Category Archives: Related Resources
Posted On: 6-13-2017 | Posted By: WK Staff
The Internal Revenue Service (IRS) has announced that tax relief is available for individual and business filers in the aftermath of recent storms and flooding that affected several counties in Missouri.
According to the IRS, individuals who reside or have a business in the following counties – Bollinger, Butler, Carter, Douglas, Dunklin, Franklin, Gasconade, Howell, Jasper, Jefferson, Madison, Maries, McDonald, Newton, Oregon, Osage, Ozark, Pemiscot, Phelps, Pulaski, Reynolds, Ripley, Shannon, St. Louis, Stone, Taney, and Texas – may qualify for tax relief. (It should be noted that the City of St. Louis is not part of St. Louis County and, therefore, has not been designated to receive this tax relief.)
According to the declaration issued by President Donald Trump, the IRS is permitted to postpone certain deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after April 28, 2017, and before August 31, 2017, are granted additional time to file through August 31, 2017. This includes the estimated tax payment due on June 15, 2017 and the quarterly payroll tax returns due on April 30, 2017 and July 31, 2017. Affected taxpayers that have an estimated income tax payment originally due on or after April 28, 2017, and before August 31, 2017, will not be subject to penalties for failure to pay estimated tax installments as long as such payments are paid on or before August 31, 2017.
If you have questions about how this declaration might affect your individual or business’ tax filing status, please contact your WK advisor at (573) 442-6171 or (573) 635-6196.
OTHER STORIES FOR YOU
DO YOU WORK WITH AN ACCOUNTANT, OR A TRUSTED ADVISOR? If your business is small and relatively uncomplicated, hiring an accountant who prepares your tax return and assists with basic accounting functions might work well. However, if your business is growing quickly, has more legs than an octopus, and faces multiple challenges each day, you might need something more – a trusted business advisor.
HOW PLAN SPONSORS CAN MINIMIZE PENALTIES IN A DOL AUDIT. Certain employee benefit plans (EBPs) are required to undergo financial statement audits in order to file the annual Form 5500. WK performs many financial statement audits of employee benefit plans. However, plan sponsors should also beware of another kind of audit: The Department of Labor (DOL) audit. A DOL audit covers some of the same aspects as a financial statement audit but generally goes into much more detail.
DOES YOUR ORGANIZATION HAVE A SOCIAL MEDIA POLICY? Social media can be a powerful tool for not-for-profit organizations to use in promoting their brand, raising awareness and raising money. Just ask the ALS Association, which benefitted from the viral Ice Bucket Challenge in 2014 to the tune of $115 million.
If your business is small and relatively uncomplicated, hiring an accountant who prepares your tax return and assists with basic accounting functions might work well. However, if your business is growing quickly, has more legs than an octopus, and faces multiple challenges each day, you might need something more – a trusted business advisor.
WK’s vision is to cultivate high-trust relationships with our clients so we can serve as your most trusted business advisors. We want you to view your WK advisors as helpers who can guide you whenever you are wrestling with an issue, no matter what it is. With the depth and breadth of resources we have at WK, it’s likely we can help you. But if we aren’t the best source of assistance for your problem, we can refer you to a banker, insurance agent, business broker or other consultant with the expertise you need. Our most fulfilling work comes from solving our clients’ problems in whatever way we can.
An accountant looks back, an advisor looks forward
An accountant could be viewed as an historian, looking backward to help you understand what already happened. Your tax return is a picture of the previous year. Financial statements describe assets and liabilities from prior periods. Bookkeeping functions report activity that has already occurred.
But a trusted business advisor can help you look ahead to future opportunities. How can you minimize your tax liabilities going forward? What can you do to plan for growth, or to plan for the succession of your business? How can you structure your various business entities to minimize risk? We can work with you to ensure you make business moves with intention and advance planning.
Being proactive instead of reactive can save you time and money. For example, we have spent months helping one client unravel an accounting mess, which we are happy to do when it’s needed. But we’d much rather help clients set up their accounting system the right way from the start, so you’ll have the accurate information you need to make better business decisions.
The traits of a truly beneficial trusted advisor relationship
- We encourage face-to-face contact with our clients whenever possible. While we are never afraid to utilize technology to aid in communication with our clients, we think that direct contact is the foundation that best supports the trusted advisor relationship. Seeing you at your workplace and learning about your organization first-hand equips us to help you more efficiently and effectively.
- We provide frequent interactions with our clients throughout the year. We like to see our clients more than just once or twice a year. We like to keep in constant contact with our clients because we know that their concerns constantly change. We want you to feel comfortable contacting us when you need advice, no matter the size of the problem or when it arises.
