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Accounting News & CPE Advice Blog

security summit

December 6, 2016

The IRS Security Summit warns taxpayers of the fast growing threat of phishing scams.

In Washington on Tuesday, the IRS, state revenue agencies, and major members of the tax industry all urged the public to be wary of widespread phishing, malware and email schemes. A 400% growth in such activity was observed during the 2016 tax season, and is expected to further expand in 2017.

The group urges the public to use extra caution whenever viewing emails containing a link or attachment, or emails appearing to come from friends, the government, or lookalike URLs.

For additional details from the summit, visit IRS.gov here.

CPAs: CPA CPE Requirements
Enrolled Agents: EA CE Requirements
Annual Filing Season Program: AFSP CE Requirements




affleck

October 24, 2016

All PTIN numbers will expire on December 31, 2016.

The IRS reminds tax professionals to obtain 2017 PTINs (Preparer Tax Identification Number) before the December 31st deadline. Any federal tax return preparer who receives compensation for their work must maintain an active PTIN. The fee for a new or renewed PTIN is $50.

IRS.gov: Tax Professionals Homepage

CPAs: CPA CPE Requirements
Enrolled Agents: EA CE Requirements
Annual Filing Season Program: AFSP CE Requirements




Hurricane tax relief

(Image: Wikipedia; Ryan Johnson)

October 18, 2016

More Hurricane Matthew victims will now have extensions available until March 15.

Victims of Hurricane Matthew in North Carolina, South Carolina, Georgia and Florida will have until March 15, 2017 to file certain tax returns and payments. This includes extension filers with October 17 deadlines.

Tax payers with addresses inside disaster areas do not need to contact the IRS and will automatically receive tax filing and penalty relief.

Tax payers outside of disaster areas whose records needed to meet deadlines are located within disaster areas may also qualify for relief and should contact the IRS at 877-562-5227. Workers with recognized organizations assisting disaster victims may also qualify.

As of October 18, 2016, the following counties are eligible:

North Carolina: Beaufort, Bertie, Bladen, Brunswick, Camden, Carteret, Chowan, Columbus, Craven, Cumberland, Currituck, Dare, Duplin, Edgecombe, Gates, Greene, Harnett, Hoke, Hyde, Johnston, Jones, Lenoir, Martin, Nash, New Hanover, Onslow, Pamlico, Pasquotank, Pender, Perquimans, Pitt, Robeson, Sampson, Tyrrell, Washington, Wayne and Wilson counties.

South Carolina: Beaufort, Berkeley, Charleston, Colleton, Darlington, Dillon, Dorchester, Florence, Georgetown, Horry, Jasper, Marion, Orangeburg and Williamsburg counties.

Georgia: Bryan, Camden, Chatham, Glynn, Liberty and McIntosh counties.

Florida: Brevard, Duval, Flagler, Indian River, Nassau, St. Johns, St. Lucie and Volusia counties.

Source: IRS News

CPAs: CPA CPE Requirements
Enrolled Agents: EA CE Requirements
Annual Filing Season Program: AFSP CE Requirements




Hurricane tax relief

(Image: Wikipedia; Staff Sgt. Jonathan Shaw)

October 14, 2016

North Carolina hurricane victims have some deadlines extended to March 15, 2017.

Businesses and individuals affected by Hurricane Matthew in North Carolina with certain October 2016 tax filing and payment deadlines now have until March 15, 2017. Any tax payments originally due April 18, 2016, however, are not eligible for relief.

Tax payers with addresses within disaster areas will automatically receive relief, and do not need to contact the IRS. Tax payers living outside of disaster areas whose records necessary to meet deadlines are located within affected areas may qualify for relief and should contact the IRS at 877-562-5227. In addition, workers with recognized organizations participating in disaster relief may also qualify for tax relief.

Similar tax relief is expected for hurricane victims in other states as FEMA continues to assess the widespread damage. As of October 14, 2016, the following counties in North Carolina have qualified for tax relief:

Beaufort, Bertie, Bladen, Columbus, Cumberland, Dare, Duplin, Edgecombe, Gates, Greene, Harnett, Hoke, Hyde, Johnston, Jones, Lenoir, Nash, Pender, Pitt, Robeson, Sampson, Wayne, Wilson

Source: IRS News

CPAs: CPA CPE Requirements
Enrolled Agents: EA CE Requirements
Annual Filing Season Program: AFSP CE Requirements




IRS Approved CE provider logo
June 1, 2016

IRS Annual Filing Season Program (AFSP) participants may now begin fulfilling annual CE requirements.

