The IRS has a partnership with ten leading tax preparation software companies that allows users with income of $69,000 or less to use their Free File Software program — though fees for state returns and/or e-filing will apply, and the service is not available for all tax forms.
(As a tax preparer, I feel an obligation to point out that how much money a person makes rarely correlates to their being qualified to self-prepare tax returns, and that there are many situations when working with a qualified and responsible CPA or EA will be a much better decision. However, if you are going to be preparing and filing your own taxes anyway, why not take advantage of the Free File program if you meet the requirements?)
Free File Software provides free federal tax prep and e-file for taxpayers. Select a brand-name software program, create an account, and then the software guides you through return preparation.
Use free brand-name software to prepare and print.
Software guides you through return preparation.
Need Help with an error or the software? Contact the company for free customer service.
State return preparation and e-file is available for free but fees may apply.
More than ever before, people can work where they want, when they want. Research shows that flexible work allows people to take better care of themselves and spend more time with family and friends. Conversely, research also indicates that just the expectation of receiving work emails after hours can cause anxiety and stress -– not just in the worker, but in members of their family.
“The first step toward establishing boundaries is to realize that you need to take responsibility for setting them. Often, the biggest enemy is ourselves – not the technology, clients or employers. We think we need to be available all the time because we have a mobile device or a home office, but in most cases, it’s simply not the reality – nor should it be.”
I recognize this is true — however, I take great pride and derive fulfillment and satisfaction from my job when I feel like I can be there for clients as they need me. Possibly more importantly, I love being able to take at least one stress off the shoulders of my small-business clients (who are wearing far too many hats as it is) by their just “knowing” that I’ve got their back. So even if there isn’t an emergency, they find themselves with less anxiety, because they don’t necessarily need to anticipate the possibility of having one. They can focus on the day-to-day of running a business.
It feels terrible to find out that a client had a crisis and didn’t contact me, because they “didn’t want to bother” me. I want them to bother me when I’m needed. I want to help make their problems less painful. And chances are, if they’re having an accounting “emergency”, I’ve seen it happen before, with other clients, and I may have some insight on how to deal with it as painlessly as possible. And sometimes, when they try to deal with it themselves, without assistance, it simply causes a bigger problem for all of us down the road.
So what’s the solution? What happens when too many clients have crises simultaneously? What happens when a client feels their needs are time-sensitive and you disagree? And how do you ever take a true “day off (when you know no one can reach you, or there’s no need to even think about your phone or laptop)?
I don’t know the answer — and neither does this article, but it gave me some more ideas to consider. For example, the author discusses “practicing what you preach” if you are setting boundaries with clients:
“Occasionally, I’ll open my laptop outside of my “office hours” to catch up on emails in the late evening. To respect my clients’ time and reinforce my own boundaries, I set up a rule on my email to only deliver emails during work hours. I can compose a response at 10 p.m., but it won’t hit my client’s inbox until 7 a.m. the following day. If you tell your clients you’re not available in the evenings, then you’re sending emails at 10 p.m., clients will start thinking you actually are available at that time.”
That said, I love getting work done in the wee hours, when everything is quiet and I can concentrate with few interruptions. It’s a joy to find a client responding to my emails at that time, bonding over our night-owl tendencies, and working out a solution to a problem before bedtime.
For me, the ideal situation would be not to set these boundaries — but also to make sure that folks know I can’t be there for them 24/7. When I was in the hospital and folks had an emergency, I simply had an out-of-office email response set, explaining my very real and human situation, and asking them to text in the case of a true accounting “emergency”. Everyone was great about it except one client — who I later decided to leave, since it was clear we weren’t a good fit. The experience, though challenging, brought out the best in my staff and my clients.
I recently brought on a client who said that her biggest frustration with her former CPA was poor communication and unanswered calls and emails. I responded and told her outright that there are only four of us in my firm — and three are part-time — and we just don’t have the capacity to respond to emails within 24 hours — in fact, it’s sometimes 48 hours, or a week, or three weeks! But that if she ever had an urgent need, she could always text me, and I’d let her know if it was something I could make happen on short notice… or, if she felt like she’d been waiting on a response that may have fallen through the cracks, that she could always just shoot me a text. She loved the transparency and the setting of expectations, and realized in the end that it wasn’t a quick response she wanted… it was knowing what to expect, and knowing how to respond. And we’re enjoying working together.
So although I disagreed with much of the advice the author of this article had to share — for my own time and place in life at this moment, at least — I definitely saw the value of thinking through the whys and hows of running your own business in an “always on” culture. She closes with some very wise words, which I wholeheartedly agree with:
“If you’re having dinner with your family, leave your phone in another room, turn off your ringer and let calls go to voicemail. When I go to dinner with a client, I leave my phone in my purse or even back in my hotel room so I won’t be distracted during a face-to-face conversation.
