Illinois has some tax laws that are different from the tax laws of some other states.  When people move to Illinois, some of those people don’t know about the laws, if they don’t hire a C.P.A.  Here are some of Illinois’ original tax laws.
Many of the tax exemptions help retirees.  Washington, DC, and 27 states, including Illinois, exempt all Social Security benefits from the state income tax.  17 states, including Illinois, exempt military pensions from the state income tax.  Some other states only allow part of a military pension to be excluded from taxes.  Only 10 states, including Illinois, exclude all federal, state, and local pension income from taxation.  Only three states, including Illinois, exempt almost all retired income from the state income tax.  Those states exempt all of Social Security, military pensions, government pensions, and certain types of private pensions.
A credit may be claimed for income taxes paid to another state.  Usually, if someone lives in one state and works in a different state, he or she must file a state income tax return, in both states.  However, some states have reciprocal agreements.  Illinois has reciprocal agreements with Wisconsin and Michigan.  If two states have a reciprocal agreement, an employee must only pay an income tax in the state in which he or she lives.
If an Illinois taxpayer spent money on supplies for his or her child’s school (including home-schooling expenses), the taxpayer may deduct 25% of the expenses over $250.  To receive the deduction, the taxpayer must attach, to the tax return, a receipt from the school.  If the child is home-schooled, the parent must attach personal expense receipts that prove that the expenses helped the child’s education.  The maximum, for this credit is $500.
Since not enough Illinois taxpayers, especially new residents, know about these state tax laws, more taxpayers should hire a C.P.A., to ensure that they will claim all credits and deductions to which they are entitled.

Sansone & Associates, P.C. is known for guiding our clients through a full range of tax planning and preparation decisions to minimize tax liabilities. We pride ourselves on being available to play a major role in supporting your financial, record keeping and tax planning issues. If there is anything, we can help you with, please schedule an appointment with one of our certified public accountants by calling 815-459-4300.

Many taxpayers miss deductions, if they don’t hire a C.P.A.  Here are five of the most common deductions that taxpayers miss, since they don’t know about them.  If those taxpayers hire C.P.A.’s, they’re more likely to learn about the deductions.
As a miscellaneous itemized deduction, a taxpayer may claim financial management and planning expenses.  If someone paid a lawyer to prepare a trust, paid a financial planner, paid to have a tax return prepared, including the cost of tax preparation software, subscribed to an investment newsletter, paid a tax lawyer, for advice, these expenses are deductible.  If a taxpayer paid other expenses to manage his or her finances, some of these are also deductible.
Having to pay taxes is difficult, if the taxpayer had expensive medical bills, during the previous year.  Medical expenses can be deducted, if a taxpayer can prove that those medical expenses were at least 7.5% of his or her adjusted gross income (AGI).
A miscellaneous itemized deduction is mileage reimbursement difference.  If a taxpayer is paid, by his or her employer, for business mileage, but that amount is less than the IRS standard rate, the taxpayer can deduct the difference.  If a taxpayer wants to claim that deduction, he or she should show the C.P.A. gas receipts, documentation about how far he or she drove, for work, and proof of how much the employer reimbursement was.
If someone is eligible, one deduction that may be large, for many people, is an IRA contribution.  For 2011, the highest deduction, for an IRA contribution, is $5,000, per year, for an individual, or $6,000, per year, for someone who is 50 or older, who makes a catch-up contribution.  The deduction begins to phase out for an AGI of $56,000, for single filers and $90,000, for joint filers.  The deduction isn’t available to anyone with an AGI above above $66,000, for single filers and $110,000, for joint filers.
Another miscellaneous itemized deduction is job search expenses.  This includes mileage, copying resumes, expenses to go to and from interviews, and other costs of looking for a job.  Many taxpayers could have used that deduction, on their 2011 tax returns, since the unemployment rate was high, last year.

Sansone & Associates, P.C. is known for guiding our clients through a full range of tax planning and preparation decisions to minimize tax liabilities. We pride ourselves on being available to play a major role in supporting your financial, record keeping and tax planning issues. If there is anything, we can help you with, please schedule an appointment with one of our certified public accountants by calling 815-459-4300.

