November 2023 - JT Tax Services

4 Tips To Prevent Charity Fraud

November 29, 2023

With the holiday season around the corner, scammers are getting ready to prey on the good-hearted nature of people looking to donate to a worthy cause. The good news is that there are steps you can take to protect yourself from charity fraud. In this post, we will share some essential tips that will help you prevent charity fraud and ensure that your donations go to the right place.

Research the Charity

One of the best ways to prevent charity fraud is to do your research. Look up the organization online and read reviews from other donors. If you can’t find any information or the charity is brand new, get in touch with them directly. Ask questions about how they use the donations and if they have any documentation that can demonstrate their legitimacy. If they are genuine, they will be more than happy to answer any questions you have.

Be Wary of High-Pressure Sales Tactics

Some charity scammers are experts at using high-pressure sales tactics to guilt-trip you into donating. If you feel uncomfortable or pressured into donating, it’s important to take a step back and do not make any commitments on the spot. A legitimate charity will never use high-pressure tactics to get donations.

Check for the Charity’s Registration and Tax ID Number

A legitimate charity will always be registered with the government and have a tax ID number. You can check this information yourself by doing a quick online search or contacting the appropriate authorities. If the charity is not registered or can’t provide you with a tax ID number, it’s a red flag that they may not be legitimate.

The IRS has a Tax Exempt Organization Search tool you may find useful.

Use Secure Payment Methods

When donating to a charity, make sure to use secure payment methods. Do not give out your credit card information to anyone over the phone or through an email. If the charity has a website, make sure they use a secure payment gateway to protect your personal information. If you have any doubts, call the charity directly to arrange your payment.

Wrapping It Up

Charity fraud is a significant problem, but by following these tips, you can protect yourself and ensure that your donations make a real difference. By doing your research, using secure payment methods, and staying away from high-pressure tactics, you can make a meaningful contribution to a worthy cause while avoiding scammers.

Remember to choose established and reputable charities that have a proven track record. By taking these precautions, you can give with confidence and support causes that matter to you.

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!

What Is Form 1099-K?

By: UNIKO Media Group

November 22, 2023

As a business owner, you must keep yourself updated about tax obligations. One of these obligations is to file annual tax returns and issue necessary forms to your contractors and employees. A crucial form in this regard is Form 1099-K. But do you know what this form is and how it works? In this blog post, we will guide you through the basics of Form 1099-K.

What is Form 1099-K?

Form 1099-K is a tax form issued by third-party payment processors to merchants, sellers, and other businesses that receive card payments such as credit and debit card transactions.

The form lists the total dollar amount of all transactions in a given year, and businesses use it to report their income to the Internal Revenue Service (IRS).

In short, Form 1099-K is used to track electronic payment transactions.

Who Files Form 1099-K?

If your business accepts digital payments exceeding $20,000 and does over 200 transactions, you must issue a Form 1099-K. Third-party transaction processors such as PayPal, Stripe or other payment vendors issue 1099-K on the IRS’s behalf.

Note that even if the third-party processor has not reported this, you as business owner will be still responsible for issuing a 1099-K.

What Information is Required?

Form 1099-K requires certain basic information about the business and its transactions. Commonly asked questions such as “What type of payment was accepted?”, “what is the total exchange of money spent?”, “what is the name and address of the payee?” must be included in the form. It’s up to the business owner to ensure that the information is accurate and complete.

What Happens if You Fail To File Form 1099-K

If a business owner fails to file or issue 1099-K, the IRS imposes penalties and interest. Remember that it is the responsibility of the business owner to keep accurate records of their earnings and follow through on their tax requirements to avoid any unwarranted penalties.

Wrapping It Up

As a business owner, it is crucial to be aware of your tax filing duties and follow them diligently. Knowing about Form 1099-K and its requirements will assist you in avoiding penalties and ensuring that your tax obligations are met in a timely, responsible, and cost-efficient manner. Familiarize yourself with the 1099-K form and stay ahead of the game, to save yourself from any predicaments.

JT Tax Services: Taxes Made Easy

What Is a W-9 Form and Why Do I Need to Fill It Out?

