Bette Hochberger, CPA, CGMA

Hi, I'm Bette Hochberger, CPA, CGMA, and I will talk a little about how we get into tax planning. Honestly, the best way to start is to keep good records. That may sound like you're not really doing anything, but you are. Because if you think about it, many times, people ask me, "Oh, how do I lower my taxes?" Well, are you taking all the expenses you can take and that you have spent money on? So again, we talked about tax evasion before. We're not making up expenses; that's not what we're doing. We're actually keeping track of things that we are spending already.

Hi Everyone - this was quite an exciting weekend in the world of Crypto-friendly Finance and Accounting. We spent the weekend watching the Silicon Valley Bank collapse and FDIC intervention. The end of SVB will change venture financing in the near future.  

TL;DR; Silicon Valley Bank - the main banking institution of Venture Capitalists and Venture Capital backed startups, collapsed in the second-largest US Bank failure ever. By the end of the weekend, the government agreed to make all depositors whole and sort out liquidating the funds later, but it was an exciting and terrifying weekend.  

After a day to reflect, we reviewed the events chronologically and highlighted some tweets for this social media round-up. Thank you to all our friends and family who were patient with us as we followed Twitter more than normal over the weekend.  

On Wednesday, a few VC-backed companies started making large withdrawals, prompting discussions in various group chats popular with the silicon valley investor crowd. According to Bloomberg, the run started when Peter Thiel advised Founders Fund Startups to withdraw their funds. As other venture capitalists followed suit, SVB had a classic bank run that took place at 21st Century Speed. Because of the intricacies of bank accounting, the speed of the withdrawals forced them to sell "hold to maturity" assets - which are not marked to market - at market rates, causing immediate losses and a liquidity catastrophe.  

By Friday morning (8 AM PST/11 AM EST), FDIC seized SVB Bank, unwilling to wait until 5 PM for more billions to leave the bank.  

FDIC nearly immediately announced that:  

250K insured deposits would be available Monday 

Some portion of the remaining funds would be available as a “Special dividend” later in the week. 

The remainder owed would be documented to be paid as assets were sold. 

On Saturday, it became clear that Circle, the backer of USDC, had $3.3 Billion (out of $40 Billion) in reserves at SVB. Circle temporarily dropped the USDC-Dollar Peg, dropping as low as 88 cents.  

Many VC-backed startups had 100% of their money at SVB. Payrolls of Tech companies were in danger of not running.  

By Sunday, Treasury, Federal Reserve, and FDIC issued a joint statement saying SVB would be shut down. Also, depositors would have access to 100% of their funds on Monday, and SVB assets will be sold. If FDIC resources are used to cover uninsured accounts (over $250,000), they will be collected from all banks with a special assessment.  

Some blame investors, but the tweet below exemplifies the problem with that mindset.   

We are glad that we were able to reach all of our clients who bank at SVB and check in on them. If you are banking with SVB and are looking for new accounting and finance advice with experience in treasury functions, we are here for you, so reach out.

Hey everyone, I’m Bette Hochberger, CPA, CGMA. Today, I will talk about the differences between e-filing (filing electronically) and paper filing and go into some of the advantages and disadvantages of each one. Let’s jump in!

Electronically filing, or e-filing is the process of submitting your tax return to the IRS over the internet.

Advantages

• Faster process. The IRS typically processes electronically filed returns within one or two days. The IRS will also send an almost immediate confirmation when they receive an e-filed tax return. If there was an error, your IRS e-file provider is requ
• Fewer errors. Your tax return must be accurate, so filing your tax return electronically will do the calculations for you. The IRS won’t need to re-enter your tax information in its system.
• Quicker refund! Probably everyone’s FAVORITE advantage to e-filing. E-filing reduces processing time, which can get individuals and businesses their refunds faster (most likely three weeks or less after filing).

Disadvantages

• There are limitations. For individual tax returns, you can’t e-file if you need to attach statements or other attachments or if you’re filing decedent returns. You also cannot e-file if you file before it begins (January 28th) or after it ends (October 20th).
• Technology isn’t perfect, so data loss is possible when e-filing.

Paper filing is sending tax returns through mail.

Advantages

• Security. Paper filing may have fewer security risks rather than e-filing. Paper filing allows you to avoid entering personal information via the internet. When e-filing, information such as your social security number or address could be at risk.
• Some people aren’t tech-savvy, so paper filing may be easier.

Disadvantages

• Longer processing time. Paper filing requires mailing, which can take a longer
• time to process. While e-filing only takes a day or two to process, paper files may take weeks to process. This means that individuals might wait up to 6 weeks to receive their refund.
• Less time to prepare. When paper filing, you must consider the time it takes to prepare and mail your tax return. If you wait too long, you could miss the deadline and experience consequences and interest.

Overall, e-filing is definitely the go-to when it comes to filing your taxes. But again, if you aren’t tech-savvy, paper filing is probably the better option. If you can’t decide which is best for you and need help filing, feel free to reach out and schedule a discovery call with me, and I’ll be happy to help.

I hope you learned something new today. As always, stay safe, and I will see you next time.