18-hour AFTR and 15-hour AFTR-exempt course packages are now available. AFSP participants have until midnight on December 31, 2016 to complete their continuing education requirements. Sequoia CPE will automatically reported all completed CE credits to the IRS PTIN system for you. Some helpful AFSP links have been provided below.

Annual Filing Season Program (AFSP)
Sequoia CPE: AFSP Homepage
Sequoia CPE: CE Requirements
IRS.gov: AFSP Details




IRS Approved CE provider logo
December 31, 2015

IRS Enrolled Agents and Annual Filing Season Program participants have until midnight December 31st to fulfill all 2015 continuing education requirements.

Time is still left for IRS Enrolled Agents and Annual Filing Season Program (AFSP) participants to satisfy all 2015 continuing education requirements. Course exams can be completed anytime before 11:59 PM PT on December 31, 2015.

There’s still time if you haven’t registered for courses yet. Here are some links to help you get started:

Enrolled Agents:
CE Requirements
Unlimited CE Membership

Annual Filing Season Program (AFSP):
CE Requirements
CE Course Packages

IRS Information:
Enrolled Agents
AFSP Tax Preparers




IRS logo

November 25, 2015

The IRS reminds tax preparers that they are a common target for identity thieves wanting to file fraudulent returns.

The Internal Revenue Service advises that tax preparers create a security plan that can be speedily implemented in the event that a data breach occurs. The agency provided the following checklist to help protect clients' information.

Safeguarding Taxpayer Data

As part of that security plan, the publication recommends preparers have:

  • Top-notch security software that includes a firewall, anti-malware and anti-virus programs; make sure they are set to automatically update so that the software can stay current against the latest threats; and consider having firewalls for both hardware and software.
  • An education program for all employees to ensure they understand the dangers of phishing emails and other threats to taxpayer data. Publication 4557 has several items related to employees such as halting their access to the preparer’s computer systems if they leave employment.
  • Strong passwords that are changed periodically; consider having different levels of password protection. For example, have one password to access the computer system and a separate password to access tax software or client files. That way, if the computer system is breached, perhaps not all of the information will be exposed.
  • Secure wireless connection. If Wi-Fi is used, protect taxpayer data by making sure it is password protected and encrypted email programs to exchange PII information with taxpayers.

Return preparers should also be sure to:

  • Back up taxpayer data frequently, perhaps on an external hard drive, and ensure that the hard-drive is kept in a secure location with limited access by others.
  • Store any paper files in a secure location.
  • Access IRS e-services weekly during the filing season and periodically throughout the year to see the number of returns filed using the preparer’s EFIN. If the number is excessive, contact the e-Help Desk for e-Services immediately.

Federal Laws Apply

Preparers also should be aware of the federal laws that require safeguards.
In the Gramm-Leach-Bliley Act, the “Safeguards Rule” requires individuals involved in providing financial products or tax preparation services to ensure the security and confidentiality of customer records and information.

The Act’s “Financial Privacy Rule” requires return preparers and others to give their customers privacy notices that explain the financial institution’s information collection and sharing practices. In turn, customers have the right to limit some sharing of their information.

Section 7216 of the Internal Revenue Code (IRC) imposes criminal penalties on tax preparers who make unauthorized disclosures or uses of information furnished to them in connection with the preparation of an income tax return.

IRC Section 6713 imposes monetary penalties on the unauthorized disclosures or uses of taxpayer information by any person engaged in the business of preparing or providing services in connection with the preparation of tax returns.

Develop Data Theft Plan

The IRS also recommends preparers create a data theft plan that they could enact should they experience a data loss.

