Monday, March 10, 2014

What if You Can’t Pay Your Taxes on Time?

Have you been shocked this year to find that you owe a significant sum to Uncle Sam? Don’t have the funds to make the payment in a timely manner? Here are some suggestions for how to minimize the damage to your pocketbook, as well as reduce the number of nasty messages from the IRS.
  1. People often make the mistake of thinking that they can file for an extension and delay when the taxes are due. Unfortunately, this is not the case. While you can certainly file an extension, the extension only delays the date the tax return needs to be filed by. Any estimated money that is due to the IRS is still due on April 15th. If not paid then, interest and penalties will be incurred. It’s an unpleasant reality but there’s not much we can do about that.
  2. If you can’t pay the entire amount that you owe, at least pay as much as you possibly can by April 15th. File your tax return by the 15th as well or file for an extension. By filing your return or requesting the extension and paying as much as you possibly can, you avoid or reduce the following charges:
    • Avoid incurring a late filing penalty, which can be a significant hit
    • Reduce the amount of the late payment penalty charged
    • Reduce the amount of interest charges incurred
    Filing on time and paying as much as you can has the potential to save you a lot of money.
  3. If you do not have the means to pay all or much of your tax bill on time, consider taking out a loan or paying the tax using a credit card. The bank or credit card charges are likely to be significantly less than interest, late filing and late payment penalties charged by the IRS. Loans or credit cards allow you to pay the balance over time unlike the IRS.
  4. The IRS does offer payment agreements in some situations. If you know you cannot make the payment and cannot swing a credit card or loan, contact the IRS immediately to request a payment agreement. The IRS website ( offers an “online payment agreement” form, which you can complete and submit online. You can also submit “Form 9465 - Installment Agreement Request” along with your tax return. Be aware that in addition to the other penalties and interest, payment agreements incur a user fee.
  5. Contact a professional tax preparer to assist you with negotiating with the IRS. They may be able to review your return and identify if there are deductions that were missed to help drop the total due. They also understand the best ways to approach a payment situation and will help to reduce the pain of payments.
  6. Whatever you choose to do, DO NOT IGNORE THE ISSUE! You do not want an IRS collection effort hanging over your head, and the longer you ignore a problem with the IRS, the bigger the problem gets both monetarily and emotionally.
Call FlemmerAssociates for assistance if you have a payment issue. We’re here to help! 916-576-7050.

Thursday, March 6, 2014

Tax Rates By Country of Residence

BBC News recently published an article comparing tax rates based on the country of residence. The numbers shared in the article were taken from a report put out by Price Waterhouse Coopers. The individuals reviewed included high-wage earners from 2013 with incomes of $400,000. In addition, they are assuming they have a $1.2 million mortgage, are married and have two children with one of those children under the age of six. I thought it was a pretty eye-opening article, so I wanted to share some of the information with you.

After income taxes and social security contributions, high-wage earners would take home the following percentage of their gross income:

  • Italy – 50.59%
  • India – 54.90%
  • United Kingdom – 57.28%
  • France – 58.10%
  • Canada – 58.13%
  • Japan – 58.68%
  • Australia – 59.30%
  • United States – 60.45%
  • Germany – 60.61%
  • South Africa – 61.78%
  • China – 62.05%
  • Argentina – 64.02%
  • Turkey – 64.64%
  • South Korea – 65.75%
  • Indonesia – 69.78%
  • Mexico – 70.60%
  • Brazil – 73.32%
  • Russia – 87.00%
  • Saudi Arabia – 96.86%

That means if you live in Saudi Arabia you get to take home 96.86% of your $400,000 salary. Nice!

Not sure how useful this information is, but I think it’s kind of fun to look at.

Monday, March 3, 2014

Difficulties With the IRS?

Are you having any difficulties with the IRS? Poor service, slow turnarounds, unable to get through by phone? Let us know what types of problems you are encountering as a result of the budgetary cutbacks. We'd like to keep clients up-to-date on what is happening.

Monday, February 3, 2014

Website Malware

If you have a website, please be vigilant about its security. 
I recently had the unfortunate experience of dealing with computer malware corruption on a website that I maintain.  I check my websites fairly regularly but was notified by a vendor that something was not right on one of them.  When I looked, I found text about Viagra, government loans and various other subjects overwriting the images and text on the site. 

I immediately contacted the technical person who deals with these kinds of things, and he verified that the site was indeed infected with malware.  I also happened to speak with a search engine optimization expert during the day who said that Google had already scanned the site and noted the issue.  The conversation alerted me to another problem – Google will list your site as infected and warn people to avoid it if the issue isn’t corrected quickly!  This will potentially divert business away from you to other non-infected sites.
My next step was to contact GoDaddy, which hosts the site.  They instructed me how to delete the current files and restore previous ones from the month prior to the infection.  I then changed my password and signed up for GoDaddy’s website monitoring service, which notifies me within 24 hours of any additional attempt to install malware on the site. 

