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Senior Property Tax Homestead Exemption

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A property tax exemption is available to qualifying senior citizens and the surviving spouses of seniors who previously qualified.  The three basic requirements are:  1) the qualifying senior must be at least 65 years old on January 1 of the year of the application; 2) he or she must be the owner of record and must have been the owner of record for at least ten consecutive years prior to January 1; and 3) the senior must have occupied it for at least ten consecutive years prior to January 1.

For those who qualify, 50 percent of the first $200,000 of actual value of the applicant’s primary residence is exempt.  The state will reimburse the county treasurer for the lost revenue.

Here is a link to the form to apply:   senior-property-tax-exemption-long-form

For more information, please contact our office.

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Smart Regs – Boulder Rentals

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All licensed rental housing in Boulder must pass a Smart Regs inspection before December 31, 2018. If your property is not currently licensed, it will need to be prior to the inspection.
– Smart Regs are a new baseline energy efficiency requirements for existing rental housing in Boulder. Improving energy efficiency in existing rental housing enhances tenant comfort and supports the community’s energy goals and climate commitment.

What is EnergySmart?

The EnergySmart Service, developed by the City of Boulder and Boulder County, provides a SmartRegs Compliance Pathway for owners and property managers. Designed to eliminate hassle, EnergySmart will provide:

Owners and property managers with a comprehensive, one-stop-shop for energy efficiency solutions;
A free, dedicated energy advisor to assist with determining where individual properties stand in relation to SmartRegs compliance, and to recommend the best method of compliance for each individual rental property; and
Direct installation of free energy efficiency measures, help scheduling contractors for any efficiency improvements that need to be made, and assistance identifying and applying for eligible rebates and incentives.
Contact EnergySmart at www.EnergySmartYes.com or call 303-544-1001 to speak with an energy advisor.

What happens if I don’t comply by Dec. 31, 2018?

The rental license for all licensed rental properties that do not pass a SmartRegs inspection before the end of 2018 will expire on Dec. 31, 2018. Additionally, until the property reaches SmartRegs compliance, you will not be able to receive or renew a rental license at the start of 2019 and beyond. The discovery of an unlicensed rental property will result in legal action.

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New Penalties for Failing to Timely File Information Returns

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If you fail to file a correct information return (1099, 1098, W2-G to name a few)  by the due date and you cannot show reasonable cause, you may be subject to a penalty.  The penalty applies if you:

– Fail to file timely

-Fail to include all information required to be shown on a return

-Include incorrect information on a return

-File on paper when you were required to file electronically

-Report an incorrect TIN

-Fail to report a TIN

-Fail to file paper forms that are machine readable

 

The amount of penalty is based on when you file the correct information return.  The penalty is as follows:

-$50 per information return if you correctly file within 30 days (by March 30 if due date is February 28 *see calendar showing 1099-MISC with box 7 information now due January 31, 2017); maximum penalty $532,000 per year ($186,000 for small businesses)

-$100 per information return if you correctly file more than 30 days after the due date but by August 1; maximum penalty $1,596,000 per year ($532,000 for small businesses)

-$260 per information return if you file after August 1 or you do not file required information returns; maximum penalty $3,193,000 per year ($1,064,000 for small businesses)

 

For further information, including exceptions to the penalty, please see General Instructions for Certain Information Returns at irs.gov.

 

 

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New Penalties for Failing to Timely File W3 and W2 Forms

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The 2016 W3 and W2 forms are due to employees and the government by January 31, 2017. Failure to file a correct form W2 by the due date without showing reasonable cause, may result in penalties as provided under IRS Section 6721.  The penalty applies if you:

 

-Fail to file timely.

-Fail to include all information required to be shown on Form W2,

-Include incorrect information on Form W2

-File on paper forms when you are required to e-file

-Report an incorrect TIN

-Fail to report a TIN

-Fail to file paper Forms W2 that are machine readable.

The amount of penalty is based on when you file the correct Form W2.  The penalty amounts below apply for tax years beginning in 2016.  The penalty is:

 

-$50 per Form W2 if you correctly file withing 30 days of the due date (February 28 if the due date is January 31); the maximum penalty is $532,000 per year ($186,000 for small businesses)

-$100 per Form W2 if you correctly file more than 30 days after the due date but by August 1; the maximum penalty is $1,596,500 per year ($532,000 for small businesses)

-$260 per Form W2 if you file after August 1, do not file corrections, or do not file required Forms W2; the maximum penalty is $3,193,000 per year ($1,064,000 for small businesses)

 

For further information, including exceptions to the penalty, please go to the General Instructions for Forms W2 and W3 at irs.gov.

