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Some tax changes are welcome. Others promise but deliver far less than originally pledged. Those with the potential to affect your daily operations are sometimes concealed within a fog of questions. One such measure hit the newsstands in 2022. The Inflation Reduction Act (IRA), a reduced version of Biden’s “Build Back Better” plan, deserves an unbiased review. As a small business owner myself, I want to help you sift through the legalese. And “government-speak.” By the time that we wrap up, I’ll have illuminated the impact of this legislation. IRS Use of Inflation Reduction Act Funds Questioned The Internal Revenue Service (IRS) has sought to improve their image. Obviously, something like this takes time. While grace can be extended in certain areas, it shouldn’t be applied too liberally. Along those lines. Treasury Inspector General for Tax Administration (TIGTA) issued a report on its use of Inflation Reduction Act funds. Their stated goal was to review the IRS’s methodology. And their stewardship, or lack thereof, of funds designated for the agency. They found that taxpayers making less than $400,000 are still being audited. Despite Secretary of the Treasury Janet Yellen seeking to limit the application for small business owners 2 years ago. Talk about government efficiency. Mandates around Coronavirus ravaged small business America . Even supposed government bailouts like Small Business Administration (SBA) funds couldn’t keep it above water. Partly because non-qualifiers appropriated funds in actions deserving of fraud charges. But more because the reaction from health regulators was so extreme. Those who did survive now have to deal with this news. Last month the White House issued an official statement which contradicts the TIGTA findings. They stated that, “the IRS is adhering to Yellen’s commitment to not increase audit rates relative to current levels for small businesses and Americans making less than $400,000 a year.” TIGTA does have more on the line than Biden’s administration for making any false claims. As an intelligent reader, I’ll simply let you decide which party is more believable. But just remember one thing. Applying critical thinking requires the acceptance of evidence-based statements over non-evidence-based ones. Next, it’s worth breaking down the pieces that make up the act. Inflation Reduction Act Explained Legislation isn’t written in layman’s terms. Nor is it ever a short read. So, I’ll only pull out the information you need to know. Back in August 2022, the IRS was earmarked $80 billion. $45.6 billion going towards enforcement . Key details: Clean energy support Climate action Tax incentives Production and infrastructure Economic growth and job creation Breaks on taxes apply to several of the particulars listed above. Supporting the overall marketing message coming from the White House. For our purposes, let’s zero in on a specific tax enticement:  Implementation and compliance Yellen had specifically directed the IRS that, “enforcement resources will focus on high-end noncompliance.” Once again, that statement aligned with the professed goal of “taking from the rich and giving to the poor.” To borrow a line from Robin Hood. Which allowed the Act to quickly pass through the halls of our law-crafting bodies. Targets: Large corporations High-net-worth individuals Complex pass-throughs The IRS apparently wouldn’t make it in marketing. Because they missed their target market. And as stated earlier, continued to audit smaller operations. Beyond poor targeting efforts, this has led to decreased efficiency in relation to overall tax investigation. Which Yellen shared in her 2022 letter was 7,500 annual audits out of more than 4 million returns. Or a dismal .2%! Around family tables and office water coolers swirls discussion around responsibility. After all, inflation doesn’t magically appear out of thin air. Now is the time to put that debate to rest. Who is Responsible for Inflation? First, I need to define the term. One way to describe it is “the value of your cash in relation to services and goods you can purchase with it.” Supply and demand factor in. Currently, with demand greater than supply, prices have significantly risen. Now I can move into where responsibility for it lies. The answer to this question may depend on a few variables: Your source of news Your understanding of economics Your level of government trust Because this is fluid, I’ll focus on what we know for sure about the Inflation Reduction Act 2024. Main contributors: Federal Reserve Federal policies The latter involves all houses of the government. House of Representatives, Senate, and President. Process: President presents his budget to Congress House and Senate decide on funding bills President signs those into law Tariffs, trade policy, and deficit spending are other contributors. Not all of them are squarely decided by the executive branch. Although his power to influence extends deep into each area. According to the Congressional Budget Office, deficit spending was 6.3% of our GDP in 2023. Eyebrows understandably raise at this number because over the last 50 years, the average was less than 4%. Why is this bad? Artificial demand is created as the government borrows from the future. To pay for today’s expenses. Imagine applying this concept to your personal finances. Say you have debt. You incur more to make payments on what you owe currently. Creating more debt and compounding the original problem. Doesn’t make much sense. But hey, the government normally just does what it wants. I want to close by giving you an advocate should the IRS come knocking. Blue Slate Accounting Tax Resolution Specialist Something is missing from the accounting field. A human approach to personalized tax resolution services. Zelienople, PA is our home, but we’ve worked with businesses and individuals across this great nation. Aiding their arrival back to good standing with the federal and state governments. Our small, but dedicated team of certified tax professionals and an IRS Enrolled Agent assist with: Preparation of unfiled income tax returns Penalty reduction Offers in compromise Payment plans Financial hardship plans Wage garnishment/bank levy releases Audits IRS appeals We can clean up the debacle of that unorganized box of tax documents. For a monthly fee, we can counsel you on deductions and breaks to use next time. Offload your tax resolution needs today. And take the first step towards reclaiming your joy and happiness!

