Archives for May 2013

Skills of an Effective Auditor

There are a number of people seeking to get involved in auditing because they realize what a rewarding experience it can be. Some people have taken the time to major in auditing so they can land a great job right out of school. Here are a few things that hiring companies are looking for in a great auditor.

Skills of an Effective Auditor

  • An auditor should be a person who has exceptional organizational skills. They have to be able to do many things at once like maintaining a complex schedule, listing of controls and many other things. Organizational skills are things that can be learned. Take the time to learn what works for you and incorporate it into the way you handle business.
  • Auditors are people who have a desire to learn all they can about their jobs. They take the time to research out every detail of an audit they are working with. As an auditor you will have to take the time and learn every aspect of the company you work with. Do not be afraid to ask for help when trying to learn new systems.
  • They are people who have a love for solving problems that other people cannot seem to handle. You must be a person who can balance an action plan with making good judgment calls about proper courses of action.
  • There will be times that you will have to speak to a lot of people. Good communication skills are an essential part of the job. Learn how to articulate things that you are needing people to understand. Try not to rush people through learning things but walk them through the process one step at a time.
  • They are people who are not afraid to try new things. The business world is always changing. Auditors must be able to learn news techniques and processes in order to stay current in their field. Begin the process of learning every aspect of the auditing field. You will need to know all about things from IT to financial book closing.

Becoming a great auditor may take some time. There are a lot skills that you will need to develop in order to be an effective auditor. Take the time to learn as much as your can about your job and you will excel in your position.

Here at Crowley & Halloran CPA’s, our consultants would be happy to help you plan and manage your business budget. Click here to request a proposal.

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How to Take the Fear Out of Being Audited for Your Taxes

The thought of being audited for taxes scares many taxpayers. However, the fact of auditing is something that can’t be avoided. The IRS conducts audits of at least 1 percent of tax returns every year. Nevertheless, you can do some things to make sure the auditing process goes smoothly and is less frightening.

  1. Prepare ahead of time by keeping good records of anything you include on your taxes. This means all expenses and deductions as well as your W2 forms and other records of income.
  2. Provide explanation of expenses. If you include the cost of a meal or travel expenses as an expense on your taxes, be sure to explain why it was added. A common area that invites auditing of your tax return is suspicious business expenses.
  3. Always double check before you include an expense if you are not sure that it is deductible. Talk with a tax professional to ensure that you can use it on your tax return.
  4. Use exact numbers for your expenses instead of estimating. These numbers should be based on your receipts.
  5. Don’t be sloppy with your tax return. If you prepare it by hand, make sure all numbers and information is readable.
  6. Check and re-check your return before you submit it. Make sure there are no mathematical mistakes or any errors before you file.

What If You Are Audited

If you get the notice that says you are being audited, you should submit all paperwork that is being asked for. It is also advisable that you work with a tax attorney if you are concerned about the auditing procedures.

According to the IRS website, irs.gov, they may conduct either an in-person audit or an audit by mail. If it is an audit by mail, you simply have to provide the information asked for. An in-person audit means that you will have to meet with the agent in person and provide the requested records.

The auditing process can be quite scary for either individuals or businesses. However, you can avoid being audited by providing accurate and detailed information on your tax returns. In the event that you are audited, working with a professional can ease your fears. Most audits end quickly and painlessly once you provide the necessary information. Plan ahead by keeping good records and responding quickly and you can get through the process.

Here at Crowley & Halloran CPA’s, our consultants would be happy to help you plan and manage your business budget. Click here to request a proposal.

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Tax Season is Finished! What to Know for Next Year

Phew! Tax Season is over, but now is not the time to sit back and relax. There is next tax season to prepare for, and there are a few simple tasks that can help make next year easier and less stressful.

Stay Organized

It may be simple, but staying organized is critical to a stress-free tax season next year. Keep all tax documents and receipts in one place so they are easy to find. Label a folder with “Taxes 2013” and use it to keep all receipts and other documents in throughout the year. No one wants to play “Look and Find” in January and February. Save yourself time by taking the time to file it now. Label what the receipt was for, especially if it is for business purposes. If the receipt is for a charitable donation, list what was donated. Take the time to file it right away so it will not be lost.

Adjust Withholdings

Believe it or not, you should not be getting a large refund from the IRS each year. The goal is to break even or only have a few hundred in a refund. If you are receiving a large refund consider adjusting your W4, which can be re-filed with your employer, to have less taken out. This will mean an immediate increase in your gross income. That “extra” money could be added to you IRA or 401(k) savings. This will help you reduce you taxes and save for your future retirement at the same time.