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IRS SCAMS

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We have been receiving many questions and concerns from clients regarding the recent rash of IRS scams. These scam artists present themselves as being from the IRS, a tax company and sometimes even a state revenue department. They are doing this via email as well as by phone. By email, they’re trying to entice people to click on links in official-looking messages containing questions related to their “tax refund”. Report these emails to phishing@irs.gov. By phone, many are using threats to intimidate and bully people into paying a “tax bill”. They even alter caller ID numbers to make it look like the IRS or another agency is calling. The callers use fake names and fake badge numbers as well. Below are some tips to help keep you safe.

THE IRS WILL NEVER:

• Call to demand immediate payment over the phone, nor will the agency call about taxes owed without first having mailed you a bill.
• Threaten to immediately bring in local police or other law-enforcement groups to have you arrested for not paying.
• Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe.
• Require you to use a specific payment method for your taxes, such as a prepaid debit card.
• Ask for credit or debit card numbers over the phone.
IF YOU GET A PHONE CALL FROM SOMEONE CLAIMING TO BE FROM THE IRS AND ASKING FOR MONEY AND YOU DON’T OWE TAXES, HERE’S WHAT YOU SHOULD DO:

• Do not give out any information. Hang up immediately.
• Contact TIGTA to report the call. Use their “IRS Impersonation Scam Reporting” webpage or call 1- 800-366-4484.
• Report it to the Federal Trade Commission. Use the “FTC Complaint Assistant” on FTC.gov. Please add “IRS Telephone Scam” in the notes.
• If you think you might owe taxes, call the IRS directly at 1-800-829-1040.

AVOID PHISHING EMAIL ATTEMPTS:

Never reply to emails, texts or pop-up messages asking for your personal, tax or financial information. One common trick is to impersonate a business such as your financial institution, tax software provider or the IRS, asking you to update your account and providing a link. For small business, these schemes may try impersonating a company leader and request payroll and human resource information for employees. Never click on links even if they seem to be from organizations your trust. Go directly to the organization’s website.

IF YOU GET A PHISHING EMAIL, REMEMBER THIS ADVICE:

• Don’t reply to the message.
• Don’t give out your personal or financial information.
• Forward the email to phishing@irs.gov. Then delete it.
• Don’t open any attachments or click on any links. They may have malicious code that will infect your computer.

More information on how to report phishing or phone scams is available on IRS.gov.

If you think you’ve been a victim of one of these scams, please follow the steps provided. You may also contact us at christine@cartercpafirm.com with any questions.

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New Safe Harbor Limits

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The Internal Revenue Service recently simplified the paperwork and record keeping requirements for small businesses by raising from $500 to $2,500 the safe harbor threshold for deducting certain capital items.

The change affects businesses that do not maintain an applicable financial statement (audited financial statement). It applies to amounts spent to
acquire, produce or improve tangible property that would normally qualify as a capital item.

The new $2,500 threshold applies to any such item substantiated by an invoice. As a result, small businesses will be able to immediately deduct many
expenditures that would otherwise need to be spread over a period of years through annual depreciation deductions.

“We received many thoughtful comments from taxpayers, their representatives and the professional tax community, said IRS Commissioner John Koskinen. “This
important step simplifies taxes for small businesses, easing the recordkeeping and paperwork burden on small business owners and their tax preparers.“
Responding to a February comment request, the IRS received more than 150 letters from businesses and their representatives suggesting an increase in the
threshold. Commenters noted that the existing $500 threshold was too low to effectively reduce administrative burden on small business. Moreover, the cost
of many commonly expensed items such as tablet-style personal computers, smart phones, and machinery and equipment parts typically surpass the $500
threshold.

As before, businesses can still claim otherwise deductible repair and maintenance costs, even if they exceed the $2,500 threshold.
The new $2,500 threshold takes effect starting with tax year 2016. In addition, the IRS will provide audit protection to eligible businesses by not
challenging use of the new $2,500 threshold in tax years prior to 2016.

For taxpayers with an applicable financial statement, the de minimis or small-dollar threshold remains $5,000.

Further details on this change can be found in Notice 2015-82, posted today on IRS.gov

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The Tax Increase Prevention Act of 2014

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This bill was signed by the President on December 19, 2014. It amends the Internal Revenue Code of 1986 to provide for the tax treatment of ABLE accounts established under State programs for the care of family members with disabilities, and for other purposes. Read more here.

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Taxpayer Bill of Rights

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The IRS has adopted a Taxpayer Bill of Rights, as proposed by the National Taxpayer Advocate, to make taxpayer rights clear, understandable and accessible for the taxpayer. Learn more about these rights here. As always, don’t hesitate to contact us via phone or email with any questions.

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