Mar 3, 2014|
Automatically Generated Transcript (may not be 100% accurate)
Following his paid programming opinions expressed are not necessarily those of this radio station it advertisers or sponsors. Maybe it's time for buffalo means business -- your host buffalo radio veteran and local business that's a good buddy Shula. Buffalo means business is the hour long weekly radio show that spotlights local business. This morning's it was brought you by doctor Bob dental care for worry free dentistry -- your nearest doctor Bob -- And Mike copier fax business technology -- the whole first document diligence. If you look like -- business featured on this show please call 8430167. That's 8430167. Now your host bloody -- -- the winner seems like it's never ending taxis and of course is never ending and it's actually in full swing my name is -- Shula. And this is buffalo means business here -- news radio 930 WB ENAMESP. End 1520. We have a special tech showed today our guest is Serena Wiki managing partner of new Wiki and company CPAs. And they should be interest and has again Maria the first overall Heidi -- time to come and there's this little show and talk about tax third policies it's a great show and it's an. Are to be on the show so popular miss it. But on top that I gotta thank the support of my crew. People only eight people that work and are firm all the much CPAs exit their general manager -- issue. An update something they really make it happen so I feel confident I can walk away that steel that's the secret right -- nothing -- and nothing in amazing about it how do you sleep during taxis and what it would have whatever and he had no working -- company. Now what are the what -- one of them. Biggest months for you what are the much you don't sleep all of we -- we worked efficiently we leave time in our client base for. The types of clients we want to we don't allow ourselves be overwhelmed shall we do fight and get some sleep we do. You know home at a regional or working two or three nights a week puts Saturdays try to take Sunday off so that the body can regenerate -- to. Any getting sharp body sharp mind and that's part of the -- and -- but I I appreciate the fact that you brought that up because CPAs. Tax periods were primarily art my CPA profession. These guys suffer ladies and gentlemen profession suffer physically because of it's it's not it's it's that it that it's a really challenging time. So you're the managing partner of the company let's talk a little bit about your background as a CPA. With no working encompass the Anderson at the 22 largest CPA firm in Western New York. That's right we've got offices in buffalo and in New York City. Client base that pretty much spans all of New York State. And we deal with family owned businesses we do a lot of estate planning. Corporate planning. -- do with high net worth individuals small family run businesses which are so much fun because they offer. A variety of problems and questions that make it worth it for us to get out of bed in the morning registering January through April but the rest of the rest of the years well. They need us and we need that we've evolved that kind of environment. Took and a computer keeps the whole thing interest rate -- and is I mean let's let's cut to the mustard here not a lot of cannot a lot of this is attack showed today are we're devoting the full hour here. On the radio station to. Texas because -- is the time of the year. But there are a lot of misconceptions. And Texas are a lot of people have concerns about auditing their concerns about you know 2014. What is has been so we're gonna talk about a lot of stuff today some -- to get right to the bacon. For some while we were talking off air raid that you have a couple concerns and -- in -- in our culture today in Texas. One of them being. The tax scams Telus Telus walk and a tax scams here in about. But their pressure. Really rose on the day when a client who's up. He's so involved the ease of foreign descent but the nationalized American highly trained professional medical professional. Who retired and he lost his wife your two prior. As result of some mistakes that. You forgot to provide information. He had a little run in with the IRS is -- over your physical that's all gone and behind us. Lo and behold the sport guy gets a phone call angles and panic mode. Because somebody calls -- as. I'm with the IRS I just want you to know. That we're going to take you to tax court ought to pursue the money that you all honesty is what you mean what money do I -- you innings as well it. -- -- these gamers said you'll money because we're -- there's been any returns he should go get an attorney were advising you to get an attorney. Because we are gonna -- you. With a summons and complaint. That'll that'll happen tomorrow because you'll the government. And it was. The client was so unnerved he immediately you know he his fight back was this is why haven't attorney my name is name is ray -- implement stuff I'm not an attorney. But I have the power of attorney on file with the virus that allows me to represent directly. So he calls me up and panic in a phone number gave me a case number game in name. And I'm thinking what is this some new fire rescue the it'll make phone calls like that but you'll money they send you a letter they said you know the letter they sent you look at three that is and then they have collections -- car points. That's that's pretty extreme. After calling the number three times on day one nothing happening and they too are finally got hold of somebody. Explained atom CPA that we should talk to the in an individual. A law that called my client and what I got was a lot of chatter feedback it actually sounded fairly