Hi, I’m Bette Hochberger, CPA, CGMA. The 2023 tax season has officially begun, so I will discuss the deadlines to file your 2022 taxes today. As we are already heading into March, by now, you should have all of your W-2 and/or 1099 forms from your employers and are ready to file.  For individuals, the last day to file your 2022 taxes without an extension is April 18th, 2023 (unless it is extended because of a state holiday). If you are a small business, your tax return is also due April 18th - but Multimember LLCs, S-Corporations, and partnerships must file tax returns by March 15th, 2023.   Every Tax Deadline You Need to Know:  April 3rd, 2023: RMD (required minimum distribution) due if you turn 72 in 2022.  April 18th, 2023: Tax returns are due. Missing the tax deadline can have consequences, including penalties and interest.  Deadline to file Form 4868 and request an extension. If you aren’t ready to file your tax return by the return deadline, make sure you complete an extension request instead, allowing you to delay filing a completed return until October 16, 2023. Remember that even if you choose to file an extension, you are still required to pay any taxes you may owe by the April deadline. Deadline to make IRA and HSA contributions for the 2022 tax year. After this date, you generally cannot make contributions for the prior tax year. First quarter 2023 estimated tax payment due. Making estimated tax payments means estimating how much income you will likely make for the year and determining how much you will owe to the IRS for income taxes. You can use Form 1040-ES to calculate how much tax liability you'll have for the year. If you overestimated how much tax liability you’d owe for a year and are due a refund, you can choose to receive that money now or transfer it to the following year’s quarterly tax payments. June 15th, 2023: Second quarter 2023 estimated tax payment due.  September 15th, 2023:  Third quarter 2023 estimated tax payment due. Deadline for extended partnerships and S-Corporation returns  October 16th, 2023: If you filed an extension, this is the due date for filing your tax return. December 31st, 2023: RMDs (required minimum distributions) must be taken for individuals 73 or older. January 15th, 2024: Fourth quarter estimated tax payment due. If you have already filed and are expecting a refund, the IRS has stated that most refunds are issued in less than 21 days. Earned Income Tax Credit refunds will most likely be refunded even earlier when filed electronically. If you filed paper, it might take longer. Want to learn more about your refund and your filing status? Check out the “Where’s My Refund” page on the IRS’s website.   If you are stressed about filing your taxes and are seeking help, I am always one click away. You can schedule a meeting with me through my website.   As always, stay safe, and I will see you next time.

Hi, I'm Bette Hochberger, CPA, CGMA, and I will discuss the news we've all been raving about today! So, it looks like the IRS announced that there would be a delay in implementing the $600 reporting threshold for third-party payment platforms' Form 1099-K. I'm sure you're wondering, "What is a 1099-k form, and what are third-party payment platforms?"  

Third-party payment platforms include:  Venmo eBay Paypal Cash App Zelle And more What is Form 1099-K?  

This form is an IRS information reporting form. It contains information, for your taxes, about the gross number of payment transactions that you had on a third-party payment network when that amount exceeds $20,000 in the previous year. So, for example, you would receive this form in 2023 if you received more than $20,000 in payments for goods or services through third-party payment networks in 2022.  What does this mean, and what changed?  The American Rescue Plan Act reduced the 1099-K reporting threshold from $20,000 to $600. Under the act, a third-party organization must report third-party network transactions paid in 2022 with any participating payee exceeding a minimum threshold of $600 in collected payments, regardless of the number of transactions. This differs from the previous point of 200 transactions per year exceeding $20,000. This was initially supposed to take effect in 2022, but it is now being delayed.  Who does this affect?  This new threshold mainly affects third-party settlement organizations and e-commerce platforms (i.e., eBay, Offer Up, etc.). However, this also includes individuals and small businesses that use those platforms. Many companies who use third-party payment networks are celebrating, as they will not be required to report the 2022 tax year transactions on a Form 1099-K to the IRS or the payee for the lower $600 threshold amount enacted by Congress as part of the American Rescue Plan Act. In addition, contrary to popular opinion, this law does not track personal transactions, such as sharing the cost of a car ride or meal, birthday gifts, etc.   When did the IRS announce this?  On December 23rd, 2022, the IRS announced the reporting thresholds for third-party settlement organizations and e-commerce platforms set to take effect for the upcoming tax filing season. Then, on January 3rd, 2023, the IRS updated the timing in response to the public's concerns. To help smooth this transition rather than just jumping right into it, they will now be delaying the implementation of the 1099-K changes, hopefully giving some clarity to taxpayers and tax professionals in the industry. However, the existing 1099-K reporting threshold of $20,000 in payments from over 200 transactions will remain in effect until they've come up with a solution.  As always, I hope you learned something new. Stay safe, and I will see you next time!