Running a small business is exciting. It's full of twists and turns. Guaranteeing that dullness stays far away from your workday. However, it does present its own set of challenges. Both from outside and inside the business. An external hazard has recently presented itself and I want to address it. So, you can prepare and plan accordingly. Read on my fellow small business practitioner. Qualified Business Income Deduction Meaning The qualified business deduction (QBI) applies to the final value of items from business income, loss, gain, and deduction. Examples: Individual health insurance IRA contributions Non-examples: Dividends from non-business investments Capital gains or losses Not every company can adopt the QBI, although I'm sure everyone would like to. Applicable businesses: S-Corporations Sole proprietors LLCs Partnerships Most, if not all, have paid staff. The one exception is sole proprietors who aren't quite ready to outsource. Within those structures, there is an additional financial qualification. Filing Individually Income less than $182,100 Filing Jointly Income less than $364,200 Data from ZipRecruiter shows that the average small business operator falls into this range. The highest paid live in New York ($143,878), while the lowest paid in Florida still make out well ($96,936). Other variables like cost of living and income tax laws may equate to tight family budgets despite this solid earning. As such, every possible break is welcome. One major benefit of the qualified business expense deduction stands out. Enabling small businesses to enjoy tax savings which can then be reinvested. Either into the business or employees. Possible reinvestment areas: Strengthening your professional development Adding to your internal or outsourced staff Opening new channels for digital and traditional marketing General improvements to your venture My guess is that you aren't in business simply to say you are. But rather to become a well-respected market leader. You can achieve this gradually. Or you can reach this coveted position sooner by using every possible advantage . Next, I want to briefly identify a few components of this allowance. Deduction Characteristics Without dragging you into the "tax weeds, there are two attributes worth noting. More than one 20% figure Itemization isn't a prerequisite Taxable business income isn't the main recipient of this reduction. Total taxable income can also experience a positive net effect. Here's how. Using your Schedule C, list income and expenses per your usual. Then calculate adjusted gross income via Form 1040. After those steps are complete, figure out your pass-through deduction. Should you adopt the standard deduction, you can still claim the QBI. My purpose in sharing these points? It's hopefully to show that you shouldn't rule out this tax write-off if the qualifications cited earlier don't apply. Your best way to confirm this and any other abatements is through a professional review . Reasons to work with an accountant: Support during an IRS dispute or audit Provide effective tax planning strategies Multiply available credits/deductions Family and friends can encourage you through the adversity from IRS scrutiny. Couple that with an advocate to work on your behalf in resolving an open case. Your strategy for taxes should evolve with any updates to tax laws. A well thought out attack plan saves money and increases the likelihood of breaking even. Translating to more cash flow, the fuel for your operation. Accuracy, compliance, and significantly less stress are a few more arguments in favor of these folks. The breaks you have access to will depend on your geographical location. Rather than having to devote extra time to research, your accountant will present an applicable list that your state grants. Unfortunately, this valuable aid to longevity and growth may be ending. Qualified Business Deduction Phase Out Set to expire in 2025, the removal of your qualified business tax deduction will ultimately hurt the overall economy. But not if the National Federation of Independent Business (NFIB) has anything to say about it. Their advocacy seeks to make it permanent. Via the Main Street Certainty Act (H.R. 4721 / S. 1796). Backers: Lloyd Smucker (R-MO) Henry Cuellar (D-TX) Steve Daines (R-MT) Their opinion on the importance of this legislation is something I share. COVID devastated our peers. According to a combined project from two top universities, almost 30% of small businesses closed in 2020 alone. A new threat to the survival of the remaining 70% exists in the end of this tax break. Rural areas will see the most immediate impact. Because local economies lack the extra cushion that larger ones in cities enjoy. Namely, in the greater number of businesses present in urban environments. But metropolitan centers won't be immune from the negative effects. Critics of the proposed Act inaccurately claim that the QBI is a tool of the wealthy. Or those making over $400,000 annually. Lots of small business owners would love to make that much each year. But they simply don't. Their contributions don't stop at boosts to regional economies. Adding local jobs. Supporting youth sports teams. Without tax savings, these same ventures might have to let go of employees. NFIB also found that 81% of owners see the QBI as integral to their business health. Before you go, know that there's a way to protect your business from ever-changing tax laws. Blue Slate Accounting Managing Your Qualified Business Expenses Something is missing from the field. A human approach to business tax services. Zelienople, PA is our home, but we’ve worked with SMBs across this great nation. Whether that’s aiding their successful filing or dealing with an IRS audit. Our small, but dedicated team of certified tax professionals and an IRS Enrolled Agent assist with: Federal, state, and local taxes Navigating tax regulations Increasing money you’re legally entitled to Limiting any tax burden Quarterly filings We can clean up the debacle of that unorganized box of tax documents. For a monthly fee, we can counsel you on deductions and breaks to use next time. Your return will be double-checked by hand for ultimate accuracy. Because we strive for excellence just like you do. Offload your business tax needs today. And take the first step towards reclaiming your joy and happiness!