professional. As I started to probe the questions with the person on the other end I let them know that I was succeed PA that I had a power returning on file. That I could identify. Almost any problem for the years prior years in question. And the man. On the phone insisted that sorry I can't talk to about this. This is not something that is covered buyer power of attorney he sounded good. And I was like. No I'm not buying this because at one point during the conversation picked up an inflection in his voice indicating that he was not sure what -- talk about. -- -- And I heard background chatter noise. Indicating that he was calling from -- room full of people on the phone making chemicals. You never hear that Paris collections you never hear any background -- notice of that feature. Well that's the bet the bottom line was I got few I was curious I called a tax attorney buddy of mine. Who separate. They did they are there is some group that is absolutely attacking Western New York with these kind of harassing phone calls. So I just wanna put your listeners ship body on notice. You know tell your mom and dad if you get a phone call like that because it's the elderly that are vulnerable more often than not. It's people off from foreign countries who are not you know even remotely comfortable with our policies. People were not highly educated pretty if you can -- spent thirty years in my practice. This guy was borderline. Almost there. All right if he had just stayed around long enough and you a few more right things to say while he didn't all right so he ran out of gas. And it turned out there was no summits that play no subpoena no court hearing nothing it was a scam but left. The people that you love no so that this can happen I just I call. I wrote to the inspector general. Email that immediately the said distant third virtually nothing we can do because many times these particular phone lines. Are are are nothing more than an uplink to an offshore. Follow up on offshore number. We can't reach it we can't get too. Really so I was wondering is gonna ask you why did this kind of an answer his phone and eroding even. And he doesn't he know that that that can be traced her is that who what is it what does -- -- -- offshore. It might be somebody actually following up. Who was dumb enough to say yeah I'll send you a check for five and eleven dollars and 32 cents what you want me to send it to. I mean it is entirely a big east these call centers these bogus -- and they do make money and they disappear overnight so fast. That the federal government cannot obtain search warrants they can't they -- -- best they can do is is is shut the phone line off. Is her way to tell for sure of people listening if you do get a tax scam phone calls are awaited say. This is a legit -- doesn't the iris do better at all. Our -- they just don't do it bit the IRS. Will never start a collection proceeding with the phone call. You'll never do that you will receive multiple notices. If a mistake was made on your return you will at least received three letters in advance so this will not be news to you. -- -- are if someone does alternate lets you ignored three letters and you do get a phone call. They've all asked to make sure that you are who you say you are and they will know your name address date of -- so security number. They'll know a lot of intimate things about you. That will allow you confirmed that this might be a real situation. And then you have the right to simply say please send correspondents to the correct address that was my old address I got a -- four years ago. And I've moved since then please boarded my dollar and I'll address with my CPA but bloom off never send the money. So that Betsy considers -- first concern here in my notes the second concern that you have. Whereas with offshore bank accounts and foreign bank account report and again because it's -- buffalo issue we talked. About this a little bit last year when when I was on the show. The IRS was in full swing. Prosecuting people with foreign bank accounts. People that would doing illicit things that they were also prosecuting good people. Who hid it maybe inherited money from a mother father and a foreign country. And where melting pot nation it's not unusual. Or. And we're also bleed bleed but up against Canada it's not unusual for someone that likes to say go. Go up to Toronto -- do business up and wrote -- have a small bank account. In Randall can -- -- a foreign country and who are required. The file annual reports with the IRS audit PDF ninety days when he to think for ms. PDF ninety days 22. You have to report to the Internal Revenue Service exists is the accounts and in certain cases. A ballpark number of the highest level the count otherwise that it do so could be deemed criminal act and those accounts could be east. Seized those accounts could be a penalty criminal penalty can be levity it's too. Well one of my. Very good client -- A penalty of something like 5000 dollars on 830000 dollar undisclosed account in India. It. Nothing -- he was holding the money with his brother. It was his mother's money. In India. But because the bank account was titled in part to him and his brother still in India. That was an undisclosed interest to foreign bank account that he had to be disclosed so that's a big issue. And don't make the silly mistake thinking oh well it's only Canada all well it's really small. On OG I forgot about it got to take that particular -- seriously. Because the IRS takes the Treasury Department -- racers why because international accounts. Can be one of the indicators one of the pages. Of terrorist acts. Money laundering. Drug. Drug dealing to be a lot of things that. The money trail all