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Disaster victims could get tax relief as part of new tax bill; IRS already offering some easier retirement plan access

Top 7 Things Tax Preparers Can Be Thankful for This Year

I can’t help but notice that when I stop and appreciate all the things that go right in my life, all the struggles and things that go wrong suddenly don’t seem so bad anymore by comparison. Focusing on what you’re grateful for is a great way to keep perspective on what’s important in your life. That’s why many of us at the Income Tax School believe in practicing gratitude every day, not just once a year according to the calendar.

At the same time, that doesn’t mean we shouldn’t take advantage of this great moment when the entire nation pauses for a day to give thanks. This is a great time for people to talk to each other and share what we’re all grateful for! Here’s a list of the top 7 things tax preparers can be thankful for this year!

The Cloud

Isn’t technology great? The internet and all these amazing cloud-based software services have made it easier (and cheaper) than ever for individuals to start their own businesses from home or wherever they like. We’re thankful for the technology that helps us and many entrepreneurs run their businesses successfully on a daily basis.

The Tax Cuts and Jobs Act

Love it or hate it, you can’t deny it’s good for the tax preparation industry. From individuals to small business owners to corporations, many people and entities need help right now interpreting the new tax laws. The tax bill also opens up an opportunity for you to offer tax planning services to your clients in addition to tax filing services.

Tax Filing Extensions

Whether you’re waiting on important information and documents or you have a client who just can’t seem to get it together, who hasn’t needed a little extra time to file once in a while? Some people’s tax strategy is to file for an extension every year. Either way, it’s good to know you can get the time when you need it – and hopefully stress about tax prep a little less.

Entrepreneurs

We love entrepreneurs – both because they are some of our best and favorite clients and because we have a lot of love and respect for the entrepreneurs who take the plunge, immerse themselves in Income Tax School classes, and go on to open their own tax prep businesses. We love to see them succeed as they help their clients and ultimately themselves, too.

Great People to Work with

From partners to employees to vendors, we’re always grateful to the people who play different roles in making our own businesses successful. We seriously couldn’t do it without them!

Emancipation Day and When Tax Day Falls on a Weekend

We’re lumping these two items together, because either scenario can push Tax Day out past April 15. In fact, for three years running (2017, 2018, 2019), we’ll have gotten to enjoy a small extension in the regular tax deadline, thanks to April 15 falling on a weekend plus the observation of Emancipation Day on the following Monday. (Washington D.C. always observes Emancipation Day on April 16. If April 16 is on a weekend, the day is observed on the Monday after April 16 – which means government offices, including the IRS, are closed.) It’s a little like getting that last bonus weekend to finish a paper in school.

You

We’re thankful for you – our readers, our ITS students, and the many people who not only have helped make the Income Tax School successful but who we consider a community of peers. From sharing ideas with each other online to catching up at the annual IRS Tax Forums, you are what make ITS so amazing and such a pleasure to be a part of. You motivate and energize us every day, and we love being here for you. So, thank you!

This is just the short list. There are so many things to be grateful for every day, from small things like hot coffee to big things like family and friends. We’d love to hear what YOU’RE grateful for this year in your tax prep business and in your life, so please tell us about it in the comments. And enjoy your Thanksgiving!

source https://www.theincometaxschool.com/blog/top-7-things-tax-preparers-thankful/

Tax extenders get extra electric vehicle element

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5 Ways to Get in On Small Business Saturday as a Tax Business

Small Business Saturday is right around the corner! While this special holiday is geared towards holiday shopping and supporting retail businesses, it’s also about celebrating the small, local business in your community. And, if you are a local tax firm, that means you too! Don’t write the holiday off as not for you – take the opportunity to get out in your community and thank your clients.

Here are 4 ways to get in on Small Business Saturday as a tax business.

Create an Email Campaign 

We are nearing the end of the year, which means your clients should be coming to you for year end planning to ensure they make the right moves. This is the perfect opportunity to thank clients for supporting your small business while encouraging them to come in and get their year end planning done.

While you’re at it, remind them that Giving Tuesday is a great way to get their year end giving done and maybe point them to a few of your non-profit clients or non-profits you’ve done promotions with.  You can also remind them to shop local and support the local economy.

Partner up

Who in your network is holding an event as part of Small Business Saturday? Is there an opportunity to partner up and offer discounts or put flyers out at an event? What about your local Chamber of Commerce or other business association? If you can’t find an event to be a part of, at least go mingle at other local events that day. It’s all about networking and building relationships.

Promote Small Business Clients

Do you have local retailers and restaurants as clients? Give them a shout out on social media for Small Business Saturday. You could highlight them, share events or discounts, or just do a post about Small Business Saturday and tag them.

Send Out Holiday Cards

It’s officially the Holiday Season, right? Why not send out personal, handwritten cards to clients thanking them for their business – and for choosing local? You will likely be the first business to send out holiday cards, which will be memorable for sure.

Embrace Small Business Saturday with open arms and get in on the action! You’re a small business too.

