Month: September 2018

Businesses aren’t immune to tax identity theft

Tax identity theft may seem like a problem only for individual taxpayers. But, according to the IRS, increasingly businesses are also becoming victims. And identity thieves have become more sophisticated, knowing filing practices, the tax code and the best ways to get valuable data.

How it works

In tax identity theft, a taxpayer’s identifying information (such as Social Security number) is used to fraudulently obtain a refund or commit other crimes. Business tax identity theft occurs when a criminal uses the identifying information of a business to obtain tax benefits or to enable individual tax identity theft schemes.

For example, a thief could use an Employer Identification Number (EIN) to file a fraudulent business tax return and claim a refund. Or a fraudster may report income and withholding for fake employees on false W-2 forms. Then, he or she can file fraudulent individual tax returns for these “employees” to claim refunds.

The consequences can include significant dollar amounts, lost time sorting out the mess and damage to your reputation.

Red flags

There are some red flags that indicate possible tax identity theft. For example, your business’s identity may have been compromised if:

  • Your business doesn’t receive expected or routine mailings from the IRS,
  • You receive an IRS notice that doesn’t relate to anything your business submitted, that’s about fictitious employees or that’s related to a defunct, closed or dormant business after all account balances have been paid,
  • The IRS rejects an e-filed return or an extension-to-file request, saying it already has a return with that identification number — or the IRS accepts it as an amended return,
  • You receive an IRS letter stating that more than one tax return has been filed in your business’s name, or
  • You receive a notice from the IRS that you have a balance due when you haven’t yet filed a return.

Keep in mind, though, that some of these could be the result of a simple error, such as an inadvertent transposition of numbers. Nevertheless, you should contact the IRS immediately if you receive any notices or letters from the agency that you believe might indicate that someone has fraudulently used your Employer Identification Number.

Prevention tips

Businesses should take steps such as the following to protect their own information as well as that of their employees:

  • Provide training to accounting, human resources and other employees to educate them on the latest tax fraud schemes and how to spot phishing emails.
  • Use secure methods to send W-2 forms to employees.
  • Implement risk management strategies designed to flag suspicious communications.

Of course identity theft can go beyond tax identity theft, so be sure to have a comprehensive plan in place to protect the data of your business, your employees and your customers. If you’re concerned your business has become a victim, or you have questions about prevention, please contact us.

© 2018

Did you know that you never have to write a check to IRS again?

by Karen Atchley, CPA

Partner at Atchley & Associates, LLP

Did you know that you never have to write a check to IRS again?  That is because there are three ways to send money to IRS without writing a check.

  1. Wire Transfer (if your financial institution is set up to make wire transfers to IRS)
  2. Direct Pay going thru the IRS website
  3. Electronic Federal Taxpayer System (EFTPS)

Below is a brief explanation of each method.  Please consult the links below or your tax professional at Atchley & Associates, LLP if you are interested in more details.

Wire Transfer

You may be able to do a same-day wire from your Financial Institution. Contact your Financial Institution for availability, cost, and cut-off times. Download the Same-Day Taxpayer Worksheet. Complete it and take it to your Financial Institution. If you are paying for more than one tax form or tax period, complete a separate worksheet for each payment.

Financial Institutions can refer to the Financial Institution Handbook for help with formatting and processing information.

Direct Pay with Bank Account 

Use this secure service to pay your taxes for Form 1040 series, estimated taxes or other associated forms directly from your checking or savings account at no cost to you.

You can easily keep track of your payment by signing up for email notifications about your tax payment, each time you use IRS Direct Pay.

  • Email notification will contain the confirmation number you receive at the end of a payment transaction.
  • The IRS continues to remind taxpayers to watch out for email schemes. You will only receive an email from IRS Direct Pay if you’ve requested the service.

If you have already made a payment through Direct Pay, you can use your confirmation number to access the Look Up a Payment feature. You can also modify or cancel a scheduled payment until two business days before the payment date.

You can also view your payment history by accessing your online account with the IRS.

Make a Payment              Look Up Payment

Direct Pay is available Monday to Saturday: Midnight to 11:45 p.m. ET and Sunday: 7 a.m. to 11:45 p.m. ET. Other outage times may occur, and IRS will let you know whether Direct Pay is available before you start your session.  Please note that Direct Pay availability has no bearing on your due date, so plan ahead to ensure timely payment.

IRS Direct Pay won’t accept more than two payments within a 24-hour period, and each payment must be less than $10 million. For larger electronic payments, use EFTPS or same-day wire

Electronic Federal Taxpayer System (EFTPS)

If neither of these two payments methods work for you, you can enroll in EFTPS by completing the EFPTS For Individuals form that can be found at EFTPS.gov. (https://www.eftps.gov/eftps/) Please make sure you submit your enrollment application in plenty of time to get enrolled prior to the time that you are needing to make your payment.

2018 Q4 tax calendar: Key deadlines for businesses and other employers

Here are some of the key tax-related deadlines affecting businesses and other employers during the fourth quarter of 2018. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing requirements.

October 15

  • If a calendar-year C corporation that filed an automatic six-month extension:
    • File a 2017 income tax return (Form 1120) and pay any tax, interest and penalties due.
    • Make contributions for 2017 to certain employer-sponsored retirement plans.

October 31

  • Report income tax withholding and FICA taxes for third quarter 2018 (Form 941) and pay any tax due. (See exception below under “November 13.”)

November 13

  • Report income tax withholding and FICA taxes for third quarter 2018 (Form 941), if you deposited on time and in full all of the associated taxes due.

December 17

  • If a calendar-year C corporation, pay the fourth installment of 2018 estimated income taxes.

© 2018