September 2023 - JT Tax Services

Closeup of a man talking on the phone illustrates blog "Scammers Impersonating the IRS on the Phone: What You Need To Know"

What You Need To Know About Scammers Impersonating the IRS on the Phone

September 28, 2023

The Internal Revenue Service (IRS) is the federal agency responsible for administering and enforcing the nation’s tax laws. Unfortunately, scammers and fraudsters have found a way to exploit the agency’s reputation and use it to perpetrate fraud schemes. Here’s what you need to know about this scheme.

How IRS Phone Scams Work

Scammers use different tactics to defraud taxpayers, but the most common method is to mimic the IRS. They call unsuspecting victims, often telling them they owe back taxes or claiming there is an issue with their tax return.

The scammer then demands immediate payment or threatens legal action, including arrest, deportation, or revocation of their driver’s license.

They may also ask for personal or financial information to “verify” the target’s identity or eligibility for a refund. These calls often use scare tactics or urgency to get the victim to act quickly without verifying the validity of the caller or the information provided.

How To Spot an IRS Phone Scam

Knowing the red flags of a scam call can help you avoid becoming a victim. Some common signs of an IRS phone scam include:

A caller who demands immediate payment over the phone or threatens legal action.
A caller who uses aggressive or abusive language, or speaks in a robotic or scripted tone.
A caller who claims to be from the IRS but doesn’t know your name or other personal details.
A caller who asks for sensitive information, such as your Social Security number, bank account number, or credit card information.
A caller who asks you to transfer money or buy gift cards or other prepaid cards.

What To Do if You Receive an IRS Phone Scam Call

If you receive a call from someone who claims to be from the IRS and you suspect it’s a fraudulent call, don’t panic or engage with the caller. Here are some steps you can take to protect yourself:

Hang up immediately
Don’t give out any personal information
Don’t make any payment or transfer money
If possible, note the caller ID information or the number the caller used
Report the call to the IRS and the Federal Trade Commission (FTC)
How to report an IRS phone scam

Reporting IRS phone scams is essential to help law enforcement catch the perpetrators and prevent them from defrauding others.

If you think you’ve been targeted by an IRS phone scam, report it to the IRS by email at phishing@irs.gov (Subject: IRS Phone Scam). Make sure to include the number of the caller, any phone number you are instructed to call, and a brief description of the communication.

JT Tax Services: Taxes Made Easy

When it comes to taxes, knowledge is power. That’s why at At JT Tax Services, we give you the peace of mind that comes with knowing that you are working with experienced professionals with in-depth knowledge of all applicable tax laws and regulations.We are located in Oxnard, California, contact us today by email (info@jttaxservices.com), telephone (805-984-8890), or through our social media accounts on Facebook, Twitter, and LinkedIn to schedule a consultation or to learn more about our services. Feel free to contact us today!

Understanding Double Taxation: What It Is and How It Affects You

By: UNIKO Media Group

September 20, 2023

If you’re a business owner or an employee of a company, you have probably heard of the term “double taxation.” It can be a confusing and complex concept to grasp, but understanding it is crucial, especially when it comes to handling taxes.

What Is Double Taxation?

Simply put, double taxation refers to the imposition of two or more tax obligations on the same income, asset, or financial transaction.

This can happen in several situations; one of the most common is when a business earns profits, and the earnings are taxed at both the corporate and personal levels. In other words, the profit generated by the company is taxed at the corporate level, and the dividends paid to shareholders are subject to personal taxes.

Another situation where double taxation occurs is in international trade. When a foreign company does business in a particular country, the profits they make are taxed in both the country of origin and the country where they operate.

Double Taxation: What You Need To Keep in Mind

Double taxation may seem unfair, but it is standard practice in many countries. The US, for example, is known to have one of the highest corporate tax rates globally, which makes it essential for businesses to consider double taxation when planning their investments.

To avoid double taxation, several strategies can be employed. For businesses, choosing a legal entity, such as a partnership or a limited liability company (LLC), can help lower the tax burden.

For individuals, it’s essential to take advantage of any tax allowances or credits that may apply.

Wrapping It Up

In summary, double taxation is a complex issue that can affect both businesses and individuals.

Understanding the basics of double taxation and implementing strategies to reduce the tax burden can help businesses and individuals stay compliant while maximizing their tax savings.

So it’s crucial to seek the advice of a tax professional who can help navigate through different tax jurisdictions and ensure you comply with all relevant tax laws.

JT Tax Services: Taxes Made Easy

What Is a Limited Liability Company (LLC)?