- We ask questions, and we listen. When we get together with our clients, we typically like to start by asking, What keeps you up at night? We want to know the issues you are most concerned about so that we can help address them and help mitigate your fears.
- We bring ideas to you. By staying abreast of trends in your industry and the latest legal and regulatory changes, we can help you take advantage of available tools. Whether we’re communicating in person, by phone, or via our Client Alerts and newsletters, we want you to be aware of what’s new. More than once we’ve heard a new client say, “You’re the first person who has ever mentioned this to me.”
Let us match you with a WK advisor
The members and associates at WK are passionate about the work we do. We derive a great deal of personal satisfaction from helping our clients be the best they can be. By helping you fulfill your needs as a business owner, we find fulfillment ourselves. So, if you are ready to work with a trusted business advisor, let us know a little about you, and we can match you with the WK advisors that best fit your industry, your needs and your personality.
Visit our WK People page, email us, or call (573) 442-6171 or (573) 635-6196. We can’t wait to get started!
OTHER STORIES FOR YOU
IS AN S-CORPORATION RIGHT FOR YOU? S corporations have become a popular entity of choice for many operating businesses. It is a “flow-through” entity, meaning that it passes all its income and losses through to its shareholders without self-employment (SE) tax or the “double-taxation” facing C corporations. But before you make the leap, you should know the requirements and tax consequences of organizing as an S corporation.
HELP EMPLOYEES SAVE FOR RETIREMENT WITH AUTO-ENROLLMENT AND AUTO-ESCALATION. Until a decade ago, employees had to affirmatively choose to participate in a company’s 401(k) plan, and the onus was on employees to understand the plan and determine an effective saving strategy based on their individual goals. However, the Pension Protection Act of 2006 gave employers the ability to jumpstart their employees’ retirement savings through plan features including auto-enrollment and auto-escalation. Plan sponsors that aren’t utilizing these features should consider whether they are right for your plan.
IS THE WORKER AN EMPLOYEE OR AN INDEPENDENT CONTRACTOR? The determination of whether a worker is properly classified as an employee or an independent contractor is an important issue, as the Internal Revenue Service, Department of Labor, state agencies and the courts continue to step up enforcement.
Find K-1 instructions for S corporations, partnerships and fiduciaries here.
Do you ever wonder how long you should keep old financial records?
Williams-Keepers LLC has developed a Record Retention Schedule that can help you determine how long you need to keep bank statements, deeds for property, tax returns and other financial documents.
- The timeframes included in the schedule are estimates, and the actual amount of time can vary according to the content of specific documents or the nature of the business with which they are associated.
- WK recommends a consultation with a tax professional or financial advisor to help you make an accurate determination about retaining specific records.
The IRS released final Repair Regulations in September 2013 to provide guidance on which amounts paid for materials and supplies, for repairs and maintenance, and for purchases of assets can be expensed and which must be capitalized. The final Repair Regulations apply to tax years beginning on or after January 1, 2014.
Helpful Repair Regulation Resources
- CCH Tax Briefing: IRS Releases Comprehensive Repair/Capitalization Final Regulations
- CCH Tax Briefing: Analysis of Comprehensive Repair/Capitalization Regulations
- Slides: Capitalization of Tangible Assets
- AICPA Repair Regulations Q&A
- Accounting Policy for Capitalization of Tangible Property Expenditures
Previous Client Alerts
Many tax advisors believe the Repair Regulations are the most dramatic changes in tax law to affect for profit businesses since the overhaul of the Internal Revenue Code in 1986. Complying with the law will be burdensome. Not only will many taxpayers need to file Form 3115, Application for Change in Accounting Method, for each accounting method change, but the filing will also need to be done for each separate entity, or trade or business.
WK advisors have completed many hours of research and training in order to learn the new concepts contained within the Repair Regulations. We’re posting some of the most relevant articles and resources below to help you better understand the Repair Regulations.
Please contact your WK advisor for additional guidance specific to your situation.
Some privately owned companies may not need audited financial statements – a less complicated and less costly compilation or review could fulfill your requirements. What are the differences between the three levels?
- A compilation engagement is typically appropriate for a small, private entity with no lenders or others who rely on financial statements. Compiled financial statements are usually for internal purposes and the information is provided by management. Footnotes are not required. The CPA offers no assurance and does not have to be independent.
- A review provides limited assurance from the CPA on the financial statements provided by management. Footnotes are required. Reviews could be appropriate for private companies who want some assurance that the financial statements are free from obvious errors, have minority or inactive shareholders, or have lenders or others who rely on financial information. The CPA must be independent of the client.
