Due to COVID-19, our office has made some changes to ensure the safety
of our clients and staff. We cannot at this time have any in person
face-to-face meetings, due to the office space not meeting 6 ft social
distancing requirements. Please call the office and we can schedule a
teleconference if needed. We are requesting anyone that comes into the
office to wear a mask, and we are taking preventative measures to keep
our office clean and maintain a healthy environment. Our office hours
have become more fluid during this troubling time. If you are needing to
drop off or pick up documents, please call the office to schedule a time
that encourages the social distancing of our clients in the office at a
time. We are monitoring COVID-19 closely and post updates to our
Facebook page as they come.

Now is the time to come together and put positive energy into our
communities. We here at Premiere Business Services are grateful for each
of you, and look forward to serving you during these unsettling times.

The IRS has created the People First Initiative to provide immediate
relief to help people facing uncertainty over taxes. In addition to
extending tax deadlines the IRS is temporarily modifying the collections
and limiting certain enforcement actions. The IRS will continue to take
steps where necessary to protect their employees, tax payers, and being
a key part of the outgoing response to the coronavirus effort.

For taxpayers with existing installment agreements, payments due between
April 1 and July 15, 2020 are suspended. Direct Deposit installment
agreements may be suspended if preferred. The IRS will not default any
Installment Agreements during this period, but by law interest will
continue to accrue on any unpaid balances. Any new installment
agreements will not be assessed until July 15, 2020.

The IRS is taking steps to assist taxpayers in various stages of Offers
in Compromise (OIC). The IRS will not allow taxpayers to request
additional information to support a pending OIC until July 15, 2020.
They will not close any pending OIC requests before July 15, 2020,
without taxpayer consent. Any ongoing OIC payments have the option for
suspend payments until July 15, 2020, although interest will accrue on
any unpaid balances. The IRS would like to remind taxpayers facing a
liability exceeding their net worth that the OIC process is designed to
resolve outstanding tax liabilities.

People who have not filed their return for tax years before 2019 should
do so. More than 1 million households that haven’t filed their tax
returns for the last three years are actually owed refunds, and still
have time to claim these refunds. Once delinquent returns have been
filed, taxpayers with a liability should consider an OIC.

Liens and levies initiated by field revenue officers will be suspended
during this period. However, field revenue officers will continue to
pursue high-income non filers and perform other similar activities where
warranted. New Automated liens and levies will be suspended during this
period.

Passport Certifications to the State Department, private debt
collections, field, office and correspondence audits will be suspended
during this period unless under unique circumstances. Unique
circumstances are particularly for some corporate and business
taxpayers. In instances when it’s the best interest for both parties and
appropriate personnel are available, the IRS may initiate activities to
move forward with examinations.

Taxpayers with Earned Income Tax Credit and Wage Verification Reviews
have until July 15, 2020 to respond to the IRS to verify that they
qualify. They are encouraged to exercise their best efforts to obtain
and submit all requested information, and if unable to do so to reach
out to the IRS indicating the reason information is not available. Until
July 15, 2020 the IRS will not deny these credits for failure to provide
requested information. Appeals employees will continue to work their
cases without holding in-person conferences. Tax payers are encouraged
to respond promptly to any outstanding requests.

The IRS will continue to take steps where necessary to protect all
applicable statutes of limitations. In instances where statute
expiration might be jeopardized during this period, taxpayers are
encouraged to cooperate in extending such statutes. Otherwise, the IRS
will issue Notices of Deficiency and pursue other similar actions to
protect the interests of the government in preserving such statutes.
Where a statutory period is not set to expire during 2020, the IRS is
unlikely to pursue the foregoing actions until at least July 15, 2020.
Practitioners are reminded that, depending on staffing levels and
allocations going forward, there may be more significant wait times for
the PPS. The IRS will continue to monitor this as situations develop.

There are still several ways to reduce tax liability before the end of
the year:
1) If you are eligible to itemize deductions, consider giving to
charity. Tax liability can be reduced with an end-of-year charitable
donation to a qualified charitable organization. If you are using the
standard deduction, charity contributions will have no effect.
2) Selling investments that create losses to offset gains recognized.
Capital losses can offset capital gains and allow up to $3,000 of
capital losses if you don’t have any capital gains during the year.
3) Consider funding a Roth, traditional IRA, or 401(k) plan to take
advantage of saver’s credit. A deductible IRA contribution will also
reduce adjusted gross income, which lowers your tax liability.
4) If you have a flexible spending account (FSA), evaluate and spend the
money for medical expenses. FSA are a “use it or lose it” account, so
use it before it disappears.
5) Check the total pre-tax health savings account (HSA) deductions and
adjust to maximize your pre-tax deduction and reduce taxable wages. In
2019 the contribution limit is $3,500 for single coverage or up to
$7,000 for family coverage. Over the age of 55? You can contribute and
extra $1,000.
6) Make energy-saving improvements to your principal residence.
Improvements include solar power, wind energy, and geothermal heat
pumps. The IRS allows a 30% credit on qualified solar energy property.
Improvements must completed before year end.
7) If you have rental or business income, you may be eligible for a 20%
qualified business income deduction(QBID). There are certain
qualifications for this deduction, check out our post on “Safe Harbor
for Rental Real Estate Businesses”.

1.Streamline Record keeping for Tax Time- When using one checking
account for home and business expenses, you’ll have to dig through
receipts, and breakdown credit card statements. To not miss out on
important deductions set up designated check, savings, and credit card
accounts for the business and use them only for business. It will be
much easier to identify income and expenses. Try out some type of
organizer for your receipts so you don’t lose them in your wallet or purse.

2.See Cash Flow More Clearly- Having a clear view of cash flow allows
you to be productive about managing it and spot problems before they
happen. Internet and utilities are typically billed the same day each
month. Business cash flow is harder to track if your account includes
both business and personal. Keeping them separate helps reduce risk of
error, and helps figure out where to look for cost-saving.

3.Have Everything in Order for an Audit- keeping business and personal
is not only beneficial for tax time, but also for audits. Having both
personal and business in one account could cause incorrect categorizing
of transactions. If you’re a Sole Proprietor, you are required to submit
bank statements to the IRS. Plus be sure to have always have supporting
documentation for any deductions claimed. Separating finances will make
it less painful during a tax audit.

4.Business Credit- Opening a business bank account and credit card is an
important step that will build your business’s credit profile. Use a
business credit card for business expenses only. It will help increase
your business credit limit, and lower interest rates down the road. In
some cases the interest paid on a company credit card is deductible as a
business expense.

5. Know Your Business Classification- Make sure your business
classification is a good fit. As your company grows you may need to look
into different classifications. Being an LLC requires you to have
separate bank accounts, as it is a distinct legal entity, and also needs
a tax identifier number. It minimizes a business owners personal
liability. If you mix business and personal, and your company is sued,
they can go after your personal finances as well.