for everything you need to know about the EITC.

• EITC Due Diligence Training Module (CE available for EAs)
• Schedule C and Record Reconstruction Training

NAEA 

Committee Members

Please give a thanks to New York Enrolled Agents who have willingly stepped up when National asked for a hand. It's not always easy to find the extra time and energy to do extra with our already full schedules, especially during tax season. These members feel it is important to the success of our organization to give a little more:

Affiliate Council:

            Vicki McGinn, EA (chair)

Audit Committee:

            Betsey Buckingham, EA

Awards Committee:

            Jeff Gentner, EA (chair)

Education Committee:

            Judy Strauss, EA

Executive Committee:

            Frank Degen, EA (chair)

            Betsey Buckingham, EA

Government Relations:

            Marc Dombrowski, EA

            Evan Golar, EA

Public Relations Committee:

            Sandra Martin, EA (chair)

Young Professionals Task Force:

            Jamaal Solomon, EA

Education Foundation:

            Judy Strauss, EA 

            (2nd Trustee)

Also important to note - in May, 2012, we will have three NYSSEA members sitting on the NAEA Board:

President:       

            Frank Degen, EA

President-Elect:

            Betsey Buckingham, EA

Director - 2 year term:

            Vicki McGinn, EA

Congratulations to this outstanding group of Enrolled Agents. When NAEA asks a fellow NYSSEAer to serve, they are showing respect to the entire group. 

If you would like to see your name here, let Sam Matlick, CAE at NAEA know of your interest. They are always looking for new people to fill the chairs. 

 

The National Tax Practice Institute™ (NTPI®) is known for the leading, face-to-face continuing education on IRS representation. The 2012 NAEA National Conference will also feature a robust Tax Preparation and an intensive Special Enrollment Exam (SEE) Review track for experienced tax preparers who have decided the time is right to become an EA.

This event includes 6 tracks, each offering 24 hours of education. 

 STATUTE 10USC §§1044a and 1044b

REQUIREMENTS: Signature of principal upon POA must be acknowledged by a notary. Under 10 USC §1044a, persons with notarial powers for military POAs are as follows:

• All judge advocates, including reserve judge advocates when not in a duty status.
• All civilian attorneys serving as legal assistance attorneys
• All adjutants, assistant adjutants, and personnel adjutants, including reserve members when not in a duty status.
• All other members of the armed forces, including reserve members when not in duty status, who are designated by regulations of the armed forces or by statute to have those powers.
• For the performance of notarial acts at locations outside the United States, all employees of a military department or the Coast Guard who are designated by regulations of the Secretary concerned or by statute to have those powers for exercise outside the United States.

WITNESSES: No witness other than notary required to signature of principal

SIGNATURE OF AGENT: No requirement that the agent sign the POA

EFFECTIVENESS OF A FEDERAL MILITARY POA: Under the provisions of 10 USC §1044b, a military power of attorney is given effect even if it does not comply with state law. Specifically, pursuant to §1044b(a), "a military power of attorney (1) is exempt from any requirement of form, substance, formality, or recording that is provided for powers of attorney under the laws of a State; and (2) shall be given the same legal effect as a power of attorney prepared and executed in accordance with the laws of the State concerned."

FEDERAL MILITARY POA FORMALITIES: Section 1044b does not give a form for a military power of attorney. It says in §1044b(b) that a "military power of attorney is any general or special power of attorney that is notarized in accordance with section 1044a of this title or other applicable State or Federal law." The definition is broad and likely provides that any POA is valid so long as it is executed by a member of the armed forces of the United States and is properly notarized. Although no specific form is provided, §1044b(c) requires that the POA contain a statement, as prescribed by the Secretary, concerning the state law exemption. Department of Defense Directive No. 1350.4 requires that military POAs include a statement or preamble as follows: THIS IS A MILITARY POWER OF ATTORNEY PREPARED AND EXECUTED PURSUANT TO 10 U.S.C.A. §1044B, BY A PERSON AUTHORIZED TO RECEIVE LEGAL ASSISTANCE FROM THE MILITARY SERVICES. FEDERAL LAW EXEMPTS A MILITARY POWER OF ATTORNEY FROM ANY REQUIREMENT OF FORM, SUBSTANCE, FORMALITY OR RECORDING THAT IS PRESCRIBED FOR POWERS OF ATTORNEY BY THE LAWS OF ANY STATE, COMMONWEALTH, TERRITORY, DISTRICT, OR POSSESSION OF THE UNITED STATES. FEDERAL LAW SPECIFIES THAT A MILITARY POWER OF ATTORNEY SHALL BE GIVEN THE SAME LEGAL EFFECT AS A POWER OF ATTORNEY PREPARED AND EXECUTED IN ACCORDANCE WITH THE LAWS OF THE JURISDICTION WHERE IT IS PRESENTED.

PREPRINTED FORMS: Many military organizations have preprinted forms of powers of attorney, to hand out to service members, but use of such a form is not required by the statute.

submitted by Judy M. Strauss, EA

IRS Toughens 

My purpose in reviewing this topic with you is to make you aware of your responsibility as a practitioner of the doctrine of due diligence. 

