Ten Ways Not To Say Goodbye: Avoiding Jailtime For Tax Charges -

When asked by a (repeat) client how to stay out of jail, criminal defense attorneyCharlie Thomas offered this sage advice: Stop stealing shit.

The same logic applies to taxes. If you want to avoid jail time, for the most part, the best advice is to file and pay on time. But I know that doesn’t always happen so let’s assume that you didn’t do that. What next?

It’s important to understand that the Internal Revenue Service doesn’t want to throw you in jail. Criminal investigations consume a lot of resources: they take time and they’re expensive. So for most taxpayers, a criminal investigation isn’t a first step, but rather the end process of lengthy attempts to get you to resolve your tax obligations. In other words, it’s rare that an agent will show up on your doorstep one day with cuffs in hand.

Additionally, while tax evasion and related charges are an important piece of the IRS Criminal Investigation (CI) charges, that’s not the sole purview. Often, criminal investigations are linked to other criminal activities like fraud, drug and weapons violations and money laundering. Remember Al Capone? When it comes to criminal activities, while other federal agencies – like the Federal Bureau of Investigation – can pursue those violations, the IRS is the only federal agency that can investigate potential criminal violations of the Internal Revenue Code.

With all of that in mind, here are ten tips for staying out of jail:

1. File and pay your taxes on time. This seems like it would go without saying. And it happens – all of the time and for all kinds of reasons – that a taxpayer might not file and pay on time. You generally get a couple of bites at the apple since ultimately, IRS just wants to get paid. Yet, time and again, once a criminal investigation has been initiated, taxpayers either refuse to pay or don’t pay the tax due. While there may be valid reasons for nonpayment (such as lack of resources to make payment), when it appears that resources are available, not filing and/or nonpayment makes a bad situation worse. At sentencing hearings, judges take note – as they did in the case of Lauryn Hill - of whether taxpayers have made arrangements to resolve ongoing liabilities.
2. Open your mail and respond appropriately. Not thinking about it isn’t going to make it go away. If you’ve been chosen for examination or if the IRS has asked you to provide additional information about your return, it means you’re on their radar. In most cases, it does not mean you’re being considered for criminal proceedings, just that additional information is required. But failing to respond – especially if you have good reasons for your behavior – doesn’t help and in most cases, it raises the level of inquiry.
3. Cooperate during an examination/audit. Audits make people angry. And defensive. And withdrawn. And combative. But none of that helps. And it could make a bad situation worse. Procedurally, criminal investigations are generally initiated from information obtained when a revenue agent (auditor) or revenue officer (collection) detects possible fraud. Speaking from experience, while there are guidelines that lead to criminal inquiries, there is some wiggle room – but not for folks who are not cooperative.
4. Be consistent. There is no privilege that applies when talking or making disclosures to IRS as opposed to state or other agencies. If you report sales of $1 million to the state for purposes of sales tax, the IRS is going to want to see those numbers accounted for – and vice versa. Information may be exchanged by other law enforcement agencies or tax authorities across the country. Don’t assume you’re being clever when you tell one story to one agency and another to IRS. Be consistent in your reporting so as not to raise concerns or red flags.
5. Don’t destroy records. Destroying records can be a crime – and you don’t need additional charges. Once an investigation is opened, an IRS special agent will attempt to gather facts and evidence. That may include interviews of third party witnesses, conducting surveillance, executing search warrants, subpoenaing bank records, and reviewing financial data. Trust me. It happens: I’ve been a witness (for the defense) at a criminal case where a private investigator was hired to analyze the lifestyle of the owner of a cash based business to determine if cash received equaled cash paid out. But those records may be evidence – and you don’t want to destroy evidence. That can also be a crime – just ask Roni Deutch who was accused of shredding piles of evidence in her tax case, making a bad situation worse.
6. Don’t lie. Failing to file and failing to pay can result in criminal charges. You know what else can? Lying to federal investigators and/or committing perjury.Of course you can get caught in a lie. Be smart. You have a right to remain silent – and you may want to use it – and your attorney can help you determine if it makes since to do so. One thing is clear: lying just makes things worse.
7. Don’t be overconfident. While there might be a temptation to roll the dice and see what happens, once criminal charges are filed, you have to take the matter seriously. Choosing not to put on any defense is rarely a good strategy. Wesley Snipes’ team said, at trial, “We could have put on a big show, but we don’t do that. We’re not going to waste the jury’s time.” The result? A conviction – and jail time. While the temptation may be to be angry and assume that any crime is the government’s burden to prove, that doesn’t equal throwing your hands up in the air. Be prepared.
8. Hire a defense attorney. Once a criminal investigation has begun, and after all the evidence is collected, the IRS special agent will determine whether to continue your case or recommend prosecution. At this point, you’re not talking yourself out of charges. Your case will be referred to either the Department of Justice, Tax Division, or the United States Attorney. At that point, it’s not a matter of simply mitigating penalties. A tax attorney – like me – can’t do much for you at this point. You need a criminal defense attorney, preferably one who has experience in tax crimes. Not a DUI attorney. Not a family lawyer. Not a corporate guy (or gal). A bona fide criminal defense attorney.
9. Read the fine print. The IRS Criminal Investigations unit secures approximately 3,000 criminal prosecutions per year. That’s a pretty big number. If you are prosecuted, you may be asked to take a plea. In some instances, that makes sense. But read what has been put in front of you and remember that you do have rights. See #8.
10. Understand that there is no Perry Mason.Last minute dramatics make for good TV but not in real life. There is no piece of evidence that is going to save you at the very end. You can’t count on the fact that, even if things are going badly, there’s going to be a moment where the momentum will generally shift. Realistically, you know how things are going as the investigation goes along. You know that continuing to stand there, hopeful, isn’t enough. You have to be proactive. Hire an attorney. Pull out records. Be forthcoming. Be thoughtful. Think about your strategy – and that means exploring all of your options. That wild card might be your lucky break – or it could be another dead end. It’s important to keep your chin up but don’t rely on theatrics – that only works in Hollywood.