"Steve, did you verify that the update is free of bugs?" Slowly glancing up from his video game, Steve noticed the irritation on his boss' face. He thought about munching the Cheetos in his hand but decided against it. "Umm, of course Ralph. Just call me the Exterminator. You know because any bugs ran for the hills." Shaking his head, the frazzled leader exited. Not knowing the chaos he could have averted if he'd verified Steve's assertion. Keep reading to find out what IT updates has to do with accounting. Fallout From the Crowdstrike Outage  Our over reliance on technology finally caught up with us. Courtesy of the Crowdstrike debacle. Affected industries: Airlines Healthcare Financial services Government Media IT Direct losses are estimated to be $5.4 billion for Fortune 500 companies. Delta Airlines alone lost $500 million. The loss in consumer confidence is much harder, if not impossible to quantify. Whether you believe it was intentional or not, one fact remains. It rocked our world. Thankfully, our IT specialists had previously chosen not to use Crowdstrike. Preventing full reliance on Big Tech infrastructure. And allowing us to serve our clients with minor interruption during the global outage. Which leads me to the crux of this article. Traditional ways of conducting business still have a place. And a valuable one. Confirming taxes or accounting by hand for example. Of course, accounting software is a great support for this task. Xero is our personal favorite. But it should never be a substitute for good old-fashioned number crunching to authenticate everything. Let's say your accountant fully depends on technological solutions. How an extended downtime could affect your business: Revenue and productivity decline Unable to pull up files or data Interruption to your financial dashboard That only matters if your meeting with potential investors is later today. And you don't have access to the figures you need. Or several other scenarios. Continuing on, I'll explain why "old fashioned" is better than whatever is popular at the moment. Traditional Accounting Benefits Let me introduce you to the concept of manual accounting. Where transactions are recorded with a greater purpose in mind. Displaying and backing up the financial health presentation you give to key stakeholders. Prior to the advent of accounting software like QuickBooks Desktop, this type of work was done by hand. In our case, we keep multiple backups of all: Documents Reports Accounting files It's methodical. And having another set of eyes double check everything safeguards against major blunders. You know, the expensive kind. Advantages: Error correction through double entry accounting Extra confidence that data is indeed valid Access to accounts during internet or power outages Through this system, avoidance of errors is a very real possibility. When debits and credits don't match, there was an error made. An experienced accountant can then go back and remedy the discrepancy. By using human critical thinking, you cut down on errors from computer-based data. Such as mistakenly using an older version of a file. Or coming across a digitally damaged file. The top reason for partnering a longer-established method with its technology-based version? You will always have a way to glean insights from the financial activity of your business. Even when somebody "forgets" to do the right software update. Time isn't always money. Unless customers choose your competitors, who have more reliable solutions. And aren't prone to service outages. Now to address the elephant in the room. Or the fly on the wall. Physical records are at risk from fire, flood, and other damage. That's an obvious fact. But this doesn't negate the reasons to have such a backup system in place. Perks far outweigh any drawbacks. As we start to land this delayed plane (too soon?), there's a topic we can't simply breeze past. Responsibility to Protect Your Business Fortune 500 companies will bounce back. Because they can afford to. Of course, they'll be layoffs and upset board rooms. But eventually it'll get back to business as usual. It's another story for small business America. Aka the lifeblood of our economy. And your main means of providing for yourself or a family. Like what we saw during COVID, more shuttered doors will start popping up. Including that community fixture that you assumed would weather any storm. I wish it wasn't so. The good news is that your venture can avoid this scenario. And not merely survive the next worldwide fiasco but thrive during it. Taking off my accountant hat for a minute, I want to speak to you as another member of this fraternity. My suggestion is to strike a balance between proven and unproven tools. I'll explain more. Take artificial intelligence for example. There may be some use cases for it, but don't rush to fire your human content writer. Why? Programmable machines speak best to programmable machines. And people speak best to people. Since the latter buy your products or services, keep the flesh and blood writer. In the same way, investors want assurance that your numbers are legit. Saying a machine believes so won't work. Remember that these folks are ultimately investing in you. Not what you sell. Give them confidence through accounting verified by hand. To conclude, there's a way to ensure that your certainty is well placed. Blue Slate Accounting Supporting Small to Mid-Sized Businesses Something is missing from the accounting field. A human approach to personalized business services. Zelienople, PA is our home, but we’ve worked with small to mid-sized businesses across this great nation. Aiding their pursuit of a financially healthy venture. Expect tailored recording from your personal Blue Slate Accounting team member: Inventory adjustments and COGS calculations Posting and verifying all financial transactions Pre-paid income/expense tracking and posting Basic or customized financial reporting Matching receipts to bank and credit card statements Bank account, credit card, and loan reconciliations We provide a quick, realistic weekly snapshot of your cash flow. Allowing you to make informed monetary decisions. Outsource your accounting solutions today. And take the first step towards profitability and contentment in your business.

Your profits are allowing you to provide for loved ones, pay staff, and save for retirement. I applaud you for that. But I also have a challenge. Stop listening to mentors and the culture saying, “It’s not enough!” Trust that your hard work and sacrifice has paid off. You don’t have to be Amazon for long-term success to mark your business. Besides, Amazon has plenty of issues which aren’t worth imitating. Read on and I’ll explain a step to confirm that you’re doing a lot right. How Often Do Small Businesses Get Audited? Small business bookkeeping can unleash the floodgates of healthy cash flow . However, an audit can put a Hoover Dam in the way. Nothing is getting past that beast of a barrier. Various factors increase the likelihood of your books being scrutinized. Triggers: Returns full of errors Rounding all your numbers up Too many vague expense categories Misuse of home-office deduction Failure to depreciate startup expenses Intermingling personal and business accounts Our federal tax agency likes inaccuracy even less than your typical accountant does. When your return contains abundant mistakes, the eyes of their employees are drawn to them. Remove all distractions (silence your phone!) when inputting figures. Please also remember to double check everything before hitting “submit.” If you’re unclear in sharing your costs, it’s also a red flag. A typical vague category for expenses is labeled “miscellaneous.” Without adding an explanation in your return, expect eyebrows to raise at the IRS. Sometimes this classification is selected because it’s quicker than determining the proper category. But shortcuts are not recommended when filing. In fact, the less work you can create for them, the better. I know from experience. Another key trigger is blending two separate accounts. One solution to avoid mixing funds is to use accounting software. You and your team don’t need to be financial experts to understand the generated reports. Coordination in real-time also becomes smoother. And should your business grow, extra features can be