Monthly Archives: May 2016

Herman & Company CPA’s Serves Clients in Delray Beach With An Eye to the Future

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As one of only seven states with no income tax, Florida presents unique benefits when it comes to preparing your taxes. Florida also has a variety of property tax exemptions that can reduce taxes for qualified taxpayers, as well as special exemptions for senior citizens, veterans, and the disabled. With a thorough understanding of financial trends and Floridian taxation policies, Herman & Company CPA’s, PC provides year-round financial services to residents of Delray Beach— whether you own a business, are tired of navigating social security and pension plans on your own, or simply want to minimize your taxes. We are dedicated to guiding our clients in Delray Beach towards maximizing what they have and minimizing their tax bite, as well as providing year-round financial services.

Year-Round Financial Planning for Business Owners and Individuals

In a fluctuating economy, every penny counts. In addition to helping clients prepare their annual taxes, we offer comprehensive, year-round financial support.

Business owners are passionate about the services they provide and products they sell, but sometimes small details can get lost in the big picture and result in substantial losses, or missed opportunities for savings. Herman & Company CPA’s, PC offers bookkeeping and accounting services with an eye not only on the success of your company, but also its future potential and growth. Clients in Delray Beach can be assured that our attention to detail and strategic financial planning will benefit their businesses year-round.

Herman & Company CPA’s, PC also offers services to assist individuals throughout the year. With services ranging from financial and retirement planning to life insurance, pension plans, and budgeting analysis, our experienced team creates personalized services tailored to our clients’ needs. Our roster of satisfied clients attests to the success of our customized financial strategies.

Clerical errors, confusion about current taxation policies, and disorganized record keeping can result in unnecessary financial loss. Herman & Company CPA’s, PC provides meticulous and comprehensive support to ensure that our clients in Delray Beach don’t miss out on opportunities for savings and financial growth, both during tax season and every other day of the year.

IRS does sometimes call taxpayers

By Bankrate

Westchester NY accountant Paul Herman of Herman & Company CPA’s is here for all your financial needs. Please contact us if you have questions, and to receive your free personal finance consultation!

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The Internal Revenue Service has learned a hard lesson about never saying never.

After years of assuring us that IRS employees never initiate calls to taxpayers, a tax preparer told the National Taxpayer Advocate that one of his clients had indeed received a call from the IRS — the real, live, legitimate IRS — without any prior notice.

That “no call without a letter first” procedure is regularly cited by the IRS, including by Commissioner John Koskinen himself, when alerts are issued in connection with the persistent IRS impersonation telephone tax scam.

As the scam, which the IRS and the Treasury Inspector General for Tax Administration say is the largest ever, expanded, taxpayers were advised to ignore purported phone calls from the IRS in order to protect themselves against tax identity theft and refund fraud.

Now, that warning has been turned upside down — at least a bit.

IRS contact confusion

That actual IRS agents do sometimes call taxpayers unannounced has the tax world buzzing. It also has taxpayers worried about how they now can differentiate between real IRS callers and criminal con artists.

The revelation came at a May 5 public forum in Iowa, one of several that National Taxpayer Advocate Nina Olson is holding across the country.

According to the tax publication Tax Analysts, which first reported the real IRS auditor calls, an Iowa enrolled agent said an IRS employee in the state called one of his clients, an elderly man, without first sending the taxpayer a contact letter.

While Olson expressed surprise at the unannounced IRS phone call, others at the forum said the practice was common, at least in the Hawkeye State.

After the Iowa event, Olson told Tax Analysts that an Omaha, Nebraska-based Taxpayer Advocate Service staffer told her that as far back as a year ago, the Internal Revenue Manual advised revenue agents that the preferred method for initiating taxpayer contact was by phone.

Olson gave the IRS’ occasional first-contact calls the benefit of the doubt, speculating that the IRS manual’s call instruction may be old and not revised to account for the current rash of telephone tax scams.

IRS revises phone call procedure

The IRS itself, however, has had second thoughts about its call-first audit outreach.