Let’s be honest. The IRS has a lot of power. A lot. And that can be very scary. There are a number of steps that you can take to mitigate – or even eliminate – the potential for examinations, penalties and quite possibly, jail time. But heading the whole thing off at the beginning? Even better.

Security Tax Services LLC

North Sound                                       South Sound

2802 Wetmore Ave, Suite 212           33530 1st Way S, Suite 102

Everett, WA 98201                             Federal Way, WA 98003

425.339.2400                                     253.237.0751

fax 425.259.1099                               fax 253.237.0701

www.securitytaxservices.com

H&R Block Offers Apology, Cash To Make Up For Filing Snafu -

If you were one of the hundreds of thousands of taxpayers affected by the tax season filing snafu involving education credits – and you filed using H&R Block – you might be getting some relief.

The tax preparation giant is offering $25 to its customers affected by the delay in processing individual tax returns claiming education credits. The $25 will be loaded onto Emerald Cards, the company’s signature debit card, which is also used for taxpayer refunds.

The company had this to say about the resolution to a situation that taxpayers and preparers alike are ready to be over:

This past tax season has been like no other in recent memory. The late passage of additional tax legislation and subsequent delay in the issuing of all tax forms pushed the beginning of the e-filing season back almost two weeks to the end of January. This alone caused a refund delay for close to 18 million taxpayers who usually file in January and receive a refund by early to mid-February.

The IRS has reported it has cleared nearly all returns impacted by the 8863 processing delay. We are confident more than 90 percent of our clients impacted by the form delay have either received their tax refund or received notice of a possible refund date. For those who are experiencing a longer delay, it is possible the IRS has identified additional issues with the return.

H&R Block appreciates that the issue involving the filing of Form 8863 this past tax season may have frustrated and inconvenienced impacted clients. H&R Block recently sent those clients who had their tax returns prepared and filed in company-owned locations its sincerest apologies and a $25 Emerald Card gift card to account for any processing delay and express thanks for their patience in this matter.

These clients can rest assured their tax professional prepared their tax return accurately and the tax refund was never in jeopardy due to this issue. The problem was a system disconnect in processing the form that unfortunately further delayed the return. This delay was not caused by something the tax professional did – or did not do.

Once the company became aware of the issue, it worked diligently on the clients’ behalf with the IRS to expedite the processing of those returns. By working with the IRS, most clients ultimately received their refund more quickly than originally expected.

H&R Block serves approximately 15 million clients in its offices and strives to provide consistent quality client service. Nevertheless, we will not stop working to improve that experience for all of our clients.