added. Without a need to research and adopt another tool. Because we all know how difficult it can be to get staff excited for new technology training. It’s right up there with reading the on-boarding manual. Moving on, I want to make bookkeeping in small business a breeze for you. How to Do Small Business Bookkeeping I don’t intend to overwhelm you. After all, you have plenty on your plate already. So, I’ll simply offer beginner small business basic bookkeeping here. But first, I want to share when handing off the books makes sense. Reasons to outsource: Early warning sign detection Accurately judge marketing results Remove the temptation for debt Free up time for revenue generation Determine your financial health quickly Of these, two reasons stand out in terms of importance. Identifying problem areas and getting back more time for profitable efforts. Here’s why you want to fill process gaps early. Letting them go unchecked could affect your bottom line. Cash flow. Or any number of other valuable metrics. Lean Six Sigma is a system to remove these unnecessary variations in processes. Getting rid of waste and boosting your fiscal health. Offering staff training in this methodology is one option. The other is working with an accountant. Entrepreneurs like yourself get in “the zone” when you’re able to focus on bringing cash into the business. There’s only one problem. You keep finding yourself adrift in an ocean of numbers. Outsourcing throws you a lifesaver. Forget that. It delivers a boat. Getting started: Business banking Accounting tools Records safekeeping Bookkeeping audit These four basics will provide a nice launchpad for becoming the top business in the Milky Way. That’s right, in the entire galaxy. Why limit your dominance to your town or county? Aim higher! As I start to wrap up, let me tell you a relatable story. Accountant Swimming Upstream You and I are in the same boat. Well not literally. Open water and I don’t mix. But figuratively in a surprising way. Former advisors offered me the following plan: Open multiple offices Create extra divisions Hire staff like crazy Then you’ll have “made it” Traditional business wisdom would call this guidance solid and worth following. There was just one problem with that advice. Okay, three problems. No mention of profit, personal happiness, or helping my clients succeed. That’s where our definitions of accomplishment diverged. In a big way. After all, it was my conscious that would have to be seared. Not theirs. I couldn’t even comprehend neglecting the most important asset for my business. Customers. Does this sound like what others have told you? The picture of a self-made entrepreneur has been drilled into our psyche. We’re told the customer is there to pay your salary. You don’t need any help to reach the boardroom in a soaring skyscraper. That is complete rubbish. To be totally honest, it’s a recipe for losing your identity as servant to your community. And bettering society. You don’t need an IPO or billions in revenue. Your business is growing at the right pace. And here’s something else. You are already successful. Stop believing the lie. This isn’t meant as some sort of self-help, touchy-feely support from an accountant. It’s encouragement from a fellow believer in true capitalism. And the American Dream. Now it’s time to cover a resource for verifying what you know deep down inside. But aren’t being told by the so-called experts. Blue Slate Accounting Small Business Bookkeeping Help Something is missing from the bookkeeping field. A human approach to personalized business services. Zelienople, PA is our home, but we’ve worked with small to mid-sized businesses across this great nation. Aiding their pursuit of a financially healthy venture. Expect tailored recording from your personal Blue Slate Accounting team member: Matching receipts to bank and credit card statements Bank account, credit card, and loan reconciliations Applying customer payments to in-house generated invoices Accounts Receivable tracking and invoicing services, including reminder letters Accounts Payable tracking and bill payment services We provide a quick, realistic weekly snapshot of your cash flow. Allowing you to make informed monetary decisions. Outsource your bookkeeping solutions today. And take the first step towards profitability and contentment in your business.

Imagine that your house was towed away. Goodbye home sweet home. Okay, it’s obviously a made-up picture. But bear with me. Just like defaulting on a car loan leads to repossession, owing the Internal Revenue Service (IRS) can end with a similar outcome. Online ad-targeting may be presenting you with alleged solutions. If so, tap the brakes for a second. Before you finish reading, I hope to convince you of a better path forward. What is Tax Resolution? When you have a debt with the IRS, it’s the process of reducing your obligation. A complicated procedure for sure. But one that a tax resolution specialist handles every year. Experience may vary, but there are general steps that they guide you through: Initial examination for determining the ideal response Necessary documentation is organized and your tax status is relayed Negotiations take place between the IRS and your counsel Services are paid for once your case is brought to a favorable end People don’t just wake up one day and find themselves duty-bound to the government. There are decisions that add up over time. Or several indecisions. Sometimes, life just happens. A death in the family. Financial struggles in a business. Regardless, there are obligations to meet. But simply getting started can feel like an imposing mountain. A Mt. Everest of liability. Stress that you’re likely dealing with: Back taxes Tax lien Bank levy Add to that high inflation. Plus, a lack of affordable housing. And you get a recipe for gloom. The IRS is notorious for inefficiency. Except when it comes to getting paid. And with a massive influx of funding for new agents, expect collections to accelerate. Bummer. But I encourage you to keep your head high. In the following sections, I’ll explain why. Tax Help for Small Business Direct File is the pet project of the IRS. The Treasury Department estimated that $5.6 million would be saved in 2024 tax prep fees. The agency used findings from its pilot program to forecast into the future. 2025 tax season and beyond: Cover additional filing situations Extend invitations to 38 more states Commissioner Danny Werfel is asking Secretary of the Treasury Janet Yellen to make it permanent. Although he stated that it’s not a complete substitute for professional tax aid. This method for tax help with IRS returns was criticized in January. 13 Republican attorney generals sent a letter to Yellen with their concerns. Especially looking out for vulnerable citizens. Specifically saying that there was an “obvious conflict of interest when the IRS acts as tax preparer, filer, and auditor.” To pull a related example from the technology field, allow me to present Google. Antitrust cases and lawsuits seem to follow them everywhere they go. It’s because they control online advertising, search, and news. Their position is extremely profitable but questioned as favoring their own self-interest. Not that of the individual internet user. Replace Google with the IRS and you can see the attorneys issue. There are situations where “free” options don’t make sense. And an expert touch is beneficial. Cases: Audit representation Tax penalties Unfiled returns Paying back taxes As a tax specialist, I normally recommend payment plans and installment agreements. Over Offers in Compromise (OIC). Types of installments: Guaranteed Streamlined Partial payment Non-streamlined Next, I’ll explore why your case should be handled by a pro. Why Outside Tax Resolution Services Are Needed Misleading marketing can lead you to believe that tax software is the answer to all your woes. TurboTax is one example. Found to have violated the Federal Trade Commission (FTC) Act, their parent company Intuit is in hot water. Don’t forget about their main competitor H&R Block. Since February, the pending case has been marinating before FTC regulators. Because of this controversy, count the costs before adopting these applications. Now let’s look at some meaningful statistics directly from the IRS: It can be expected that