Hi, I'm Bette Hochberger, CPA, CGMA, and today I want to discuss some recent statistics regarding venture capital.  What is Venture Capital?  According to Investopedia, "Venture capital (VC) is a form of private equity and a type of financing that investors provide to startup companies and small businesses that are believed to have long-term growth potential. Venture capital generally comes from well-off investors, investment banks, and any other financial institutions."  On this page, we've discussed angel investors and venture capital before, so if you want to learn more, click here.   What Happened?  If you didn't know, venture capitalists historically tend to invest heavily in California, Massachusetts, and New York. But according to the latest statistics, all that has changed! Where did all that money go? You guessed it, The Sunshine State, and two other honorable mentions - Texas and North Carolina.  According to Crunchbase.com, "The Sunshine State saw the biggest percentage increase of any state in venture capital investment between 2021 and last year." This is no surprise to me as I am heavily entrenched in the Miami Tech scene, but seeing these numbers really solidifies my stance on Miami Tech's staying power.  A huge reason for this uptake is that Florida stayed open while the prior ring leaders (California, New York, and Massachusetts) remained more or less closed. We saw people moving to Florida left and right. So much so that we even started offering Florida Domicile packages to potential movers to reassure them that their old state won't come chasing after them for taxes.  So, anyway, that is the news, what do you all think? Let me know in the comments, and as always, stay safe.

Hi, I'm Bette Hochberger, CPA, CGMA. Today I will explain Form 1098-T and what that means for college students. Let’s go ahead and jump in!  What is Form 1098-T?  Your college or career school may be sending you (or already has sent you) a 1098-T form. Please don’t worry, because it may be a good thing. Form 1098-T is a Tuition Statement to report qualified tuition and related educational expenses to you and the IRS. So, why might receiving this form be a good thing? If you are a current student or recent graduate who has received Form 1098-T, you might be able to get added money refunded to you when doing your taxes. In short, it’s possible to claim these expenses as educated-related tax credits.   Who gets the 1098-T form, and what are the qualified expenses?    Schools must send Form 1098-T to any student who paid “qualified educational expenses”  in the prior tax year. Qualified expenses include tuition, scholarships or grants,  fees required for enrollment, and course materials required for a student to be enrolled. If someone else pays for these expenses on behalf of the student, such as a parent, the student will still get credit for them and receive Form 1098-T. Schools must send this form out to their students by January 31st, 2023, and file a copy with the IRS by February 28th, 2023.   Understanding Form 1098-T  The 1098-T form has been updated over the past several years. Before, Boxes 2 and 3 were used, but now they are no longer used and will be seen empty. Box 2 showed how much the school billed the student during the year, and Box 3 was provided to put a check mark if the school’s reporting method had changed. Now, looking at the form, you will see ten boxes. Let me explain a little more about what each one means.   Box 1: Payments received for qualified tuition and related expenses.  Box 2: Empty  Box 3: Empty  Box 4: Adjustments the school has made to qualified expenses for a prior year. The student may be responsible for additional tax for that year if it turns out that a previous year’s expenses were lower than initially reported.   Box 5: Scholarships or grants. These may reduce the number of qualified expenses students can use when calculating a credit.   Box 6: Adjustments to scholarships or grants for a prior year. These adjustments may affect the student’s tax liability for the previous year, so the student may have to file an amended return.   Box 7: This box is checked if the amount in Box 1 included amounts for an academic period beginning January-March 2023.   Box 8: This box is checked if the student is enrolled at least half-time.   Box 9: This box is checked if the student is enrolled in a graduate program.   Box 10: This box will only be filled in if the student had expenses reimbursed under a “tuition insurance” policy. These typically go along with instances where the student is forced to withdraw from school due to medical reasons or family emergencies. This box, if filled in, will show the amount reimbursed.     I hope you were able to learn something new today. As always, stay safe, and I will see you next time!

2023 E-Filing Taxes with the IRS

Join Sarah Broglie and me for this #FinanceFriday, where we will discuss "The Best Fit: How To Choose a Financial Advisor."  Learn more about Sarah here: https://www.raymondjames.com/sarahbroglie/our-team/bio

Hi, I am Bette Hochberger, CPA, CGMA, and on today's quicky, we will be discussing the Home Office Deduction. The main questions we are tackling are: What is the home office deduction, what qualifies, and how do I calculate it? As a bonus, I will also walk you through the two ways the IRS allows you to claim the home office deduction, the simplified option and the regular method (i.e., Form 8829).   What is the home office deduction?   The home office deduction is a tax deduction the IRS allows Schedule C businesses to take. Schedule C refers to the portion of the 1040 tax return that deals with people who run their businesses as sole proprietors, so single-member LLCs, and 1099 workers. In short, this deduction allows sole proprietors to deduct expenses related to their home offices.   What Qualifies?   The space must be exclusively and regularly used for Schedule C business purposes for your space to qualify for the home office deduction. Exclusively meaning, the space is only used for business purposes. Regularly means, you use the space often and continuously. If you meet these requirements, you may deduct a portion of your home expenses (e.g., mortgage interest, insurance, utilities, repairs, maintenance, depreciation, and rent).   How do I calculate it?   The IRS provides two options for calculating the home office deduction. The first is the simplified option, which is a rate of $5 per square foot, so if the qualified area is 150 square feet, you multiply 150 X $5, giving you a deduction of $750. Using this method, the maximum amount of space you can deduct is 300 square feet. Now, if this is not advantageous, you can use the regular method, Form 8829. I highly recommend you consult with a professional before attempting this form on your own and doing some tax planning to find out if it would be worth it to go through the headache of filling out the extensive Form 8829. Please watch the video above if you want to see my overview of the form.   That is all we have today; I hope you learned something new. If you have a specific topic you want to see discussed, don't hesitate to DM me, and I will put it on the docket. As always, stay safe, and we will see you next time.