This was the second high profile statement from the company. In March of this year, H&R Block CEO Bill Cobb issued an apology to customers, admitting that the company “missed a step” but making assurances that “I want you to know that we hear the frustration of those impacted by this issue loud and clear, and we’re working every avenue we can to get your refund to you as fast as possible.”

Those processing delays were expected to hold up refunds for as many as six weeks. However, it appears that IRS was able to move affected returns more quickly than expected and most taxpayers saw their refunds in less time. By mid-April, almost all taxpayers who had been impacted by the filing problems had received their checks.

The damage was done, however, for a number of taxpayers. In particular, students hoping to use refunds to pay tuition and those relying on finalized returns in order to complete financial aid applications, were angry and took to the internet to complain. At least three lawsuits have been filed by customers hoping to recover from losses suffered because of the delays. The company hasn’t responded publicly to the lawsuits but has continued to stress that the majority of customers were not significantly affected.

The delays, of course, made headlines for weeks in an already dramatic tax season marked by a late start, sequestration worries and last minute online outages reported by TurboTax customers. H&R Block hopes that, now that things have settled for most taxpayers, this gesture will help make up for some of the difficulties. So you tell me, will it?

Security Tax Services LLC

North Sound                                       South Sound

2802 Wetmore Ave, Suite 212           33530 1st Way S, Suite 102

Everett, WA 98201                             Federal Way, WA 98003

425.339.2400                                     253.237.0751

fax 425.259.1099                               fax 253.237.0701

www.securitytaxservices.com

Not Ready To File Your Taxes? Extension Form, Details Available

If you're like me, you're not ready to pop your return in the post just yet. That’s right: like more than 10 million other taxpayers, I'm filing for an automatic extension this year.

Don't get all judge-y. There’s no need. There are lots of legitimate reasons why taxpayers need more time to file. One of the most common reasons is a situation like mine where income does not come from a mere W-2. In addition to having self-employment income, my husband and I own a business; it’s a pass through entity so we can’t start our returns until we receive the information from the business. Not to mention that, oh say, I’m a bit busy this time of year.

But there are other reasons: you could be a beneficiary of a trust or estate or a shareholder or partner in a pass through entity and just now getting your Schedule K-1. You might not have received your forms on time. You might still be waiting for a 1099-R. You might be funding an IRA (you have until tomorrow) and need to include that information on your form 1040. There are lots of reasons. You don't need to tell anyone why you're filing for extension – even the IRS. And it doesn't (contrary to popular belief) increase your risk of audit or examination.

Your name (and spouse’s name if you’re filing jointly) – I think you can manage.Here’s what you need, generally, to file an extension:

• Your address.
• Your Social Security (and spouse’s Social Security number if you’re filing jointly).
• Estimate of total tax liability for 2012
• Total of what you paid in 2012 (including withholding)
• The amount you’re paying with the extension, if anything.

The last bit is important because an extension is an extension of the time to file and not an extension of time to pay. If you expect to owe at tax time and you’re filing for extension, you should make a payment with your extension request.

To file for an extension, you can:

• File for an extension online for free using Free File link on IRS.gov;
• Ask your tax preparer to file for extension for you;
• File for an extension using the federal form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return (downloads as a pdf) or download it here:

The regular “timely filing” rules apply – so be sure and get your extension postmarked by the end of the day on April 15.

Filing for extension gives you a six month extension of the original time to file. For 2013, this means that, with an extension, you’ll have until October 15 to file a return. If you timely file for your extension, you will not be subject to the late-filing penalty, which is normally 5% of your unpaid balance per month.

In some circumstances, taxpayers get an extension of time to file without having to ask. For 2013, that includes:

• If you’re a US citizen or resident and you live outside of the U.S. or Puerto Rico and your main place of business or post of duty is outside of the US or Puerto Rico or if you are active duty military and live outside of the U.S., you qualify for a 2 month extension without having to file form 4868. That moves your due date to June 17 (since June 15 falls on a Saturday) to file and pay. However, interest is still due on any tax payment made after April 15.
• Members of the military and others serving in Afghanistan or other combat zone localities generally have until at least 180 days after they leave the combat zone to file returns and pay any taxes due.
• People affected by certain tornadoes, severe storms, floods and other recent natural disasters have extra time. Currently, parts of Mississippi are covered by federal disaster declarations, and affected individuals and businesses in these areas have until April 30 to file and pay.