All C.P.A.’s are well-trained, so the customer can know that the C.P.A. will do his or her job, well.  To become a C.P.A., an accountant must fulfill requirements that are decided the the American Institute of Certified Public Accountants (AICPA).  The requirement usually includes about 150 college hours that are applied to an accounting program.
If a business owner hires a C.P.A., the business owner has more time that he or she may use to manage the business.  Many business owners would usually enjoy spending more time helping customers, instead of working on accounting.  This will ensure that each customer receives enough attention, causing them to tell their friends and relatives about the company.
The cost of a C.P.A. is lower than many people think.  The majority of C.P.A.’s charge $150-$400, per hour, so some people, who aren’t rich, think that they can’t afford to hire a C.P.A.  However, many of the less-experienced C.P.A.’s charge $30-$50, per hour.
A C.P.A. can give some business ideas that the client needs, to operate his or her business more efficiently.  If a C.P.A. knows about a business owner’s sector, revenue, and expenses, the C.P.A. can give suggestions about how the business owner can improve the business.  A C.P.A. can do that because he or she knows how much the business can afford to invest, and the C.P.A. also knows the expenses that a business owner should try to decrease.
Hiring a C.P.A. can decrease  a person’s stress.  The majority of C.P.A.’s guarantee their work.  Therefore, if someone hires a C.P.A., he or she knows that the work will be done well, or the client won’t be expected to pay more.
Sansone & Associates, P.C. is known for guiding our clients through a full range of tax planning and preparation decisions to minimize tax liabilities. We pride ourselves on being available to play a major role in supporting your financial, record keeping and tax planning issues. If there is anything, we can help you with, please schedule an appointment with one of our certified public accountants by calling 815-459-4300.

Filing the extension form, Form 4868, usually doesn’t delay the date on which a payment is due. The IRS requires a payment by April 17.  Your CPA can help you through this process. An estimated tax payment must be calculated and paid by April 17. This is part of filling your extension.  The payment amount must be at least 90% of the correct amount, to avoid paying a penalty.  Sometimes, people may receive a six-month extension of the time that they are required to pay, if the requester is unemployed or a self-employed person whose income greatly decreased.  Those people may apply for the payment extension, if they file Form 1127-A.

After a taxpayer filed for the extension, using Form 4868, he or she must file Form 1040, 1040A, or 1040EZ by Oct. 15, to avoid a penalty.  The interest rate is 3%, per year, compounded daily.  The late-payment penalty is usually 0.5%, per month.  The extension approval is automatic, if it’s filed on time and includes a tax payment.

A taxpayer may pay by mailing a check, by using a free federal website, by using a credit or debit card, or using direct debit.  If someone mails a check, the taxpayer should make the payment out to “United States Treasury.”  The taxpayer should write his or her Social Security number, on the check, and he or she should include Form 1040-V, which is the payment voucher.  The federal website is the site of Electronic Federal Tax Payment System, www.eftps.gov.  If someone has a problem with the website, he or she should call the EFTPS phone number, 800-316-6541.  If a taxpayer uses a credit or debit card, he or she can do that as a paper or electronic filer, by phone or oneline, using www.IRS.gov.  The IRS doesn’t charge for this service, but credit card companies do.  If a taxpayer is using direct debit, he or she must tell the IRS his or her account number and bank routing number.

Some taxpayers may want to pay by installments, but that can’t be done by using Form 4868.  The IRS sometimes accepts installment plans, but only if the taxpayer files his or her return.  The majority of taxpayers, who owe $50,000, or less, in tax, penalties, and interest, can use the Online Payment Agreement, on www.IRS.gov, to set up a monthly payment plan, for up to six years.  Taxpayers may also request a payment plan by printing Form 9465-FS, from that site, and mailing it, with a tax return or IRS notice.

After filing an extension, a taxpayer has six more months to convert a traditional IRA to a Roth IRA.  If someone does this, it may decrease his or her tax and decrease his or her penalty.  Investors have until their tax filing deadlines (including extensions) of the year they converted to a Roth IRA to undo their conversions.

Sansone & Associates, P.C. is known for guiding our clients through a full range of tax planning and preparation decisions to minimize tax liabilities. We pride ourselves on being available to play a major role in supporting your financial, record keeping and tax planning issues. If there is anything, we can help you with, please schedule an appointment with one of our certified public accountants by calling 815-459-4300.