- An audit is a report that provides the highest level of assurance that financial statements prepared by management are fairly presented in all material respects in accordance with generally accepted accounting principles. Audits are often desired or required by any public or private entity such as businesses, not-for-profit organizations and governments. They can be required by lenders, insurers, by-laws, funding sources or regulatory bodies. In addition to using information supplied by management, the CPA conducts “search and verification” procedures such as observing inventory, confirming receivables, testing selected transactions, examining supporting documentation and gathering information from outside sources. While an audit provides a reasonable level of assurance that the financial statements are free of material misstatements or fraud, it does not provide a guarantee of absolute assurance. The CPA must be independent of the client.
Click on the links below for helpful information from the DOL, IRS and the AICPA’s Employee Benefit Plan Quality Center. Most items are in PDF format.
Section 403(b) plan primer
If your organization sponsors a 403(b) plan that is subject to ERISA, Department of Labor regulations subject the plan to the same Form 5500 reporting and audit requirements that current exist for 401(k) plans. Williams-Keepers LLC can prepare the required IRS filings and perform a high-quality audit efficiently and in compliance with the DOL’s requirements. Employee benefit plans are a significant practice area at WK, and we commit time and resources to staying current on legal and regulatory changes.
In 2007, the Treasury Department and the IRS finalized the first comprehensive 403(b) regulations since 1964. The intent of the regulations was to move the regulatory framework of 403(b) plans closer to that of 401(k) plans. Highlights of the new regulations addressed: (1) plan documents, (2) contract exchange and transfer rules, (3) timing of deferral deposits, (4) universal availability rule and (5) plan termination.
Beginning in 2009, employee benefit plans established under Internal Revenue Code Section 403(b), covered by the Employee Retirement Income Security Act of 1974 (ERISA) and sponsored by charitable organizations are subject to the same Form 5500 reporting and audit requirements that previously existed for Section 401(k) plans. The amended regulations issued by the Department of Labor eliminated the exemption previously granted to certain Section 403(b) plans from the annual Form 5500 reporting, disclosure and audit requirements under Title I of ERISA.
Section 403(b) plans covered by ERISA (generally, plans sponsored by charities and schools but not those sponsored by religious organizations or governments) that have 100 or more eligible participants are required to file audited financial statements beginning with their 2009 Form 5500 filing. Smaller 403(b) plans with fewer than 100 eligible participants will be able to use a new Short Form 5500 and will be eligible for a waiver of the audit requirement.
Factors that could make the preparation of the financial statements and Form 5500 more difficult might include having multiple third-party administrator (TPA) vendors (non-exclusive administration of the plan), orphan contracts (old accounts and contracts that were not transferred to the current TPA), “missing” participants, participants with multiple annuity contracts, or historical plan records that are nonexistent or not readily available for previous years.
WK has the expertise and the experience to help you meet your requirements. Contact us at (573) 442-6171 or (573) 635-6196 or via e-mail at firstname.lastname@example.org to learn more.
- Amended DOL regulations (PDF)
- DOL Field Assistance Bulletin No. 2007-02 (ERISA Coverage of 403(b) Tax-Sheltered Annuity Programs)
- DOL Field Assistance Bulletin No. 2009-02 (Annual Reporting Requirements for 403(b) Plans
- DOL Field Assistance Bulletin No. 2010-01 (Annual Reporting and ERISA Coverage for 403(b) Plans
- IRC 403(b) Tax-Sheltered Annuity Plans
- Publication 571, Tax-Sheltered Annuity Plans for employees of public schools and certain tax-exempt organizations (PDF)
- 403(b) plan participant brochure (PDF)
- 403(b) plan participant brochure (PDF)
- Designated Roth Accounts under a 401(k) or 403(b) plan (PDF)
- 403(b) Plan Checklist (PDF)
- Check-up for 403(b) Retirement Plans
WK is committed to excellence in our audit practice and undergoes a peer review, conducted by outside CPAs, every three years.
In addition, WK is a member of two AICPA divisions that are designed to help ensure high quality audit services – the Governmental Audit Quality Center and the Employee Benefit Plan Audit Quality Center. If your government entity or employee benefit plan requires an audit, we encourage you to visit these sites and access the free resources available to auditees, such as internal control information, single audit tools and practice aids, and Yellow Book resources.
If you are interested in personal tax, estate planning, retirement planning, residential real estate and other money matters that affect you and your family, we recommend the Values newsletter.