 

source https://www.theincometaxschool.com/blog/small-business-saturday-tax-business-promotions/

Standard & itemized tax deductions for the 2019 tax year

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Your many tax season VITA & TCE volunteer opportunities

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IRS is ending 2017 tax return e-filing on Nov. 17

It’s OK to Say No: How and When to Fire Problem Clients (Nicely)

Sometimes someone special walks through your door – someone so special that they make you want to scream in frustration.

I’m talking about the problem client – also called the toxic client. We’re talking about that person who does nothing but cause you problems and agony. The ones who make you question why you went into business for yourself.

Well, these moments are precisely why you went into business for yourself. When you work for someone else at a company you don’t own, you might have to put up with an awful lot of ridiculous behavior and situations from coworkers and clients. You don’t get to decide who gets the boot.

But when you own your own tax business, you can decide when a client has crossed a line – and then take action to correct the situation. It’s both a drawback and a perk of being the big boss. (But ultimately, it’s more of a perk, because at least you get to be in charge of making the call!) That’s why it’s important to learn how and when to fire problem clients.

 

First, determine if they are actually a problem

Part of working for yourself – or really just part of life – is getting along with different kinds of people. Some of your clients will become your friends. Some of your clients will be just that – clients – and you’ll have purely business relationships with them. That leaves a handful of others who will always not be as easy to work with as others.

However, “not as easy to work with” doesn’t actually take them to the level of toxic clients who are so bad you need to fire them.

Ask yourself these questions:

• What is the client actually doing wrong? Is it something you can coach them to be better at? Maybe you can help teach them the best ways to work with you (for example, teaching them the right timelines for getting documentation turned in).
• Is your ego getting in the way? Do you feel that somehow they are questioning your work? Don’t let pride get in the way of a client relationship. Listen to what your client needs and see if they have a valid point – and if you can fix or improve upon whatever they’re asking for.
• Is it still possible to resolve the issue? Are you both still communicating well enough that you can sit down and listen to each other? Is it possible to reach an understanding and move forward?

Depending on the answers to these questions, you might be able to work things out.

Have you tried absolutely everything you can to salvage the relationship? If the answer is “yes” and it still isn’t working, keep reading …

 

Problem client red flags to look for

Sometimes you aren’t going to be able to resolve things with some clients. Four of the biggest, most glaring red flags are:

• Poor communication: Is your client really listening to you? Can you understand each other? Does your client let lots of time elapse between responses or give no response to your queries (time sensitive or not)? Do they refuse to use efficient ways to communicate (for example, they insist on talking on the phone or visiting in person when an email would do)?
• Poor understanding of what the problem is: This point is related to poor communication, but it’s worth talking about separately. Do you understand what the problem is – and is your client able to articulate it to you in a constructive way? Can you understand well enough to fix the problem? If you can’t even work together well enough to understand the issue and you reach a communication impasse, that’s a bad sign.
• Know-it-all attitude: Does your client tell you how to do your job, whether they know anything about taxes or not? You need their input about their financial situation, yes. However, once you get that info, you’re the expert and they are there to get advice from you. (After all, if they already knew the best way to file their taxes, they wouldn’t have come to you, right?)
• Overly harsh criticism: Does the client give unnecessarily harsh – and often unhelpful – criticism? Is their attitude hostile or are they making accusations against you? 

When you see too many of these red flags in your client relationship, it’s time to cut your toxic client loose. Otherwise, you risk digging yourself in deeper, losing more money, increasing your stress levels, and making the situation worse overall.

When it’s time to have the conversation

Once you’ve decided to let a client go, how do you tell them?

• Be direct, but not cruel. It’s all right to say something, such as, “This doesn’t seem to be the best fit for you or for me.” It’s not all right to call someone out and say, “I hate working with you. You’re a …”

• Give as much or as little detail as you feel comfortable with. I will say, in this area, less is always more. You don’t have to outline every disagreement you have had with each other. You don’t really owe them an explanation beyond, “This doesn’t seem to be working for us.” However, if you’d like to give any additional detail, feel free. Just don’t cross the line into giving away too much personal information.

• Offer helpful recommendations for other tax advisors. Feel free to make suggestions of other offices or individuals they may want to contact.
• Wish them all the best. Always try to leave things on a positive note as much as possible.

 

Of course, there is a “plan B.” You can always say something along the lines of, “Some things have come up and I’m not going to have the time and energy to devote properly to you right now.” Whether it’s true or not, some people would rather not give any hint of a problem within the client relationship. That choice is up to you. We tend to recommend the direct-but-polite route, but you make the decision that you’re comfortable with. After all, it’s your business.

Also, please note that if your client has actually done something really bad or even illegal, such as sexually harassed you or your staff, provided false documentation, or somehow put you and your staff in danger or in any legal risk, all bets are off. Call your lawyer and let them know exactly why you’re cutting off the relationship.

Assuming this is simply a toxic client you need to let go, a sample script or email (because we recommend talking on the phone or in person, but if you have to do an email, you can adapt this script) might look like this:

Hello, [Client]!

After much thought, I regret that My Tax Company, LLC, will no longer be able to help you with your tax preparation.