In statement issued after the Iowa forum, the IRS detailed the differences between a real auditor’s call and one from tax ID thieves. “Generally, phone scam callers are focused on masquerading as an IRS collection operation and demanding immediate payment of money,” said the IRS statement. “These callers typically are not saying they are contacting taxpayers for an audit.”

The IRS also noted that when a legitimate tax agent conducts an audit, an appointment generally must be scheduled to discuss the case. IRS revenue agents do, in some limited in-person field audits, call first to schedule the initial audit meeting. But during those scheduling calls, a real IRS agent will not ask for payment or personal financial information.

Those call-first instances, however, are over.

“In an abundance of caution and in light of pervasive phone scams seeking to extort money from taxpayers, the IRS has decided to adjust this policy for in-person field exams,” said the IRS in its statement. It now will notify taxpayers in this smaller exam category first by mail that their return has been selected for audit and then contact them to schedule audit appointments.

You, too, can help by remaining skeptical of all purported tax calls. If you are concerned about a call ostensibly from the IRS, hang up and contact the agency directly yourself or have your tax preparer do so.

Don’t worry. The IRS won’t be mad that you broke off the call. In fact, the agency suggests the very same thing.

You also should keep an eye on your personal data and credit reports if you have or suspect you’ve fallen prey to tax identity thieves.

Paul S. Herman CPA, a tax expert for individuals and businesses, is the founder of Herman & Company, CPA’s PC in White Plains, New York.  He provides guidance and strategies to improve clients’ financial well-being.

ADP W-2 data hacked in latest breach

By Bankrate

Westchester NY accountant Paul Herman of Herman & Company CPA’s is here for all your financial needs. Please contact us if you have questions, and to receive your free personal finance consultation!

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Identity thieves have their hands on a new batch of personal and tax data after hacking the payroll outsourcing company ADP.

The information is from W-2 forms, the documents workers get from their employers in late January or early February so they can file their annual tax returns with the Internal Revenue Service and state tax departments.

Now crooks have all they need to beat those filers to the punch and submit fake 1040s claiming fraudulent tax refunds.

Personal data used to get into ADP

Krebs on Security website, which first reported the ADP breach, also obtained a copy of a letter that affected U.S. Bank employees received regarding the security issue.

Unauthorized access to the workers’ tax and employment data occurred, according to the U.S. Bank letter, “because ADP offered an external online portal that has been exploited.”

Basically, the crooks didn’t break into the payroll service provider’s site, but rather used workers’ confidential personal information that they had obtained from other sources to register as the workers at one of the firms using the ADP customer portal. Once connected, they simply viewed or downloaded the W-2s.

That same tactic of getting individuals’ information — names, birth dates and Social Security numbers — elsewhere and then breaking into a site with additional data was used by identity thieves who hacked the IRS’ Get Transcript online application. Around 724,000 taxpayer accounts ultimately were compromised.

Small, but possibly costly, breach

Both U.S. Bank and ADP said the actual number of affected employees was limited, but did not reveal exact numbers. ADP also told Krebs that the same fraud was used against “a very small subset” of ADP’s total customers this year.

Of course, the minuscule possibility means nothing if you’re in that small group that was hacked. Once your identity is stolen, you could face big problems.

Tax moves to combat ID theft

On the tax side, if you know or even just suspect that your ID has been stolen, the IRS recommends you send it Form 14039, Identity Theft Affidavit. This puts the agency on alert for your Social Security number and other information that could show up on a fake return.

If a criminal does file a fake return pretending to be you, file your real tax return on paper, attaching a copy of the Form 14039 with your legitimate filing. Also watch for any follow-up correspondence from the IRS about your real or possible fake returns and respond immediately.

Paul S. Herman CPA, a tax expert for individuals and businesses, is the founder of Herman & Company, CPA’s PC in White Plains, New York.  He provides guidance and strategies to improve clients’ financial well-being.

 

Any U.S. tax advice contained in the body of this website is not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.