almost 5% of Americans won’t file each year In 2020, the total number of tax liens was 291,081 A tax lien is a claim on both assets and property at the federal level. Two ways to remove this obstacle: Fully pay the money you owe to the agency Reduce your long-term payment plan in a timely manner Other tax specialists and I normally are called on after notice is received. But as with most tax resolution situations, timely action is advised. Dealing with the IRS is super low on most people’s order of enjoyable activities. Working with an outside party removes this anxiety. Through a power of attorney (POA), we advocate on your behalf. Beyond representation, other rights granted to us: Dispute application of the law and facts Accept delivery of notices and communications Collect specified tax documents/information Wrapping up, it’s time to finally rid yourself of this burden. Blue Slate Accounting Tax Resolution Specialist Something is missing from the accounting field. And no, it isn’t incomplete records. It’s a human approach to personalized tax resolution services. In the age of artificial intelligence, it’s even more needed. If you want to know the truth, it’s one of the reasons we opened in the first place. To re-insert humanity into the industry. Zelienople, PA is our home, but we’ve worked with businesses and individuals across this great nation. Aiding their arrival back to good standing with the federal and state governments. A highly prized state to be in. We’ll never do anything illegal, just whatever we can to save you money! Our small, but dedicated team of certified tax professionals and an IRS Enrolled Agent assist with: Preparation of unfiled income tax returns Penalty reduction Offers in compromise Payment plans Financial hardship plans Wage garnishment/bank levy releases Audits IRS appeals Basically, anything unamazing hanging over your head. In terms of taxes at least. We can clean up the debacle of that unorganized box of tax documents. For a monthly fee, we can counsel you on deductions and breaks to use next time. Our concern for you even trickles into our off-work hours. Offload your tax resolution needs today. And take the first step towards reclaiming your joy and happiness!

Most of the mail you receive immediately ends up in the trash. Then there’s some that you’d love to dispose of. But I’d advise against it. An example being post-Coronavirus collection letters. I want to shed light on their arrival in droves. And whether you should be concerned. Keep reading to learn why the IRS temporary collection delay resolved. Plus, how to deal with it. IRS Stay of Collections Ends IRS collections were put on hold in March 2020 via the People First initiative. At the time, former Commissioner Chuck Rettig stated, “We are temporarily adjusting our processes to help people and businesses during these uncertain times. We are facing this together, and we want to be part of the solution to improve the lives of all people in our country.” Top areas of tax relief: Installment agreements Offers in Compromise Specific methods for redress experienced a dip in usage. Halted services: Audits Field collection Automated compliance notices Mainly, the agency chose to focus on sending out stimulus payments. But other reasons factored in. Among them: Remote work caused disruptions Record number of phone calls 35 million unprocessed returns (2023) Between 2019 and 2022, business and individual tax debtors increased by nearly 11% . At the same time, IRS revenue field officers held off on many new lien and levy penalties. Officials attempted to resume this process in summer 2021. However, growing service needs put a stop to that. Although we saw IRS collections suspended, work in the field began once more in 2022. Expect some of the 87,000 officers Biden hired to direct their energy towards this effort. The maligned agency wants to change their image. One step in this direction is the creation of the Alternative Dispute Resolution Management Office ( ADR ). Goals: Conclude disputes sooner Clarify current guidance By improving internal collaboration, they believe overall program use will see a notable boost. Taxpayers can expect this move to enhance the IRS’s ability to demand repayment. Next, I’ll address weapons in their arsenal. Power of the IRS Collections Division Enforcement is something the IRS is proficient in. Just ask Microsoft . They compel action through certain tactics. Such as mushrooming interest and penalties. It doesn’t stop there. IRS collection options: Liens Levies Allow me to break them down a bit. Tax Liens A federal legal claim on both assets and property, tax liens place the IRS at the front of the line. In terms of creditors. The other guys must wait for a chance at restitution. Should you seek additional financing, expect a barrier. Whether for a home loan or another type of funding. It’s true that they are difficult to lift. Even a Currently Not Collectible (CNC) status won’t alleviate this debt. But it’s not impossible. Ways to annul your lien: Money owed is paid in full Prompt reduction on a long-term payment plan Over time, consistency in payments will provide a way out. Tax Levies Instead of a legal right, as with liens, tax levies are an actual claim on your possessions. Prior to enforcement, you should receive a collection notice stream. Including an initial payment request, several reminder letters, and a notice to levy. A final notice of intent to levy puts you in the “penalty box.” You then have 30 days to pay in full or sign an agreement. Possible next steps from the IRS: Zero out your bank account, effectively closing it Deduct a specific amount from your paychecks Acquire and sell any owned property (non-primary) If a balance still isn’t met, wage reduction may continue. Worst case scenario is another levy showing up in your mailbox. Here’s some semi-good news. The best-case scenario is an amount over the sale of your property being credited to your bank account. A small victory is better than no victory, right? Passport Revocation For all you world travelers out there, 2021 saw the authorization of passport revocation. Courtesy of the Department of State (DOS). Another option is denial of your renewal request for various travel documents. You must have a seriously delinquent tax debt to experience this unfavorable outcome. Even if you prefer to remain stateside, the fact of this power being granted to the government is slightly unnerving. Moving on, I want to offer a healthy dose of encouragement. Ward Off IRS Tax Collections At our firm, I’m seeing collection letters from 2-3 years ago. And now for the promised optimism. I’m finding that some are either: Incorrect Already paid So, seeking professional tax resolution might provide the peace of mind you long for. Here’s another fact. When the 2023 tax season ended, average refunds were down by more than 7%. The cutback of tax benefits tied to the Coronavirus are a root cause. Odds are, this is news to you. Use this to your advantage. The right adjustments to your tax strategy can remove you from the balance-due filer group. Plan ahead while being the first to hear of new changes to the Tax Code coming from Washington. Other perks of tax help: Avoid an audit in the first place Quickly spot IRS errors Internal Revenue Manual (IRM) and Internal Revenue Code (IRC) knowledge Add an advocate before the IRS. Someone fluent in “taxspeak.” Since we’re on the subject, I’d like to throw my hat in the ring. Blue Slate Accounting Tax Resolution Specialist Something is missing from the accounting field. A human approach to personalized tax resolution services. Zelienople, PA is our home, but we’ve worked with businesses and individuals across this great nation. Aiding their arrival back to good standing with the federal and state governments. Our small, but dedicated team of certified tax professionals and an IRS Enrolled Agent assist with: Preparation of unfiled income tax returns Penalty reduction Offers in compromise Payment plans Financial hardship plans Wage garnishment/bank levy releases Audits IRS appeals We can clean up the debacle of that unorganized box of tax documents. For a monthly fee, we can counsel you on deductions and breaks to use next time. Offload your tax resolution needs today. And take the first step towards reclaiming your joy and happiness!

