Saturday, May 27, 2017
Gig Workforce and Portable Benefits
On May 25, 2017, Senator Warner (D-VA) and Congresswoman DelBene (D-WA) introduced H. 1251 and H.R. 2685, Portable Benefits for Independent Workers Pilot Program Act. It calls for $20 million of grant dollars for states to study and pursue innovative ways to provide portable benefits to "the growing independent workforce."
Per Senator Warner: "Whether by choice or necessity, a growing number of Americans are working without a safety net and have difficulty planning and saving for retirement, health care needs, or on-the-job injuries. The nature of work is changing rapidly, but our policies largely remain tied to a 20th century model of traditional full-time employment.” “As more and more Americans engage in part-time, contract or other alternative work arrangements, it’s increasingly important that we provide them with an ability to access more flexible, portable benefits that they can carry with them to multiple jobs across a day, a year, and even a career. These incentive grants will accelerate experimentation at the state and local levels to better support a more independent 21st century workforce.”
This is a good idea, but puzzling as to why they don't address this at the federal level given the number of provisions regarding workers that exist at the federal level. For example, only employees get unemployment benefits, not contractors. Retirement plans differ for employees versus contractors. Why not modify these rules to address the fact that even if someone is an employee rather than a contractor, they will have numerous employers over their careers. They all need portable benefits.
Why aren't federal tax reform discussions also focused on trends and modernization of our tax system?
What do you think?
source http://21stcenturytaxation.blogspot.com/2017/05/gig-workforce-and-portable-benefits.html
Friday, May 26, 2017
Thursday, May 25, 2017
4 Reasons to Focus on Complicated Returns Next Tax Season
This Summer is a great time to evaluate the tax season and make a plan for next season. Beyond staffing and process improvements you should be looking at the services you offer and what you plan to offer or focus on next season.
We’ve been watching the industry and the news closely and have 4 reasons why you should focus on complicated returns next tax season.
Tax Software Competition is High 
Tax software has made filing taxes easier and more convenient for taxpayers. Their marketing is aggressive and their apps and software are extremely user friendly. Thanks to the convenience and price point, more and more Form 1040 taxpayers are opting to use software over tax preparation services.
People with complex tax situations are more likely to seek out a professional to make sure that they file properly and pay the least amount of tax liability. So why not target them next season?
IRS Free File
In addition to tax software companies, there’s the IRS Free File option. Taxpayers with an adjusted gross income of $64,000 or less can use the IRS Free File option and essentially bypass the need for purchasing software or hiring a tax pro. It’s estimated that 70% of taxpayers are eligible for this service.
IRS Free File essentially eliminates your 1040 clients but it does not eliminate businesses or individuals with complicated tax situations.
Tax Reform is Coming
One of the big campaign promises of President Trump was to overhaul the tax system and simplify the tax code. The GOP is currently hard at work creating a blueprint for what that system will be. What will be passed is still up in the air but a simplified tax code will mean that filing taxes is going to be a lot easier for the general public. However, those who have to deal with tax complications, such as capital gains, rental property, business income, tax credits, estate taxes, etc. are going to need some tax planning help. Complications and a need for a tax pro are going to be inevitable for those with complicated tax situations.
For more on the possible tax reform, read What Tax Reform Will Mean for Tax Pros.
You’ll Make More Money
Focusing on complicated returns will bring in more revenue because complicated returns come at a higher cost to the taxpayer. They require multiple forms and more time and know-how to prepare.
Spend the off-season finding ways to market to people with more complicated tax situations. For some, that may mean more tax training to acquire the knowledge. Take advantage of our Early Bird Special and save 25% on Tax Courses and CE Seminars so you can be ready to take on more complicated returns.
source http://www.theincometaxschool.com/blog/focus-on-complicated-returns/