Can I deduct expenses for my home office?

The quick answer is yes. Whether you are self-employed or an employee, if you use a portion of your home exclusively and regularly for business purposes, you may be able to take a home office deduction.

You can deduct certain expenses if your home office is the principal place where your trade or business is conducted or where you meet and deal with clients or patients in the course of your business. If you use a separate structure not attached to your home for an exclusive and regular part of your business, you can deduct expenses related to it.

Your home office will qualify as your principal place of business if you use it exclusively and regularly for the administrative or management activities associated with your trade or business. There must be no other fixed place where you conduct substantial administrative or management activities. If you use both your home and other locations regularly in your business, you must determine which location is your principle place of business, based on the relative importance of the activities performed at each location. If the relative importance factor doesn’t determine your principle place of business, you can also consider the time spent at each location.

If you are an employee, you have additional requirements to meet. You cannot take the home office deduction unless the business use of your home is for the convenience of your employer. Also, you cannot take deductions for space you are renting to your employer.

Generally, the amount you can deduct depends on the percentage of your home used for business. Your deduction will be limited if your gross income from your business is less than your total business expenses.

Is my business eligibility for a schedule C-EZ?

Your business may be eligible to use the abbreviated Schedule C-EZ instead of the longer Schedule C when reporting business profit and loss on your federal income tax return, according to the IRS. That’s because the deductible business expense threshold for filing Schedule C-EZ of the Form 1040 is $5,000. This change allows an additional 500,000 small businesses to file the C-EZ rather than Schedule C.

Schedule C-EZ, Net Profit from Business (Sole Proprietorship), is the simplified version of Schedule C, Profit or Loss from Business (Sole Proprietorship).

Schedule C-EZ consists of an instruction page and a one-page form with three short parts — General Information, Figure Your Net Profit, and Information on Your Vehicle. The instruction page includes a worksheet for figuring the amount of deductible expenses. If that amount does not exceed $5,000, you should be able to use the C-EZ instead of Schedule C. 

Can I appeal my tax return with the IRS?

Sometimes business can be found in the middle of a disagreement with the IRS. One of the guaranteed rights for all taxpayers is the right to appeal. If you disagree with the IRS about the amount of your tax liability or about proposed collection actions, you have the right to ask the IRS Appeals Office to review your case.

IRS Publication 1, Your Rights as a Taxpayer, explains some of your most important taxpayer rights. During their contact with taxpayers, IRS employees are required to explain and protect these taxpayer rights, including the right to appeal.

The IRS appeals system is for people who do not agree with the results of an examination of their tax returns or other adjustments to their tax liability. In addition to examinations, you can appeal many other things, including:

  • Collection actions such as liens, levies, seizures, installment agreement terminations and rejected offers-in-compromise
  • Penalties and interest
  • Employment tax adjustments and the trust fund recovery penalty

Appeals conferences are informal meetings. The local Appeals Office, which is independent of the IRS office that proposed the disputed action, can sometimes resolve an appeal by telephone or through correspondence.

The IRS also offers an option called Fast Track Mediation, during which an appeals or settlement officer attempts to help you and the IRS reach a mutually satisfactory solution. Most cases not docketed in court qualify for Fast Track Mediation. You may request Fast Track Mediation at the conclusion of an audit or collection determination, but prior to your request for a normal appeals hearing. Fast Track Mediation is meant to promote the early resolution of a dispute. It doesn’t eliminate or replace existing dispute resolution options, including your opportunity to request a conference with a manager or a hearing before Appeals. You may withdraw from the mediation process at any time.

When attending an informal meeting or pursuing mediation, you may represent yourself or you can be represented by a certified public accountant or individual enrolled to practice before the IRS.

If you and the IRS appeals officer cannot reach agreement, or if you prefer not to appeal within the IRS, in most cases you may take your disagreement to federal court. But taxpayers can settle most differences without expensive and time-consuming court trials.

Is there a tax filing deadline or payment options I can use?

Tax, tax, tax. If you’re trying to beat the tax deadline, there are several options for last-minute help. If you need a form or publication, you can download copies from the IRS Tax Forms in our support center. If you find you need more time to finish your return, you can get a five or six month extension of time to file using Form 7004, Application for Automatic Extension of Time to File Certain Business Income Tax, Information, Other Returns. And if you have trouble paying your tax bill, the IRS has several payment options available.

The extension will give you extra time to get the paperwork to the IRS, but it does not extend the time you have to pay any tax due. You have to make an accurate estimate of any tax due when you request an extension. You can also send a payment for the expected balance due, but this is not required to get the extension. However, you will owe interest on any amounts not paid by the March 15 deadline, plus a late payment penalty if you have paid less than 90 percent of your total tax by that date.