Barrington Illinois, voted in by Money Magazine as a top place to live in the United States in recent years, is a terrific residential area. Being a business owner in Barrington has it’s perks, too. Since residents voted in April, 2009, to secede from Cook County, Barrington Illinois has successfully escaped the skyrocketing sales taxes of Cook County and the Chicagoland area. Sales taxes vary from region to region and states such as Illinois who depend heavily on sales taxes for revenue will frequently audit businesses and individuals who have a big difference between their income taxes and sales taxes. Here are few tips to help your existing or new business in the area of sales taxes:

-Verify that the appropriate sales tax is being charged and paid through creating an verification and error reduction process.

-Enter sales tax as separate line items in your business vouchers as well as creating reports for taxes paid to vendors.

-If faced with an audit you can ask for a state-approved, managed audit that involves random spot checking as opposed to a standard audit.

-After an audit when you are given a tax assessment be sure you understand the procedures you must follow, the deadlines involved and your options.

-Sales taxes can be incredibly difficult to manage on your own and getting representation in the event of an audit as well as getting a second opinion is a lot more expensive than if you simply had an accountant manage the proper preparation of your forms.

Barrington, IL, may have some tax perks compared to the city of Chicago, but it never hurts to protect yourself and your business in the event of an audit. Today Barrington, IL, achieves a great deal of its revenue from the car dealerships and boasts the presence of other great companies such as GE Healthcare and the Gatorade Sports Science Institute. In addition to a strong business community, the Barrington location has a long and proud heritage. From the first village board meeting March 20, 1865, to the present day the village is considered one of the most successful, wealthiest and best places to live. Barrington will celebrate it’s 150th anniversary in 2015 and will begin celebrating early in 2013 with exciting planned festivities, so make sure your business isn’t left out of all the action.

Sansone & Associates, P.C. is known for guiding our clients through a full range of tax planning and preparation decisions to minimize tax liabilities. We pride ourselves on being available to play a major role in supporting your financial, record keeping and tax planning issues. If there is anything, we can help you with, please schedule an appointment with one of our certified public accountants by calling 815-459-4300.

Are you one of those people who wishes phones were still just used to call people? Well, believe it or not you can actually do accounting and manage important segments of your finances through mobile apps. Everyone’s crazy about Smartphones these days, and statistics show more people access the internet through their Smartphone than through their computer. These numbers are not going to change and if you don’t know what mobile programs and applications are out there, it’s only too easy to get left behind in the wake of technological advances. To help keep you up to date and in the know about what bookkeeping tools are available through mobile phones we’ve compiled a list of apps worth checking out and downloading. All of the recommended apps that follow are available on either iPhone or Android devices, the two most popular Smartphone devices on the market today:

Xero

What it does: Create, send and share invoices as well as record receipts.

Best feature: Organizes and submits photos of receipts.

Cost: Like it’s name, the cost of this app is zero, and it’s available for free on iPhone and Android devices. Additional costs apply through your online Xero account.

Quickbooks Mobile

What it does: Syncs with your Quickbooks Account.

Best Feature: Enables you to update information that will then sync to your Quickbooks files.

Cost: Free to existing Quickbooks users, or usable for free after purchase of Quickbooks.

QuickOffice

What it does: Gives you access to Microsoft Office tools like Microsoft Word, Excel, and PowerPoint

Best Feature: The app transfers files to and from the mobile app and connects with other services like Google Docs.

Cost: Prices vary from the free “Lite” version of the App to $19.99 per download.

Intuit Online Payroll

What it does: Manages your payroll from your mobile phone.

Best Feature: Sets up direct deposit for employees.

Cost: Starting at $25 per month for the basic version.

Iteleport

What it does: Displays and controls your computer screen from your Mac or PC Desktop.

Best Feature: Enables you to have access to flash content.

Cost: $25 one-time fee to download.

Many accounting firms are getting on the bandwagon and recognizing that the website of the 1990′s is today’s Mobile App. In the years to come small businesses and CPAs alike will be at a competitive disadvantage for not embracing mobile solutions to manage your finances. For specific recommendations for your personal needs, demonstrations  on how to use mobile apps for accounting and bookkeeping, as well as suggestions on how to share mobile information with your accountant you should contact your CPA.

Still curious about Mobile Apps for Accounting? Feel free to call us and schedule an appointment with one of our certified public accountants by calling 815-459-4300 to explore this topic as well as our services for providing ongoing support.