It’s a popularity contest. But not the type you’re thinking of. This one involves a three-letter agency. And regular folks like you. The Internal Revenue Service is aware of its status among taxpayers. Regardless, they are looking for ways to improve their image. Let’s see if they’ll make the cut. IRS Process Experiencing Dwindling Usage Earlier in the month, the IRS’s National Public Liaison meeting took place in Washington D.C. Among the topics was the alternative dispute resolution (ADR) process. I previously touched on this subject. More specifically, the creation of a new branch under the agency’s Office of Appeals. The tax resolution unit focuses on closing accounts which want to avoid costly litigation. From settlement to mediation, they are incentivized to satisfy both parties. But there’s a problem. At least from the perspective of the IRS. There aren’t enough takers who want to engage with this method of dispute conclusion. And officials have seen usage continue to plummet. So, federal decision makers assembled to encourage use of the system. Hoping that a cross-functional team could generate unique solutions. Businesses across this nation have found success with this approach. However, there needs to be an established culture of collaboration. Before this team can solve problems. Traditionally this has been harder in the government sector. Mainly due to red tape and competing priorities. Why they want it to work: Studies reveal mutual compliance Cases finalized sooner Perhaps non-adoption of this tool is tied to something deeper. A misalignment with the values of everyday Americans. Next, I’ll cover reasons for this discrepancy. Barriers to ADR Use Might Be Self-inflicted The National Taxpayer Advocate’s 2023 report to Congress highlighted a relevant fact. Trust in the IRS Independent Office of Appeals is low. One of the complaints lies in their lack of independence. Go figure! Appeals Officers (AOs) lack autonomy for decisions Absence of transparency for settlement standards System applies broad view on individual cases Decision Maker Complication Through observations and data, they found that AOs have reduced independent authority. Leading to confusion around their intended role in the settlement process. A second player may be to blame. Appeals specialists. Examples: Technical guidance coordinators Subject matter experts Working just out of view, they take a different approach than their peers. Involving them can restrict the authority of AOs to settle. Defeating the original purpose for their hiring and frustrating taxpayers. A similar example I can think of is “independent” fact-checkers on social media. Users can’t appeal to these individuals. And the platforms themselves must trust the determination. Muddled Standards for Settlement Another point of contention deals once again with Appeals specialists. This time, it’s their refusal to approve a settlement. But the decision, although unwelcome, isn’t the main source of grievance. Their reasoning is. The report found that these individuals denied cases when they, “deviated from undisclosed, nationwide settlement parameters.” Zoom in on the word “undisclosed.” And you’ll understand why taxpayers and tax professionals cite a lack of transparency. Systems Missing Personal Touch A final problem rears its head when settlements involve coordinated issues. Plenty of practitioners see taxpayers reluctantly choose litigation over an IRS appeal. Why? They believe impartiality is more likely to occur in court. A tax court must consider facts and circumstances unique to that case. An approach that some tax professionals suspect isn’t happening at the Office of Appeals. Regulations may constrain their ability to deliver a custom approach. But without the IRS dispelling this speculation, we’re left wondering. Let’s set aside this issue for now. Because you’re here for solutions. With any negotiation, compromise is key. Which leads me to a lesson from another field. Perspective-taking is a sales tactic. The aim is to determine what the other party is thinking. Having accomplished this, you boost the odds of walking away feeling good. Good in terms of not sacrificing your own interest for that of the other party. Should you decide to engage with the IRS for your outstanding tax balance, wise counsel is essential. I’ll explore this more next. Professional Help Smooths Out Tax Resolutions Beyond helping you avoid an audit , a tax resolution specialist can stand in for you. Think of them as part of your team in a wrestling match. Tag them as needed. You won’t have to deal with the collectors directly. Freeing you to reinvest that time “currency” into earning the capital needed to fulfill your debts. Extra perks: Helps you wade through confusing IRS practices Advocates for a fair deal Applies Tax Code expertise to your situation Non-industry folks normally find the language of taxes perplexing. Your ally acts as an interpreter. Because they deal with both the IRS and public. Having participated in numerous tax resolution disputes, their negotiation skills are invaluable. Because the amount you are responsible for isn’t fixed. That’s right. Top options at their disposal: Installment agreement Offer in Compromise (OIC) Delayed collection The first two are more advisable as they offer a bit more flexibility. I want to unpack an OIC for a minute. It’s an agreement that settles your debt for less than you owe. The IRS website relays that you should entertain this choice after expending all others. Say that’s the case. A lump sum or periodic payments with an initial amount down will be part of the agreement. Factors they consider: Income Expenses Assets Capacity to pay Tax help relief is real and attainable. As is that “debt-free” feeling of joy. You’re now ready for an important first step. Blue Slate Accounting Tax Resolution Specialist Something is missing from the accounting field. A human approach to personalized tax resolution services. Zelienople, PA is our home, but we’ve worked with businesses and individuals across this great nation. Aiding their arrival back to good standing with the federal and state governments. Our small, but dedicated team of certified tax professionals and an IRS Enrolled Agent assist with: Preparation of unfiled income tax returns Penalty reduction Offers in compromise Payment plans Financial hardship plans Wage garnishment/bank levy releases Audits IRS appeals We can clean up the debacle of that unorganized box of tax documents. For a monthly fee, we can counsel you on deductions and breaks to use next time. Offload your tax resolution needs today. And take the first step towards reclaiming your joy and happiness!