Can you represent me with the IRS?

Yes, Our Professional CPA representation can be vital during any period of an IRS audit. Our experience with tax authorities enables us to guide clients in their dealings with federal and state agencies on all matters relating to tax. If you have been chosen for an audit by the IRS, the professional representation you can find at Zabel can put many of your worries at ease. We are ready and willing to answer any questions the IRS may be asking you.

Can I make charitable contribution at my company?

Yes, Many organization support their community and it is within your rights to contribute and receive deductions for your efforts supporting society. Your donations to these causes (up to 10% of taxable income) can add up to a nice tax deduction for your corporation.

Here are a few tips to help make sure your contributions pay off on your tax return:

You cannot deduct contributions made to specific individuals, political organizations and candidates, the value of your time or services and the cost of raffles, bingo, or other games of chance. To be deductible, contributions must be made to qualified organizations. Cash contributions must be substantiated by a bank record, or a receipt, letter or other written communication from the donee organization indicating the name of the organization, the date of the contribution, and the amount of the contribution. In addition, if the contribution is $250 or more, a written acknowledgement showing the amount of cash contributed, any property contributed, and a description and a good faith estimate of the value of any goods or services provided in return for the contribution or statement that no goods or services were provided in return for the contribution, is required. Non-cash contributions over $500 must be supported by an attachment to the return which states the kind of property contributed, along with the method used to determine its fair market value. Form 8283, Non-cash Charitable Contributions is required for contributions with a claimed value of more than $5,000. Contributions which exceed the 10% limitation can be carried over for five years.

Organizations can tell you if they are qualified and if donations to them are deductible. IRS.gov has an Exempt Organizations Select Check online tool to help you see if an organization is qualified. In addition, taxpayers can call IRS Tax Exempt/Government Entities Customer Service at 1-877-829-5500. Be sure to have the organization’s correct name and its headquarters location, if possible. Churches, synagogues, temples, mosques and governments are not required to apply for this exemption in order to be qualified.

Where’s my tax refund?

Finally your expecting a tax refund from the Internal Revenue Service this year. This can be caused by various scenarios such as over payments, amended returns or adjustments. If you file a complete and accurate paper tax return, your refund should be issued in about six to eight weeks from the date IRS receives your return. If you file your return electronically, your refund should be issued in about half the time it would take if you filed a paper return — even faster when you choose direct deposit.

You can have a refund check mailed to you, or you may be able to have your refund electronically deposited directly into your bank account. Direct deposit into a bank account is more secure because there is no check to get lost. And it takes the U.S. Treasury less time than issuing a paper check. If you prepare a paper return, complete Form 8050, making sure that the routing and account numbers are accurate, and attach it to the corporation’s tax return. Note that Form 8050 may only be filed with the original Form 1120 or 1120S, and the corporation is not eligible to receive direct deposit if the receiving financial institution is a foreign bank, or foreign branch of a U.S. bank. Incorrect numbers can cause your refund to be misdirected or delayed. Direct deposit is also available if you electronically file your return.

You may not receive your refund as quickly as you expected. A refund can be delayed for a variety of reasons. For example, a name or identification number and Social Security number listed on the tax return may not match the IRS records. You may have failed to sign the return or to include a necessary attachment, such as Form W-2, Wage and Tax Statement. Or you may have made math errors that require extra time for the IRS to correct.

I was just given notice from the IRS

It’s a moment any taxpayer dreads. An envelope arrives from the IRS — and guess what it’s not a refund check. But don’t panic. Many IRS letters can be dealt with simply and painlessly.

Each year, the IRS sends millions of letters and notices to taxpayers to request payment of taxes, to notify them of a change to their account or request additional information. The notice you receive normally covers a very specific issue about your account or tax return. Each letter and notice provides specific instructions explaining what you should do if action is necessary to satisfy the inquiry. Most notices also give a phone number to call if you need further information.

Most correspondence can be handled without calling or visiting an IRS office, if you follow the instructions in the letter or notice. However, if you have questions, call the telephone number in the upper right-hand corner of the notice, or call the IRS at 1-800-829-1040. Have a copy of your tax return and the correspondence available when you call so your account can be readily accessed.

Before contacting the IRS, review the correspondence and compare it with the information on your return. If you agree with the correction to your account, no reply is necessary unless a payment is due or a signature is required. If you do not agree with the correction the IRS made, it is important that you respond as requested. Write an explanation why you disagree, and include any documents and information you wish the IRS to consider. Mail your information along with the bottom tear-off portion of the notice to the address shown in the upper left-hand corner of the IRS correspondence. Allow at least 30 days for a response.

