UNIKO Media Group, Author at 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

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.

JT Tax Services: Taxes Made Easy

IRS Further Postpones tax-filing and tax-payment deadline for California Storm Victims

By: UNIKO Media Group

October 18, 2023

Individuals and businesses in 55 of California’s 58 counties will be able to take advantage of the new federal deadline. Keep reading to learn all the details.

What You Need To Know

The Internal Revenue Service (IRS) has announced that it will postpone for a second time the federal tax-filing and tax-payment deadline for victims of storms that hit California earlier this year.

Individuals and businesses in 55 of California’s 55 counties (the exceptions are Lassen, Modoc and Shasta counties) will have until Thursday, November 16 (instead of October 16), to file and pay their 2022 tax returns.

The eligible returns and payments include those listed below (keep in mind that this extension applies only to federal taxes):

2022 individual income tax returns and payments normally due on April 18.
For eligible taxpayers, 2022 contributions to IRAs and health savings accounts.
Quarterly estimated tax payments normally due on April 18, June 15 and Sept. 15.
Calendar-year 2022 partnership and S corporation returns normally due on March 15.
Calendar-year 2022 corporate and fiduciary income tax returns and payments normally due on April 18.
Quarterly payroll and excise tax returns normally due on May 1, July 31 and Oct. 31.
Calendar-year 2022 returns filed by tax-exempt organizations normally due on May 15.

Other returns and payments qualify. Visit the IRS Disaster Assistance and Emergency Relief page for more details.

Taxpayers in the affected areas don’t have to contact the IRS or take any other action to take advantage of the extended deadline. The IRS will automatically provide filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area.

Additional relief may be available to affected taxpayers who participate in a retirement plan or individual retirement arrangement (IRA). To learn more, contact the IRS or get in touch with our experts at JT Tax Services.

JT Tax Services: Taxes Made Easy

5 Bookkeeping Terms You Need To Know

By: UNIKO Media Group

October 12, 2023

Bookkeeping can be a daunting task, especially if you are new to it. It involves recording financial transactions, organizing them, and ensuring that they are accurate. To do this effectively, you need to be familiar with some bookkeeping terms. In this blog post, we will discuss some of the essential bookkeeping terms that you need to know.

Assets

Assets are the valuable items that a company or a person possesses. They can be tangible or intangible, such as cash, land, buildings, and patents. In bookkeeping, assets are recorded on the balance sheet and are used to determine the net worth of a company or an individual.

Liabilities

Liabilities are the obligations that a company or an individual owes to others. They can include debts, loans, and accounts payable. Like assets, liabilities are also recorded on the balance sheet and can affect a company’s or individual’s financial health.

Expenses

Expenses refer to the costs incurred by a company or an individual in running their operations. They can include salaries, rent, utility bills, and other expenses that are necessary to keep the operation going. In bookkeeping, expenses are recorded on the income statement and are deducted from revenue to determine the net income.

Revenue

Revenue is the income generated by a company or an individual from their operations or investments. It can come from sales, rental income, interest on investments, and other sources. In bookkeeping, revenue is recorded on the income statement and used to calculate the net income.

Equity

Equity is the value that remains after all the liabilities are deducted from the assets. It represents the ownership of the company or the individual. In bookkeeping, equity is recorded on the balance sheet and can be affected by changes in assets or liabilities.

Wrapping It Up

Knowing these bookkeeping terms is essential for anyone who wants to keep their financial records accurate and up-to-date. By understanding the definitions and how they apply to your business or personal finances, you can make informed decisions that will keep you financially healthy. Keep these terms in mind when working with your bookkeeper or accountant and use them to track your financial activity. Remember, good bookkeeping practices lead to financial stability and success!

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!

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

By: UNIKO Media Group

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

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

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.