Some taxpayers can relate to a scene in Disney’s “Zootopia.” It features sloths manning a DMV office. These folks would simply swap it out with the Internal Revenue Service (IRS). But its commissioner Danny Werfel is on a mission to change that. With a new branch in their Office of Appeals. Allow me to translate this news for your tax resolution purposes. New IRS Tax Resolution Unit Aims for Speed The main goal of this Alternative Dispute Resolution Management Office (ADR) is to accelerate tax resolutions . They are “committed to providing taxpayers who wish to resolve their issues without litigation a choice of early resolution options,” stated Werfel, and “ensure taxpayers are aware of these options.” Why it’s advantageous: IRS can reinvest time elsewhere You can get on with your life It operates outside of the usual litigation process. Administrating and managing cases before they create more headaches for both parties. Operating closely with stakeholders, legal professionals, dispute parties, and others, the office ensures fairness and efficiency. At least that’s the aim. General methods: Negotiation Conciliation Arbitration Mediation There’s a difference between negotiation and conciliation. The former is direct communication between parties, while the latter is handled through a third-party. Specific offerings: Fast-track settlement Post-appeals mediation Fast-track mediation Rapid appeals process Updates to the first couple include removing barriers to access and piloting other changes. Such as: Clean up current guidance Wrapping up disputes earlier IRS Sees Dip in Use of Programs Collaboration is planned between this new department and their business operating divisions: Outreach and education Mediator support and training Data collection However, these improvements won’t replace the established appeal process. This move comes as a declining number of people are using their programs. One could infer that is a good sign for taxpayers. Perhaps less are finding themselves at odds with the agency. Or more are locating reputable experts to guide them. Namely, tax professionals who specialize in wrapping up these types of situations. Statistics on the exact number of people requiring these services are tough to find. But the IRS reported that at the end of fiscal year 2022, there were close to 11.4 million delinquent filers. An increase of almost 18% from 2021. So, there is still very much a need. We are in the digital age. Leading to a large disparity between available tax resolution services. As we continue, I’ll contrast the two present selections. Comparing Tax Help Online and in Person During a March speech at American University, the IRS commissioner identified the whale in the room. That the federal revenue service is unpopular. Inefficient return and refund processes. Drawn out wait times. He didn’t deny the difficulty in changing this perception of the public. His hope is that a more digitized agency will shift the needle. Werfel stated, “We’re catalyzing this transformation because a digital-first IRS is a generational imperative. It’s how most taxpayers want to interact with us in the 21 st century.” He added that the eventual goal is to allow someone to complete all their interactions without speaking to a human. The Inflation Reduction Act of 2022 is funding this evolution. In case you missed its passage, the government took aim at three areas: Decreasing inflation Reducing family costs Fighting climate change Okay, the last one makes no sense. But the other two seem like relevant issues. Whether the massive investment helps as stated is to be determined. I’m not holding my breath though. Computerized benefits per the federal agency: Improve effectiveness of in-person assistance Hold the wealthy more accountable They are unsurprisingly motivated to collect $520 million from millionaires who owe them. Digital Tools Aren't a Replacement for Humans Don’t be surprised if the IRS’s foray into digital includes AI. Scratch that. Count on it. I’m not a fan of artificial intelligence because it’s error prone. For our purposes, let’s imagine a scenario. Taxpayer Bob is incorrectly flagged as being delinquent. Courtesy of the machine speeding through masses of data. One of the thousands of newly hired IRS agents knocks, or better yet, breaks down his door. Should the agency determine a blunder was made, an apology won’t exactly cut it. You may be saying this sequence of events is implausible. Maybe thirty years ago. Not in today’s America. Chatbots and other supposed time savers might be okay for simple tax issues. Unfortunately, money owed to the IRS doesn’t fit into that category. It needs the human touch. Without it, the odds of misunderstandings abound. And for your average citizen, this creates unnecessary stress and anxiety. Just as a tax professional should double check every return by hand, the IRS shouldn’t outsource sensitive collection to AI. Increased online interactions does free up IRS employees to focus on other encounters. In theory making them more available for your call or visit. Either way, it won’t happen immediately. Going back to Werfel, he compared the effort involved to be a “large mountain to climb.” When tax help relief is needed, you’re assailed with promises from various sources: Targeted advertising Email marketing Social media posts Spam calls/texts All you want is peace of mind . Being inundated with unprompted messages has the opposite effect. As should be true in other areas of your life, I encourage you to seek wise counsel . Rather than spending untold hours searching, I’ve made your exploration a bit easier. Blue Slate Accounting Tax Resolution Specialist Something is missing from the accounting field. A human approach to personalized tax resolution services. Zelienople, PA is our home, but we’ve worked with businesses and individuals across this great nation. Aiding their arrival back to good standing with the federal and state governments. Our small, but dedicated team of certified tax professionals and an IRS Enrolled Agent assist with: Preparation of unfiled income tax returns Penalty reduction Offers in compromise Payment plans Financial hardship plans Wage garnishment/bank levy releases Audits IRS appeals We can clean up the debacle of that unorganized box of tax documents. For a monthly fee, we can counsel you on deductions and breaks to use next time. Offload your tax resolution needs today. And take the first step towards reclaiming your joy and happiness!