the foreign bank account might lead to of course -- for so. Since since and and also since the big -- target thing over the holiday season. Identity theft that's going to be I mean identity I don't three people personally who had identity theft. In going to rock and the rigmarole of the past three months. I had a a client who unfortunately. Was guilty of some some crime and that's part of cleaning up his life. He came out of prison he filed tax returns stuff like this and everything was fine and dandy news use current use up to date he was doing the right thing. All of a sudden it's a notice from the virus indicating that his tax refund was being withheld. Pending review all of -- certain date. And when we got a copy of the and he showed me competent noticed it had nothing to do with any of the three years with the tax returns he filed. Instead it was part of a -- War someone who obviously you'd hate it stolen his identity he's in prison he's helpless right you can't defend themselves. So hit somebody grabbed somehow found discovered -- security number date of birth. Are made up and address and filed a refund claim. To be sent to an edges Kentucky I've never been a Kentucky. Specter of the previous five years he -- a New York State. For obvious reasons we can prove where he was so the point of the matter is identity theft is a very common problem this country's getting worse by the day. So if you're starting point if you use a professional tax repair and -- -- a partner and organization called digits it'll shameless plug for them but their IP friends and I think for as a company. And they said that tax preparation agencies -- what we call low hanging fruit. Why because. On the computers the text prepared you've got named Andrew -- security number date of birth. -- name -- dependence which bank accounts are what account numbers have been there to be a there's there's there's a result of the gold mine of information. About -- body and I'm. Protects -- computers so you should ask your prepare. You know as a starting point what you do to safeguard my information so it doesn't disappear in the night how do we know that you do have lockdown procedures. How do we know that someone can't access your database. Are you doing the right things for me. And do you have a policy text appear to notify me. If my identity is stolen or fewer. In fact of the matter is if you don't have policy you better have it because the New York State law -- business law requires notification. All of our businesses. To the attorney general's office in the state police fifty day hacking incident involves other people's identities you have to note there's there's several forms filed. So that's a touchy issue on. I wouldn't get you know people -- me what that means I've never gonna file electronically because it's. I don't want my identity stolen by file electronically more likely than that my ideas would be stolen. That is not necessarily true. Because if you were called before mandatory electronic filing before that happened. I think some tax people. Were called a you a text -- or -- paper filed tax returns that were in eighty. Service that are. Run by I think in the state of Pennsylvania. Where they hit tons of mail. Sitting -- -- tax returns. Tax checks all of all of this information. And none of that paperwork had been process. You know a paper tax return can just is easily be stolen. It can be that information can find its way into someone else's hands. By accident and you'll recover that. So I'm indicate can there be he'd get every anything more we can worry about this in this society has a lot of stuff we're here with -- in the Wiki. -- with no Wiki and companies CPAs. Other web site to Wiki -- -- And -- you wanna call at six they won 6367. Will be right back with. Buffalo means business. Here in WB yen and 1520. ESPN. If I told you you can reverse diabetes and stop taking your diabetes medication. If you or someone you care about has diabetes or pre diabetes there's a special free report you need to watch you may have heard about this is all over the Internet eleven diabetes dot com. People who have followed this plan at eleven diabetes dot com reportedly have not only normalize their blood sugar but it stopped taking their diabetes -- it's completely with their doctor's approval eleven diabetes dot com. Is a natural. Drug free approach to reversing diabetes with remarkable results in this littlest four weeks. 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Welcome back to buffalo means business money and his buddies surely your congenial weekly -- stand here with arena Wiki we have a special tech show. Today and -- raised managing partner of new Wiki and company CPAs. Just plethora of information here about whatever one doesn't wanna think about. Which are taxes and stuff like that end and I have a question for you -- ICL lot of people. Our -- a lot of people but a lot of commercials. A lot of things promoting people to do their own taxes. With software. And things like that kind of you know gives everybody the feeling that they can be either own CPA. Let me ask you this -- still a lot of people who self prepare their returns. I would say that there's probably a good percentage of people that are doing yourself first. And I don't necessarily have a problem with them as a whole because they're not part of our target market. Hopefully these of people that have simplified tax returns and you know very simple like short form type people because. The that that the software package is out there. It's it would be pretty hard with the props that they have to this understand the questions cheat and he gave birth any Social Security knee in the edges. If you can answer those three questions