There is nothing more frustrating than realizing your financial data isn’t accurate. Knowing there is an error is one thing, but finding it can feel like looking for a needle in a haystack. Here is a quick checklist to help correct mistakes and circumvent hindering oversights:

-First, double check and reconcile statements for all balance sheet accounts. If banks make mistakes, it helps to stay on top of your statements so you can let them know as soon as errors are discovered. Credit cards, checking, savings, any other sources of credit as well as loans are all good to consistently track.

-Review whether items in your reports in Quickbooks were set up correctly. One way to do this for example, is to modify the details of Total Income on your Profit & Loss Statement.

-To avoid duplicates, indicate as inactive or merge accounts or list items. Use the missing checks report to find duplicate invoice numbers.

-Set preferences to eliminate and avoid future errors. Establishing defaults such as checking the box to use Undeposited Funds as a Default Deposit to Account is a strong practice to adopt throughout all areas of your Quickbooks files.

-Mistaking a deposit for a withdrawal, or sign error, can be found by dividing the amount by which you are off by 2 and looking for the answer as an entry in the wrong column.

-Inaccuracies due to transposition of numbers can be identified successfully when the amount you are off by is divisible by 9. If this is the case there are likely reversed some numbers somewhere in your records.

-Run regular manual backups on your files as part of your maintenance routine. Consistency is key in this area, and the sooner you can establish a regular pattern in this area, the safer your files will be in the event of file corruption.

-To fix corrupted and damaged data you can use both the Verify Data utility as well as the Rebuild Data utility. Use the Verify Data utility if transactions are missing or if data is showing up in the wrong places. Apply the Rebuild Data utility if the Verify Data utility fails, returns errors, or if your payroll forms are not showing up correctly.

-Reach out for help if something still isn’t right. Intuit, the company who makes Quickbooks, has services available to assist with difficult data corruption errors and as well there are a number of third party companies that specialize in Quickbooks file repair. Your CPA can also help find critical errors and guide you through the process of reestablishing certainty in your numbers and credibility to your records.

If you’d like assistance with your accounting system or with Quickbooks please schedule an appointment with one of our certified public accountants by calling 815-459-4300 to explore our services for providing ongoing support.

Despite the fact that there is almost no mistake on your taxes that you can’t undo with the right tax consultant, if you’re waiting till the last minute to file your taxes this year the anxiety and pressure of the time crunch could leave you vulnerable to making careless errors that will cost you in headaches and frustration down the road. To help lighten the burden and deal with the looming deadline ahead here are some practical tips for last minute tax filers:

1. Work with a Tax Professional to help avoid glaring errors, reduce your overall bill, and accurately express changes to your life and business in your return that might prove difficult to do well on your own.

2. Get an extension. If you owe taxes, pay the IRS, and file an extension by filling out IRS Form 4868.

3. Take the standard deductions instead of itemizing. If you waited till the last minute and your records are in disarray, it will be more difficult to itemize deductions accurately.

4. Give your return the quick once over to make sure you’re not giving the appearance of any tax scams such as abuse of charitable deductions or  exaggerated fuel tax credits.

5. File electronically to speed up the processing of your return and it’s timely arrival to the IRS.

6. Proofread and double check basic information like Social Security numbers and Automatic Deposit information.

Your last minute tax filing need not be a nightmare. Filing Taxes isn’t a picnic for most people, but once you get down to business you will find relief in the process of getting the work done. Don’t pay any more than you’re legally obligated to pay and take the time to ask questions to maximize your return. When you’re finished you can take a load off and celebrate!!

Sansone & Associates, P.C. is known for guiding our clients through a full range of tax planning and preparation decisions to minimize tax liabilities. We pride ourselves on being available to play a major role in supporting your financial, record keeping and tax planning issues. If there is anything, we can help you with, please schedule an appointment with one of our certified public accountants by calling 815-459-4300.

As we start to count down the days still left to file your tax return, you may be scrambling to accurately prepare your list of tax deductions for donations made to charitable organizations. There is now a new tool available on the IRS website to look up the tax-exempt status of nonprofits called Exempt Organizations Select Check, or EO Select Check. With this tool you can view who is eligible to receive tax-deductible contributions, and whether or not their status to do so has been revoked.  The Select Check tool will update monthly to reflect those organizations who’s tax-exempt status has been reinstated.