“This one click will release torrents of cash flow today!” Filing season can be confusing. Without social media posts and hashtags providing another layer of mental clutter. Solution? Pay attention to warnings from the IRS about bogus help. Shield your business through education. Which begins right now! Dangers of Social Media Tax Advice for Free For many conservative small to mid-sized business owners, false information on TikTok isn’t new. But other Big Tech platforms are just as guilty. Normally, it won’t cause significant harm if followed. Unless the advice leads to a need for tax resolution services. Beyond owing the Internal Revenue Service (IRS) cash, large civil and criminal penalties are also possible. Tarnishing your hard-earned reputation. Also consider that the average first-year failure rate of small businesses is 21.9 %. This avoidable situation only increases the likelihood of shuttering your doors. Two suppliers of inaccurate tax tips: Scammers Attention-seekers Cyber-literate criminals are ultimately seeking to steal your identity. An increasingly likely outcome for many Americans. How common? In 2022, the FTC saw over 1.43 million cases of this theft. If you or someone you know has been a victim, describing it as frustrating is an understatement. But not every misleading information spreader is nefarious. Some marketers use what’s called “clickbait” to draw your eyes to their content. Cutting through all the online noise. However, its widespread use doesn’t equate to clear-cut unethical behavior. I see this falling into the “bit exaggerated” category. I never like having to tell clients that their excitement is misplaced. Seeing the shift from smile to frown is difficult. Schemes to avoid: Form W-2 Form 8944 Let’s zero in more closely for a minute. W-2 Scammers will tell you to falsify: Income Withholding Employer They claim the e-file withholdings will generate up to five figures. A bold claim. Resist it. Here’s why. The IRS will verify your W-2 figures. Variations: Fraudulent Form 7202 Credits for Sick Leave and Family Leave for Certain Self-Employed Individuals. Here, a credit is promised based upon status as an employee. Instead of your actual status as self-employed. One major detail rules this one out. It was only available for 2020 and 2021 tax years. Moving on. Fraudulent Schedule H Household Employment Taxes. Also disregard this ploy. It deals with a refund sought from sick and family medical leave wages. For made up employees. Yikes! Resist the temptation. And keep a clear conscience. Form 8944 Preparer e-file Hardship Waiver Request. Unless you’re a tax pro, this form shouldn’t be in your return. It allows professionals to file by paper. It won’t magically deliver a refund in the mail. Prevent a $5000 penalty and criminal prosecution by resisting any urge for dishonesty. I know our economic times aren’t the best. But don’t risk your family’s future. There’s a better way. Business Tax Services Are a Better Path Forward A tip for tax advice online. Free doesn’t always equate to “correct or helpful.” That’s what I’ll quickly cover before sharing authentic solutions to maintain good standing with the IRS. A Final Word of Caution Sometimes you’ll see tax suggestions that are accurate at the federal level. But what’s missing is funds owed to the state. I’ve seen some cases where these unmentioned state taxes negate any federal savings. Suspicious omissions. Which usually means that your best interest isn’t being factored in. Now we can get into reputable sources of tax guidance. Trusted Aid for Your SMB IRS Commissioner Danny Werfel states, “There are many ways to get good tax information, including @irsnews on social media and from trusted tax professionals. But people should be careful who they’re following on social media for tax advice.” The government agency suggests their online hub of IRS.gov for verifying what you come across. Specifically: Double-checking facts Filling out forms correctly Locating other federal websites Going directly to the source is always warranted. They furnish good advice. But still not the best. Your safest bet will involve a financial investment. Handing off tax preparation to a pro . The top reason to do so is scalability. Insulating your operation through expansion. Furthering your practical legacy to children and grandchildren. Practical in terms of financial stability. Since the goal every tax season is to break even, not loan the government money, outsourcing is effective. Extra Evidence for Adding Expertise Beyond growth, you can enjoy other perks. Additional ways their protective umbrella helps your business: Decrease risk of errors or penalties Increase deductions/credits Ensure compliance with complex tax laws Provide direction for future filings Tax prep software isn’t perfect. Neither are the companies that provide it. Despite these true statements, it still offers benefits. Particularly in the hands of a tax professional. Because they should be double checking everything by hand. Your state has credits and deductions it chooses not to advertise. A hired expert can find out if you qualify. Reducing any tax burden. Neither the Internal Revenue Code (IRC) or Internal Revenue Manual (IRM) are considered light reading. You can rest easy knowing that you may never need to crack them open. That’s something your outsourced help is responsible for. They are intimately familiar with the specifics. Even if you owe this year, it doesn’t mean you always will. An expert guide assists in the creation and exercise of your strategic plan. Speaking of those proficient in this area, allow me to wrap up. Blue Slate Accounting Tax Advice for Small and Mid-Sized Businesses Something is missing from the field. A human approach to business tax services. Zelienople, PA is our home, but we’ve worked with SMBs across this great nation. Whether that’s aiding their successful filing or dealing with an IRS audit. Our small, but dedicated team of certified tax professionals and an IRS Enrolled Agent assist with: Federal, state, and local taxes Navigating tax regulations Increasing money you’re legally entitled to Limiting any tax burden Quarterly filings We can clean up the debacle of that unorganized box of tax documents. For a monthly fee, we can counsel you on deductions and breaks to use next time. Your return will be double-checked by hand for ultimate accuracy. Because we strive for excellence just like you do. Offload your business tax needs today. And take the first step towards reclaiming your joy and happiness!