Today we will be doing an overview of various #TaxCredits on this #taxtiptuesday. We are reviewing the Child Tax Credit, Recovery Rebate Credit, Earned Income Tax Credit, Lifetime Learning Credit, American Opportunity Credit, Child and Dependent Care Credit, Saver's Credit, and Adoption Tax Credit.

On this #TaxTipTuesday, Bette talks about tax savings for college! On this Tax Tip Tuesday, we'll talk about some benefits you can get when you've got kids at college and possibly if you are returning to school.

On this #TaxTipTuesday Bette talks about the new student loan debt cancellation and what it means for your taxes.

I'm Bette Hochberger, CPA, CGMA, and on today's Tax Tip Tuesday, we're going to talk about some penalty relief from the IRS.  Now it's been a crazy couple of years and the IRS has certainly had its share of problems during all of what's been going on. You might remember when the pandemic really first hit they were moving deadlines, it was very chaotic, very crazy, and even with extending those deadlines, there were a lot of people that still couldn't manage to get their stuff together in time and file. And you could have filed extensions and still file later as usual but it's been rough, it's been a rough time, hard to get information, hard to get all your stuff together to get to your CPA or tax preparer, et cetera.  So the IRS did come out and they said that there was a notice called the 22-36 that if you filed a late 2019 or 2020 tax return that they are going to remove the penalty. We call it a penalty abatement in the CPA world. So this is huge. If you filed things late or if you got a letter from the IRS that said that there is a failure-to-file penalty that was assessed, and if you already paid it even these are all either getting removed or they're going to be refunded. It's automatic; you don't have to call the IRS, you don't have to send a letter; it's supposed to happen by the end of September, they're saying it's $1.2 billion of refunds to taxpayers who received this failure to file penalty.  There are some other little caveats to this. There are other different types of relief that they're giving, but it's really just, "Did you file late?" If you filed late, they are removing those penalties for the 2019 and 2020 tax years.  Now, something else that was part of that, I think it's part of that same notice. Yep, it's part of notice 2022-36. Also, if you had certain international information return penalties right, and if you need to file what we call the FBAR, if you have a foreign bank account with an over $10,000 balance and you have to file that return every year, it's the Fin-sen, it's a little bit strange it's not really for taxes. Still, a lot of times your CPA might ask you about if you have a foreign account. Returns like those, they're also getting penalty relief and that's huge because those are very, very, very big penalties. You're talking a $10,000 penalty for not filing those returns. So that's huge news.  It hopefully will take some of that burden off of the IRS so you don't have to keep calling and waiting on hold for hours, or trying to send letters that feel like they go right into the garbage can. It's supposed to all happen automatically. So if you know had one of those penalties and you don't get a refund by the end of September probably wait a couple of weeks and then you might have to try calling again afterward, but hopefully, fingers crossed everybody who's entitled gets it.  And that's it, that's all I have for you. So if you are one of those people suffering from these penalties, I hope you get it. And if you have any other questions drop a comment, and throw us a like. We'll see you next time.

Hi, I'm Bette Hochberger, CPA, CGMA. This #TaxTipTuesday, we are discussing the benefits you can access if you have kids in school or if you are in college. #TaxCredits #AmericanOpportunityCredit #LifetimeLearningCredit 

Hi, I'm Bette Hochberger, CPA, CGMA. A very recent of looks like it's dated yesterday's opinion editorial in the New York Post; apparently, New Yorkers are still fleeing the state and moving to the sunshine state of Florida. Now, Floridians, for anyone who's been living here since I guess the pre-pandemic, we've seen this, we know. We know how little housing there is and how many drivers are on the road, but we have an official number now.  Florida Department of Highway Safety data says a 12% increase in the number of New Yorkers swapping their driver's licenses for Florida's just in the first four months of 2022. So many people, it's crazy. Then not only that, it's high-income people who are moving. Now, anecdotally, we've seen this. We've seen the people I talk to who are moving, who want to know how they're going to save on taxes, how it's going to help them. We've seen it in the housing prices, but it's exciting to have that confirmed with actual data.  If you want to hear more about the Florida housing market, check out last week's Finance Friday with Alexa Rosario. We talked all about what was going on. It was fascinating, and please check out the article. It's just fascinating. It's interesting to see what's changed over the last few years. New Yorkers, we are so happy you're here. Keep Florida weird. Okay. Let's not turn it into a new New York. We love it the way it is; just don't change anything. Enjoy the sunshine state, and we will see you next time. Thanks.