If I had not quickly become aware of the issue, I would have had to retrieve a backup of the website.  Fortunately, I have a one, but if you don’t back up your site regularly, you should consider downloading a plugin that allows you to do a regular backup. 
I strongly recommend that you check your website’s hosting company to see if they offer a malware monitoring service.  Get signed up so you don’t end up spending a day trying to fix the issues.  In the short time that my site was infected, I had three people reach out to tell me about the problem.  But how many others saw the site and just left?  I think I caught it quickly enough for little damage to have occurred, but I’ll probably never know.  I’m definitely maintaining the monitoring service from now on.  Check your sites, and be sure you’re protected!

Friday, January 31, 2014

IRS is Open for Business

The IRS is officially accepting tax returns effective today. Contact your tax preparer to make an appointment to have your taxes done as soon as you have all of your documents together. Refunds may be delayed this year because of the funding issues the IRS is experiencing causing short staffing so the sooner you get your return in, the sooner your refund will arrive.

Give us a call if you’d like to make an appointment. 916-576-7050.

Monday, January 27, 2014

More Issues with the Target Breach

As if potentially having your identity stolen by thieves while shopping at Target last December wasn’t enough, now there’s even more cause for concern. The store recently sent out a legitimate email to customers whose information was in their database at the time of the information breach; however, they soon discovered that scammers sent out a similar email that looked official, but was just another means of collecting personal information from unwitting individuals. In fact, Target has found and terminated at least twelve scams related to email, Facebook and other media conduits.

Here is a copy of the actual email sent by Target to customers:

If you have received an email that appeared to be from Target and you have already opened it, double check that the “From:” address in the above email matches what you received. Furthermore, ensure that the link you clicked to view the email is the same as the one listed in the above email, and that the letter is exactly the same. If not, you need to follow the instructions listed below:
  1. Contact the credit reporting agencies Experian, Equifax and Transunion, as well as your credit card companies to let them know that a watch needs to be kept on your account for fraudulent activity.
  2. Monitor your bank account and your credit card accounts daily and let the bank or credit card companies know immediately if you see any unexplained activity.
  3. Obtain a copy of your credit report so you know what your credit status is.
  4. Consider asking for a fraud alert to be placed on your account. Lenders will be notified if someone attempts to open credit under your name.
  5. Target is offering free credit monitoring at The only item you will be asked to enter is your email address. Within 72 hours you will receive an email providing your activation code.
If you received an email from Target, but have not opened it stay safe and delete the email. You can view the letter at the website listed above. But just because you are playing it safe and deleting the email, you still need to stay alert to other possible scam emails coming in as a result of the Target breach.

Everyone needs to stay vigilant, be extremely careful when opening emails you do not recognize and be aware that Target has promised it will never request any personal information in any email they send. If personal information is requested, you can be absolutely sure the email is bogus.

If you have any questions, call us at Flemmer Associates, 916-576-7050. We are happy to help.

Thursday, January 23, 2014

How is the Customer Service at the IRS?

The Taxpayer’s Advocate Service recently released a report regarding the performance of the IRS during the 2013 tax year. As you may imagine, there were numerous issues during the tax season last year and similar issues can be expected for the 2014 tax season. Some of the problems commented on in the report include:
  1. Fewer calls from taxpayers were answered than in previous years.

      1. In 2013, only 61 percent of all taxpayer calls were answered.

      2. That means 20 million calls were not able to get through.

      3. The reason given for this poor performance was lack of resources.

  2. Taxpayers were kept on hold for significantly longer periods than in past years

      1. Ten years ago, the average wait time was less than three minutes to speak with a customer service representative.

      2. Last year, the average wait time was 18 minutes.

      3. Again, resources were named as the culprit.

  3. As a result of the dwindling budget and resources for the IRS, they have stated that assistance with return preparation for the elderly and disabled will be discontinued in 2014.

  4. The IRS has also stated that answers will only be provided for “basic” tax law questions. In addition, these “basic” tax law answers will only be given during the tax filing season ending April 15. Any questions after April 15th will be directed to the website.

If you have worked well with the IRS in the past, you may find it significantly frustrating to try to do so in the current fiscal climate. I contacted the IRS a few days ago about my own tax situation and was on hold for 22 minutes before a customer service representative answered. I will say that once I was able to speak with her, she was extremely pleasant and very helpful.

If you’ve been handling your tax returns yourself it may be time to consider turning them over to a professional to avoid the hassles and frustrations, which are becoming more and more frequent in the system. Give us a call today for a free 30-minute consultation. 916-576-7050.