right you've got a real problem because it. Enter your W two year federal withholding in your state withholding tax and your gross wages now. Yeah there are people that are all bombs and hit the wrong button on Paul Casey could have potentially in electronic care what scares me more. Of -- prepares it. Won't use excel software package because. One of their big mistakes is Matt Stairs they. You don't do their handwriting spore that math skills are war. At the end of the day either tax calculation -- if it if you got those problems that can't read a text table right you're done. I will tell you after again 3730 years in the business. I would have a hard time actually accurately preparing return without a computer I mean -- some of the software calculus of the calculations are. Unbelievable but on the simple return maybe you can get -- Com. Bear in mind. You have to understand. What you're putting down on paper and once you get past the simple questions the harder issues -- things that are. You know possibly just being alert to. Certain tax rules. One of the classic comments that I made about young. Young college graduates who grew up in the off computer air. A young person comes in and -- maybe start at first you're too and they're preparing tax returns are entering data. And therefore the computer did it must be right. Ironically I can look at acts to look at the data of the high points of the tax return compute roughly the -- outcome in my head. War a piece of paper and that becomes Mike checked my sanity check. But person who's never been exposed to preparing -- by hand. He runs the risk of having the -- -- garbage in garbage out at a fever that a computer so I worry about text -- that do stuff like that and then next thing is. If you get a more complex tax return. And complexity start with something as simple as what is by filing states. And in my head of household in my married filing joint Kidman married filing separate and I really married maverick I'm -- it. You know do we talk in the office these days about the gay marriage issue. And you know how do you interpret that out of state by state basis because federal law hasn't come out with a position on -- yet. So but the IRS will accept the married -- of great -- returned. With with two game with a gay couple which is cool now. Also understand that -- -- writing answers in wrong answers to questions in the software packages. Give you generic questions leaders are villains you know fill in the blank. And and I had I will describe with the commission last year by rocket scientist claims that this guy is a UHP. He is a genius he does stuff with numbers that I've never seen -- and never will be able to replicate myself. But when he tried to prepare his -- return he commingled. The activities of three separate businesses. Using. A software package that was made for that. While because he misinterpreted what the props were about. And that taking tax positions -- return and actually triggered an audit. And when all was said and done for a three year period. He would vote 101000 dollars the -- the penalties. Because you really didn't make good faith effort but it wasn't his bag of tricks that he was comfortable. So those are some of the some of the things that can go wrong size -- in the wrong filing status if you're doing it by hand. I'll make sure that your entering all the 1090 nine's you received if you didn't get a 1099. From say if you're an independent contractors. Are -- to find out. Because sometimes. A business owner like me will pay -- are able if I paid you money. To do some service for our firm I will issue 1099 but what if you didn't see it in the mail. Well you're gonna forget entering it the IRS knows about that tonight bill restate your tax return because you'll omitted information. Armed the other thing that I would ask you to think about is understand. That a number of tax deductions. And allowances have changed you know from 2013. Our 2012 to 2013. For instance the tax brackets for a -- filing joint family have been indexed for inflation. The Social Security base has been adjusted from a 1101001. -- in 2000 while. 113 72013. It's going opponents 171002014. That's -- Also think about all we've got by the way Merry Christmas. Or economic or whatever. What ever gift giving season you like the IRS has come out with a simplified office and home deduction. There used to be this form and we could still use it where you actually articulate which are mortgage interest realist beat Texas are. He utilities your repairs and maintenance and things like that. And what you can do is you fill this form out and if you're using your home office primarily -- -- an office -- primarily. And exclusively. For business purposes in pro rate the square feet of that rule as against. The polish your house and that. Gives you a deduction. But in the process of doing that you're actually giving up on one side of the return. Some of your mortgages is realistic Texas while the simplified options kind of cool because now. Are you gotta go if you use your home X as required exclusively. For business purposes this one particular room. You can take up to 300 feet. Multiplied by a factor of five -- -- and that's a deduction that you can take on your tax return if you'd used for business. Event and I didn't question about that. I have a question about the home office deduction because a lot of people. Is so when you say it it's exclusively has to be. For business aren't so does that mean you can't. Petted dog you can't do what I mean there's nothing you can do other than business. Ironically should say that because our our our staff knows that our office's stock friendly and the so there are some of our partners and managers