Anthony Sykes & Company

         Almost 72% of all the revenue collected by the Internal Revenue Service ( IRS ) comes from Payroll Taxes . With this understanding, it easy to see why they put so much effort into making sure that every business pays their fair share. This is done in a variety of ways.           First, there is usually some educational outreach if it is determined that a business is not meeting its obligations. The IRS uses years of experience combined with data analytics to pinpoint which businesses need help. It would be wise to accept and apply the information they provide, because the next steps are not as pleasant.           Since the IRS considers payroll tax an essential part of the tax system, it will use any and every method at its disposal to make sure that this obligation is paid. This can include lawsuits, seizures of property, and criminal prosecution by the...

         The filing deadline for many tax-exempt organizations is coming soon. They normally need to file Informational Returns of the 15 th day of the 5 th month after their accounting period has finished. For those who operate their fiscal year on the calendar year, the time for them to file is May 15 .           This year the Internal Revenue Service ( IRS ) want to make sure that filers know what is and is not required. By law, most parts of these forms must be made available to the public . These organizations are strongly cautioned against using Social Security Numbers or any other personally identifying information on these forms, schedules, or attachments. Doing so will prevent their donors, clients, or benefactors from having their identities compromised.           There are a wide variety of Forms 990 that are used for tax-exempt organizations. Not...

         In this Tax Season, there have been many adjustments from previous years. One of which is related to the claiming of dependents. It came as a surprise to some that the tax filer, spouse, or dependents can no longer be claimed as personal exemptions. This has been suspended. However, dependents can still be claimed if they meet qualifying criteria.           For any dependent claimed, their name and Social Security number must be listed in the Tax Return. The Internal Revenue Service ( IRS ) is taking these steps to combat fraud. In recent years, the Child Tax Credit has been a target of criminals. A Taxpayer cannot claim any dependents, if they themselves, or even their spouse, have been claimed as a dependent. Making sure that a child or relative still qualify to be claimed as a dependent is not the same as it was a year ago. Talk to your Qualified Tax Professional to understand the nuances of this...

         Federal income tax that is withheld from paychecks is generally paid over the year. The amounts withheld are shown on the Form W-2 . That has not changed. However, this has been a big issue when filing 2018 Tax Returns because of how the Tax Cuts and Jobs Act ( TCJA ) changed Withholding Tables. That directly impacted the Tax Refund or debt responsibility given to Taxpayers.           To avoid another surprise next year, the Internal Revenue Service ( IRS ) recommends a Paycheck Checkup as soon as possible. This should be done even if there are no significant changes from last year. This way, you can plan to get the refund you want next year. Withholding can be changed by filling out a Form W-4 . The amount withheld depends on the amount of income earn, along with filing status (married or single), the number of allowances (the more claimed, the less withheld), and any other additional amount request...

        This is a post for those who, for one reason or another, did not file their Tax Return on time. This does not include those who have filed extensions, because they would not be considered late. What should everybody else do? Here are some practical steps that will save you stress and money.           Do not panic. This might seem like a strange point to make, but it is helpful. Thinking too much about a missed deadline will keep you from moving forward and making progress. Just deal with the situation at hand. File as soon as you can. If you have a Refund coming, there will be no penalty for filing late. However, if you owe a Tax Debt, penalties and interest are determined by how late the Tax Return is filed. Either way, it is in your best interest to get this done promptly.           Find a Qualified Tax Professional. Since the Tax Season is over, many seasona...

         A general warning has been issued to all Taxpayers by the Internal Revenue Service ( IRS ). There are some who continue to promote what have been deemed frivolous schemes and tax arguments . Considering that this happens every year, it has earned a spot on the 2019 IRS “ Dirty Dozen ” list. These are considered the 12 most common tax scams seen during the year.           Some of the myths that continue to be promoted are that only those who work for the Federal Government are subject to income tax, the First Amendment allows for the refusal to pay taxes on religious or moral grounds, and that only foreign income is taxable. These arguments, and many others like them, have been thrown out of court repeatedly , so do not get talked into going down this path. Taxpayers have the right to contest their Tax liabilities, but they must do so legally . Using any frivolous arguments will bring stiff penalties an...

         The Internal Revenue Service ( IRS ) continues to strenuously warn taxpayers against claiming Business Tax Credits for which their companies do not qualify for . This is a tactic commonly used by Tax Preparers who are not to be trusted. This is a practice seen often, which is why falsely claiming Business Tax Credits has a spot on the IRS 2019 “Dirty Dozen” list.           There are two credits that are often claimed irresponsibly. One is the Research Credit , which is used to support scientific experimentation that improves a product or process used in the business. There are very specific guidelines that must be followed in order to successfully claim this credit and if there is no supporting documentation, failure to do so will lead to the claim being rejected. The Fuel Tax Credit is even more difficult to claim. It’s basically limited to use of farming or other vehicles not used on highways. Wit...