By: UNIKO Media Group

September 12, 2023

One of the most popular business structures, especially for small business owners, is a Limited Liability Company, or LLC for short. If you’re unfamiliar with what an LLC is or how it operates, don’t worry! This guide will provide you with a comprehensive overview of what an LLC is, how it works, and why it might be the right option for your business.

What is an LLC?

A limited liability company, or LLC, is a legal structure that combines the benefits of a partnership or sole proprietorship with those of a corporation.

Essentially, it’s a way to structure your business that offers both personal liability protection and flexibility.

By forming an LLC, you are creating a separate legal entity that can own property, enter into contracts, and conduct business.

However, unlike corporations, there are no shareholders or boards of directors to answer to – instead, owners of an LLC are referred to as members and can manage the company themselves.

How does an LLC work?

To form an LLC, you will need to file paperwork with your state’s Secretary of State and pay a registration fee.

Typically, this involves providing basic information about your company, such as its name, address, and the names of its members.

Once your LLC is registered, you’ll need to draft an operating agreement, which outlines how the business will be run, how profits and losses will be divided among members, and other important information.

An LLC is typically taxed as a pass-through entity, meaning that the profits and losses are reported on the individual tax returns of members and not at the business level.

Why choose an LLC?

There are several benefits to choosing an LLC as your business structure.

One of the most significant advantages is that LLCs provide personal liability protection to their owners. This means that if your business is sued or incurs debt, your personal assets (such as your home or car) cannot be used to satisfy those debts.

Additionally, LLCs offer flexibility in terms of management structure, and there are typically fewer formalities required than with a corporation. This means that you can operate your business more informally while still enjoying the legal benefits of being a separate entity.

LLCs: What You Need To Keep in Mind

While LLCs offer many benefits, there are also some potential drawbacks to consider.

One of the most notable is that LLCs can be more expensive to form and maintain than sole proprietorships or partnerships.

Additionally, the process of forming an LLC can be complex, and it may be beneficial to work with a lawyer or tax professional to ensure that you’re complying with all applicable laws and regulations.

Finally, while LLCs provide personal liability protection, there are limits. For example, members can still be held personally liable if they engage in fraudulent or illegal activities on behalf of the company.

Wrapping It Up

Overall, a Limited Liability Company is a popular legal structure for entrepreneurs looking to start a business.

It offers personal liability protection, flexibility, and a relatively easy process to set up and maintain.

However, there are also some potential drawbacks to consider, such as the cost of formation and maintenance.

By understanding how an LLC works and weighing the pros and cons, you can make an informed decision about whether it’s the right structure for your business.

JT Tax Services: Taxes Made Easy

We are located in Oxnard, California, contact us today by email (info@jttaxservices.com), telephone (805-984-8890), or through our social media accounts on Facebook, Twitter, and LinkedIn to schedule a consultation or to learn more about our services. Feel free to contact us today!

What Is a C Corporation and How Does It Work?

By: UNIKO Media Group

September 8, 2023

When starting a new business, it’s important to choose the right structure for your company. One popular option is a C Corporation. But what are they, exactly? Read on to learn more about C corporations, from a basic definition to their pros and cons.

Definition of a C Corporation

A C Corporation is a type of business structure in which the company is owned by shareholders who have limited liability for the company’s debts and obligations.

The corporation operates as a separate legal entity that can conduct business, own assets, and enter into contracts.

This means that the corporation can sue and be sued, enter into agreements, and pay taxes separately from its owners.

How a C Corporation Works

A C Corporation is managed by a board of directors who are elected by the shareholders.

The board of directors is responsible for making major business decisions, such as choosing the company’s officers, approving budgets, and setting corporate policies. The officers of the corporation, such as the CEO and CFO, are responsible for the day-to-day operations of the business.

C Corporations issue stock to shareholders, which represents their ownership in the business. Shareholders are not involved in the day-to-day operations of the business and do not have liability for the debts and obligations of the corporation.

Advantages of a C Corporation

One of the main advantages of a C Corporation is that it offers limited liability to its shareholders.

This means that the personal assets of the shareholders are protected from the corporation’s debts and obligations. Additionally, the corporation can raise capital by issuing stock to investors, which can help the business grow and expand.

Another advantage of a C Corporation is that it can deduct certain business expenses, such as salaries, benefits, and property taxes. This can help reduce the company’s tax liability and increase its profits.

Disadvantages of a C Corporation

One of the main disadvantages of a C Corporation is that it is subject to double taxation. This means that the corporation pays taxes on its profits, and then the shareholders pay taxes on any dividends they receive. This can result in a higher overall tax liability for the company and its shareholders.

Another disadvantage of a C Corporation is that it requires more formalities and paperwork than other business structures, such as a sole proprietorship or partnership. This can result in higher administrative costs and more time spent on compliance.