The way we honor relationships is to give them time. Protect and honor your relationships with your family, friends, clients and yourself by setting boundaries, communicating them clearly, and turning off your phone and laptop. In an increasingly ‘always on’ culture, we can’t forget the importance of unplugging.”
Each month the City of Chicago offers twice-weekly (Wed & Fri) FREE business education workshops presented by experts in private practice as well as representatives from various city departments. There are quite a few good ones this month — see the list below — and they’re all offered at City Hall (right downtown and near public transit). To register for any of them, email BACPoutreach@cityofchicago.org or call 312.744.2086.
City Inspections – Ask Questions, Get Answers Wed, February 5, 3:00 PM – 4:30 PM City Hall, 121 N. LaSalle St. – 8th Floor, Room 805 Presented by the City of Chicago To operate a successful business in Chicago you need to know what it takes to maintain compliance. Officials from several City departments will provide insight on how to operate safely, stay compliant, help prepare for inspections and highlight the do’s and don’ts of operating a business.
Construction Project Management Fri, February 7, 9:30 AM – 11:00 AM City Hall, 121 N. LaSalle Street – 11th Floor, Room 1103 Presented by City of Chicago Department of Business Affairs & Consumer Protection (BACP) and Department of Planning & Development (DPD) Working with design and construction professionals to make your business dream a reality takes smart planning and organization. Learn the best practices for establishing your schedule and budget, hiring the right professionals and dealing with unforeseen challenges to ensure your project is completed on-time and on-budget.
NO WORKSHOP DUE TO HOLIDAY
2020-02-12
Speak Up and Speak Out: Public Speaking Training for Small Business Owners Fri, February 14, 9:30 AM – 11:00 AM City Hall, 121 N. LaSalle Street – 11th Floor, Room 1103 Presented by Michele Williams MSW, MA, Public Speaking Consultant and Columbia College Speech Instructor You have started or plan to start your own business. You know you have something special to offer but does the rest of the world? Whether it’s giving an elevator pitch, hiring staff, giving a community lecture, talking to a loan officer, or speaking at a National Conference knowing the basics of public speaking will enhance your ability to confidently speak up and speak out. Your speaker Michele Williams has been adjunct faculty at Columbia College for over 32 years and is a public speaking consultant. She has helped over 1,000 people become more confident public speakers. Topics include: choosing topics, types of speeches, organizing the speech, dealing with fear, relaxation, non verbal communication, relating to the audience, use of language and creating new opportunities.
How to Obtain a Sidewalk Café Permit Wed, February 19, 3:00 PM – 4:30 PM City Hall, 121 N. LaSalle St. – 8th Floor, Room 805 Presented by the City of Chicago Department of Business Affairs & Consumer Protection (BACP), Public Way Use (PWU) Unit, Anthony Bertuca Come learn about the Sidewalk Café Permit Application process by attending this informative workshop. We will explain the application process, inform you of all the requirements, and help you get prepared to submit an application. The entire application process may take up to 30 days and the 2020 Sidewalk Cafés Season begins on March 1st.
Choosing the Right Legal Entity: A Small Business Entity Workshop Fri, February 21, 9:30 AM – 11:00 AM City Hall, 121 N. LaSalle Street – 11th Floor, Room 1103 Presented by Chicago Lawyers’ Committee for Civil Rights (CLC) As an entrepreneur starting a new business, you will be faced with many important decisions; one of the first and most important decisions will be selecting the right legal structure for your business. The legal entity you choose will impact many critical aspects of your business, such as your ability to raise capital, how your company will be managed, its tax treatment, liability protection for managers and more. At “Choosing the Right Legal Entity: A Small Business Entity Workshop”, CLC equitable development and small business attorney, Akele Parnell, will discuss the advantages and disadvantages of various business structures including the Sole Proprietorship, C-Corp, S-Corp, LLC, Benefit Corporation, Cooperative Association and more.
What You Need to Know About Your Business & Taxes Wed, February 26, 3:00 PM – 4:30 PM City Hall, 121 N. LaSalle St. – 8th Floor, Room 805 Presented by the Internal Revenue Service (IRS) and Ladder Up This workshop will answer important tax questions for your business including: Are you required to file a tax return? Is your worker an independent contractor or an employee? What will the IRS request during an audit? Are you required to make estimated tax payments? What resources does the IRS have for small business owners?