By: UNIKO Media Group

November 15, 2023

Many people feel confused about different tax forms and what they mean. One such form is the W-9, a form that may be required for individuals and businesses in various situations. But what exactly is a W-9 form, and why do you need to fill it out? In this blog post, we’ll explore the ins and outs of the W-9 form and everything you need to know about it.

W-9 Form: a Basic Definition

Firstly, let’s start with the basics. What is a W-9 form? A W-9 is a tax form used by businesses to collect information from independent contractors or other entities they will be paying for services rendered.

It is used to request the taxpayer identification number (TIN) of the individual or business, which is then used by the business to report earnings to the IRS. The form asks for basic information such as the recipient’s name, address, and TIN, as well as signature and date.

Why Is the W-9 Form Important?

You may be wondering why a business would need this form if they are already collecting the information they need to pay you. The main reason is for tax reporting. Once you provide your TIN on the W-9 form, the business will typically use that information to file a 1099 form with the IRS, which reports the money paid to you. If the business doesn’t have your TIN, they could be subject to penalties by the IRS for failing to report the payment.

The W-9 form is most commonly used by independent contractors and businesses, although it can also be required in other situations, for example, you may be required to provide a W-9 form when canceling some types of debt or closing a real estate transaction.

It’s important to note that the W-9 form is not the same as a W-4 form, which is used by employees to provide information to their employer for income tax withholding purposes. While they have similar names and serve a similar purpose of collecting tax-related information, the two forms are different and serve different functions.

Wrapping It Up

The W-9 form is a form used by businesses to collect the TIN of individuals or businesses they will be paying for services rendered. It is vital for tax reporting purposes and can be required in various situations such as when canceling some types of debt.

JT Tax Services: Taxes Made Easy

Bookkeeping vs Auditing: What Is the Difference?

By: UNIKO Media Group

November 8, 2023

You’ve probably heard the terms “bookkeeping” and “auditing” thrown around in conversations about finances. However, it’s important to understand that these terms are not interchangeable. In fact, bookkeeping and auditing serve two different purposes for your business.

What is Bookkeeping?

Bookkeeping is the process of recording and organizing a business’s financial transactions, such as revenue, expenses, and payments. This includes tracking sales, purchases, receipts, and other financial documents. In short, bookkeeping is a way to keep track of your business’ cash flow. It enables you to see how much money is coming in and going out of your business.

A bookkeeper is responsible for maintaining accurate records and ensuring that all financial transactions are correctly classified and recorded. Nowadays, technology has made bookkeeping easier. There are digital tools that you can utilize, such as cloud-based accounting software that can reduce human error and increase efficiency.

What is Auditing?

Auditing, on the other hand, is the examination of a company’s financial records and statements by an independent third-party auditor. This includes a review of the financial statements, internal controls, and accounting practices of the business.

The purpose of auditing is to ensure the accuracy and reliability of the financial information presented to stakeholders, including investors, lenders, government bodies, and others. In other words, auditing is a way to verify that a company’s financial statements are factual and accurate and to identify any discrepancies or errors in the financial statements.

The Main Differences between Bookkeeping and Auditing

The main difference between bookkeeping and auditing is that bookkeeping is an internal process, whereas auditing is an external process. Bookkeeping involves maintaining accurate financial records that account for every financial transaction, while auditing involves analyzing financial records to verify their accuracy.

Another difference is that bookkeeping is ongoing, whereas auditing is performed on an annual or bi-annual basis. Bookkeeping is essential for day-to-day business operations, while auditing is important for providing an accurate and reliable snapshot of the company’s position for investors.

How the Two Practices Work Together

While bookkeeping and auditing are two separate processes, they work hand-in-hand to ensure the financial health of a company.

Bookkeeping provides the foundation for accurate financial statements, which is the starting point for an auditor.

The auditor will examine the records, and financial reports generated from bookkeeping and identify any errors or discrepancies that need corrective action. The bookkeeper then uses the auditor’s feedback to update and fine-tune the company’s records.

Wrapping It Up

In conclusion, bookkeeping and auditing are essential accounting practices for the successful operation of a business. Bookkeeping keeps track of the flow of money in and out of the business on a daily basis, while auditing ensures the accuracy and reliability of financial reports. Both practices are vital for ensuring a company’s financial success and stability. By understanding the differences between bookkeeping and auditing, business owners can make informed decisions about their financial management and ensure compliance with regulatory requirements.