to bring their dog Ian once and violently we pet the dog so that's okay. You can bet your dog regularly record no Wiki and company is a pet friendly CPA -- -- -- But com. You cannot have. Closet in that room being used as storage for your Christmas ornaments. -- four year summer clothing that's going to be coming out soon so don't you know don't -- -- around the corner be it. You have positive mental attitude about that but -- if you get that stuff in that room. Or in that closet in that room. Or if you've got the the Dresser in that room where you're storing stuff in addition to your desk in your computer knowledge your business files. You'd just violated rule number one it's not used exclusively for business. But I mean don't don't people don't I mean. Don't offices ever have a closet and her horror you know if you go to incoherent corporate park -- -- You know and that's that's kind of a weird funny line it seems to me is an end. Well it does say it does seem a little unfair sometimes it is your right you you would have a coat rack in your office. But you wouldn't have your summer clothes in -- off the street where it. Are you you you brought ups another. Point that I wanted to talk about we have about six minutes. In this segment again we're here with -- Wiki from a Wiki company you're listening to buffalo means business my name is -- Shula. Let's talk a little bit about audits -- who's getting audited now. Com audits body when you during earlier breakeven or saying. Your sense was that the wasn't at least you heard I hear there's guys here are -- -- government cutting back on audits every time I read something that says. There's a last auditors -- There are there as many audits today in my -- and my belief is there's ever been and there even more targeted. Off our firm represents. Wealthy people people with businesses and people with rental property and people with a lot of capital gains activity. And stocks and bonds stuff like that. Guess what those people are ought to targets and the IRS is focusing on them so that's happening but guess what it's not just the IRS anymore. It's New York State. New York State is got. Office audits and they've also got correspondence audits -- global they've never had before. Which yeah is absolutely surprised me. -- and it's. Assuming that's all right. Actually it's not surprising to me because because you're figuring out you know I'm sure there are sitting around in your -- -- and where we in my money for a bought -- trying to open more audits that well that's right but you know to have routine taxpayers audited by New York State. It's really not normal for the longest period of time but. I'm sitting. An increasing frequency of that -- quite an interest at. Scene and it -- got a a couple of those audits and process right now I'm very very very interest in seeing what their turnaround time is with New York State. Because the IRS is pretty good we -- we package up a package sent to talk two correspondence audit. And they turn it around typically in sixty days may -- ninety's tops. With questions and answers and a closing letters should be forthcoming pretty quickly. However some people skip around life. With with weird business practices and you know the kind of slippery. But they never seem to get audited while other people. You know he's cool what's at their water I mean we -- we have a couple minutes in the segment what are the flags for an audit what are they looking for. Hide W two income makes you would absolute target. If you get -- hi hi W two income or gross income of over -- quarter million dollars or more you can probably generally see. About a 4% -- shifts right and the average audit rate is about one little less than 1% of all the returns and file the United States. But a person was over a quarter million dollars of gross income much higher numbers. All right so that's that and again. But why what is it triggered I mean if if somebody's getting paid. RW two K I mean that's that's employee income rate that's the income means that there's deep pockets. Doesn't take a look at the rest the return our other tax positions and return rental property charitable deductions that BB nine cash. Our high medical. Played business expenses that will read an opportunity for the -- probe. And possibly some -- some deductions. You know I mean it just seems it's just seems a little unfair to me that the people that are making that kind of money it. Appeared legitimately and a W two you know. Are are the subject Ali's. Volleys audits you know but he. A bank robber was once asked. Why he robbed banks. Says well it's because that's where the money it's an and that and to that to that extent -- New York State's attitude is. Let's on the people with a deep pockets because of they've taken positions and tax -- like unsupported charitable contributions. Disproportionate amount medical expenses. Hi business entertainment deductions. On unsupported interest expense that they can go after that disallow those expenses and and hit a taxpayer with a good size assessment. And move very efficiently. -- not have to worry about a collection problem if if you're audited once is that. Red flagged them to maybe keep beyond their Christmas list if you are audited once you can pretty much count. -- -- and they've they've. Targeted the additive identified you as being. And I'm not compliant taxpayer because the Levy an assessment against Cubans can significance. On that is an absolute flag that says more likely that I'm gonna get hit again in the next three years on the other hand is the converse. It I get through with a note what they called no change letter. Generally speaking that means that the taxpayer who's who's somebody who follows the