Sometimes, the IRS sends a second letter or notice requesting additional information or providing additional information to you. Be sure to keep copies of any correspondence with your records.  If you’ve received a notice and are confused about what to do next, reach out to our team for help.

Will your Virtual CFO services help me with budgeting?

Yes, That’s a great question. Knowledge is power, and our Budgeting & Forecasting services is why Zabel can help. We give you the power to lead your business towards higher profits, increased financing if desired and a higher Return on Investment. Our Virtual CFO service has years of extensive selection of budgeting, forecasting and corporate performance management ranging from many reporting measures to identify the overall health of your business, Inventory control, Cash controls all the way up to a full financing analysis to improve management, planning and decision-making. All of our Budgeting and Forecasting services are committed to providing the CEO and shareholders of your company with accurate financial projections and budgets for future operations. These processes will define the current state of the business, estimate future sales, and will help you prepare a budget oriented towards achieving your goals.

Providing Innovative Service

No matter what budgeting and forecasting service you choose, your company will obtain in-depth reports and expert insight. In fact, all of our services are designed to accommodate the exclusive needs of businesses owners. On average our clients have managed to increase the Return on Investment (ROI) by more than 15% when using our services over time.


Let Forecasting Help You To Define your Goals

Forecasting is the art of predicting future trends that the company may see. This is vital for preparing an accurate budget and a strong financial strategy. Forecasting uses a combination of your companies past sales figures and well-researched projections that will give you a realistic insight into the future of your company. With this knowledge in hand, you will be able to create an accurate budget that strategically allocates finances to the areas where your business will need it the most utilizing trailing twelve or eighteen month financials. 

A Well Defined Budget Will Help Optimize Your Organization For Growth

Budgets are detailed financial statements of expected revenues and expenses, and the value of a professionally made budget cannot be understated. A budget prepared by our service will give your business the knowledge it needs to find new opportunities for cost cutting and to develop clear, achievable goals. This will ensure that you will never be caught off guard by unexpected expenses, and always have enough finances to fulfill your goals. With our budgeting services, we will define a profit-oriented budget and financial plan that will help your company thrive.

Methods Used to Help Grow Your Business

By separating our service enables your business to choose the exact service that it needs, at a price range you can afford. Whether you wish to review your business through corporate performance management, or would like to provide your management staff with accurate information to improve their decisions and planning.

  • Financing Anаlуѕіѕ
  • Profіtаbіlity Anаlуѕіѕ
  • Prо-Fоrmа Fіnаnсіаl Prоjесtіоn
  • Cаѕh Flоw Prоjесtіоn
  • Industry Sресіfіс Comparative Anаlуѕіѕ
  • Industry Kеу Pеrformаnсе Rаtіоѕ Rерort

What are Virtual CFO services?

Zabel’s virtual CFO services will digitally connect to your business with our qualified staff of certified Bookkeepers. One of the best features is the CFO’s ability to use the latest web technology at their disposal. In fact, our Virtual CFO will have all your meetings using web conferencing tools. This means that no matter where you are, your business will be able to improve its profitability and bankability, at a fraction of the cost. Zabel CFO services offer businesses robust financial controls, stabilized cash flows and increased profitability letting the owner get back to what’s important.

Here is an example of the typical services that would be provided.

Account Reconciliation:

Enter Checks, Deposits, and Automatic Withdrawals
Reconcile Bank Account (s)
Enter Credit Card Activity 
Reconcile Credit Card Account(s)
Reconcile Loan Accounts
Record/Verify Payroll
Update Fixed Asset Module
Print Financial Statements with PY Comparison
Review Financials
Fix Open Points (opt)
Update Tax Projection
Review Financial Statements 
Review Tax Projection
Print Financial Statements with PY Comparison to File Cabinet
Notify Client

 Payroll:

Receive Payroll information 
Enter Hours (opt)
Prepare Payroll
Print Reports to File Cabinet
Review Payroll for Accuracy
Prepare 941
File 941
Prepare State Unemployment Tax Return
File State Unemployment Tax Return
Prepare State Income Tax Withheld Return
File State Income tax withheld return
Contact Client with amounts due
Put Payroll records into File Cabinet

Sales Tax:

Calculate Sales Tax owed
File Sales Tax Return
Print Sales Tax Confirmation
Notify Client of Amount due
Send Client Sales Tax Confirmation
Pull Sales Tax Confirmation into File Cabinet

Connect with us to learn more about how we can help your business succeed with Fractional CFO services: tzabel@zabelco.com