The whole process should only take you a few minutes and, in most circumstances, won’t cost you anything. So stop worrying, do it now and then breathe. You got this.

Need help getting a extension? We are always here to help. Give us a call today.

Security Tax Services LLC

North Sound                                       South Sound

2802 Wetmore Ave, Suite 212           33530 1st Way S, Suite 102

Everett, WA 98201                             Federal Way, WA 98003

425.339.2400                                     253.237.0751

fax 425.259.1099                               fax 253.237.0701

www.securitytaxservices.com

Lost Your Job? There Could Be Tax Consequences -

Given the current economic conditions, you may be faced with tax questions surrounding a job loss and unemployment issues. Here are some answers:

Q: What if I received unemployment compensation in 2012? 

A: Unemployment compensation you received under the unemployment compensation laws of the United States or of a state are considered taxable income and must be reported on your federal tax return. If you received unemployment compensation, you should receive Form 1099-G showing the amount you were paid and any federal income tax you elected to have withheld.

Types of unemployment benefits include:

• Benefits paid by a state or the District of Columbia from the Federal Unemployment Trust Fund
• Railroad unemployment compensation benefits
• Disability payments from a government program paid as a substitute for unemployment compensation
• Trade readjustment allowances under the Trade Act of 1974
• Unemployment assistance under the Disaster Relief and Emergency Assistance Act

You must also include benefits from regular union dues paid to you as an unemployed member of a union in your income. However, other rules apply if you contribute to a special union fund and your contributions are not deductible. If this applies to you, only include in income the amount you received from the fund that is more than your contributions.

Q: Can I have federal income tax withheld?

A: Yes, you can choose to have federal income tax withheld from your unemployment benefits by filling out Form W-4V, Voluntary Withholding Request. If you complete the form and give it to the paying office, they will withhold tax at 10 percent of your payments. If you choose not to have tax withheld, you may have to make estimated tax payments throughout the year.

Q: What if I lost my job?

A: The loss of a job may create new tax issues. Severance pay and unemployment compensation are taxable. Payments for any accumulated vacation or sick time also are taxable. You should ensure that enough taxes are withheld from these payments or make estimated tax payments to avoid a big bill at tax time. Public assistance and food stamps are not taxable.

Q: What if I searched for a job?

A: You may be able to deduct certain expenses you incurred while looking for a new job, even if you did not get a new job. Expenses include travel, resume preparation, and outplacement agency fees. Moving costs for a new job at least 50 miles away from your home may also be deductible.

Q: What if my employer went out of business or in to bankruptcy?

A: Your employer must provide you with a 2012 W-2 Form showing your wages and withholdings by January 31, 2013. You should keep up-to-date records or pay stubs until you receive your Form W-2. If your employer or its representatives fail to provide you with a Form W-2, contact the IRS. They can help by providing you with a substitute Form W-2. If your employer liquidated your 401(k) plan, you have 60 days to roll it over to another qualified retirement plan or IRA.

If you have experienced a job loss and have questions, please call us. You need to be prepared for the tax consequences.

Security Tax Services LLC

North Sound                                       South Sound

2802 Wetmore Ave, Suite 212           33530 1st Way S, Suite 102

Everett, WA 98201                             Federal Way, WA 98003

425.339.2400                                     253.237.0751

fax 425.259.1099                               fax 253.237.0701

www.securitytaxservices.com

10 Important Updated Facts about Mortgage Debt Forgiveness -

If your lender cancelled or forgave your mortgage debt, you generally have to pay tax on that amount. But there are exceptions to this rule for some homeowners who had mortgage debt forgiven in 2012.

Here are 10 key facts from the IRS about mortgage debt forgiveness:

1. Cancelled debt normally results in taxable income. However, you may be able to exclude the cancelled debt from your income if the debt was a mortgage on your main home.

2. To qualify, you must have used the debt to buy, build or substantially improve your principal residence. The residence must also secure the mortgage.

3. The maximum qualified debt that you can exclude under this exception is $2 million. The limit is $1 million for a married person who files a separate tax return.

4. You may be able to exclude from income the amount of mortgage debt reduced through mortgage restructuring. You may also be able to exclude mortgage debt cancelled in a foreclosure.

