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  • Business Tax – The RMS difference…







    The RMS Accounting Interview is the most thorough you have ever experienced. We provide more than 100 propriety worksheets, designed to discover every imaginable tax-related personal and occupational tax-saving opportunities.
    Everything is reviewed for mathematical accuracy, and proper application of tax theory. Nothing is taken for granted. We demand total accuracy in each phase of the preparation of your return.
    After computer processing, your return is quality checked one more time for accuracy prior to the preparer signing. We produce a tax return that reflects the lowest tax to which you are entitled.
    TAXATION IS NOT A SIDELINE ACTIVITY WITH US – We are full-time, year-round specialists in this profession. Our motivation springs from the philosophy that there is a great deal more involved than merely entering figures on government forms. Regardless of its simplicity or complexity, we handle your tax return with the deepest sense of responsibility.

     

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    us FREE:
    We will check your completed form, and if we can’t legally and honestly save you AT LEAST our full standard fee,YOU WILL OWE US ABSOLUTELY NOTHING.

    Open Year-Round – Free Audit Representation -Over 20 Years of Experience.

    There is no need for you to incur the cost of an office, equipment, insurance, FTEs, or reference materials!

    Pay the Lowest Tax the Law Allows: LLC, Partnership and Corporate Tax Preparation







    One of our tax professionals will review your business and personal income tax situation with you. Then our tax professional will work with you to make sure you pay the lowest income tax allowed by law. Our corporate tax preparation service includes tax planning as well. In addition to getting your corporate tax preparation right and completed the first time, our tax professional will also assist you with tax planning to help you reduce next year’s business taxes as well.

    The tax professionals at RMS Accounting are here year round to answer your questions and help you with all your business and corporate tax preparation needs. There are no surprises with us, one of our tax preparers will sit down with you and review your information with you, explain what needs to be done and provide you with a written fee quotation. Best of all, the fee we quote is the fee you pay, there are no surprises when you pick up your completed return.

    Anyone can put numbers on a tax form. Only the tax professionals at RMS Accounting can help you uncover every deduction the law allows.  At RMS we double check every income tax return. When RMS Accounting prepares your income tax return you can rest assured you are not paying one penny more in tax than is absolutely required.

    We stand behind the income tax returns we prepare.  No one wants to be audited, but should it happen you can rest easy because our tax professionals are enrolled to practice before the IRS and they will represent you and your income tax return as filed free of charge. No other tax preparer offers this kind of protection.

    Have a question once your return is complete? Our tax professionals are here to answer your income tax questions year round. Once we prepare your income tax return you will receive FREE year round tax help from our tax professionals and tax accountants. At RMS there is never a charge for responding to an IRS notice or answering a client’s tax questions. In fact all RMS Accounting clients receive a FREE year end tax planning consultation.

    Call us today at 800-382-1040 for a FREE no obligation consultation.

    Audit Reconsideration







    Bad IRS Audit Results? You may be eligible for “Audit Reconsideration”!

    Audit Reconsideration may be available to taxpayers that were assessed under the IRS Automated Underreporter Program (AUR) and the Automated Substitute For Returns Program (ASFR). AUR assessments come about when information on returns filed by the taxpayer does not match information IRS receives from third party sources. Fail to respond to an IRS CP – 2000 or other matching notice and IRS will assess additional taxes based on information it has received such as 1099s and W-2s. ASFR assessments come when taxpayers failed to file required tax returns and IRS files a substitute return based on the information it received from third party sources. These substitute returns do not take into account any deductions to which the taxpayer would be entitled. Taxpayers may be eligible for audit reconsideration on these types of assessments even after additional taxes have been assessed and the collection process has begun.

    Audit reconsideration may also be used to reevaluate the results of a prior audit when the taxpayer disagrees with the original determination, and the taxpayer can supply additional documentation which was not considered during the original examination or when the taxpayer believes that a deficiency was incorrectly assessed. A taxpayer might request audit reconsideration because: The taxpayer did not appear for the audit. The taxpayer moved and did not receive the IRS correspondence. The taxpayer disagrees with the assessment from the audit of their return and has additional information to be considered. The taxpayer disagrees with that assessment created under the authority of the Internal Revenue Service code 6020(b) (ASFR SFR). The taxpayer has been denied tax credits such as EITC claimed, during a prior examination.

    Audit reconsideration is not available if: The tax payer has already been afforded a reconsideration request and provided no new information. The taxpayer has previously entered into a formal closing agreement with the IRS under code section 7121, using form 906 or form 866. The assessments were made due to a compromise under Internal Revenue Code Section 7122. The taxpayer entered into a “Offer of Waiver of Restrictions on Assessment and Collection of Deficiency in Tax” or “Offer of Waiver of Restrictions on Assessment and Collection of Deficiency in Tax”

    The fact that collection action is in progress does not prevent the taxpayer from asking for and obtaining Audit Reconsideration.

     

    FBAR







    Foreign Bank Account Reporting (FBAR) What U.S. Taxpayers with Foreign Accounts Need to Know.

