We wish you a healthy and happy new year
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Important Dates
December 16-24 -Hanukkah
December 25 - Christmas Day, office closed
December 31 - New Year's Day, office closed
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New Standard Mileage Rates Now Available; Business Rate to Rise in 2015
Beginning on Jan. 1, 2015, the standard mileage rates for the use of a car, van, pickup or panel truck will be:
- 57.5 cents per mile for business miles driven, up from 56 cents in 2014
- 23 cents per mile driven for medical or moving purposes, down half a cent from 2014
- 14 cents per mile driven in service of charitable organizations
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Wendy Harden honored
The event recognize the outstanding efforts of women in Minnesota who are making noteworthy contributions to their professions, their communities and society at large.
Congratulations, Wendy!
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Fraud Corner
Forensic Analytics for Discovering Vendor Fraud
One technique used to uncover fraud is the largest subset growth test. This test is based on the fact that people escalate their frauds at a much more rapid pace than what would be considered normal. They also don't know when to stop.
A fraudulent vendor often shows explosive year-over-year growth. An employee using a company purchasing card for personal expenses often has geometric growth in total purchases. An employee with a fraudulent overtime scheme also often shows high growth in hourly totals, perhaps even to impossible levels.
Running a computer-based test to review the vendors with the largest annual growth in total dollars is one way to determine if certain vendor's dollar growth is abnormally high and suspicious.
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SDK in Indian Gaming Magazine
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Check out the December issue of Indian Gaming Magazine, which includes an article written by Jason Schanno, of SDK's gaming team. |
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SDK's December Newsletter
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Season's Greetings! As we close out the year, we hope you have great aspirations for a prosperous new year.
This month, we highlight our client Sylvester's Property Management - SPM. SPM is a home grown company, extremely passionate about the level of service they provide to their customers in the green industry. They create sustainable landscapes for each commercial property.
Located in St. Paul and serving customers in the Twin Cities, SPM offers a proactive approach to their customers' outdoor needs. With over 20 years of experience in the green industry, SPM has knowledge in turf, tree, shrub care and snow management. Visit their website for more information.
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SDK's Annual Tax update offered information all business owners need to know. In this issue of e-news, we share high level information on two of the six topics.
Repair Regulations
These regulations will affect every taxpayer that acquires, produces, or improves tangible property in its business beginning on or after January 1, 2014. It focuses on whether tangible property should be capitalized or deducted. The regulations are complex and will require additional time and consideration of each taxpayer's facts and circumstances.
Below are some additional items you should expect to see on your tax return due to the regulations:
1) Form 3115 - Change in Accounting Method: at least one, but could be many
2) Elections: De Minimus Safe Harbor
Health Insurance - ACA
The Affordable Care Act is a complex piece of legislation that attempts to reform the health care system. The most significant provisions in the ACA are:
-Employer Health Care Arrangements
-Small Business Health Care Tax Credit
-Individual Health Insurance Mandate
-Premium Tax Credit
Steps you can take to prepare yourself for the ACA changes:
1) Let your tax preparer know whether or not you had health coverage for 2014
2) Be ready for additional questions to see if you qualify for any exemptions
Click below to view the SDK Tax Update videos by topic.
Business Tax - Laurie Waterman
Repair Regulations - Ryan Churness
Health Insurance- ACA - Jennifer Stavish
Individual Tax - Rick Tollefson
Estate and Gift Tax - Jill Abrahamson
Employee Benefits - Valorie Mussehl
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Year-End Checklist from Accounting Services
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1099 filing instructions:
- Make sure to have independent contractor's W-9's filled out.
- If filing by paper, 1099's and 1096's are due to the IRS by March 2, 2015.
- If filing electronically, 1099's and 1096's are due to the IRS by March 31, 2015.
- Click here for more details on 1099's.
In preparation for year-end payroll, ask employees to review their name, address, Social Security number and Form W-4 information to maintain accuracy on W-2 forms. Make sure the following items are listed on employees' W-2's:
- Personal use of auto
- S corporation health insurance
- Other taxable fringe benefits
If you have questions, please contact us to discuss the issue further. Pam Brackeen, 612-332-9315.
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Tips for Year-End Gifts to Charity
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Many people give to charity each year during the holiday season. There are several tax rules that you should know about before you give.
1. Qualified charities. You can only deduct gifts you give to qualified charities.
2. Monetary donations. Gifts of money include those made in cash or by check, electronic funds transfer, credit card and payroll deduction.
3. Household goods. Household items include furniture, furnishings, electronics, appliances and linens.
4. Records required. You must get an acknowledgment from a charity for each deductible donation (either money or property) of $250 or more.
5. Year-end gifts. You can deduct contributions in the year you make them.
6. Special rules. Special rules apply if you give a car, boat or airplane to charity.
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Extenders Package Passed by House and Senate
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The House voted 378 - 46 to "extend" for another year, tax breaks that mostly expired on December 31, 2013. The Senate closed out 2014 passing the bill, which will retroactively extend the package of expired tax breaks for 2014. It was approved in a 76-16 vote. The bill now goes to the President.
Highlights of the extenders include:
- Teacher deduction of $250
- Discharge of indebtness of up to $2 million for personal residence
- Mortgage insurance premium deductibility
- Sales tax deduction
- Education expense deduction
- R & D credit
- Work opportunity credit
- 50% bonus depreciation and 179 depreciation
- IRA distributions to charity
- Many energy credits were extended
Contact a member of the SDK tax team with specific questions on how this will impact you.
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We welcome your comments and feedback, and will do our best to answer your questions. Contact your SDK representative or send a note to one of us and we'll be sure to find the right person to assist you.
SDK's Editorial Board
Emma All Runner, Accounting Services
Beth Johnson, Marketing
Ron Kelner, CPA, Tax
John Lawson, CPA, Audit
Valorie Mussehl, CPA, Employee Benefits
Jennifer Schiefert, CPA/ABV/CFF, CFE , Forensic & Valuation Services
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