Hi, I am Bette Hochberger, CPA, CGMA, and on today's Finance Friday, we have the author of Seller Mistakes, Michael Bell, who will tell us all the secrets that your real estate agent does not want you to know. Then, we will hear all about his journey in writing his book, Seller Mistakes, and he will give us an overview of the primary mistakes.  Michael Bell is a first-time, and as he says, a last-time author of the international best-selling book Seller Mistakes.  It hit #3 on the Wall Street Journal list in 2021.  Michael is a full-time real estate broker in Pasadena, California, for Sotheby's International Realty and is ranked in the top .01% of all agents nationwide.  Michael told me he had hoped to sell a few hundred books, but the book has taken off and has sold almost 38,000 copies.  What he writes about and what we will talk about have obviously resonated, and that's why I asked him to join us.  Be sure to check out the video above if you want to hear more!  One of the stand-out reviews - “Michael provides first-hand expertise to sell your home for top dollar in this well-written book.” – Philip White, President & CEO of Sotheby’s International Realty  However, Seller Mistakes supposedly made a few realtors angry, so if you are curious as to what the fuss is about, you can grab a free copy of the book on his website or order online! Also, if you want to hear about Seller Mistake's author Michael Bell's weird hobbies; be sure to watch the video.

Hi, I'm Bette Hochberger, CPA, CGMA, and I have exciting news! We are officially accepting crypto as payment. Our firm knew that accepting cryptocurrency as payment was the only natural next step after solidifying our relationship with TaxBit. If you don't already know, at Bette Hochberger CPA, CGMA, we pride ourselves on being a crypto-informed CPA firm.  Some of you may ask yourself, "What is a crypto-informed CPA Firm?" And to that, I will tell you one of the many stories I have heard from my clients who are involved with crypto. For the sake of the story, we will call the client "Charlie." So, Charlie has been investing in cryptocurrency for a while, obtaining new coins and even dabbling in NFTs. Eventually, Charlie becomes what many would call a crypto-expert, and he opens up a crypto-mining business. Tax time comes around, and Charlie is worried since he knows the transactions are difficult to track and that crypto's tax laws are finicky. So, he goes to his accountant, who he has been going to for the past few years, and his accountant tells him that they can't do it and good luck finding anyone who will.  That is where we came in, we saw a need that CPA Firms were neglecting, and we decided to take the time and care for that need. We are so excited to tell you that we have partnered with TaxBit, the industry's most trusted and largest cryptocurrency accounting software. We searched a lot of software, but once we found Taxbit, we fell in love. One of the great things about TaxBit is that you will get 20% off your TaxBit subscription when you sign up with us.  We want you to be secure, safe, and free of IRS audits. We won't struggle to understand your crypto mining, staking, and NFT woes at my firm. Instead, we will meet you with cutting-edge software and the effortless payment option of cryptocurrency. We hope that if you are one of the many who have felt rejected by CPAs or misunderstood by them, you will trust me to be your crypto CPA.  Are you excited that we are accepting crypto as payment and partnering with TaxBit? Let us know on social. Anyway, that is all I have for today, and I look forward to seeing you on my calendar.

Hey, I'm Bette Hochberger, CPA, CGMA, and today we will talk about why running payroll when you are an S corporation owner is essential. Okay. So you have to run payroll when you're an S corporation owner. The IRS, the government, knows that many people create S corporations because they function similarly to an LLC. Or a partnership where you get that flow-through entity, and you get the tax savings of not being a regular C corporation where the taxes are a lot higher. And the other cool thing is with the S corporation; you're not paying self-employment tax on all that income because if you were just an LLC or you were a sole proprietor or just a regular partner, you'd be paying self-employment tax on all of your net income, and that could be a little bit painful.  So, the result of that is because the government knows you're not paying money into that self-employment tax; you do need to run payroll to get those payroll taxes paid in. So, payroll tax and self-employment tax is kind of the same thing.  So when you're an S corporation owner, I don't care how much you're making, how little you're making, whatever the IRS can come in and make your life a living hell if you're not running payroll. So run payroll, please. But, of course, there are other reasons you want to do it besides the fact that you can be inviting an IRS audit, which nobody wants. Still, if you're looking for some other tax planning and you're an S corporation owner, you might be looking at some retirement accounts, and a lot of times, you need to be on the payroll for those retirement account contributions to happen. So if it's not enough that the IRS wants you to run payroll, do it so that you can put away money for your future and lower your taxes at the same time, which is fantastic.  If you aren't set up already to run payroll, it's not the fastest process. You do need to register with your state. So tick tock because the sooner, the better, because we're already a week into December.  So that's my big tip for today. If you are an S Corporation owner, run your payroll! Thanks. #TaxTipTuesday