    FBAR is the Foreign Bank and Financial Account Report. FBAR rules are set forth in the Bank Secrecy Act, first enacted by Congress in 1970, the responsibility for enforcing these rules was given to IRS in 2003.

    The FBAR requires that all U.S. Person report any financial interest or authority, over a financial account in a foreign country, with an aggregate value over $ 10,000 at any time during the year. The report is filed on form FinCEN 114 which replaces the form TD F 9022.1 which was used for reports filed prior to July 2013. The form must be filed electronically on or before June 30th each year. No filing extensions are available. The law also requires tax payers disclose on their federal tax return that they have foreign financial accounts of $10,000 or more on their federal income tax return. This in generally done by marking the appropriate box on Schedule B. Taxpayers who fail to disclose the account on their federal income tax return could be subject to criminal sanctions for filing a false tax return.

    Reporting is required of all U.S. Persons with a financial interest or authority over a foreign account. U.S. Persons include: U.S. Citizens whether they live inside or outside the U.S., Resident Aliens, U.S. Corporations, U.S. Limited Liability Companies, U.S. Partnerships, U.S. Trusts and U.S. Estates.

    A U.S. Person has a financial interest in a foreign account if he or she is the legal or beneficial owner of a foreign account or they have effective control of the account even if said control is through a third party. A person can also be considered to have financial interest in or control over a foreign account by attribution. Reporting rules require a person serving as a shareholder, partner or trustee to report foreign accounts they control through said entities, if the owner of the account is (a) a person acting as an agent on behalf of the U.S. Person, (b) a corporation where the U.S. Person owns, directly or indirectly, more than 50 percent of the outstanding stock, (c) a partnership in which the U.S. Person owns more than 50 percent of the profits, or (d) a trust in which a U.S. Person has either a present interest in more than 50 percent of the assets or from which the U.S. Person receives more than 50 percent of the income.

    Non-owners with authority over a foreign account are also subject to the FBAR reporting rules. Authority means the U.S. Person has the ability to order a distribution or disbursement of funds or other property held in the account.

    Financial accounts in a foreign country are broadly defined as any asset account and encompasses simple bank accounts (checking or savings), as well as securities or custodial accounts. It also includes a life insurance policy or other type of policy with an investment value (i.e., surrender value).

    The $10,000 filing threshold applies to the aggregate of the highest amounts held in all accounts at any time during the year. So an individual that had three foreign accounts that each had a maximum value of $4,000 during they would meet the FBAR filing requirement due to the aggregate value being $12,000.

    Failure to file as required can result in substantial penalties. civil penalties of up to $10,000 may be imposed on nonwillful violations. This penalty may be avoided if there was reasonable cause and the U.S. Person reported the income earned on the account. The penalty for willful violations is far more severe. It is equal to the greater of $100,000 or 50 percent of the balance of the account at the time of the FBAR violation. This 50% per year penalty could result in a taxpayer with an account containing $1,000,000 being assessed a penalty of $1,500,000 because he failed to file returns for three years on the same account! Effectively creating a 150% penalty (see the case of United States v. Zwerner.) No reasonable cause exception exists for a willful violation. The IRS has six years to assess a penalty against a taxpayer that violates the FBAR reporting rules.

    Note: U.S. Taxpayers including Expatriates with foreign accounts should also review FACTA Reporting Requirements.

    FACTA







    The Foreign Account Tax Compliance Act (FACTA) What U.S. Taxpayers With Foreign Assets Need to Know!

    FATCA is the Foreign Account Tax Compliance Act. FATCA was enacted in 2010 to target non-compliance by U.S. taxpayers using foreign accounts. FATCA requires foreign financial institutions (FFIs) to report to the IRS information about financial accounts held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold a substantial ownership interest.

    FATCA has two primary working parts. Part one requires foreign financial institutions to annually report to the U.S. government information about financial accounts held by U.S. taxpayers, or held by foreign entities in which U.S. taxpayers hold a substantial ownership interest. Part two requires U.S. taxpayers with specified foreign financial assets that exceed certain thresholds must report those assets to the IRS annually on an information return.

    Since we doubt any of our readers are foreign financial institutions we will concentrate here on how part one affects U.S. taxpayers. While the nuts and bolts of the FFI reporting requirements do not require any action on the part of U.S. Taxpayers the results of this reporting have already been setting off alarm bells for all that thought offshore accounts would protect them from the prying eyes and sticky fingers of the IRS.

    U.S. Taxpayers have always been taxable on their worldwide income, but before the introduction of FATCA many taxpayers ignored this assuming “what they don’t know about, I have no reason to tell them about”. The problem with this has always been that it was a crime to hide income from the IRS. FATCA make hiding from the IRS close to impossible and could expose some tax payers to criminal charges.

