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Tax Tips Newsletter
Serving you since 1993
June 2014 - Vol 9, Issue 6
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Greetings!
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We are back to work on individual tax returns. If your information is in our office, I should be reviewing your returns very soon.

If you are on extension, now would be an excellent time to get your information in. We have time to work on your returns now. It's not crazy-busy so we can really give you the excellent service that you deserve.

I want to share some information that I just received regarding inherited IRAs. The Supreme Court has just ruled that inherited IRAs are not "retirement funds" and are not protected from creditors in bankruptcy. This ruling only pertains to inherited IRAs. Traditional IRAs and other retirement accounts will continue to be protected from creditors in bankruptcy.

Our office will be closed on Friday, July 4th, and all other Fridays for the remainder of the year. Happy Independence Day!

Many thanks for your referrals. I appreciate your confidence in my staff and me.

Don't overlook the following two deadlines this month if they apply to you:

* The second quarterly payment of estimated income tax for 2014 is due on June 16.

* If you have foreign bank, savings, or investment accounts that exceeded $10,000 in 2013, you are required to file "Treasury Department Form 114" by June 30, 2014.

Form 114 is new this year, replacing the prior Form 90-22.1. This report is not a form that you file with your income tax return. Rather, it is a separate form that must be filed electronically with the Treasury Department in Detroit. The report must be received by the Treasury Department by the June 30 due date. No filing extension is available. Penalties for failing to meet this filing requirement are severe and can include jail time.

Contact my office if you need details about these requirements or filing assistance.
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Is your child taking a job this summer? If so, you both may have questions about taxes. The following information may be helpful.

For 2014, your child can earn as much as $6,200 and not pay a dime in federal income taxes. If your child's earnings won't exceed this amount, consider having the child claim "student - exempt" when completing the federal withholding allowance certificate (Form W-4). If this is the child's only income and the total doesn't exceed the $6,200 limit, he or she then won't have to file a 2014 tax return.

Don't overlook the fact that there will still be withholding from your child's paycheck for social security and Medicare taxes. But those payments are not income taxes, and they cannot be refunded to the child.

Keep in mind that self-employment income, tips, and interest, dividends, and stock sales can affect your child's tax return filing requirement.

Realize also that as long as you provide more than half of your child's support, you can continue to claim the child as an exemption on your tax return. Your child will lose his or her exemption, but that exemption deduction is typically more valuable to you than to your child.

If you need more details about the tax implications of your child's summer job, give me a call. I will be happy to help.
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Tax Tip of the Week: As we near the end of June you will be filing your second quarter payroll taxes. It's a good time to do a check-up, especially if you outsource your payroll. Check out this article for a check list to follow.

Business Tip of the Month: In today's high tech world we can buy almost anything without leaving the comfort of our cushy favorite chair at home. It's most important that a website is catering to the customer as if you are face to face with them. Is your web site easy to navigate? Is your product well presented with a clear description? Does it look professional? Read this article for more tips at making sure your website is customer friendly.

Financial Tip of the Month: Finding a good auto mechanic that you can trust is like finding a good financial advisor! A bad one can cost you lots of money! In southern California we need our cars to get around so our car mechanic is in on our priority call list! Read this article to be aware of auto repair scams.

Fraud Alert: Just in case you're searching the web looking for a "mail order bride or groom," here are some tips to look out for so you don't get scammed! It'd be really embarrassing to tell your friends that you got scammed out of a lot of money! Read the article.
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Let me know if I can help you with any Quickbooks problems.

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Sincerely,
Linda Heineman
Linda L. Heineman, CPA

phone: 626-577-0979