5. You may also qualify for the exclusion on a refinanced mortgage. This applies only if you used proceeds from the refinancing to buy, build or substantially improve your main home. The exclusion is limited to the amount of the old mortgage principal just before the refinancing.

6. Proceeds of refinanced mortgage debt used for other purposes do not qualify for the exclusion. For example, debt used to pay off credit card debt does not qualify.

7. If you qualify, report the excluded debt on Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness. Submit the completed form with your federal income tax return.

8. Other types of cancelled debt do not qualify for this special exclusion. This includes debt cancelled on second homes, rental and business property, credit cards or car loans. In some cases, other tax relief provisions may apply, such as debts discharged in certain bankruptcy proceedings. Form 982 provides more details about these provisions.

9. If your lender reduced or cancelled at least $600 of your mortgage debt, they normally send you a statement in January of the following year. Form 1099-C, Cancellation of Debt, shows the amount of cancelled debt and the fair market value of any foreclosed property.

10. Check your Form 1099-C for the cancelled debt amount shown in Box 2, and the value of your home shown in Box 7. Notify the lender immediately of any incorrect information so they can correct the form.

If you received Form 1099-C, but aren't sure what to do with it, give our office a call. We'll help you figure out whether your cancelled debt is taxable--or not.

Security Tax Services LLC

North Sound                                       South Sound

2802 Wetmore Ave, Suite 212           33530 1st Way S, Suite 102

Everett, WA 98201                             Federal Way, WA 98003

425.339.2400                                     253.237.0751

fax 425.259.1099                               fax 253.237.0701

www.securitytaxservices.com

Claiming the Small Business Health Care Tax Credit -

If you're a small business owner with fewer than 25 full-time equivalent employees you may be eligible for the small business health care credit.

What is the Small Business Health Care Credit?

The small business health care tax credit, part of the Patient Protection and Affordable Care Act enacted in 2010, is specifically targeted to help small businesses and tax-exempt organizations provide health insurance for their employees. Small employers that pay at least half of the premiums for employee health insurance coverage under a qualifying arrangement may be eligible for this credit. Household employers not engaged in a trade or business also qualify.

How Does the Credit Save Me Money?

For tax years 2010 through 2013, the maximum credit is 35 percent for small business employers and 25 percent for small tax-exempt employers such as charities. An enhanced version of the credit will be effective beginning Jan. 1, 2014 and the rate will increase to 50 percent and 35 percent, respectively.

Note: The sequester, which took effect on March 1, 2013 includes a reduction to the refundable portion of the Small Business Health Care Tax Credit for certain small tax-exempt employers. As such, the refundable portion of the claim will be reduced by 8.7 percent. Without congressional intervention, this rate remains in effect until the end of fiscal year 2013 (September 30).

The amount of the credit you receive works on a sliding scale, so the smaller the business or charity, the bigger the credit. Simply put, if you have more than 10 FTEs or if the average wage is more than $25,000, the amount of the credit you receive will be less.

If you pay $50,000 a year toward workers' health care premiums--and you qualify for a 15 percent credit--you'll save $7,500. If you save $7,500 a year from tax year 2010 through 2013, that's a total savings of $30,000. And, if in 2014 you qualify for a slightly larger credit, say 20 percent, your savings go from $7,500 a year to $12,000 a year.

Is My Business Eligible for the Credit?

To be eligible for the credit, you must cover at least 50 percent of the cost of single (not family) health care coverage for each of your employees. You must also have fewer than 25 full-time equivalent employees (FTEs) and those employees must have average wages of less than $50,000 a year.

Let's take a closer look at what this means. A full-time equivalent employee is defined as either one full-time employee or two half-time employees. In other words, two half-time workers count as one full-timer or one full-time equivalent. Here is another example: 20 half-time employees are equivalent to 10 full-time workers. That makes the number of FTEs 10 not 20.

Now let's talk about average wages. Say you pay total wages of $200,000 and have 10 FTEs. To figure average wages you divide $200,000 by 10--the number of FTEs--and the result is your average wage. In this example, the average wage would be $20,000.

Can Tax-Exempt Employers Claim the Credit?

Yes. The credit is refundable for small tax-exempt employers too, so even if you have no taxable income, you may be eligible to receive the credit as a refund as long as it does not exceed your income tax withholding and Medicare tax liability.

Can I Still Claim the Credit Even If I Don't Owe Any Tax This Year?

