer Tax Identification Number ( PTIN ) and the voluntary system now in place. The basic motive for trying to create these standards is to protect Taxpayers, who are sharing their most sensitive personal information in this process. It would seem to mak...

This is the continuation of our series focusing on good qualities to look for in a tax preparer. Again, it's better to make this choice sooner, rather than later. Both sides can discuss what is needed in a relaxed atmosphere, allowing Taxpayers to make an important decision with all the facts clearly set in front of them. Here is what they should be looking for. Have a clear understanding of the service fees. Make sure to avoid preparers who will base their fee on a percentage of the refund. Be cautious of those who claim to be able to get bigger returns than anyone else. All fees and costs should be understood before making a choice. Any and all Tax Refunds belong to the Taxpayer, and should be sent directly to them, never to the preparer. Never sign a Tax Return that is blank. Remember that no matter who prepares the return, the taxpayer is responsible for what it contains. So if one were to sign a return that has no information yet, they would be responsible for ...

          Business owners have opportunities to lighten their Tax load. This is especially true of small business owners. While it requires good record keeping throughout the year, these deductions can be well worth the effort. Here are 2 examples.           Utilities. On top of being able to deduct rent payments for a business, expenses like telephone, water, and electricity are also able to be used as tax deductions. This is a great way to save money and is an option for those who work from home. Careful records must be kept to separate business use from personal use in the case of a home business.           Vehicle . There are 2 groups of expenses that can be helpful deductions that are available to be used. However they cannot be used together, it is one or the other , not both. Car mileage can be deducted at the standard rate (54 cent...