    FATCA requires Foreign Financial Institutions (FFIs) to report to the IRS information about financial accounts held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold a substantial ownership interest. In order to avoid withholding under FATCA, a participating FFI will have to enter into an agreement with the IRS to: Identify U.S. accounts, Report certain information to the IRS regarding U.S. accounts, Withhold a 30 percent tax on certain U.S. connected payments to non-participating FFIs and account holders who are unwilling to provide the required information. Registration began January 1, 2014. FFIs that do not register and enter into an agreement with the IRS will be subject to withholding on certain types of payments relating to U.S. investments. As I write this over 700,000 banks and 70 countries have already registered or signed reporting agreements. Many of the countries that have already signed have been consider tax havens with banking secrecy for many years by Americans. These countries include: Cayman Islands, Costa Rica, France, Germany, Mexico, Denmark, Ireland, Switzerland, Spain, Norway, Japan, Bermuda, Guernsey, Isle of Man, Jersey, Malta, and the Netherlands.

    Anyone with an undisclosed foreign account that did not properly report the income may want to think about amending their tax return before then IRS get a chance to come looking for them.

    Part two requires U.S. Taxpayers to report “specified foreign financial assets” that exceed a threshold amount in aggregate which they own, control or have beneficial interest in to the IRS. Specified foreign financial assets include: financial accounts maintained by foreign financial institutions and other foreign financial assets held for investment such as foreign stocks or securities, interests in a foreign entity, any financial instrument or contract that has as an issuer or counterparty that is other than a U.S. person, foreign pensions and deferred compensation plans, and certain foreign trusts and estates. Taxpayers that have specified foreign financial assets that exclude the threshold amounts must file for 8938 “Statement of Foreign Financial Assets” with their federal tax return. At this time only individuals (1040 Fliers) are required to file form 8938.

     

    The reporting threshold for filing form 8938, for domestic taxpayers is:

     

    • Unmarried taxpayers living in the U.S.: The total value of specified foreign financial assets is more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year.

     

    • Married taxpayers filing a joint income tax return and living in the U.S.: The total value of specified foreign financial assets is more than $100,000 on the last day of the tax year or more than $150,000 at any time during the tax year.

     

    • Married taxpayers filing separate income tax returns and living in the U.S.: The total value of specified foreign financial assets is more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year.

     

    The reporting threshold for filing form 8938, for U.S. citizens with a tax home in a foreign country is:*

     

    • You are filing a return other than a joint return and the total value of your specified foreign assets is more than $200,000 on the last day of the tax year or more than $300,000 at any time during the year.

     

    • You are filing a joint return and the value of your specified foreign asset is more than $400,000 on the last day of the tax year or more than $600,000 at any time during the year.

     

    * You are a U.S. citizen whose tax home is in a foreign country if you are either a bona fide resident of a foreign country or countries for an uninterrupted period that includes the entire tax year, or you are a U.S. citizen or resident, who during a period of 12 consecutive months ending in the tax year is physically present in a foreign country or countries at least 330 days.

     

    Specified Foreign Financial Assets (SFFA) may be converted to U.S. Dollars using year-end spot rate for converting that currency for purposes of computing the filing threshold you must use highest fair market value during the year of the asset. For SFFA without a stated market or other valuation taxpayer must make a reasonable estimate of their maximum value. Except for taxpayers that elect the filing status of married filing jointly, joint owners of a SFFA generally each include the full value of the asset in their calculations for determining whether threshold is met and reporting the asset.

    The following are considered to be Specified Foreign Financial Assets (SFFA) and are required to be reported on form 8938: Any financial account maintained by a foreign financial institution. Foreign bank accounts, Foreign mutual funds, Foreign hedge funds, Foreign private equity funds, Certain foreign insurance products and Other foreign financial assets held for investment that are not in an account maintained by a U.S. or foreign financial institution, namely: Stock or securities issued by someone other than a U.S. person, Any interest in a foreign entity, Any financial instrument or contract that has as an issuer or counter party that is other than a U.S. person, Foreign pensions and deferred compensation plans, Foreign trusts and estates (if “specified individual” is aware of its existence). Income from SFFAs which is reported on the tax return must also be identified on form 8938.

    Form 8938 is only required to be filed if you must file a U.S. Income tax return. So a tax payer that had foreign accounts in excess of the applicable threshold but did not have enough gross income to require them to file a U.S. income tax return would not be required for file a 8938.

    Duplicate reporting of SFFAs included on the following returns is not required: 3520, 3520-A, 5471, 8621, 8865 and 8891. But the SFFAs must still be included when determining if the filing threshold has been met.

    The penalties that may be imposed for failure to file form 8938 when required include, a $10,000 civil penalty as well as an additional $10,000 continuation penalty for each 30 day period after the taxpayer is notified by the IRS of the failure to file (not to exceed $50,000). Failure to file can also result in criminal penalties.

    Some relief from the civil penalty is available for those that can show the failure was due to reasonable cause and not willful neglect.

    Information reported on your form 8938 for FBAR may and often does duplicate information already reported on FenCEN 114 for FACTA.

    Note: U.S. Taxpayers including Expatriates with foreign assets should also review FBAR Reporting Requirements.