The EO Select Check has great new searching features allowing lookup by Employer Identification Number (EIN), city, state, and others just in time to prepare your return. If your donation was made by December 31st of last year you can include it when you file your 2011 tax return, and if it was made after you can hang onto it for next year.  Information about an organization’s exempt status is now updated more frequently, monthly as opposed to quarterly which is another great benefit for continual use throughout the year. The public can also learn if an organization has filed a Form 990-N (e-Postcard) annual electronic notice. If a charity’s annual gross receipts are $50,000 a year or below they are required to submit Form 990-N to maintain their exempt status. The new EO Select Check gives all of this access and information in one place on the IRS website now as opposed to several dispersed locations.

Now that documenting your itemized donations has just become a little easier, the ease of this new search tool might have you sifting through old records with new enthusiasm. One of the growing ways people are donating these days is through their mobile phones. The charges for texting donations or giving anonymously through your phone will appear on your phone bill and can be used in place of a receipt or bank statement. For some this might make life easier but for others it’s just one more hassle when it comes time to prepare a return, especially if you are under a tight deadline.

To help avoid obvious blunders if you’re under the wire it helps to keep in mind a few of the things that are not tax deductible. Donations to individuals, political parties, professional or business associations are not deductible. Contributions to for profit organizations, foreign governments, or labor unions also cannot be deducted. As well, the value of your time for services rendered to a non-profit isn’t deductible. When in doubt, the new EO Select Check tool will provide the most recent information about the status of an organization, plus it couldn’t hurt to put a phone call into the organizations you’ve donated to for further clarification or requests for documentation. If you have questions about whether something is deductible or not or would like additional tips for preparing this segment of your return you should contact your CPA for more details.

Sansone & Associates, P.C. is known for guiding our clients through a full range of tax planning and preparation decisions to minimize tax liabilities. We pride ourselves on being available to play a major role in supporting your financial, record keeping and tax planning issues. If there is anything, we can help you with, please schedule an appointment with one of our certified public accountants by calling 815-459-4300.

Last year over seventy-five new businesses opened in Crystal Lake, IL, despite tough economic times. The city’s main activities are retail, dining and industry, but service providers and professional offices were also included in the types of new businesses to recently open their doors. Small, locally owned stores are located in the downtown district and many independently-owned companies reside in the industrial parks of Crystal Lake. Many of these businesses will likely participate in or have a role in the various upcoming summer festivals in the city giving residents a chance to get to know and support them.

As Crystal Lake’s new companies continue to grow and thrive, whether you’re a day or a decade into running your company, making sure your small business is going in the right direction is critical to reaching your goals. Whether you’re one of Crystal Lake’s landscaping firms, new restaurants, or trendy boutiques needs often arise where additional expertise outside of your regular staff can make or break your success. Keeping track of expenses and determining best business practices for streamlined operations are some common areas of focus for a new or growing start-up.

A great city to own and operate a business, Crystal Lake, IL, prides itself on being a terrific environment for entrepreneurs. There are a lot of local resources available if you need outside help to reach your goals. Putting in place a financial roadmap for your expenses is a great example of something a new company might need additional assistance with in their first year or when goals and directions change down the road. Making sure firms have similarly aligned goals to yours and have proven results working with similar businesses can assist with choosing who to work with.

Finding the right experts to help you grow your business is easier when they are available to meet you in person and will take the time to get to know you and what you do. To improve the success of your business it’s always better to have access to the right resources when you need them. Here are some ways a new business can benefit from hiring a CPA:

-Setup, strategic planning and support for a new accounting system

-Help, training and advice for programs like Quickbooks and Peachtree

-Corporate tax planning to help create a financial plan for the future of your company

-Creating a budget and revenue forecasting to help avoid over or under spending in your first few years of business

-Objective insight around big financial decisions

-Outsourcing tasks like financial statement preparation, payroll processing, and bookkeeping you don’t have time to do on your own

There are plenty of opportunities for new and established businesses alike to find local services that aren’t currently within their organization. In 1835 Ziba Beardsley named the lake and town of Crystal Lake, IL when he said the “waters were clear as crystal.” From the time the first cabins were built to the first city council in 1914, and the supportive Crystal Lake Chamber of Commerce of today, businesses have flourished with steady growth as well as community involvement and contributions. Crystal Lake residents have a lot to be proud of as success progressively escalates in their business sector.

Sansone & Associates, P.C. is known for helping small businesses with accurate reporting; financial system set up and helps with compliance issues. We pride ourselves on being available to our business clients to play a major role in their business decisions. If there is anything, we can help you with, please schedule an appointment with one of our certified public accountants by calling 815-459-4300.