The Federal Trade Commission outlines best practices for businesses that experience data theft. Its main guidance is available at “Information Compromise and the Risk of Identity Theft: Guidance for Your Business.” They include notifying:

  • Law Enforcement — If local police are not familiar with investigating information compromises, contact the local office of the FBI or the U.S. Secret Service. Also, contact local IRS Stakeholder Liaison so they can contact IRS Criminal Investigation.
  • Affected Businesses — For example, alerting the major credit bureaus that a data theft involving Social Security Numbers has occurred and that clients will be advised to place fraud alerts on their accounts.
  • Individual Clients — This is the hard part, but the earlier clients are notified, the faster they can take action to mitigate any damage. Also:
    • Discuss the timing with law enforcement to avoid impeding the investigation;
    • Designate a person responsible for releasing information. Communications is critical. The FTC has a model letter that can be used as a template to notify clients about the data theft.
    • Describe in any notice to clients what is known about the compromise, including how it happened, what information was taken and what actions have been taken to remedy the situation.
    • Consider additional steps such as offering free credit monitoring for clients.

Contact

The IRS has updated its guidance to preparers including new procedures should they suffer a data theft. Preparers should contact the IRS Stakeholder Liaison for their state. Contact information is available on IRS.gov, keyword search Stakeholder Liaison.

CPA CPE requirements: CPA Requirements
Enrolled Agent CE requirements: EA Requirements
AFSP CE requirements: AFSP Requirements




Wisconsin GAAP

October 16, 2015

Legislators are proposing amendment to require the state to follow generally accepted accounting principles.

Wisconsin state senator and CPA Howard Marklein is backing a bill to amend the state’s constitution to stop the government from continuing to account for its finances on a cash basis. The new system would allow the state to start budgeting and making financial decisions in ways similar to most businesses.

If passed, the measure would force the state to begin carrying out generally accepted accounting principles, or GAAP. Current practices have led to "all sorts of creative accounting and robbing of funds,” claims Marklein. "I think politicians in the past have been afraid to adopt it because it would have forced them to make tough choices.”

In order for this bill to be passed into law in Wisconsin, it must be approved by two consecutive legislatures and then by a statewide vote.

Source: Telegraph Herald

CPA CPE requirements: CPA Requirements
Enrolled Agent CE requirements: EA Requirements
AFSP CE requirements: AFSP Requirements




property taxes

August 14, 2015

Tax public policy think tank sorted out average effective property tax rates across the US.

The Tax Foundation, a Washington DC based public policy think tank, recently published a report analyzing property tax rates nationwide. Only owner-occupied housing was considered and the organization factored in varying policies created by state, city and local governments, as well as school districts, fire departments and utility commissions. States with higher property taxes often rely less on other major tax categories. Their findings of the 10 states with highest effective property taxes are ranked below.

1. New Jersey - 2.38%
2. Illinois - 2.32%
3. New Hampshire - 2.15%
4. Connecticut - 1.98%
5. Wisconsin - 1.96%
6. Texas - 1.90%
7. Nebraska - 1.84%
8. Michigan - 1.78%
9. Vermont - 1.71%
10. Rhode Island - 1.67%

Source: Tax Foundation

CPA CPE requirements: CPA Requirements
Enrolled Agent CE requirements: EA Requirements
AFSP CE requirements: AFSP Requirements




Obamacare

July 28, 2015

Major audit defense firm says only 1% of clients have been audited by IRS for Affordable Care Act issues.

TaxAudit.com, one of the nation’s largest audit defense firms, says that out of its roughly 13,000 clients who have been audited so far this year by the Internal Revenue Service, just only over 1% have been related to issues concerning the Affordable Care Act. This year was the first time Americans were required to include their health insurance status.

“Truthfully, I’m a little surprised it’s that low right now,” says Dave Du Val, TaxAudit.com’s VP of customer advocacy. Du Val stated that only individuals who had claimed an exemption from the ACA's individual mandate were among those audited. He believes the IRS has effectively enacted a grace period this year by not aggressively challenging Americans’ claims to possess health insurance.

“I don’t think they have the manpower now, I don’t think they believe they have the manpower either,” Du Val assessed. At this time, members of the U.S. House of Representatives are proposing $838 million in budget cuts to the IRS for fiscal year 2016.

Source: CNBC

CPA CPE requirements: CPA Requirements
Enrolled Agent CE requirements: EA Requirements
AFSP CE requirements: AFSP Requirements




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