rules religiously. And we can -- him as much as we want we're never gonna get another nickel out of let's move on somebody else. Basically if they catch you ones -- Hopeless at your analyst if you could take it to once you're once a liar always a clerk who oversaw the liked -- you can work your way out of out of a bad situation. Sometimes it's -- of Tutsis. -- and and don't confuse an audit with just an assessment -- sometimes people make. You know mistakes sometimes people leave often interest interest -- bank account excellent that that's not an audit that's just correction that's not the in the world. Okay here with -- -- a Wiki Eric tech show from a Wiki and company CPAs. Didn't go to the website Wiki company earned -- Wiki Kodak -- my name is buddy Shula and will be read that with buffalo means. You can see me because of radio and I can't see you because I'm totally blind. My blindness doesn't hold me back but I've tried to steer away during the day because not sleeping through the night. Often I struggled to concentrate and just depot sound familiar you're not alone but this is not a sleep disorders sexually -- 24. Learn about the link between total blindness and your symptoms visit learn more and onto Ford dot com or call 8558562424. Or it's a show that. Addresses the issues of native people their communities their struggle to maintain distinction and autonomy for journalism -- let's talk maybe it would John McCain heard every Sunday evening at nine on ESPN fifteen point eight from Buffalo, New York in the historic homeland of the Seneca bloods talk native -- on the power of ESPN fifteen to one raising powerhouse -- up and -- the East Coast of turtle island Sunday nights at -- be sure to tune into let's talk -- with John -- on ESPN fifteen point. I told you you can reverse diabetes and stop taking your diabetes medication. If you or someone you care about has diabetes or pre diabetes there's a special free report you need to watch you may have heard about this is all over the Internet eleven diabetes dot com. People who follow this plan at eleven diabetes dot com reportedly have not only normalize their blood sugar but it stopped taking their diabetes -- it's completely with their doctor's approval eleven diabetes dot com is a natural. Drug free approach to reversing diabetes with remarkable results in as little as four weeks. Eleven diabetes dot com will save you from being a slave to doctor prescribed drugs. It's easy. Eleven diabetes dot com gives you three specific actions to get your blood sugar under control and the best part is. The main ingredient in solution is a common spice found in most kitchens. Watch the free video for yourself. At eleven diabetes does come watch for free at eleven diabetes dot com get back to quality of your life and free yourself from diabetes medications go to eleven diabetes dot. -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Buffalo means business my name is British below what the rain no Wiki from no Wiki and company CPAs it is tax season. And that's what we're talking about all show long -- buffalo means business. I'd -- couple missed people have about death tax returns and our -- -- open book we got the guy you here today. And I'm gonna ask you just point blank in you you tell me what to think about these things filing a tax return is voluntary. There is no requirement to file a -- her. -- tax invasion. Authors all over the place saying that is. The case but truth of the matter is if you've earned income over certain levels you must file a tax return it's not voluntary. You must pay your fair share the only thing about volunteering your tax is that. You you know an opportunity to self report with some degree of accuracy and honor and dignity. And if you're close enough to write the -- lets you go and you've to you've fulfilled your obligation. If you say I don't feel like doing this type not gonna happen. The -- What about F a extend my return you know on nine demand less likely maybe to have a -- red flag by you know like to be audited if I extend my return now people. Think that just because the ended up in the grouping that was filed after April 15 and remember that is the date despite the fact that we have a tendency to forget that date problem. You must it be if you file after April 15 you have not at all reduce your likelihood applaud at all about -- you increase -- -- in you do not increase it either if you're thrown into the same pool because remember. Most -- don't happen for a year year and a half after the return as -- Soul you're gonna what you filed April 15 to October 15. You may see an audit the following. June July. What about claiming that pat is a dependent. Well it somebody trying to claim their dog for Fido is dependent. I would say that there are probably gonna they're barking up the rock trio wouldn't do it myself. Two people actually try to do that why would they do I get the I get the cast that request can I can I claim my dog as his if you could find a way to get me -- security remembered. Prove that this dog uses part human. And sometimes. Are usually well elements what do they say well -- skies it does go legs are humans. But does he have Social Security number right there about it yeah that's -- okay. I would of someone pays cash -- barter is it not taxable or traceable how to people can -- in with Erica I don't know when people don't think that. Cash can be traced to barred QB trees because. The IRS auditors are so skilled they do lifestyle laws I could part of myself I was blue in the face. And exchange accounting services for cars and -- use of vacation homes and things like this. Alternately IRS would catch. Those types of things because ultimately they can retrace your life