Digital Mindset for Growth 101 Fri, February 28, 9:30 AM – 11:30 AM City Hall, 121 N. LaSalle Street – 11th Floor, Room 1103 Presented by Grow With Google #GoogleDigitalCoaches with JinJa Birkenbeuel Learn how to change your mindset from analog to digital by translating your entrepreneurial dreams into online action for your brand and your business. We will give guidance on how to create goal-based strategies for your business that will help it become more “discoverable’ and recognized online so you can connect with customers. We will touch on creative branding, social media, YouTube and content strategies. Come ready with your mobile phone to work and learn!
Also, in case you weren’t aware, BACP offers a Business Start-Up Certificate Program, designed to give business owners the essential elements in starting and growing a business. Attend nine workshops at BACP and learn the essentials of business planning, financing, marketing, legal issues, technology and more. Complete the program workshops within six months and earn your certificate, as well as get free advice on your business plan. You can register for the Business Start-Up Certificate Program at any BACP workshop. Learn about the full set of BACP offerings here.
Nice, short, to-the-point article in Accounting Web this week that I wanted to share encouraging folks to outsource their accounting function.
Accounting and finance are often among the first set of duties to be outsourced. These tasks, which require considerable attention to detail and expertise, can help businesses protect themselves from financial and legal hazards while also finding creative methods to improve their bottom line. An outsourced accountant can help your business organize (or reorganize) your books, prepare its taxes, generate long-term financial projections, establish an eCommerce platform and much more.
They illustrate how opportunity costs should factor into your decision, using a simplified example:
Suppose that your business’ accounting responsibilities require 100 hours of work per month. If you consider each hour of work to be worth $40 (or whatever number you deem fit), this means your business’ total accounting costs will amount to $4,000 per month ($48,000 per year). However, if your business could generate $50 worth of revenue for every operational hour that it gains, this means you are missing out on $5,000 per month ($60,000 per year) in positive cash flows.
They do a nice job of outlining the benefits to outsourcing as well:
Cost-effective
Access to expertise
Access to new systems, structures & technologies
In fact, according to Deloitte, two of the most common reasons for outsourcing include improved performance (62 percent) and reduced errors (53 percent). Because only a fraction of business owners have accounting or financial experience, these functions are often among the first to be outsourced.
Big news from the IRS that we’ve been waiting on for a while — how will charitable donations of virtual currency be treated for tax purposes? Forbes summarizes things for us:
The Internal Revenue Service (IRS) has issued guidance for donors (and charities) on the FAQ page of its website. The IRS addressed whether gifting virtual currency to a charity could result in income, gain, or loss. The IRS confirmed that if you donate virtual currency to a charitable organization, you will not recognize income, gain, or loss from the donation. That’s the same result as giving stock or other appreciated assets, which are also characterized as capital assets.
The IRS also explained how to calculate the value of a gift of virtual currency to a charity; addressed the charity’s responsibilities for gifts of virtual currency; and reviewed charity reporting requirements to the IRS.
UPDATED 12/31/2021: Due to a new law, Illinois S-Corps and Partnerships should generally now pay quarterly IL state (not federal) taxes through the business, rather than personally. This post below is about how to pay IRS and IL taxes personally; here’s how to make IL business tax payments.
There are multiple options for paying personal quarterly estimated taxes. You can a) have your tax preparer create vouchers for you, that you then print and mail with a check; b) prepare your own vouchers for the IRS and IL DoR; c) pay online.
As of March 2020, federal and state agencies and the Postal Service are having so many challenges with paper-mailed checks and vouchers that we are encouraging everyone to make any tax payments online.
If you want to pay online, the easiest way to do this is to use IRS Direct Pay and IDOR MyTaxIllinois. Paying online offers confirmation that the payment made it to the agency, reducing the chance of issues down the road, especially if the check is lost in the mail or routed incorrectly in the processing department. It also allows taxpayers to be very clear about what type of tax and tax period are being submitted, again eliminating confusion on the part of the agency and preventing future problems.
If you are paying online, I recommend making payments one day before the due dates, as sometimes it takes overnight for the agencies’ systems to process payments. The funds are usually pulled from your bank account the same day or one day later, so there is very little wiggle room.
You do not have to have an account with either the IRS or IL DoR in order to make payments using these methods.
Internal Revenue Service (IRS)
For the IRS, once you get to the site, select the following options (noted in the screen shot below) — 1) the reason for the payment, 2) the form you would be mailing in if you weren’t doing this online, and 3) the year to which the payment should apply… for example, for 4th-quarter 2019 personal estimated taxes, you’d select the following:
Here’s a nice little video that walks you through the process of verifying your identity.