Hi, I'm Bette Hochberger, CPA, CGMA, and #VeteransDay2021 is approaching. The complicated life of military personnel and their families doesn't get any less complex during tax season, so I figured I would try to uncomplicate it for you by sharing some of the unique tax rules that apply to active and retired military. I will also briefly touch on the work opportunity tax credit (WOTC) available as an incentive for employers looking to hire a qualified veteran. Let's get started.  So, the first thing you need to know is if you are eligible for military tax benefits. According to the IRS, you may qualify for military tax benefits if you are a US Army, US Navy, US Air Force, US Marine Corps, US Coast Guard, or the US Space Force. Aside from armed forces, some uniformed services and support organizations are also eligible.  Once you find out if you are eligible, you should know that combat pay and your basic allowance for housing and subsistence are non-taxable forms of income! Non-taxable means that you do not have to claim that income on your taxes unless you decide that claiming it would work best for your specific tax situation (such as claiming the Earned Income Tax Credit).  In a normal tax situation, filing an extension is necessary to file "late," and it doesn't excuse late payments; however, if you are a qualified military member stationed abroad or in a hazardous zone, you will have an automatic extension that gives you at least 180 days once you leave your station to file and pay!  With so many people moving to Florida, I get asked about moving expenses often. Moving expenses usually must be proven using a time a distance test. Because of the 2017 Tax Cuts and Jobs Act, most taxpayers aren't eligible for this deduction; however, if you are moving because your station is moved. Instead, you need to file form 3903 to get those moving expenses reimbursed.  To take a deeper look at and find more credits and deductions available for current and former military, go to www.irs.gov/individuals/military.  Now, what if you are an employer looking to hire a veteran? Well, there are benefits available for you also! The Work Opportunity Tax Credit (WOTC) allows employers to hire certain groups who struggle to gain employment due to unfortunate circumstances. The IRS specifies that to acquire the WOTC, you must hire qualified veterans. You can find the qualifications on the IRS website.  So, hire a veteran and don't miss out on these tax credits. That is all I have for this Veteran's Day Quickie, be sure to like and comment if you found this video helpful. Thank you for joining; I will see you all next time.

#Cryptocurrency #TaxTipTuesday Hi, I'm Bette Hochberger, CPA, CGMA. And on today's #TaxTipTuesday, we're going to talk about your #cryptomining business. I've been getting some calls, emails, et cetera, meetings with people setting up #crypto mining businesses. Because why not? If you're in Miami and you want some Miami coin, and maybe you want to go mine it. Well, you need to know some things if you're going to start a crypto mining business. So first off, every time you mine a coin, it's considered taxable income. Make sense. It's kind of like if you have any other business and you perform a service or sell a good, whatever it is that you do in that business, it's an income event, which means it's taxable. And you most likely won't get a 1099 from this from anyone, so you're going to have to keep outstanding records to make sure you're reporting all that income.  Now that income is taxed at ordinary rates, which is the value of the crypto you mine on that day. And now the IRS will tell you that if you're in the business of mining crypto, that income, in addition to being subject to ordinary income tax, is also subject to self-employment tax, which is 15.3%. So now, if you're self-employed, no matter what you do, whether it's mining crypto or something else, you're subject to those taxes. So that's pretty much the same as if you were running any other kind of business.  So if you're mining crypto on your own, and you're doing it as a business, you're going to file a Schedule C on your personal income tax return. The cool thing about this is that you're allowed to deduct expenses against that income. So what kind of expenses are we looking at? Rent, electricity, cost of your gear or your rig, repairs, and maintenance. Anything related to running that crypto mining business is a legitimate business deduction to offset that mining income.  Now, because this is a business, you can set up other business structures. You don't have to be a sole proprietor, which is what the default is if you're only filing a Schedule C. So you could go and set up an LLC, an S Corp. You can talk to a CPA, maybe be if you want to figure out what the best structure is, but you absolutely can do it. Now, the thing you have to remember is just like every other business. If you're going to do certain transactions, they are going to trigger certain things. For example, if you pay people, whether you pay them in crypto or if you pay them in fiat currency. If you pay them more than $600 during the year, you have to issue them a 1099 same as a regular business.  Now, what makes it a little bit more complicated is if you are paying people or doing any other transactions in the cryptocurrency, that's a whole other taxable event in and of itself where we're going to trigger the capital gain rates. So there's a lot of moving parts when you're in the crypto business world. You've got a lot of transactions to keep track of, and the most significant thing here I'm going to tell you is to keep good records, keep good records. Very, very important.  You don't want to get in trouble with the IRS. You don't want to have a problem with anyone. So good recordkeeping is what's going to cover your butt. So what do you think? Are you going to start a crypto mining business? It might be very lucrative. Who knows? And if it is, you're going to need some tax help. But let me know what you think about crypto businesses in general; drop a comment, and we'll see you next time. Thanks.

Hi, I'm Bette Hochberger, CPA, CGMA. For today's business quickie, we will be discussing the difference between venture capitalists and angel investors so that you can decide which investor best suits your business.  Venture Capitalists, It's essential to remember that Venture Capitalists (VCs) are not the same as a bank loan; when a company takes on a VC investment, they are essentially taking on a partner. The VC investment is usually traded for a 40% preferred-equity ownership position. This can be a pro or a con depending on the kind of support your business needs; in order to take on this kind of investor, I would suggest finding an investor you trust. Venture capitalists are generally a part of larger companies and typically invest using pooled money from their firms - think pension funds, etc. Venture capitalists usually invest in already established businesses to reduce risk, so VCs are probably not the right fit for you if you are a start-up. VCs invest more money than angel investors, averaging $11.7 million. So, do your research and come prepared with your business plan and key performance indicators (KPIs). Get with your accountant before meeting with the VC of your choice, and make sure to review your financial statements and decide how much capital you should be seeking.  Angel Investors  Angel Investors, unlike VCs, are accredited individuals who use their own money to invest in small businesses and start-ups. Typically, angel investors take on more risk than VCs and invest earlier. So, if you're a start-up and don't have much of a proven track record yet, consider an angel investor. Angel Investors, just like VCs, are not to be confused with a bank loan; they will want equity in your business. The average angel investment amount is $333,000, so their equity is likely to be less than a VC. However, because angel investors are individuals, they often act as mentors to the entrepreneurs they assist. This level of support can be good or bad, the good being that they can help you network with established professionals and assist in business decisions. The bad is when you don't agree on what business approach to take. So, before making hasty decisions, ask yourself what you are looking for in an investor and compare your options.  Anyway, that's all I have for today's business quickie. Let me know what you think in the comments and drop a suggestion or any business content you would like to learn about more.