The Internal Revenue Service seems to be asking tax preparers to exercise more care and diligence when preparing a tax return.  In NY with the passage of the Marriage Equality Act we are going to be asked to make certain that the same gender couples have been duly married. When a same sex couple comes to your office you may be expected to see their marriage certificate.

Diligence is the continued effort to accomplish something.    Due Diligence is the exercise of the proper care and effort that a reasonable person would expect from someone carrying out a task.  The preparation of a tax return is a task that requires the exercise of due diligence.   The Rules of Practice before the IRS, Circular 230, IRS requires preparers to exercise due diligence when preparing a return. (Circular 230 § 10.22)

Taxpayers are expected to exercise due diligence in substantiating their returns and when providing us, the preparer, information to prepare their return.  The preparer community is expected to exercise due diligence when preparing the return and in taking positions on the tax return.  The Internal Revenue Service is expected to exercise due diligence when taking positions on examination, collection and other areas.  One such area, for example, is in the last known address.  The courts have held that the IRS is to use reasonable diligence.   What is reasonable?  That is the question. And the answer will vary depending on the area of tax practice and the area of the return in question. The matter of what constitutes due diligence is often an area of contention between the preparer community and the Internal Revenue Service. The level of diligence required changes when the preparer is filing a return claiming the EITC or when positions that may be questioned are taken.  It is important for you to understand what is required of you.

Circular 230 requires you to:

 (a) In general. A practitioner must exercise due diligence - (1) In preparing or assisting in the preparation of approving, and filing tax returns, documents, affidavits, and other papers relating to Internal Revenue Service matters; (2) In determining the correctness of oral or written representations made by the practitioner to the Department of the Treasury; and (3) In determining the correctness of oral or written representations made by the practitioner to clients with reference to any matter administered by the Internal Revenue Service.(b) Reliance on others. Except as provided in §§ 10.34, 10.35 and 10.37, a practitioner will be presumed to have exercised due diligence for purposes of this section if the practitioner relies on the work product of another person and the practitioner used reasonable care in engaging, supervising, training, and evaluating the person, taking proper account of the nature of the relationship between the practitioner and the person.

reference: § 10.22 - Page 19

Out with the old and in with the new!  After celebrating the coming of a New Year, we turn our focus to gearing up for tax year 2012.  While we are busy preparing end of year financials and information returns for our clients, we need to step back and reassess our business and what our expectation are for this year.

It is very easy to fall back on our "old" ways of doing things.  Technology has forced us to step up our game.  Clients expect more and more from us.  We tend to be people pleasers, and want to do what is in the best interest of the client.   But we need to make sure that what is in the best interest of our client is also in the best interest of our business.

How many times has a client come to you with a "quick" question?  How many times did you speak to that client to gather the necessary information to identify the client's "real" question and perhaps do preliminary research before you answered that question?  And most importantly, were you adequately compensated for your time, effort and expertise to address the issue?  This is where many of us fall short (myself included).  How many times were you frustrated because clients are not aware of the value you add to their lives?

While making our New Year's resolutions for losing weight, reading more, exercising more, spending more quality time with our loved ones, etc., we need to also make resolutions to improve the quality of our business, as well.  Resolutions are pipedreams for many, but those who define their goals and measure the progress of their achievements, they are the true "winners" who create new, sustainable habits for life.

IBM, General Electric, Proctor and Gamble, H&R Block, etc. have not been profitable and sustainable entities by chance.  These companies make better business decisions by identifying goals that are MEASURABLE, implementing the change and managing the change.  Change in any organization must be tracked at multi-levels: 

• The customer level:  how clients perceive you, your working environment, their experience with you and your staff,
• The process: how the work flows, start to finish
• Staff:  How does your staff manage stress, the customers, their jobs?
• Technology:  are you using technology to your advantage?
• Public Perceptions:  what does the public think of you or your firm?
• You:  what is holding you back from achieving your ideal business?

At this point you might be thinking that you simply do not have time to deal with this now.  If not now, then when?  Change is nothing more than creating a new habit.  Break it down into manageable pieces.  If you want to eat healthier, then identify a new habit and incorporate that into your life, such as, I will eat a piece of fruit every day.  Notice that the statement is positive.  Negativity usually will not work, for example, I will NOT eat sweets - ever.  This new habit will probably not be sustainable and could only create more stress.

The new habit (change) must be part of your overall resolution (business plan).   Your business is most likely your biggest asset.  Growing and sustaining your business should be managed.  By growing and sustaining your business, you are also creating wealth.  Where do you want to be in 5, 10, or even 20 years?  Do you plan to sell your practice in the future?  What is its marketability today and where do you expect it to be 20 years from now?   By building on your experience and expertise, you can create not only new habits (change), you can create new wealth for your retirement.

A toast to you for an incredible 2012!

submitted by Liz Simeone, EA