If you are a small business employer who did not owe tax during the year, you can carry the credit back or forward to other tax years. Also, since the amount of the health insurance premium payments are more than the total credit, eligible small businesses can still claim a business expense deduction for the premiums in excess of the credit. That's both a credit and a deduction for employee premium payments.

Can I File an Amended Return and Claim the Credit for Previous Tax Years?

If you can benefit from the credit this year but forgot to claim it on your tax return there's still time to file an amended return.

Businesses that have already filed and later find that they qualified in 2010 or 2011 can still claim the credit by filing an amended return for one or both years.

Give us a call if you have any questions about the small business health care credit. And, if you need more time to determine eligibility this year we'll help you file an automatic tax-filing extension.

Security Tax Services LLC

North Sound                                       South Sound

2802 Wetmore Ave, Suite 212           33530 1st Way S, Suite 102

Everett, WA 98201                             Federal Way, WA 98003

425.339.2400                                     253.237.0751

fax 425.259.1099                               fax 253.237.0701

The Home-Based Business: Basics to Consider -

More than 52 percent of businesses today are home-based. Every day, people are striking out and achieving economic and creative independence by turning their skills into dollars. Garages, basements and attics are being transformed into the corporate headquarters of the newest entrepreneurs - home-based business people.

And, with technological advances in smartphones, tablets, and iPads as well as a rising demand for "service-oriented" businesses, the opportunities seem to be endless.

Is a Home-Based Business Right for You?

Choosing a home business is like choosing a spouse or partner: Think carefully before starting the business. Instead of plunging right in, take time to learn as much about the market for any product or service as you can. Before you invest any time, effort, and money take a few moments to answer the following questions:

• Can you describe in detail the business you plan on establishing?
• What will be your product or service?
• Is there a demand for your product or service?
• Can you identify the target market for your product or service?
• Do you have the talent and expertise needed to compete successfully?

Before you dive head first into a home-based business, it's essential that you know why you are doing it and how you will do it. To succeed, your business must be based on something greater than a desire to be your own boss: an honest assessment of your own personality, and understanding of what's involved, and a lot of hard work. You have to be willing to plan ahead, and then make improvements and adjustments along the road. While there are no "best" or "right" reasons for starting a home-based business, it is vital to have a very clear idea of what you are getting into and why. Ask yourself these questions:

• Are you a self-starter?
• Can you stick to business if you're working at home?
• Do you have the necessary self-discipline to maintain schedules?
• Can you deal with the isolation of working from home?

Working under the same roof that your family lives under may not prove to be as easy as it seems. It is important that you work in a professional environment; if at all possible, you should set up a separate office in your home. You must consider whether your home has the space for a business, and whether you can successfully run the business from your home.

Compliance with Laws and Regulations

A home-based business is subject to many of the same laws and regulations affecting other businesses and you will be responsible for complying with them. There are some general areas to watch out for, but be sure to consult an attorney and your state department of labor to find out which laws and regulations will affect your business.

Zoning

Be aware of your city's zoning regulations. If your business operates in violation of them, you could be fined or closed down.

Restrictions on Certain Goods

Certain products may not be produced in the home. Most states outlaw home production of fireworks, drugs, poisons, sanitary or medical products, and toys. Some states also prohibit home-based businesses from making food, drink, or clothing.

Registration and Accounting Requirements

You may need the following:

• Work certificate or a license from the state (your business's name may also need to be registered with the state)
• Sales tax number
• Separate business telephone
• Separate business bank account

If your business has employees, you are responsible for withholding income, social security, and Medicare taxes, as well as complying with minimum wage and employee health and safety laws.

Planning Techniques

Money fuels all businesses. With a little planning, you'll find that you can avoid most financial difficulties. When drawing up a financial plan, don't worry about using estimates. The process of thinking through these questions helps develop your business skills and leads to solid financial planning.

Estimating Start-Up Costs

To estimate your start-up costs, include all initial expenses such as fees, licenses, permits, telephone deposit, tools, office equipment and promotional expenses.

Business experts say you should not expect a profit for the first eight to 10 months, so be sure to give yourself enough of a cushion if you need it.

Projecting Operating Expenses

Include salaries, utilities, office supplies, loan payments, taxes, legal services and insurance premiums, and don't forget to include your normal living expenses. Your business must not only meet its own needs, but make sure it meets yours as well.