Hey, everybody. It's been a minute. We've been so busy during the tax extension season. I haven't had time to come on and give you guys all kinds of great advice and information and stuff about taxes and crypto, all kinds of nuttiness, but it's an important day, or at least, it will be in a week. So I will do a real quick Finance Friday to make sure we get it done. So let's start.

Hi, I'm Bette Hochberger, CPA, CGMA, and coming on today to let you know that the extension deadline for corporations, specifically C-corporations, is not the S's. So if you didn't file your S-corporation return, you're late, but your C-corporation returns and your individual 1040 income tax returns are due next week, a week from today, 10/15 on a Friday, which is not fun for us CPAs, although it will make Saturday a lot more fun.

It's what we call a drop-dead deadline. That means that this is it. There's no extension past here. So if you're coming up on this deadline, you got to get your stuff together, get it in, get it filed. A lot of times, people will ask me like, "Oh, I can't afford to pay my taxes. Should I file?" And the answer is yes; you absolutely should, because if you don't file, even if you owe it, even if you don't have the money right now to pay the taxes, you're going to get hit with all kinds of penalties and interest on those penalties, that you can stop or prevent from filing on time, even if you can't pay, right? So if you can't pay your taxes, you can always work with the IRS. You can set up payment plans. There are other things; if you're in really dire situations, I'm not even going to get into that because that's the whole super complicated thing, but know that if you can't pay it right now, you can work it out with the IRS.

You can set up payment plans; they'll go across, I think, five or six years, they'll stretch it out for you. And even if you do go on a payment plan, you can pay it off early. So please don't wait; get it done. Also, we've noticed a lot of problems with filing this year; we've had a lot of electronic filing problems with the IRS. So do not wait till the last second. If you made it to this point, you're probably a bit of a procrastinator, but suck it up, get it done. It's not fun. No one likes to do it, but better to do it sooner rather than later. And hopefully, we will come back with more regularly scheduled videos after this deadline, so looking forward to it, and we'll see you next time.

It’s time for a #BusinessQuickie, and I wanted to come on here and tailor this go-live to our small business owners who want to know the difference between contractors (1099) and employees (W-2) so that you can find which best fits with your business. I figured this would be a great topic for labor day! Let’s get started.

You might ask why is it important to know the difference? If you misclassify an employee as a contractor, it can lead to audits, penalties and fees, so we want to avoid that at all costs. There are three areas the IRS looks at to make this determination- behavioral control, financial control, and the relationship.

So, what is a W-2 employee? Well, a W-2 employee is a typical employee that works for you either part-time or full-time. With W-2 employees, you must withhold payroll taxes from their paychecks, and your business pays the payroll taxes on their earnings. The W-2 employee can be either hourly or salaried. When it comes to labor laws, such as minimum wage and overtime, W-2 employees are protected.

In contrast, a 1099 worker usually works for you part-time. When it comes to payroll taxes for 1099 workers, your business doesn’t need to withhold taxes or pay taxes on their earnings. The contractor is never salaried and is less protected by labor laws.

Now, which is best for your business? Well, there are pros and cons to both, and you are going to have to make this determination with your own facts and circumstances.

The pros of working with 1099 workers are fewer costs because you don’t have to pay payroll taxes for them, you don’t have to pay worker’s compensation insurance or provide benefits like healthcare, and - because your business is not subject to the same labor laws that apply to W-2 employee’s- you’re less likely to be sued on the grounds of labor law violations. A contracot also makes for a more casual relationship between your business and the individual, so there is more flexibility. However, the cons of hiring contractors are they generally have a higher hourly rate than W-2 employees and the casual relationship I just talked about can backfire since they don’t understand your company’s culture and they are less likely to be available to you and your company when you call them needing their assistance on a whim.

The pros of working with a W-2 employee are it is much easier to hire W-2 employees since most people aren’t looking for contracted work. There is also more versatility with W-2 employees since they can pretty much do anything you might need them to since their role is less defined than a contractors’s role. The W-2 employee will be more reliable since they usually work for you full time with a set schedule and understand the company’s culture. The cons are, of course, they cost more in payroll taxes and benefits, and you have a lot of labor laws to follow.

In summary, both types of workers can be a great fit for your business depending on what you need them for. Just DON’T you accidentally file one as the other because the IRS will fine you with penalty and fees.  And payroll audits are no joke!

That’s it for the #BusinessQuickie. Happy labor day! Enjoy your weekend, drop a comment, and I will see you next time.