and find out what you've done and then they asked questions. That you -- fourth hole I exchange my services for the players. Very easily so when people in the real world say you know he paid -- cash and you know we can lower the price because -- -- -- I mean it. Is so you're saying that. People that -- can still. I I've -- river hearing. Somebody's come to my door asking to do some services. On my house for cash. And I was absolutely floored he'd never -- mean in his life fraud he knows I could have been federally. When an idiot. And people will get caught I mean that your if you remember. It's cloudy and twenty years ago bunch of people that were parking cars on the on the front lawns around. Football stadium. Remember that and New York State sent auditors or was the virus. And they they document how many cars were parked at each football game multiplied by the number of games and went back and -- people's pictures secede. Clean and come. Interest an optimist paid in cash. They -- they got caught. You you use it last year in the showed it that -- -- that something that kind of stuck with me it was about things that we knew. Deposit money yourself in a base that they know certain things. The out. Bank secrecy act -- NC 101000 dollar requirement. If somebody deposits 101000 dollars in cash to bank account. The either have to volunteer that there there's cash transaction and the source of the funds. Or conversely the bank is required in the bank bank security options will follow the -- say on this day. 101000 dollars or better yet. But let's treat -- he'd brought and you know 8 o'clock 10 o'clock 12 o'clock 2 o'clock when he 500 dollars each -- a series of -- transactions. Hitting 101000. And right now. My understanding from law enforcement is that the tracking numbers as low as 3000 dollars. Because. You know illegal activities illegal activities a neutral cash activity. Is is is the foundation for most types of illegal Italy other illegal activity like drug dealing. A smuggling. Com. It tears. So the banks are really uptight about this in the news report that stuff to the arrest people who don't make enough money to they get audited DC have you you've got to return your record 101000 dollars a year. They subject they are absolutely subject and and and once had a taxpayer who was in the cash a cash business. And I will tell you what -- different decisions exact answer. -- didn't return in and she wanted to claim the earned income credit she went to -- gross income down. A below certain trash will likely can't support -- -- -- return because an actress reportedly elect. And we earned it and pretenses and there were. People work work. And claiming deductions for children that read to the regular. What about students today a final return absolutely if their income is over a certain level. Absolutely have to file please don't think it's over 2000 dollars -- the and sometimes I find students working overseas. And like student exchange type situations. They think well I in the money increase increase I don't have to I don't have to report by filing he -- in the eight states not true. In most cases you'll have to file a tax return because -- US it's. What about other paperwork reduction act tell us about that and every time you open up and higher as publication. That tells you how to fill out a form 1040. There will be eighty. Law page in their talk about the paper -- paperwork reduction. And an estimation to complete this particular document three Q1 hour and fifteen minutes aren't and it's. I've never tried it myself but I would ask your listeners ship if you are still do your tax returns he'll finish -- by hand. Please call me up and tell me if you could actually future tax return done with in the a lot of time if you do are up near the enterprise will be candy bar for me okay. It's -- you're saying your can't be done I don't know that can be done but I I think sometimes. Just the time to acquire the knowledge associated with some of these forms. The amount of Reading and depth that has to go into it. Is it's greater than most people think. The average guy right there's a lot of average guys in Western New York the average person an average a woman. They can make some pretty big errors and comes back to bite him. What are some of the big -- at the average folk are Macon. Rental property owners up. Big issue failure to issue 1090 nine's 1099 is reporting form for somebody that you paid more than. 599. Dollars and 99 cents to that is to say once you hit 600 dollars. You have to get that that. A guy who's cutting your grass there. Or cleaning appears no run your rental property you're doing repair work. Give their Social Security number or their -- -- the numbers there -- interest. And issued them a 1099 aunts and copy in the the IRS what they don't wanna give either so security number all of you should probably enter into that question -- question before they start working for you right. Because if they're working off the books. How are you going to be able approve. That you paid in cash. The don't wanna do it typically they'll co processor while. You know to be check payable cash right. Now and the IRS doesn't feel like tracing that person down for a 600 dollar check that the justice -- your deductions -- that that hurts. Report in which which leads to exploit in a rental property or port documentation. If you it. The IRS in New York State is sending out letters during the -- saying. -- credit card statement. Is by itself is not sufficient documentation. He actually have to have the credit card receipt. If I go to. Best -- for example. And gold by a computer. The statements could say in my in my in my thesis statements considered best. But I don't know if you