Illinois Department of Revenue (IDOR)
For the IDOR, go to the MyTax Illinois site (if you already have an account for sales taxes or another reason — do not log in, unless you are making business tax payments), and then click the “> Make an IL-1040, IL-1040-ES, or IL-505-I payment” link (see print screen below).
Then follow the instructions for making a quarterly estimated tax payment; it will make you enter your personal information (SSN, etc.) and ask you what kind of tax payment you wish to make.
It may require you to enter your driver’s license information or your AGI from a past tax return to confirm identity and get your IL-PIN.
Then it will take you to a Payment Information page.
You’ll want to select “IL-1040 Estimated Payment” and enter your tax year. Make sure it’s for the correct year and quarter — this is very important. The example below is for the fourth quarter of 2021.
Then, enter your payment information and click the Submit button.
It will require you to enter and confirm your email address before clicking OK.
Make sure to print the confirmation screen, even though they will send you an email receipt — every once-in-a-while IDOR fails to push the request through, and the amount is not debited or recorded. If you have the print-screen, you can prove you attempted to pay it on-time and that the mistake was theirs.
It will also include a confirmation code, the date/time of the request, the reporting period and amount, and bank withdrawal information. You can click “Printable Confirmation” or just print the webpage to pdf.
Please make sure to note how much you paid to each agency and on which dates — and let your tax preparer know this information as well. Securely uploading copies of the final confirmation screen to your tax preparer or bookkeeper is a great practice, so they can easily store the info in your file.
If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. Ths allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.
If for some reason your employee does not consent to online delivery, or if they do not have an email address, you can print the W-2 and give or mail it to them.
Gusto files the required federal, state and local copies of W-2 forms to the appropriate tax agencies, so you don’t need to order special paper stock in order to print and mail copies of W-2s — you can just print them on regular paper for those employees who may need it.
To recap, there are three methods to issuing your employees their W-2 forms —
Method 1: Enable your employees online access to their Gusto accounts so that they can obtain their W-2 forms electronically.
Method 2: Download individual W-2s, and distribute them to specific employees.
Method 3: Print the entire W-2 PDF bundle, and distribute them to all employees.
As you probably know if you are a regular reader of my blog, I am a big fan of Gusto. They have made many improvements over the past few years, and at this point they really blow away the competition, especially with their QuickBooks Online integration. (I am not being paid to say any of this — I am simply a big fan, having spent way too many years dealing with payroll company frustrations.)
And if you are a client of mine, but aren’t using Gusto payroll yet and would like to — just let me know, or sign up here! You will receive a 15% discount, since I do not accept revenue shares.
For those of you who are not clients of mine, but are interested in using Gusto for payroll, sign up here!
And for colleagues who are interested in offering Gusto as an option to your own bookkeeping and accounting clients, let me know and I’ll introduce you to my rep, Annie Arthur — who is seriously the best.
The Internal Revenue Service announced this week that the official opening day of the 2020 tax season for individuals will be Jan. 27, which is when the IRS starts to accept and process 2019 federal tax returns. You have until April 15 to file your return and pay your tax bill.
This year, taxpayers with adjusted gross incomes of $69,000 or less can use free commercial software by going to IRS.gov/freefile. Free File will open by the afternoon of Jan. 10, although taxpayers won’t actually be able to file their returns until the start of the tax season, Smith said.
I’m getting an awful lot of questions from clients about this, as well as being frustrated with it myself. So I thought now would be a good time to remind you of an old blog post (I’ve also just added this link to my Links page in the Resources section of our website so you don’t have to search the Blog for “Is QuickBooks Down” anymore).
I took a webinar a couple of months ago through NSAC by this same presenter, Steve Dawson of Dawson Forensics. I found his style to be approachable and friendly, and the information useful and applicable to all small businesses, not just cooperatives. He even kindly took the time to speak with me afterwards when I emailed to ask for some follow-up information, and offered his time gratis to a client with a time-sensitive question. Clearly he is passionate about helping others in the field.
This upcoming 1-hour webinar (which I will also be attending) seems like something that would be useful for any small business that has grown enough that it has a need for internal controls, but does not know which ones or how to implement them — as well as for accounting and bookkeeping professionals who would like to assist their small business clients in this area. I am eager to hear actual case examples as illustrations of what went wrong and what could have been done to prevent the issues in the first place.
This session focuses on the most common types of internal fraud occurring in Cooperatives. Actual case occurrences serve as the backdrop for presenting what went wrong, the lack of or failure of internal controls, and what can be implemented now to alleviate these types of occurrences in the future.