Hi, I'm Bette Hochberger, CPA, CGMA. And today, we're going to talk about the Olympics because they're going on right now, and even though there's a bit of controversy around the games and some of the athletes, I like to bring it back to my favorite topic: taxes. Specifically, taxes that Olympians must pay on their winnings and complexities within that tax.

Read the full article or watch the video here: https://bettehochberger.com/quickies/the-olympics-are-taxing-4689/

Hi, I'm Bette Hochberger, CPA, CGMA, and today we're going to talk about how long does it take to become a #Florida resident?  Hmm, well, people are still leaving California and New York and many of these various distorted high-tech states, and they're still coming to Florida. So thank you all. We appreciate it. Our property values love it. So you guys might not like it when you're coming here and trying to rent or buy, but for those of us who were here before, we're delighted. So thank you.  Now, if you want to establish residency in a state, the general rule is 183 days. Hmm, sounds like a random number, except if you take 365, the number of days in a year, divide by two, you get 182 and a half. So round that up because they're not going to count a half a day, and you have 183. So they want you to be there for more than half the year. Right?  Okay. So does that mean you can just count backward, 183 days, and boom, just move by then? Eh, maybe technically, possibly. But as we know, nothing really goes that smoothly and when you're trying to establish your residency, you're dealing with a lot of government agencies. So we know, even before COVID, we know government agencies do not move that fast.  So I would say if you're trying to establish residency in Florida, you want to move in the first half of the year. Right? You could do June. You're going to be pushing it. You might run into some snags. But if you can do it earlier in the year or do it at the very end of the year before the next year starts, it's even better. It's not good for that year that it's the end of, but you'll be able to establish residency for the following year.  So things you're going to need to do. Find a place to live, get a lease, buy a house, something like that. Those things can take a long time. If you're lucky, if you're maybe not so picky, and perhaps you have a lot of money, you could possibly get them done quickly. But you got to give yourself a little bit of time, especially if you're buying because that closing process isn't that fast.  You're going to need to move your driver's license. Holy crap, does anyone enjoy going to the DMV? No, it's never fun. We had an appointment system for a while. I believe we stopped in Florida. So now you got to get up at 2:00 o'clock in the morning and get in line to get to the DMV. It's not a fast process by any means, so there's that.  Basically, anything you're doing with the government to establish your residency here, it's going to take you a hot minute, maybe a few weeks even, it depends, but it's going to take you a while. So I would say at the very latest, if you're trying to be a resident for the gear, come before July. So if you're trying to move here now, I don't think it's going to work. You're not even going to hit the days. But if anyone's planning for next year, beginning of the year, for sure, or come here at the end of this year and you should be all set. You'll be able to get all those documents in order and prove your residency.  So I hope you found that helpful. Keep moving to Florida. We love it. It's even sunny sometimes right now, which is excellent in summer. But that's it, and we'll see you next time.

Hi, I'm Bette Hochberger, CPA, CGMA, and on today's Tax Tip Tuesday, we're going to talk about the upcoming back-to-school sales tax holiday. This is a very cool thing we do in Florida. It's been going on for; I don't even know how long. It's been going on for years, but basically, what's going to happen is there are many things that you can buy that are going to be sales tax exempt for going back to school.

This is going to start this coming Saturday, July 31st, and it runs through August 9th; and basically, there's a list of qualifying items, mostly stuff you would expect to need to go back to school: pens, pencils, paper, or staplers, like all that kind of good school stuff. And it is exempt from sales tax, which is a nice break for families, right? But, unfortunately, kid's school supplies are expensive; especially if you have many kids, you have to pay a lot of money.

Some things you might not realize are the books and pencils kind of stuff, it also applies to clothing: shoes, footwear, things like that, but there is a limit of $60. So, if you need to buy some expensive sneakers for your high school boy as I do, unfortunately, it's only if the item is $60 or less. School supplies have to be $15 or less per item.

And then, this is an excellent thing. A lot of kids now, especially since everyone had to go online, have purchased many computers, right? The first thousand dollars of a sale of a computer and certain computer-related accessories is not subject to sales tax. So if you have to buy a fancier computer and it's over a thousand dollars, that first thousand, no sales tax. They would do sales tax on the rest of it.

Now, all these things have to be used... Personal use for kids to go to school. It can't be commercial. So no business owners. I'm sorry. You cannot go out and refurbish your office with all new office supplies and computers and all that stuff. It's really for getting the kids back to school. But yeah, that's it. So go shopping. I'm going to say, "Go early." I don't know if you've ever tried to buy this stuff at the tail end of this back-to-school sales tax holiday. There's nothing left. And when you get those lists where they want particular things, like you need that purple binder and other crazy stuff that ends up on those school supplies lists. So you want to go early, so you can find what you're looking for. And enjoy that sales tax holiday—yet another great reason to live in Florida.

And that's it for this Tax Tip Tuesday, and we'll see you next time.

A #BusinessQuickie about the ins and outs of deducting meals and entertainment for business. https://bettehochberger.com/tax-tip-tuesday/tax-credits-vs-tax-deductions-4643/