bought a computer there while I don't know if you bought a TV either. Who would be -- -- -- use computers business. Wouldn't be so normal to them and vote sixty its color TV in his in his office would -- the Harris is looking for that. For blowing down that the field. On reported income just as much as missing. Not filing 1090 nines for other people is not reporting your only income properly. If you own multi unit or even single unit rental property you should have looked carefully document laud showing what money came in. From what customers. What contracts if it's if it's vacation rental property. And they have that really I really -- back to the rental contracts -- get for vacation property. Wrong depreciation method and lives on real estate and in fact on the IRS -- just come out with some new rules. For whether or not. Is there to call the tangible property regulations under code section 263. Describing whether -- -- something is a capital improvement or he repair. And one of the things if you have a small business like rental property or some other type of business you should set and a threshold that says. Any expenditures that are incurred that are routine maintenance -- my property under. Over 5000 dollars will be treated as a improvement. Anything below 5000 dollars will be treated as an expense the IRS generally well. If you document that and keep that somewhere a permanent file. They -- respect that as a norm assuming that all other effects may access. But you don't document that. Then the IRS can pretty much bigger number put out let's talk a little bit but Cuba outside sales people that's another. Red flag -- all absolutely in and outside to help people many times like to use the office at home deduction and I understand it. But what are the key rules is. Do you have an office available by your employer within fifty miles of your home. If you do then that officer at home Israeli and that something for your employers can mean it's it's for years since that tax deductible. If you have a place to hang your head at work that is your office that your home. The lack of documentation. Primarily for meals and entertainment. Many people think they can get by with estimates or again credit card statements -- things like that. The IRS rules are very specific in New York State policy -- policy. Who what where why when and how that's what you have to document. Who you who you partied with wind how much you paid while you were there what was the business relationship. How much did you pay. And of course when did that happen so. You have to reek and -- compute that the proper documentation for ought to usage. If you're claiming the mileage deduction. Please make sure that you can identify. Where you win. How many miles it was when you went and you know what was the business relationship with the trip. Are sometimes be careful because if you're a high income person -- W -- kind of person the IRS wants to take a look at that. And many times are high income W two type sales person in -- many of the salespeople are former presents. Make a ton of money from him better than 2000 dollars and in many cases. And and and yet they get twenty or 30000 dollars of employee business expenses for travel on and on reimbursed expenses. Big fall to something called the Alternative Minimum Tax. And AM -- you'll often caused many of those tax deduction to beat loss so. It is if that's the case see if he can get your employer to be more liberal. In his or her travel reimbursement rules if if they will exchange W two page which is taxable. Or employee reimbursement. You could possibly get 20000 dollars of expenses reimbursed with no income tax effect. Verses having 20000 dollars in wages. And losing the corresponding 20000 dollar deduction if you catch my math. If as we wrap up to show we have about a minute left. Your final thoughts to me before the show were were not really about Texas or about something -- so in in fifty seconds or so what are your final thoughts my final thoughts are tax time is it time for you to think about not just income taxes by about finances about risk management financial risk management as a whole. I would challenge everyone your listeners -- to make sure that they have a power returning on file. You know naming their spouse or some other -- oneness summit -- and transact business for each other. Sounds like a legal issue but it's very important that the continuity happen in case you're not capable. Health care proxy same basic thing who's making your health care decisions by making sure that you Havel will that is updated because it's such a tragedy you know. Poor people only doubles too sometimes are right and the in the proper estate planning. And they don't do that so I would say when your with your tax professional asked them a little bit about those types of things. And make sure that you've covered all the bases not just the income tax. While rock thank Marino Wiki from -- Wiki and company for being here in buffalo means business. And day it's our annual tech show was good that's a lot of information if you -- more information you can call -- six they won. 63676. They won 6367. The located right in west Seneca or -- on the website no Wiki -- dot com you can email ray himself but -- -- new Wiki Cole attack. Rain again thanks for being here enjoy taxis and explain. Right and doubt we'll see next weekend for another edition of buffalo means business. Thank you for listening to buffalo means business -- -- to buffalo radio veteran M local business have a good -- Shula. Buffalo means businesses an hour long weekly radio show that's spotlights -- local business brought you by doctor Bob dental care. 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