If you had to pay in more money to the government, then consider increasing the amount taken out of your paycheck. You can figure this amount by using a tax calculator on the IRS website. This will help you figure out how much extra will need to be withheld from your paycheck so you will not have to pay in any extra, or at least not as much as before.

Remember it is important to start now. Procrastinating will not help make tax time any easier, and being prepared will make it less stressful for you. Stay organized and make your adjustments. This will put you on the right path to a better tax season next year.

Here at Crowley & Halloran CPA’s, our consultants would be happy to help you plan and manage your business budget. Click here to request a proposal.

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How Your CPA Can Help Stop Identity Theft

The thought of identity theft is scary, but during tax season, identity theft becomes a nightmare for almost 450,000 people, and it is increasing every year. The IRS processes 145 million returns in a year. Almost 109 million of the claims are refunds, and average $3,000. This makes tax returns a prime target for any would be thief. It is important to know how to protect yourself during tax season to prevent the worst from happening.

Identity theft has devastating consequences. It will delay taxpayer refunds, victims may lose job opportunities, be refused for loans, housing, cars, and can even be arrested for crimes that they did not commit. The most common ways thieves obtain information is through email or phone phishing and dumpster diving. Thieves are looking for personal information, such as, bank records and credit card receipts.

If your identity is stolen, several steps should be taken. First, file a report with the police. Close any bank or credit cards accounts affected. Inform credit bureaus and consider freezing credit accounts. A freeze restricts access to the credit reports and prevents thieves from opening other accounts with the stolen information. The IRS has a form (Form 14039) that needs filled out if your identity was stolen anytime during the year. Make sure that you answer all IRS notices immediately, using the name and number printed on the notice.

To prevent identity theft, shred any mail that has personal information on it before throwing it away. Watch credit reports from the three major credit bureaus. If working with a CPA, forward any emails that appear to be from the IRS to them and do not click on any of the links before forwarding the email. Keep your SSN safe; do not give it out, store the card in a secure place. Protect your home computer with firewall, anti-spam, and anti-virus software and update regularly. Change passwords to bank and credit cards sites regularly.

None of this is a guarantee that your identity is safe, but the more you safeguard your personal information the better chances you have of not being a victim.

Here at Crowley & Halloran CPA’s, our consultants would be happy to help you plan and manage your business budget. Click here to request a proposal.

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Timing Benefits: When to Tap into Social Security

Everyone knows that there is a magic age when a person can begin a new adventure, retirement is just such time. However, when is the right time to tap into social security? Retirement can be drawn as early as 62, but the Social Security Administration has also created an incentive program for workers that choose to wait until age 70 to retire.

Social security is an annuity that is paid out based on the age that you retire. If a person retires at age 62 then their payment will be 25% less than if they retired at age 66. If a person chooses to retire at age 70 they will earn an additional 8% per year which translates into almost $17,000 annually. The standard advice would be to wait to retire as long as possible. With other investment payouts, it is possible to delay social security payout until the time it is needed to supplement funds. By waiting until age 70 and taking advantage of the higher benefits, a person is provided with a kind of longevity insurance thanks to the government.

Now what about couples, well you are not forgotten. Couples can contemplate several options. The first being the “claim and switch” This is designed for a family that claims two incomes where both individuals are 66 years old. The spouse with the lower earnings (the wife) can retire and file for their benefits as long as the other spouse (the husband) has reached his full retirement age. The husband can then file for benefits based on the lower-earning spouse’s benefits and forgo his own benefits until age 70, when he can then retire and collect the maximum benefits. The wife can either switch to the benefit based on that of the husband or choose to keep her own; whichever is more advantageous to the couple.

Another choice would be for the couple to use the file and suspend. This works well for a couple where only one income is claimed. For example the husband works and the wife stays at home. The husband, at his full retirement age, can file and then suspend payments until the age of 70, and then the wife can file for spousal benefits. She could do this to delay taking out her own social security until the age of 70, where she could then switch if the benefit is higher.

There are many options in the vast and confusing world of social security benefits, but it is important to work with someone who can help navigate and analyze the individual situations.

Here at Crowley & Halloran CPA’s, our consultants would be happy to help you plan and manage your business budget. Click here to request a proposal.

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