Projecting Income

It is essential that you know how to estimate your sales on a daily and monthly basis. From the sales estimates, you can develop projected income statements, break-even points and cash-flow statements. Use your marketing research to estimate initial sales volume.

Determining Cash Flow

Working capital--not profits--pays your bills. Even though your assets may look great on the balance sheet, if your cash is tied up in receivables or equipment, your business is technically insolvent. In other words, you're broke.

Make a list of all anticipated expenses and projected income for each week and month. If you see a cash-flow crisis developing, cut back on everything but the necessities.

If you think a home-based business is in your future, then don't hesitate to give us a call. We'll set up your business and make sure you have the proper documentation system in place to satisfy the IRS.

Security Tax Services LLC

North Sound                                       South Sound

2802 Wetmore Ave, Suite 212           33530 1st Way S, Suite 102

Everett, WA 98201                             Federal Way, WA 98003

425.339.2400                                     253.237.0751

fax 425.259.1099                               fax 253.237.0701

STS QuickBooks Tips - Spring Cleaning: Streamlining QuickBooks 2013

Although Intuit did a great job of giving QuickBooks' home page a fresher, more "open" look in its 2013 versions, maybe some of your screens have become unnecessarily cluttered. Perhaps your QuickBooks company file needs some attention as well. By taking a few minutes to do some "spring cleaning" you'll have a tidier workspace, and you'll save time and frustration. The following suggestions will help you to do just that.

Make a Clean Start

One simple way to take care of cluttered screens is to do the following:

• Minimize icons. That pretty graphical process map on the home page is great for quick access to frequently-used actions. Some of them must remain there if they're related to activities you do (i.e., Invoices has to stay if you use Estimates), but you can remove some of the ones you don't use. Go to Preferences | Desktop View | Company Preferences. You'll see this:

Figure 1: You can turn off some of the feature icons on your home page.

Some of the options have been grayed out because they support other processes. To remove an active feature icon like Inventory, click on it. In the window that opens, uncheck the box next to Inventory and purchase orders are active (you can also modify options here).

Figure 2: Clicking the checkbox next to Inventory and purchase orders are active grays out the other options and removed related feature icons from the home page.

To reduce the number of feature icons even more, go to the Finance Charge, Jobs & Estimates, Payroll & Employees, Sales & Customers, Sales Tax and Time & Expenses. QuickBooks removes the related icons and reroutes the process map on the home page.

More Time-Saving Tweaks

• Don't allow multiple windows to open in your work area. Tired of seeing all of those overlapping open windows on your desktop? Open the View menu and select One Window. All of your open windows remain active in the background. To return to one of them, open the Window menu and select the one you want to move to the front (Window | Close All returns you to a blank work area).

Figure 3: Your Icon bar can be your fastest route to often needed screens--if you modify it to only contain the functions you use, in order of importance. You can also change the labels to make them more meaningful to you.

• Trim down your icon bar. Seems like a minimal change, but it's one of those things that can add unnecessary moments of frustration throughout the day ("Where's the Calendar!"). Click View | Customize Icon Bar.


• Customize columns in Lists. You probably work in QuickBooks' Lists often, but are you spending too much time tracking down the right information? Customize their columns so your registers contain only what you usually need (and add additional ones if it's helpful). Open a list, right-click anywhere within it and select Customize Columns to modify the display (re-size column widths by placing your cursor on the vertical set of dots between labels and dragging).

Figure 4: When you customize your columns in Lists, you'll find what you're looking for faster. 

• Hide inactive items. Highlight an item, right-click and select Make Item Inactive. Open the Item menu in the lower left and click Hide Inactive Items (this action won't delete them).

Internal Cleaning

These may all seem like cosmetic changes, but you will save time and frustration over the long run.

The most critical spring cleaning task is company file analysis and maintenance. We can handle this for you. QuickBooks can slow down and start generating error messages when the data file becomes unwieldy and sloppy. Preventing file corruption before it crashes your system is a lot faster and less expensive than a reconstruction project.

Security Tax Services LLC

North Sound                                       South Sound

2802 Wetmore Ave, Suite 212           33530 1st Way S, Suite 102

Everett, WA 98201                             Federal Way, WA 98003

425.339.2400                                     253.237.0751

fax 425.259.1099                               fax 253.237.0701