As much as I’d like to be able to help you, I think another tax preparer may be a better fit for what you need. You may want to reach out to [Competitor A] at [contact info] or perhaps [Competitor B] at [contact info] to see if they can help you.

Thank you again for your business. I wish you all the best!

 

Keep it short, simple, and to the point.

 

Final words

In short, know your deal breakers when dealing with clients. What can you put up with from difficult clients – and what behaviors and situations will not be tolerated?

When you’re doing a cost-benefit analysis to consider if this client is big enough to keep or not, remember to include your own sanity in that check. It’s not always about the dollars and cents. If a client causes you too much stress or could possibly damage the reputation of your office (either because your project goes badly or they start talking badly about you around town), they aren’t worth working with.

Do you have any horror stories about clients you had to let go or whom you wish you’d let go? Let us know in the comments.

source https://www.theincometaxschool.com/blog/how-when-fire-clients/

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Digital Services Tax (DST) Plans Outside the US

New ways of doing business often challenge tax rules written for a different model. That is a concern expressed for many years by several countries. The concern is that it looks like companies that make money by other than selling tangible goods are profiting by activity in the country, but have no permanent establishment in the country, so owe no income tax. For example, a search engine company makes money when someone uses its search engine because it provides data to the company. And if the user clicks on an ad, the search engine company makes money. But no tax revenues go to the user's country.

The OECD, European Commission and others have been studying this for many years. The AICPA recently released a policy paper that explains the topic, issues and lists what some countries are doing or proposing. See AICPA Policy Report – Taxation of the digitized economy: A policy paper designed to educate, enlighten and stimulate discussion (October 2018).

The UK has also studied this issue and solicited comments on its suggestions. It now proposes to start a Digital Services Tax (DST) in 2020. In November 2017, the UK government released a discussion paper – Corporate tax and the digital economy: position paper; later updated in 2018. The position is that “a multinational group’s profits should be taxed in the countries in which it generates value.”  Also see the UK policy paper – Digital Services Tax: Budget 2018 brief. It states:

 “The DST applies a 2% tax on the revenues of specific digital business models where their revenues are linked the participation of UK users. The tax will apply to: search engines; social media platforms; and online marketplaces. That is because the government  considers  these business models derive significant value from the participation of their users.”

The UK DST will only apply to businesses with at least £500 of global revenues ($650 million USD).

Congressman Brady, Chair of the House Ways and Means Committee, stated his opposition to the UK DST – On 10/31/18, he released the following statement:

“The United Kingdom’s introduction of a new tax targeting cross-border digital services – which mirrors a similar proposal under consideration in the European Union – is troubling.  Singling out a key global industry dominated by American companies for taxation that is inconsistent with international norms is a blatant revenue grab. 

“The ongoing global dialogue on the digital economy through the OECD framework should not be pre-empted by unilateral actions that will result in double taxation. If the United Kingdom or other countries proceed, that will prompt a review of our U.S. tax and regulatory approach to determine what actions are appropriate to ensure a level playing field in global markets.”

Spain has also proposed a DST of 3%.  See DLA Piper Global Tax Alert 11/1/18.

Is a new tax the answer? Can existing income taxes be modified to address where income is generated? How easy it is to know where income is generated? I think technology makes it possible to know the location of the person clicking on a social media ad. The harder question might be where is that income generated for tax policy purposes. That has been a longstanding multistate question - where the costs of performance occur or at the destination, or perhaps some combination?

What do you think?



source http://21stcenturytaxation.blogspot.com/2018/11/digital-services-tax-dst-plans-outside.html

Are You a Leader or a Boss?

 

In case you missed it, October 15th was National Boss Day, a day for employees to celebrate and honor their bosses. The holiday caused me to pause and think about the term “Boss” and what it meant. Reflecting on that, I was reminded of how important it is to be a leader instead of a boss.

A Boss is… 

The person in charge. He/she writes the checks, takes responsibility, and grants permission. Sure, a boss can gets things done. They put out fires, manage employees, and run the day to day. But being the boss is not what we should aspire to be. What we should aspire to be is a leader.

A leader is…

Way more than a boss. A leader sets the tone for the organization. They LEAD and inspire employees to do better and be better. A leader has a mission and vision and drives the organization towards it. They plan for the future and curate a culture that exemplifies the mission and vision of the company. They look for solutions to organizational challenges and develop their employees to help them grow and learn.

Qualities of a Leader

“A leader is one who knows the way, goes the way, and shows the way.” – John C. Maxwell

While everyone has their own, unique leadership style, these 10 leadership qualities can be found in the best leaders.

• Honesty & Integrity
• Confidence
• Commitment
• Passion
• Strong communication skills
• Decisive
• Accountable
• The ability to empower others
• Creativity
• Empathy
• Emotional intelligence
• Open-minded
• Influential
• Problem solver

Are you a leader or a boss?

Bosses tell you what to do. Leaders tell you why and how to do it.

Bosses need you to perform. Leaders want you to be successful.

Bosses measure success by title, rank, and hierarchy. Leaders measure success by the passion and impact of the people they employ.

 

source https://www.theincometaxschool.com/blog/leader-vs-boss/